City closing in on short list of master developers for midtown campus

By Teya Vitu tvitu@sfnewmexican.com

Jan 13, 2020

The city of Santa Fe in the coming days may announce a short list of master developers in contention to redevelop the city-owned midtown campus on St. Michael’s Drive.

A nine-member evaluation committee of city department heads and staff members has been going through proposals submitted Oct. 31 by seven potential master developers in response to a city request for expressions of interest. The city’s announcement that it’s nearer to a short list is the next step in a process that will continue into the spring.

It was unknown Monday how large the short list will be, but it’s estimated three or four developers may advance to the interview stage to determine which one could be selected in April, said Daniel Hernandez, the city’s contracted project manager for the midtown campus.

“In spring, we will identify a master developer with whom we will go really deep and negotiate a development and disposition agreement toward the end of the year,” Hernandez said.

It’s possible the project that will be assembled this year could include elements from all seven master developer proposals as well as 14 proposals submitted for smaller projects or potential tenants. That is the essence of the city’s request for expressions of interest — seeking ideas and a compatible developer partner rather than the standard request for proposals process, which emphasizes complete proposals.

The midtown campus timeline specifies a Jan. 15 decision for a short-list, but there is no requirement to meet that date, Hernandez said.

The evaluation committee is composed of the city’s department heads in economic development, planning, public works, affordable housing, arts and culture, and four staff members. It has been evaluating the seven master developers on a point system assigned to a spelled-out criteria in the areas of experience, capacity, composition, approach and finance.

“How adept are they and experienced are they in fulfilling the underlying objectives in the criteria?” Hernandez said. “Are they responsive? Are they ready? Or are they preoccupied with five different projects? We need you now. Do they have deep investors that can keep a project moving forward in slow economic times?”

Mayor Alan Webber said the “courting process” tackles how experienced the master developers are and how watertight their financing packages are.

“Show us how you ‘get’ what we’re trying to do there,” Webber said. “We’re looking for a fit with a developer so it’s a partnership. Where have you done this before? Does your proposal and experience demonstrate that you understand the community values? Some have that, some don’t.”

The city seeks a master developer focused as exclusively as possible on the long-term project that could run 10 or 20 years and, in today’s dollars, is estimated at $400 million to $500 million, Hernandez said.

A new component of public input will come into play in February, March and April as the city seeks more specifics from the community of what is wanted at the midtown campus. Hernandez said city funding has been set aside to invite local organizations to engage the community in novel ways to get specific input that will be used as the city negotiates with the chosen developer.

“We will be very clear on what kind of information is valuable to us,” said Hernandez, who is still developing the specifics. “If you are a civic organization, talk to arts organizations to come up with creative venues.”

Hernandez and Webber repeatedly said the midtown campus request for expressions of interest process is all about “what the public wants.” Master developers have acknowledged their involvement is based on what the city wants. The mayor has said on multiple occasions the city will make suggestions on what master developers might want to include in their projects, but on Monday said, “We want to share the driver seat.”

The city intends to enlarge the 64-acre campus it currently owns.

The city and the state General Services Department are discussing a land swap involving 19.55 acres of state-owned land adjacent to the midtown. The city is offering 48.1 acres of land upon which the New Mexico Department of Public Safety campus sits, as well as an impound lot, both of which the state currently leases from the city.

The land swap is anticipated to be presented to the Legislature during the 30-day session.

“Nothing has been finalized,” General Services spokesman Thom Cole said.

The state land wraps around two sides of the Santa Fe Higher Education Center between the midtown campus and Siringo Road and a 7.9-acre chunk that is surrounded on three sides by the midtown campus.

An appraisal is pending but the state land is valued at $4.33 million and the city property at $8.9 million. The city is seeking $4.577 million from the state.

More Information

Master Developer Hopefuls

• Central Park Santa Fe, headed by historic railroad hotel reviver Allan Affeldt.

• Santa Fe Innovation Village, headed by Silicon Valley CEO John Rizzo.

• National Nuclear Security Administration, which administers the Los Alamos National Laboratory management and its operating contract.

• KDC Real Estate Development & Investmentcq/Cienda Partners. Cienda owns La Fonda on the Plaza.

• Raffles Education Corp., a Singapore entity that attempted to buy the Midtown campus while the Santa Fe University of Art and Design was still operating there.

• Local developer Zydeco.

• Specialized Capital Partners, a Chicago entity.