REQUEST FOR QUALIFICATIONS FOR REAL ESTATE DEVELOPMENT SERVICES RFQ #2013 ED 101 DUE DATE: August 30, 2013 The Virgin Islands Port Authority (VIPA) 8074 Lindbergh Bay P. O. Box 301707 St. Thomas, USVI 00803-1707 (340) 774-1629 Issue Date: JULY 2, 2013 1
I. INVITATION The Virgin Islands Port Authority ( VIPA ) invites experienced developers to submit qualifications relative to the performance of the following services: To oversee the creation and implementation (including applying for and securing all funding sources) of a phased master development plan for the development of VIPA s Parcel 68 Remainder, Estate Lindbergh Bay ( the Property ). The work will include successfully applying for and securing funding to rehabilitate, construct or develop the Property with mixed income housing, considering the needs of VIPA, the current residents of Bourne Field, and other St. Thomas residents by providing suitable housing alternatives. The existing Bourne Field housing is at the end of its useful life. The highest and best use of the site is for airport expansion. The Developer will be responsible for designing and implementing a relocation plan that meets the reasonable needs of the Bourne Field residents and VIPA and for developing alternative housing on Parcel 68 Remainder, Estate Lindbergh Bay. The Developer, at its sole cost, will be responsible for coordinating the relocation of all Bourne Field residents and providing VIPA with vacant apartments at the Bourne Field housing site. VIPA is seeking an experienced real estate developer (the Developer ) to develop the Property by maximizing the resources available for mixed income and affordable housing purposes within St. Thomas. It is the intent of the VIPA to receive Fair Market Value for the sale or long term lease of the Property for the intended use as mixed income housing. Before the commencement of any pre-development activities, VIPA and the Developer will enter into a mutually agreeable master development agreement setting forth the terms and conditions for the mixed income development, including land purchase or lease prices, (the Master Development Agreement ), which will be subject to the approvals of VIPA s Board of Directors and, where applicable, the Federal Aviation Administration ( FAA ). VIPA s goal is to have the sites receive sufficient funding and proceed through the development and closing process as expeditiously as possible. Responses that demonstrate an ability to complete the development on the earliest possible realistic schedule will be favorably received by VIPA. However, it is recognized that development phasing may be required. BASIC INFORMATION 1. The Virgin Islands Port Authority (VIPA) is a semi-autonomous agency that owns and manages the two airports and the majority of the public seaports in 2
the United States Virgin Islands. VIPA is also charged with controlling the harbors in the territory. 2. The Virgin Islands Port Authority s mandate is to promote the wise use of these facilities for the betterment of the Virgin Islands and its people, and to assist the government of the U.S. Virgin Islands in fostering and sustaining sound economic development. To this end, the Port Authority is committed to: Maintaining and developing the airports and seaports of the virgin Islands to accommodate the current and future demands of its users; Making sure that the airports and seaports are accessible to all qualified users; Providing efficient and quality service to the public; Providing a safe and secure environment at all of its port facilities to working with the government of the U.S. Virgin islands on initiatives to attract tourists and private investors to the territory; Fostering commerce by providing reasonable and appropriate incentives to airlines, cruise ships, cargo operators and other potential investors to entice them to do business in the Virgin Islands; Making sure that all of its facilities are in full compliance with local and federal regulations; and Improving port facilities to keep up with modern technology. 3. VIPA owns Parcel 68 Remainder, Estate Lindbergh Bay (the Property), consisting of approximately 78.8 acres. 4. VIPA owns Parcel 69, Estate Lindbergh Bay, consisting of approximately 8.84 acres, improved with housing known as Bourne Field Housing. The Bourne Field Housing community, located adjacent to the Cyril E. King Airport on St. Thomas, was constructed during the 1940 s as housing for naval officers and their families. VIPA now manages the property and currently leases approximately 40 apartments to various residents. Pursuant to Board policy VIPA is no longer accepting new applications for rentals at Bourn Field. The facilities are at the end of their useful life and are to be demolished. 5. VIPA desires to demolish the Bourne Field Housing and redevelop Parcel 69 for expanded airport facilities. 3
6. The existing Bourne Field Housing tenants (the Residents) are on short term leases or month to month tenancies. VIPA has the legal right to evict the Residents and has no legal obligation to assist with relocation or with finding alternative housing for the Residents. However, VIPA recognizes the extreme shortage of alternative housing opportunities in St. Thomas and wishes to facilitate the development of alternative housing that provides a reasonable housing alternative for qualifying residents of the broader St. Thomas community. II. REGULATORY SUMMARY The development will be subject to the jurisdiction of various governmental entities including, but not limited to, the USVI Department of Planning and Natural Resources (DPNR) and the Federal Aviation Administration (FAA). The Property is owned by VIPA; however it is subject to restrictive covenants and regulations running to the FAA. The sites are also subject to other codes, ordinances and laws, including without limitation, those of the Territory of the United States Virgin Islands. Consistent with Presidential Executive Orders 11625, 11625, 12138 and 12432, the Developer will make efforts to ensure that small and minority owned businesses, women s business enterprises, labor surplus area businesses, and individuals or firms located in or owned in substantial part by persons residing in the area of the Development are used when possible. III. THE DEVELOPER S ROLE The Developer will be an integral advisor to VIPA throughout the redevelopment effort. The following is a representative list of the expected responsibilities of the Developer. The following list is not inclusive of all duties. Such duties will ultimately be set forth in a Master Development Agreement. a. The Developer shall provide, or arrange for the provision of, all such services as are necessary for the development and construction of each development, including without limitation, all master planning and financing activities and services and designing and implementing the Bourne Field relocation plan; b. Provide regular reports to VIPA on the progress of the development efforts including work completed, associated costs, schedule and budgetary requirements; c. Prepare any financing applications, including Low Income Housing Tax Credit (LIHTC) applications, as necessary to ensure overall project feasibility; 4
d. Identify a tax credit syndicator with competitive terms; e. Develop a construction strategy and implementation schedule; f. Undertake environmental and geotechnical testing; g. Oversee design, construction and quality control of the development; h. Procure the construction contractor; i. Selection of third party contractors and/or subcontractors including design professionals; j. Provide a completion guarantee to the VIPA and any other entities for whom a guarantee would be required; k. Review, recommend and submit draw requests for approval and disbursement; l. Undertake all marketing and lease up efforts; m. Obtain all required building permits, zoning and other regulatory approvals with VIPA s assistance as facilitator only. IV. QUALIFICATIONS Each respondent must have within its development team: Experience in master planning and the redevelopment or revitalization of multifamily communities; a. Experience in maximizing the use of various financing vehicles; b. Experience in the development, construction and management of rental housing developments preferably located in the Virgin Islands; c. Experience I site preparation and infrastructure development; d. Experience in housing developments that incorporate tax credit and affordable housing financing, completion of the development, placing the development in service; 5
e. Experience in construction management and supervising general contracting; f. Experience in residential rental property management including maintenance and security functions; g. Expertise in regulatory compliance issues; h. Expertise with local government authorities which regulate the permits and utilities necessary for development; and i. Expertise in WBE and MBE compliance; and j. Expertise in HUD rules, including mixed-finance and subsidy layering rules; k. Experience in completing environmental mitigation, including asbestos and lead based paint remediation preferably in the USVI. V. INSURANCE AND BONDS Upon commencement of the Master Development Agreement, the Developer will procure and maintain at all times and at the Developer s own expense, the types of insurance specified below. The insurance carriers used by the Developer must be authorized to do business in the Territory of the USVI and the insurance provided will cover all operations under the Master Development Agreement, whether performed by the Developer or by subcontractors. Workers Compensation and Occupational Disease Insurance in accordance with the laws of the Territory, and with a minimum employer s liability limit of $1,000,000 per occurrence. Commercial General Liability Insurance (primary and umbrella) or equivalent with limits of not less than $5,000,000 per occurrence equivalent with limits for bodily injury, personal injury, and property damage liability. VIPA is to be named as an additional insured on a primary non-contributory basis for any liability arising directly or indirectly from the services contemplated by the Master Development Agreement. Automobile Liability Insurance (Primary and Umbrella) for motor vehicles (owned, non-owned and hired) used in connection with the services to be performed, covered with comprehensive automobile liability insurance with limits of not less than $2,000,000 per occurrence combined 6
single limit, for bodily injury and property damage. VIPA is to be named as an additional insured on a primary non-contributory basis. Developer will insure that contractors/professionals maintain Professional Liability Insurance covering acts, errors, or omissions with limits which are the greater of 100% of the value of the professional services contract or $2,000,000 annual aggregate. Coverage extension will include blanket contractual liability and will enable the VIPA to make claims under such policy for the term provided by law following discovery or the termination of the Master Development Agreement. When the policies are renewed or replaced, the policy retroactive date must coincide with or precede the start of work under the Master Development Agreement. A claims policy which is not renewed or replaced must have an extended reporting period of one (1) year. Blanket Crime Insurance shall cover all persons handling funds under the Master Development Agreement, including, without limitation, the Developer s employees, agents and subcontractors, and cover against loss by dishonesty robbery, burglary, theft, destruction, disappearance, computer fraud, credit card forgery, and other related crime risks. The policy limit shall cover losses for the maximum funds collected, received and on promises, or all at any given time. Broad Form Builder s Risk insurance shall, at any time before the Developer or Owner has issued a notice to proceed under any construction contract related to any portion of a mixed-finance development or site, cover the structures to be constructed pursuant to such contract as well as the associated materials, supplies, machinery and equipment that belong to or will be a part of such structure for the duration of any outstanding construction contract between the parties. It shall be in a form submitted to and approved by VIPA insuring all work in place and all materials used for such work, and payable on a completed value basis regardless of whether partial payment has been made by VIPA. VIPA (or its designee) shall be named as loss payee. Insurance funds paid shall be deposited in an escrow account and all repairs shall be paid out from that account. Such insurance shall insure the interests of subcontractors as well as the Developer and VIPA, as their interests may appear. The Developer will be required to furnish VIPA original Certificates of Insurance evidencing the required coverage to be in force on the date of 7
the Master Development Agreement, and Renewal Certificates of Insurance, or such similar evidence, if the coverage has an expiration date or renewal date occurring during the term of the Master Development Agreement. The Developer will require all subcontractors to carry the insurance required herein, or the Developer may provide the coverage for any or all subcontractors, and, if so, the evidence of insurance submitted will so stipulate. VIPA will be named as an additional insured on all subcontractor insurance policies. The Developer and each subcontractor will agree that insurers will waive their rights of subrogation against VIPA. The Developer will agree that any insurance or self-insurance programs maintained by VIPA will apply in excess of, and not contribute with, insurance provided by the Developer under the Master Development Agreement. Prior to closing, the construction professional will be required to submit a performance and payment bond for 100% of the construction contract price. The Developer shall ensure that such performance and payment bond is obtained and remains in place for the term of the construction contract, and is issued by a company registered with The U.S. Treasury Department. VI. INVITATION FORMAT Attached to this Request for Qualification (RFQ) is a Qualification Submission Document. Responses are to be made by completing this form in its entirety. The respondent shall submit one (1) original and five (5) copies of the completed Qualification submission Document to: Virgin Islands Port Authority 8074 Lindbergh Bay P. O. Box 301707 St. Thomas, USVI 00803-1707 Attention: Carlton Dowe, Executive Director Tel.: (340) 774-1629 All qualifications will be considered as they are construed with VIPA reserving the right to reject any or all materials and the right to request oral presentations of all or some of the respondents. VIPA requests that information be succinct. After reviewing the qualifications, additional information may be requested by VIPA. VIPA maintains the right to request that selected respondents to the RFQ submit a response to a to-be-issued Request for Development Proposal, if necessary. 8
VII. INVITATION DUE DATE All qualification Submission Documents must be received by VIPA prior to 3:00 PM (ADST) on Friday, August 30, 2013, at the office of the Executive Director as identified herein. No amendments will be accepted after this date and time. Submittals received after the date and time specified above will not be considered. Submittals must be made in strict accordance with the requirements of the RFQ. Following evaluation of qualifications and approval by VIPA, the respondents who are found to be responsive to this RFQ will be ranked. VIII. AMENDMENTS TO THE RFQ VIPA reserves the right to cancel or revise in part, or in its entirety, this RFQ, including, but not limited to, the selection schedule, the submittal date and the submittal requirements. All prospective respondents will be notified by written addenda if VIPA cancels or revises this RFQ. IX. VIPA CONTACT The VIPA Contact for this submission is Executive Director. To insure full understanding of and responsiveness to this request any questions should be directed to Carlton Dowe, Executive Director, in writing. Replies will be issued by addenda and emailed to all parties recorded by VIPA as having received this RFQ. Questions received after 4:00 PM (ADST) on Monday, August 19, 2013, will not be answered. Only answers issued by formal written addenda will be binding. Oral and other interpretations or clarifications will be without legal effect and may not be relied on. Written information given to any potential respondent by VIPA shall be furnished to all other potential respondents. X. SPECIAL CONDITIONS By submitting a Qualifications Submission Document to this RFQ, respondents acknowledge and agree to the following conditions: All Qualifications Submission Documents submitted in response to this RFQ become the property of VIPA. As such, all Qualifications 9
Submission Documents submitted are public records, subject to public review. VIPA will make no determination as to the adequacy of any system, process, procedure or representation made by any respondent. As such, pre-qualification does not infer approval of any such systems, processes, procedures or representations. No respondent shall initiate contact with any member of the Board of Directors of VIPA regarding this RFQ until after completion of the selection process and execution of the Master Development Agreement. If any respondent has any reason, not related to this RFQ, to contact any of the above parties, they will be required to disclose to that party that they are a respondent in this solicitation. Failure to adhere to these requirements may result in disqualification from the solicitation. VIPA accepts no responsibility for any expenses incurred in the respondents preparation of the requested Qualification Submission Documents; such expenses are to be borne exclusively by respondents. Only one (1) Qualification Submission Document from an respondent will be considered. VIPA reserves the right to waive any irregularities in any Qualification Submission Documents, to reject any or all Qualification Submission Documents, and to re-solicit for Qualification Submission Documents, as may be deemed to be in the best interest of VIPA. Any person or affiliate, who has been disbarred or suspended from bidding on projects by any federal, state or local government agency, must fully disclose to VIPA the details of such disbarment or suspension. Any person or affiliate who has been placed on the convicted vendor list following a conviction for a public entity crime may not submit a proposal on a contract to provide any goods or services to 10
a public entity, may not submit a proposal on a contract with a public entity for the construction or repair of a public building or public work, may not submit on leases of real property to a public entity, may not be awarded or perform work as a contractor, supplier, subcontractor, or consultant under the Master Development Agreement. VIPA reserves the right to request clarification of information submitted in the Qualification Submission Documents, to interview respondents, and to request additional information of one or more respondents. In addition, VIPA may conduct such investigations and interviews as it deems necessary to assist in the evaluation of any Qualification Submission Document submitted, and to establish to VIPA s satisfaction the responsibility, qualifications and financial ability of any respondent. XI. SELECTION PROCESS All proposals will be reviewed by VIPA. VIPA shall be sole judge as to evaluation and ranking of proposals. Based on the evaluation and ranking, interviews may be conducted with selected respondents. No respondent s conference is anticipated for this RFQ. VIPA will assess the aspects of the proposals in the following manner: Evaluation Factors Points Development Team 15 USVI Development Experience 15 LIHTC Experience 15 Financing Experience 15 Financing Strategy 15 Financial Responsibility 10 References 15 VIPA intends to attempt to negotiate a Master Development Agreement with the top-ranked respondent. In the event the top-ranked respondent elects not to participate in the negotiation process or if negotiations with the respondent reach an impasse, VIPA reserves the rights to terminate negotiations and invite the next ranked respondent to participate in the negotiation process. 11
XII. AWARD It is anticipated that the top-ranked respondent will be interviewed no later than the week of September 30, 2013, and notification in the form of a written Notice of Award is expected no later than November 1, 2013. The final selection of pre-qualified respondents will not create a binding contract or obligation on the part of VIPA to enter into a Master Development Agreement, or any other agreement, with any o the pre-qualified respondents. 12
QUALIFICATION SUBMISSION DOCUMENT FOR REAL ESTATE DEVELOPMENT SERVICES STATEMENT OF QUALIFICATIONS The respondent to the RFQ issued on, 2013 by VIPA will be the entity that will serve as the Developer as described in the RFQ if selected (the Developer Entity ). The respondent s submittals in response to the RFQ shall be accompanied by a Letter of Interest on the respondent s letterhead. The letter should (i) state respondent s understanding of the work to be done; (ii) state why the respondent believes itself to be best qualified to perform the engagement; (iii) certify respondent s ability to start work immediately; (iv) certify respondent s commitment to perform the work expeditiously; (v) certify respondent s ability to timely obtain the required insurance; (vi) certify respondent s commitment to make efforts to ensure that small and minority-owned businesses, women s business enterprises, labor surplus area businesses and individuals or firms located in or owned in substantial part by persons residing in the area of the mixed-finance development are used when possible; and (vii) state that the response is firm and irrevocable for sixty (60) days. DEVELOPMENT TEAM (15 points) Although the RFQ is only for the selection of the entity that will serve as the Developer as described in the RFQ, the respondent shall identify the development team for the developments described in the RFQ (the Development Team ), which will include the Developer Entity and any other key professionals, which may include, but are not limited to, design, construction, marketing, financing, management and affordable housing professionals ( Team Members ). 1. DEVELOPER ENTITY: Name and address (including telephone, fax and email) of the Developer Entity. State the type of legal entity (form of organization) and the state of organization of the Developer Entity. 2. KEY PRINCIPALS (INCLUDING ANY ENTITY HOLDING INTEREST IN THE DEVELOPER ENTITY), WHETHER IN EQUITY, BY AGREEMENT OR CONTRACTUAL: Name, address, position and description of the nature and percentage interest in the Developer Entity. Provide profiles of the principals and key staff to be involved in the development effort. 3. ORGANIZATIONAL STRUCTURE: Describe your organizational and management approach. Identify the individual who will serve as the project manager and who will 13
direct and coordinate the development effort to completion. Specify all members of the firm who will regularly interact with VIPA and describe their qualifications and responsibilities. This information should specify existing time commitments and previous development experience. 4. INTEGRATED APPROACH: Describe how (or if) your organization has an integrated structure encompassing development, construction and property management services. 5. LITIGATION/TERMINATION: The Developer Entity and each person (including any entity holding interest in the Developer Entity) must: (i) identify any litigation within the last five (5) years where it was either plaintiff or defendant; and (ii) identify and summarize, including resolution, any complaints filed against it related to the delivery of any professional or licensed services. Also, advise whether the Developer Entity or any of its affiliates have ever been terminated (whether with or without cause) prior to completing a project, and if so, identify the project and summarize the circumstances. VIPA reserves the right to contact any federal, state, county or local agency, department and/or licensing body to verify the information provided pursuant to this section. 6. TEAM MEMBERS: a. Identify each Team Member of the Development Team. b. Describe each Team Member s specialization, relevant experience and specific contribution to the Development Team. c. Describe in detail any identity of interest among the Development Team. d. Submit an organization chart showing all of the key individuals from the Team Members who will be assigned to the project. The chart should reflect the hierarchy and lines of communication. e. Submit resumes of the key individuals and detailed descriptions of the responsibilities that the key individuals will be required to perform. f. Describe the degree to which the Team Members and key individuals can dedicate their professional time to the project. 14
g. Describe the Development Team s specific experience with: (i) new construction and marketing of affordable rental housing units in the USVI or a comparable setting; (ii) complex financial structuring, including managing multiple funding sources and mixed-finance projects; and (iii) the LIHTC program in the USVI. Any previous collaboration among some or all members of the Development Team should be noted. Successful experience in the mixed income development of communities similar to the project should be provided. h. If selected, the construction professional will be required to later submit a performance and payment bond for 100% of the contract price. Submit a letter from the construction professional, if any, certifying the construction professional s ability to provide such performance and payment bond. 15
DEVELOPMENT EXPERIENCE (7.5 points USVI experience, 7.5 points other areas experience 15 total points) List previous development experience of the Developer Entity: PROJECT NAME: LOCATION: NUMBER OF UNITS: TOTAL DEVELOPMENT COST: TYPE AND SIZE OF UNITS: DATE SELECTED AS DEVELOPER: ORIGINAL PROJECTED COMPLETION DATE: CURRENT STATUS: FINANCE SOURCES AND AMOUNTS: PROJECT REFERENCE: PROJECT NAME: LOCATION: NUMBER OF UNITS: TOTAL DEVELOPMENT COST: TYPE AND SIZE OF UNITS: DATE SELECTED AS DEVELOPER: ORIGINAL PROJECTED COMPLETION DATE: CURRENT STATUS: FINANCING SOURCES AND AMOUNTS: PROJECT REFERENCE: 16
DEVELOPMENT EXPERIENCE (7.5 points USVI experience, 7.5 points other areas experience 15 total points) List previous development experience of the Developer Entity: PROJECT NAME: LOCATION: NUMBER OF UNITS: TOTAL DEVELOPMENT COST: TYPE AND SIZE OF UNITS: DATE SELECTED AS DEVELOPER: ORIGINAL PROJECTED COMPLETION DATE: CURRENT STATUS: FINANCE SOURCES AND AMOUNTS: PROJECT REFERENCE: PROJECT NAME: LOCATION: NUMBER OF UNITS: TOTAL DEVELOPMENT COST: TYPE AND SIZE OF UNITS: DATE SELECTED AS DEVELOPER: ORIGINAL PROJECTED COMPLETION DATE: CURRENT STATUS: FINANCING SOURCES AND AMOUNTS: PROJECT REFERENCE: 17
PROJECT SPECIFIC EXPERIENCE (15 points) For each project described above, put an x in the box if your Development Team performed the function or utilized the described financing. DEVELOPMENT Development Feasibility Studies Real Estate Redevelopment Zoning Approval Subdivision Approval Site Preparation Work Environmental Work Master Planning Project 1 Project 2 Project 3 Project 4 FINANCING Financial Feasibility Studies LIHTC HOME CDBG Historic Tax Credit Fannie Mae Federal Home Loan Bank Affordable Housing Program Bank Financing: Bond Financing Bond Underwriting Tax Credit Syndication Personal Guarantees Corporate Guarantees CONSTRUCTION Construction Management Design Services Coordination Alternative Energy (Solar/Wind) PROPERTY MANAGEMENT Marketing Plans/Lease Up Property Manager Site Maintenance Site Security LIHTC Compliance 18
FINANCING (15 points) Describe current terms your organization has been successful in negotiating to maximize the value of 9% competitive housing credits. Illustrate this experience with descriptions of at least three (3) similar developments. Describe your approach to managing the financial risk associated with affordable housing development. FINANCING STRATEGY (15 points) Provide a narrative description of the proposed methods that will be utilized to identify and obtain the maximum private investment needed to complete the development effort. Describe what private and public funds will likely be necessary, and from what sources and when these funds will likely be available. FINANCIAL RESPONSIBILITY (10 points) Submit financial statements for 2011 and 2012, including balance sheets and statements of income and expenses prepared in accordance with generally accepted accounting principles (GAAP) REFERENCES (15 points) References shall be provided for the experiences listed above (include name and telephone number of contact person). References must verify respondent s representations. In the event that VIPA elects to conduct reference checks, a uniform set of questions will be used to check each reference. VIPA reserves the right to check other references. REFERENCES: LIHTC Investor: 19
Architect: Financial Institution: General Contractor: 20