In May of 2005, TerraMark proposed a development on the OUSD Lake Merritt properties which it called “The Trophy.”
Details of the original proposal differ in some ways from the final Letter of Intent signed between TerraMark, State Superintendent Jack O’Connell, and State Administrator Randolph Ward in June of 2006.
Terramark proposed a “mixed-use community that would include residential towers, retail space, visually unobtrusive parking” and open landscaped areas.
The development would consist of four towers with approximately 1,000 total dwelling units (in the final Letter of Intent, the development was changed to consist of five high-rise towers with a minimum of 1,000 units and a maximum of 1,388 units).
Of the original four towers, two were planned to reach a height of 37 floors, the third would have 28 floors, and the fourth would have 27.
The retail component would include 75,000 square feet of retail/commercial space.
“Of that,” TerraMark wrote in its proposal, “25,000 square feet is designated as a health club or cultural/entertainment venue and the other 50,000 square feet for appropriate service-oriented retail establishments.
Physically, the retail establishments are to be located on the lobby floors of the residential towers and in a separate low rise dome-shaped structure. … Anticipated retailers include restaurants and cafes such as Starbucks, drugstores, cleaners and other service oriented businesses.” In addition, “a significant amount of above and below ground space has been allotted for a structured parking deck.”
In its presentation to the OUSD Board of Trustees this week, TerraMark officials said that the parking garage would include a waterfall cascading down one side of the building as a tourist attraction.
As an aide to OUSD’s students, TerraMark’s original proposal included a contribution of “15 state-of-the-art computers to the OUSD for every condominium unit sold” TerraMark estimated the cash market value of this “contribution” at $10 million.
Mention of the computer contribution does not appear in the final Letter of Intent.
TerraMark is also proposing that “the regulation-sized swimming pool in the health club” of the complex “could be made available for OUSD students for scheduled competitions.”
In its original proposal, TerraMark offered a flat sum of $25 million for the 8.25 acre OUSD parcels “and an additional sum of $10 million which the OUSD can use to procure a new off-site academic campus, bringing the total offer to $35 million.”
In addition, TerraMark proposed “in order to assure the OUSD to receive an income stream in perpetuity, the developer will guarantee the District an annual sum of $500,000, with revenue being derived from a permanent annual assessment on the condominium homeowners’ association as well as on the owner of the retail condominium unit.”
An ongoing revenue stream from the property was one of the requests made by the OUSD Board of Trustees in its original Request For Proposals.
In the final Letter of Intent, the perpetual revenue stream was eliminated, and TerraMark promised a “tentative” base price of $60 million for the property.
That $60 million base price could be lowered significantly if certain conditions outlined in the Letter of Intent are not met, so that the final actual price offered by TerraMark for the property is not yet known.