2019/11/06 Mullin360 Real Estate Services, LLC Net Growth Demand Analysis - Amendement No 1AMENDMENT NO. 1 TO
AGREEMENT BETWEEN MULLIN360 REAL ESTATE SERVICES LLC
AND THE CITY OF MENIFEE FOR NET GROWTH DEMAND ANALYSIS (AUTOMOBILE
RETAIL CLUSTER FEASIBILITY)
This is Amendment No. 1 to that certain AGREEMENT for Professional Services
Agreement ("Agreement") made on January 16, 2019 by and between the City of Menifee ("City')
and MULLIN360 REAL ESTATE SERVICES LLC ("Consultant") for NET GROWTH DEMAND
ANALYSIS (AUTOMOBILE RETAIL CLUSTER FEASIBILITY) which Amendment is made and
entered into on2019 to increase the compensation amount as indicated
below:
1. Section 1.1, "Term of Services" is amended to read as follows
2. Term of Services. The term of this Agreement shall begin on the January 16, 2019 and
shall end on August 31, 2020 unless the term of the Agreement is otherwise terminated
or extended as provided for in Section 8. The time provided to Consultant to complete the
services required by this Agreement shall not affect the City's right to terminate the
Agreement, as provided for in Section 8.
3. Section 2, "Compensation" is amended to read as follows, increasing the contract amount
by: $150,000.00 (ONE HUNDRED FIFTY THOUSAND DOLLARS AND ZERO CENTS)
Section 2. City hereby agrees to pay Consultant a sum not to exceed $227,300.00
(TWO HUNDRED TWENTY SEVEN THOUSAND THREE HUNDRED DOLLARS AND
ZERO CENTS) notwithstanding any contrary indications that may be contained in
Consultant's proposal, for services to be performed and reimbursable costs incurred under
this Agreement. In the event of a conflict between this Agreement and Exhibit A, regarding
the amount of compensation, this Agreement shall prevail. City shall pay Consultant for
services rendered pursuant to this Agreement at the time and in the manner set forth herein.
The payments specified below shall be the only payments from City to Consultant for services
rendered pursuant to this Agreement. Consultant shall submit all invoices to City in the
manner specified herein. Except as specifically authorized in advance by City, Consultant
shall not bill City for duplicate services performed by more than one person.
3. Exhibit A, Scope of Services is supplemented to include Amendment No. 1 Scope of
Work Additional Work, which supplement is attached as Exhibit A hereto. "Amendment
No. 1 Scope of Work Additional Work (Amendment No. 1)" is not intended to replace
the original Exhibit A to the Agreement, but instead to augment and increase the scope of
work listed in the original Exhibit A to the Agreement.
All other terms and conditions of the Agreement remain in full force and effect
CITY OF MENIFEE
f
Bill Zimm V aff, Mayor
Attest:
Approved as to Form:
d-vr���
Je r . Melching, Ci rney
MULLIN360 REAL ESTATE SERVICES LLC
Owner
Jim urn, Owner
Professional Services Amendment No.1 with MULLIN360 Real Estate Services LLC
Exhibit A: Amendment No. 1 Scope of Work Additional Work (Amendment No. 1)
(See following pages for additional detail)
Addendum to Attachment "A"
The following provides our background, desired outcome, scope of services, timing and fees structure for
Mullin360 Real Estate Services, LLC to provide expertise and guidance for the development of an auto
park in the City of Menifee with outreach efforts.
There are defined challenges to establishing an auto park or auto cluster to generate sales tax revenue
and desired employment for the City of Menifee. The elements that are to address for success are (a)
Creating a marketable development to attract dealer groups, (b) California state statute that impacts
dealer distancing from brand to brand in Riverside County, (c) Dealer group's ability to establish new
points with their respective OEM's or relocate existing franchises and (d) fractured land ownership to
coordinate a cohesive attractive master planned auto park in the target location most probable to attract
dealerships.
Background:
City of Menifee has looked for opportunities to recruit auto dealerships to the City overthe past few years.
City of Menifee retained Mullin360 Real Estate Services, LLC in 2019 to conduct a proprietary research
effort that measures the potential of auto dealerships performance and potential locations within the City
of Menifee. Mullin360 has been involved in over 1,200 dealership locations throughout the nation and 40
auto park projects.
Desired Outcome:
City of Menifee desires an auto cluster or auto park within its city limits to generate sales tax revenues
from new and used vehicle sales, parts and service. An auto park creates synergistic reach expanding the
buyer audience to a larger trade area than a free-standing dealership or two. Any dealership locating in
Menifee is beneficial however it is desired that a park be established if the market demand is present.
Mullin36o is the single source of expertise in the nation that brings 35 years of auto retail experience and
the network of OEM's (manufacturers), dealer groups, national public dealer groups to a project.
Furthermore, it exclusively understands the elements that positively impact an auto park development
through design, incentive packages, development structures and pricing so that the dealers will be
successful, and the land owners be whole. These developments do not benefit from retail, industrial,
office, multifamily, specialty development expertise or experience. This narrow niche has been pioneered
by Mullin360 over three decades establishing relations in the specific pool of prospects for this potential
automotive retail development in Menifee. Furthermore, Mullin360 has expertise in working together
with Indian Communities since 1994 with three major developments and this contemplated development
has over 37% land ownership by Pechanga Indian Community.
Scope of Services:
Scope of services to ascertain the development of an auto park or auto cluster in Menifee by Mullin360
Real Estate Services are as follows:
Land Ownership
There are three very diverse owners that make up the land contemplated for the auto park.
Mullin360 will meet with each land owner as needed in an effort to create an inter -ownership
agreement for land owners to work together to create a single auto park destination
development. This will be inclusive of agreeing to mutually beneficial market pricing,
infrastructure design, City agreements and other elements to unify the location to operate as
much as possible, a single ownership -styled entity. This is so that the auto retail prospects can
work with one unified plan, representative and document efficiently a lot sale.
City of Menifee Agreement
Work with the City of Menifee on the entitlement and development design. Auto parks require
variances from typical code due to the unique land use to be successful. Mullin360 will work with
the City to ensure these elements are included in a potential overlay so that the prospective
dealers can benefit from one location that allows for their use in a way that is competitive to other
options in surrounding cities.
Prospect Meetings
Mullin360 will at its expense provide designs, branding and lot layouts to prospective dealers and
their representative OEM's for consideration into the park. This will occur so long as the land
owners agree to work together for a single master planned park development. Dealer groups need
different information than the dealer groups and Mullin360 will present often to these groups in
an effort to secure a commitment from the prospects. Formal prospect activities shall be under
separate agreement with the land owners.
Professional Services Amendment No. 1 with MULLIN360 Real Estate Services LLC
State Statute Impact
Mullin360 will continuously measure the potential impact of the State Statute governing brand -
to -brand distance. It is uncertain until a project is proposed and dealers' express interest as to
hoe the OEM's shall respond. The site bodes all of the elements (large retail, freeway exposure,
rooftop expansion, solid demographics) to render the site appropriate. Mullin360 will meet with
the OEM's effected and share the NGDA data as well as utilize their experience for this type of
dialogue to educate them.
Mullin360 had incorporated a "Grand Announcement" event whereby the prospect pool (dealers
first then ORM's) are assembled to learn firsthand of the park, its features, benefits, City
cooperation, pricing and timing. Mullin360 will also provide LOI commitment letters conditional
on ORM approval for dealer groups in an effort to accelerate the absorption of the park or further
identify the statutory radius impact.
In conclusion, Mullin360 will coordinate and direct all pertinent activities with the three land
owners and their representatives, various City departments, potential existing and new dealer
prospects, respective OEM's and other vested groups (dealer architects/engineers, sealer
contractors, OEM market researchers) in an effort to gain valid commitments to construct
multiple dealerships on the targeted site in Menifee.
Timing:
Mullin360 Real Estate Services, LLC shall provide the above referenced services and coordination over a
ten (10) month period upon execution of its agreement with Mullin360 Real Estate Services.
Reporting:
Mullin360 shall report in person or telephonic each month with progress as to the development and its
elements to Economic Development and departments they coordinate as needed. (Meetings inherent to
the development with the City of Menifee —planning, treasure, etc.- will occur as needed and unrelated to
the reporting meetings).
Fees:
Mullin360 Real Estate Services, LLC shall invoice fifteen thousand dollars ($15,000.00) at the conclusion
of each 30-day period for ten (10) months for a total not to exceed one hundred fifty thousand dollars
$150,000.00. Should either party determine that the projects potential is not feasible or mutually
beneficial, the agreement may be cancelled in writing by either party, the services concluded, and any
future payments will not be due or payable
Professional Services Amendment No. I with MULLIN360 Real Estate Services LLC