13 of 2024 - Property Disposition at Approximately 310 South 500 West_________________________________
, Chair
REDEVELOPMENT AGENCY OF SALT LAKE CITY
RESOLUTION NO. _______________
Authorizing Lease Rate and Terms for USA Climbing Headquarters and Training Facility
at Approximately 500 West 300 South
RESOLUTION OF THE BOARD OF DIRECTORS OF THE REDEVELOPMENT AGENCY
OF SALT LAKE CITY AUTHORIZING LEASE RATE AND TERMS FOR USA CLIMBING
HEADQUARTERS AND TRAINING FACILITY AT RDA-OWNED PROPERTY AT
APPROXIMATELY 500 WEST 300 SOUTH IN THE DEPOT DISTRICT PROJECT AREA.
WHEREAS, the Redevelopment Agency of Salt Lake City (RDA) desires to ground
lease real property located at approximately 500 West and 300 South in Salt Lake City
(Property) for the purpose of redeveloping it in a manner consistent with RDA’s Depot District
Project Area Plan.
WHEREAS, USA Climbing (USAC), a non-profit and national governing body of the
sport of competition climbing in the United States, intends to ground lease the Property from the
RDA and construct their national headquarters and training facility (Project) at the Property. The
Project will also include certain public benefits including equitable and inclusive programming,
transportation demand management strategies, use and activation of the historic Salt Lake Mattress
Company building, and construction of an outdoor plaza to be utilized for USAC-hosted
competitions as well as other non-USAC community events. Certain details of the Project, ground
lease terms, and public benefits are more particularly described on the term sheet attached as
Exhibit A (Term Sheet).
WHEREAS, the RDA is willing to provide USAC a below-market ground lease of the
Property to facilitate the development of the Project in exchange for USAC’s commitment to
develop and maintain the public benefits in the Project as detailed on the Term Sheet.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the
Redevelopment Agency of Salt Lake City that the Board approves the terms outlined on the
Term Sheet for the Project and that the Board authorizes the RDA administration to negotiate the
final agreements consistent with the Term Sheet or more beneficial to the RDA, and execute the
ground lease and any other relevant documents consistent with this Resolution and incorporating
such other terms and agreements as recommended by the City Attorney’s office.
Passed by the Board of Directors of the Redevelopment Agency of Salt Lake City, this
____ day of , 2024. 9 July
Alejandro Puy
13
Alejandro Puy (Jul 27, 2024 15:41 GMT+2)
Salt Lake City Attorney’s Office
Allison Parks
The Executive Director:
____ does not request reconsideration
____ requests reconsideration at the next regular Agency meeting.
________________________________
Erin Mendenhall, Executive Director
Attest:
________________________
City Recorder
Allison Parks (Jul 17, 2024 15:49 MDT)
Jul 17, 2024
Jill
o1 (Jul 29, 2024 09:5т MDT)
Jill Love
n
in 4 Tris#(an (Jul 29, 2024 1ч:14 MDT)
EXHIBIT A
TERM SHEET
1
USA CLIMBING AT RIO GRANDE DISTRICT
Development and Ground Lease Agreement Term Sheet
Purpose
The purpose of ground leasing Redevelopment Agency property to USA Climbing is to help facilitate the
construction of their national headquarters and training facility as well as establish an exciting and
catalytic anchor tenant for the Rio Grande District.
Parties
The Redevelopment Agency of Salt Lake City (RDA) and USA Clim bing. USA Climbing is the national
governing body of the sport of competition climbing in the United States. USA Climbing is a non-profit
entity that promotes the disciplines of bouldering, lead and speed climbing, as well as collegiate and
paraclimbing series.
Property to be Leased
A portion of property near the southwest corner of 500 West 300 South, Salt Lake City, Utah 84101. The
lease area shall encompass building footprints, setback areas between buildings and adjacent rights-of-
way, and the outdoor plaza. An approximate depiction of the real property to be leased is shown in Exhibit
1 of this document and will be referred throughout as “Lease Area.”
Project Description
The project involves the construction of a headquarters and training facility for USA Climbing, which will
include:
1. New construction of a primary structure that is about 65-75 feet tall with a roughly 45,000 sf
footprint (exact specifications subject to further stakeholder engagement). This structure will
include bouldering, lead, and speed climbing walls, as well as other support uses that are typical
of a climbing facility. Most areas of the facility will be accessible by the community; some spaces
will be reserved for the U.S. National Team’s exclusive use. The exterior building facades will
include climbing walls.
2. Rehabilitation of the historic Salt Lake Mattress Company building, anticipated to include
publicly facing and accessible food, beverage, and retail uses, as well as private spaces for USA
Climbing offices.
3. New construction of an outdoor plaza that will be utilized for USA Climbing-hosted competitions
as well as other non-USA Climbing events (will be designed to accommodate 3,500 – 5,000
spectators).
Lease Terms
1. Term: 99 years, to commence upon execution of a ground lease agreement. Execution of a
ground lease agreement is contingent on both parties satisfying the conditions outlined in the last
section of this document. Ownership of the improvements constructed on the Lease Area will
revert to RDA ownership at the end of the term. In the last five years of the term, USA Climbing
may exercise an option to renew the lease for an additional 50 years. The lease rate for the
additional lease period will be fair market value, unless otherwise negotiated and approved by the
administration and legislative body.
2
2. Lease Rate: As set forth in more detail below, the lease rate will be based on a portion of the fair
market value of the Lease Area and will be increased incrementally over time. The outdoor plaza
space shall not be included in the calculation of the lease rate. Stated another way, the outdoor
plaza shall be leased at no cost.
a. The annual lease rate will be the fee simple, fair market value of the Lease Area (not
including the outdoor plaza space, as determined by an RDA-commissioned appraisal)
multiplied by 5% (Annual Lease Rate). If a ground lease agreement is not executed
within 12 months of the approval of this term sheet by the RDA Board of Directors, the
RDA shall reserve the right to commission an updated appraisal on which the Annual
Lease Rate will be based.
b. The Annual Lease Rate will be increased, or escalated, every five years. This escalator is
based on the average consumer price index (CPI) rate over the previous five years, with a
minimum escalation rate of 2% and a maximum escalation rate of 5%. The first
escalation will take place at the start of the 6th year of the lease and be based on the
average CPI rate calculated for the first 1-5 years of the lease. The Annual Lease Rate,
inclusive of the escalation, shall be referred to as the “Escalated Annual Lease Rate.”
c. The Escalated Annual Lease Rate shall be reduced according to the following schedule:
i. Years 1-6: USA Climbing will not make any lease payments during the first six
years to account for construction and stabilization.
ii. Year 7: USA Climbing shall make a payment that is equal to 45% of the
Escalated Annual Lease Rate.
iii. Year 8: USA Climbing shall make a payment that is equal to 50% of the
Escalated Annual Lease Rate.
iv. Year 9: USA Climbing shall make a payment that is equal to 55% of the
Escalated Annual Lease Rate.
v. Years 10-99: USA Climbing shall make annual payments that are equal to 60% of
the Escalated Annual Lease Rate.
3. Common Area Maintenance (CAM) Fees: CAM fees will be collected from Rio Grande District
property lessees to contribute to the cost of maintaining public spaces in the neighborhood. The
annual CAM fee for USA Climbing will be $1.50 per square foot of the gross floor area of their
project, inclusive of the new structure and the Salt Lake Mattress Company Building (Annual
CAM Fee). Gross floor area shall be interpreted to mean the sum in square feet of all floors of the
building, measured from the exterior face of the exterior walls. The Annual CAM Fee will be
assessed upon USA Climbing receiving its occupancy permit, be charged at the same reduced rate
as the schedule provided in 2.c.i-v, and escalated in the same manner as outlined in 2.b.
4. Community Benefits: During the term of the lease, USA Climbing is committed to providing the
community benefits described below. The lease rate outlined above is tied to USA Climbing
providing these benefits, and as such, should USA Climbing not provide these benefits, the lease
rate will increase as specified in more detail in the agreements.
a. Equitable and inclusive programming that may include offerings such as youth
programming, workforce development opportunities, and access to the facility for
community members who may not otherwise have access to the sport of climbing, based
on income or other key measures.
b. Transportation demand management strategies to reduce auto dependency of employees
and visitors and encourage the use of alternative modes of transportation. This may
3
include discounted day passes for those that utilize public transit, and inclusion of
shower, locker, and bicycle storage facilities.
c. Activation of the historic Salt Lake Mattress Company Building, anticipated to include –
at ground level - food and beverage and retail components that are open and clearly
accessible by the general public during regular operating hours. The second floor will
house private USA Climbing offices and the basement may be utilized for storage.
d. Design, construction, and management of the outdoor plaza, which will primarily be used
for USA Climbing-hosted events and made available for use by other entities for
additional events.
i. Design – USA Climbing shall work collaboratively with the RDA to develop the
design for the outdoor plaza, which shall be incorporated into the construction
drawings for the larger project at USA Climbing’s sole expense.
ii. Construction – The plaza shall be constructed by USA Climbing and built at the
same time as the rest of the project. Prior to construction, USA Climbing and the
RDA will determine a cost-sharing formula and the RDA will reimburse USA
Climbing for agreed-upon plaza construction costs, in an amount not to exceed
$1 million, unless a greater amount is approved by the RDA Board of Directors.
iii. Management – USA Climbing will be responsible for managing the use of the
plaza, for both USA Climbing and non-USA Climbing-hosted events. It is
anticipated that USA Climbing will host six (6) multi-day competition events per
year, in addition to smaller events associated with their programming. USA
Climbing events may take precedence over other plaza uses but when there is no
scheduling conflict, USA Climbing shall allow all reasonable requests by outside
parties to utilize the plaza for special events. USA Climbing shall not charge the
City or RDA for the use of the plaza. Other Rio Grande District property lessees
that contribute to the CAM fund will be charged a reduced rental rate for the use
of the plaza.
iv. Maintenance – USA Climbing shall contribute to a CAM fund that will be
utilized to fund maintenance of the outdoor plaza, as well as other publicly
owned parks, plazas, park strips, public art, alleyways, parking facilities, etc.,
within the neighborhood. CAM fees will also be used to fund enhanced street and
sidewalk maintenance beyond the baseline City maintenance level. The RDA
shall be responsible for implementing maintenance activities funded by the CAM
assessment.
e. Tracking and Reporting. Some of the community benefits described above are physical
improvements that will be memorialized in construction drawings, development
agreements, cost-sharing agreements, and/or use agreements. Others are programmatic
and ongoing in nature and shall be memorialized in a 5-year community benefits plan that
is provided by USA Climbing to RDA Staff for their approval, and which may be
amended from time to time with prior Staff approval. RDA Staff will present USA
Climbing’s informational progress report to the RDA Board of Directors at the conclusion
of each 5-year plan period.
5. Additional Terms :
a. Parking: The RDA is exploring the feasibility of financing and developing a shared
parking structure on the south block of the neighborhood.
4
i. If developed, the RDA will lease parking privileges to interested property owners
and tenants, including USA Climbing, based on operational needs, estimated
demand, and parking management best practices.
ii. If the parking structure is not completed by the time the USA Climbing project is
operational, the RDA shall lease adjacent RDA-owned property to USA
Climbing at no cost for a temporary surface parking lot. USA Climbing shall be
responsible for funding and constructing all site improvements necessary for the
surface parking lot. The planned location of the parking structure and temporary
surface parking lot (if needed) is shown in Exhibit 2.
iii. Should the parties need surface parking for an extended period, or if the proposed
temporary parking location becomes unavailable for this use, the parties will
work together to negotiate a solution to accommodate USA Climbing’s parking
needs within one block of their facility, with the goal of ultimately eliminating
the surface parking lot.
b. Salt Lake Mattress Building: As part of the construction of the project, USA Climbing
will take on the responsibility of paying the up-front costs of rehabilitating the historic
Salt Lake Mattress Building. The RDA will reimburse USA Climbing up to $6 million for
design and construction costs associated with seismic upgrades and building
improvements needed to meet minimum building code requirements, unless a greater
amount is approved by the RDA Board of Directors.
c. Demolition of Existing Buildings: The Lease Area currently contains existing structures.
USA Climbing will take on the responsibility of paying the up-front costs of demolition.
The RDA will reimburse USA Climbing up to $120,000 for these costs, unless a greater
amount is approved by the RDA Board of Directors.
d. Contaminated Soil Disposal: It is possible that USA Climbing will encounter soils
contaminated with semi-volatile organic compounds (SVOCs) during excavation for their
building. Potentially contaminated soils should be screened and stockpiled during
excavation and disposed of in accordance with applicable laws. USA Climbing will take
on the responsibility of paying the up-front costs of disposing of contaminated soils, and
the RDA will reimburse USA Climbing for the cost differential associated with
transporting and disposing of contaminated soil versus non-contaminated soil. It is
anticipated that the cost differential will not exceed $200,000.
e. RDA to Develop Certain Adjacent Public Improvements: As part of the planned
redevelopment of the neighborhood, RDA will design and install utilities with increased
capacity to support increased density, reconstruct 300 South between 500 West and 600
West, and extend the City grid by building out new midblock street connections, as
illustrated in Exhibit 3. It is the RDA’s intent to coordinate with USA Climbing, the
design consultants, and pertinent City divisions when developing plans for the public
improvements adjacent to USA Climbing’s lease area.
i. Accessible Parking Spaces – The RDA recognizes that USA Climbing works
with paraclimbing athletes who may require special accommodation. As such, the
RDA commits to working with USA Climbing to identify opportunities to
incorporate accessible on-street parking spaces near the project, along the
planned Market Street alignment.
5
Conditions to Execution of Lease and Development Agreements
• USA Climbing to receive approval of these development agreement and lease terms by the RDA
Board of Directors.
• Compliance with all applicable laws and regulations, including any applicable RDA policies such
as the Sustainable Development and Public Art policies. If any waivers of RDA policies are
requested, such waivers must be considered by the RDA Board of Directors.
• The Project shall align with the RDA’s administrative design review process, which shall require
RDA’s review and approval to ensure the design and development plans are consistent with the
term sheet.
• USA Climbing to receive all City approvals required to construct the Project, including obtaining
any necessary zoning approvals from the City’s Planning Division and a will-issue demolition
and building permit from the City’s Building Services Division.
• USA Climbing to provide evidence of insurance in such amounts and coverage as deemed
necessary by the RDA.
• RDA to review USA Climbing’s projected operating pro forma to ensure that future ground lease
payments are supported and the Project will be maintained, during the term, consistent with the
RDA Board-approved term sheet.
• Parties agree on the form of a Development Agreement, which shall include, but is not limited to:
o USA Climbing’s commitment to construct the Project consistent with the RDA Board-
approved term sheet, all City approvals, and a schedule of development.
o An RDA-approved community benefit plan/strategy.
o RDA to approve USA Climbing’s financial sources and uses and firm financial
commitments for sources of funding and donations consistent with the schedule of
development.
o USA Climbing’s commitment to comply with all applicable laws and regulations.
o An obligation for USA Climbing to provide the RDA quarterly progress reports on the
construction of the Project.
o Remedies should USA Climbing not comply with the terms of the Development
Agreement may include, but not be limited to, filing a breach of contract claim,
terminating the ground lease, damages, injunctive relief, or any other remedies available
at law.
• Parties to agree on the form of a Lease Agreement, which shall include, but is not limited to:
o USA Climbing’s obligation to pay the applicable Lease Rate and CAM fees.
o USA Climbing’s commitment to maintain the Project, during the term, consistent with the
RDA-Board approved term sheet.
o USA Climbing shall not be permitted to assign the lease to an unaffiliated entity without
the RDA’s consent, which may be withheld at the RDA’s sole discretion.
o Submission and approval of the community benefits plan.
o An obligation for USA Climbing to provide the RDA annual progress reports on the
performance of the public benefits.
o Continual operation of USA Climbing’s headquarters, outdoor plaza, and activation of the
Salt Lake Mattress Building consistent with the term sheet and the community benefits
plan.
o Remedies should USA Climbing not comply with the terms of the Lease Agreement may
include, but not be limited to, filing a breach of contract claim, terminating the ground
lease, increasing the Lease Rate, damages, injunctive relief, or any other remedies
available at law.
6
• Receive approval from the RDA and City Attorney’s Office on all matters pertaining to the
legality, sufficiency, and form and substance of all other documents that are deemed reasonably
necessary for the execution of the transaction.
7
Exhibit 1: Lease Area
8
Exhibit 2: Proposed Future Parking Areas
Temporary Surface
Parking Lot
Shared Parking
Structure
9
Exhibit 3: Planned Neighborhood Midblock Street Connections
RDA Resolution 13 of 2024 - USA Climbing
Property Disposition 310 south 500 west
Final Audit Report 2024-07-30
Created:2024-07-17
By:STEPHANIE ELLIOTT (stephanie.elliott@slcgov.com)
Status:Signed
Transaction ID:CBJCHBCAABAAjnwCPtRFuRNNaJ6NBm5Pd9bd85tmuggU
"RDA Resolution 13 of 2024 - USA Climbing Property Dispositio
n 310 south 500 west" History
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Agreement completed.
2024-07-30 - 0:14:40 AM GMT