The Sunnyvale Town Center Parking Structure is a 500,000 square foot facility that provides approximately 1200 elevated parking spaces with another 1200 spaces at ground level. The structural maintenance of the facility, which was built by the original developers of Sunnyvale Town Center in 1978, is the responsibility of the City of Sunnyvale. Beginning in 1979, Degenkolb Engineers has provided engineering services and annual reports to the City of Sunnyvale regarding the structural condition of the facility.

Staff has proceeded with Council direction to explore options for closing or demolishing the Sunnyvale Town Center Parking Structure. It is now necessary to have the involvement of professional design consultants so these options can be further defined. There are a number of specialized structural and architectural issues that need to be addressed and that require the input of design professionals. Additionally, it is prudent to initiate design work at this time due to schedule constraints that are mentioned later in this report.

At this time, the most likely future options for the structure are closure or demolition. While a closure option can be implemented in a very short time period, demolition work requires a significantly longer time frame and the preparation of design documents for the bid and award of a construction contract. It is actually necessary to start design work now to be in a state of readiness if a demolition option were to be approved by Council in the future.

Entering into an agreement for professional design services does not mean that Council is endorsing an action to demolish the parking structure. By entering into a design services agreement at this time, engineering design work can proceed so that the City is prepared in the event that demolition is necessary. This design activity does not preclude other options from being fully considered; it merely ensures that a City demolition contract, if it is the preferred solution, can be implemented in a timely manner. Staff intends to return to Council for approval prior to any future activity relating to demolition work or closure of the parking structure.

Degenkolb Engineers has performed design services for the City in the past, and staff has been well satisfied with their services. Additionally, Degenkolb has unique qualifications to perform this work; they are extremely knowledgeable about the structure and have been monitoring it annually since 1979. Section 2.08.070(b) exempts professional services from competitive bidding.

Staff has continued working in a number of areas relating to the future disposition of the parking structure. The most recent activities are listed below:

• Three meetings have been held to discuss issues relating to the structure with direct financial stakeholders including representatives from Macy’s, Target, J.C. Penney, American Mall Properties, Lehman Brothers, the Forum Group, Harvest Partners and the Court appointed bankruptcy Receiver. At the first meeting members of the group expressed a preference for demolition over closure.

• Staff continues to evaluate potential options for demolition of the parking structure and reconstruction of surface parking. This work is relatively complex as it involves more than just demolition. It will be necessary to salvage existing light fixtures, demolish the structure while protecting the ground level improvements, reconstruct drainage inlets, install salvaged lights, and reconstruct second story mall exits. The situation is further complicated by the need to address stakeholder interests regarding both the short-term and long-term impacts of any proposed changes to the parking structure.

1. Phase construction with only a portion of the parking being affected at one time. This approach would minimize the amount of parking loss, but would likely be more expensive and take longer to complete.
   
2. Close the entire structure while demolition and reconstruction takes place. This would be a less expensive option but the parking impacts may be undesirable.
   
3. A portion of the structure could be demolished and some surface parking restored, with the remainder of the structure being closed for parking. This would be a less expensive option than demolishing the entire structure.
   
4. In the event that agreement cannot be reached with stakeholders regarding the need to demolish the structure, and if deterioration of the facility continues as anticipated, it may be necessary to discontinue parking and close the structure.

• Field reviews of the structure were conducted by City staff with Degenkolb Engineers and their architectural sub-consultant to identify construction options and look at potential building code issues relating to Mall exit requirements and ADA compliance. Degenkolb subsequently submitted a fee proposal to provide engineering and architectural services relating to potential demolition and reconstruction work. Their fee proposal is in the amount of $115,000 and includes structural and architectural design services. As was indicated previously, there are a number of design options that are in the process of being considered. Additionally, there are unknown conditions and potential stakeholder concerns that make it difficult to precisely identify all the design services that may be needed. In the interests of proceeding expeditiously, the recommended agreement contains a larger than usual design contingency. This contingency amounts to $35,000 and can be authorized by the Director of Public Works for Additional Services as needed.
  
• Analysis of schedule constraints would indicate that if a demolition project were to be implemented, construction should begin immediately following the June 7 and 8 Sunnyvale Art & Wine Festival. The preferred construction completion date would be mid to late October so as to avoid impacts to the holiday shopping season. This schedule is extremely aggressive and is predicated on engineering work starting immediately and on full cooperation by all affected stakeholders. The number of parties involved, and their competing interests, pose a potential problem for issues being resolved in a timely manner. A demolition construction contract may need to contain requirements that curtail or limit construction activity during the months of November and December if the project cannot be completed prior to the end of October 2003.

Project costs for design activity include:

Design & Engineering------- $115,000

Estimated Design Total-----  $150,000

Funds are available in the Redevelopment Special Revenue Fund. Redevelopment Capital Projects Sub-Fund, budgeted in Project #803100 – Town Center Parking Structure Maintenance.

The costs to either close or demolish the structure will be more fully defined as design work progresses. Estimates for demolition at this time range from $3.4- $4 million. The City owns, and is responsible for, approximately two thirds of the structure.

Staff recommends that Council:

1. Award a contract in substantially the same form as the attached draft, to Degenkolb Engineers in an amount not to exceed $115,000 for design services to provide construction documents for the demolition of the existing Sunnyvale Town Center Parking Structure; and
   
2. Authorize a contingency in the amount of $35,000 for additional services authorized by the Director of Public Works.