25-R-134 EastGroup Properties Subdivision Improvement for BNSF Schertz Business ParkRESOLUTION 25-R-134
A RESOLUTION BY THE CITY COUNCIL OF THE CITY
OF SCHERTZ, TEXAS AUTHORIZING A
SUBDIVISION IMPROVEMENT AGREEMENT
WITH EASTGROUP PROPERTIES, L.P. FOR
BNSF SCHERTZ BUSINESS PARK.
WHEREAS, the landowner desires to defer certain sewer public improvements
obligations for BNSF Schertz Business Park; and
WHEREAS, pursuant to Section 21.4.15 of the City's Unified Development Code, the
obligation to dedicate and construct improvements for the Subdivision may be deferred if an
Improvement Agreement is executed and if sufficient surety is provided to secure the obligation
to construct the improvements; and
WHEREAS, the City staff of the City of Schertz has recommended that the City
enter into a Subdivision Improvement Agreement; and
WHEREAS, the City Council finds that it is in the best interest of the City to enter
into the agreement with the landowner to defer the construction sewer improvements.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SCHERTZ, TEXAS THAT:
Section 1. The City Council hereby authorizes the City Manager to execute the
Subdivision Improvement Agreement for BNSF Schertz Business Park Subdivision
generally in the form attached subject to approval of minor changes approved by the City
Attorney as shown on Exhibit "A".
Section 2. The recitals contained in the preamble hereof are hereby found to be true,
and such recitals are hereby made a part of this Resolution for all purposes and are
adopted as a part of the judgment and findings of the City Council.
Section 3. All resolutions, or parts thereof, which are in conflict or inconsistent with
any provision of this Resolution are hereby repealed to the extent of such conflict,
and the provisions of this Resolution shall be and remain controlling as to the matters
resolved herein.
Section 4. This Resolution shall be construed and enforced in accordance with the laws
of the State of Texas and the United States of America.
Section 5. If any provision of this Resolution or the application thereof to any person
or circumstance shall be held to be invalid, the remainder of this Resolution and the
application of such provision to other persons and circumstances shall nevertheless be
valid, and the City Council hereby declares that this Resolution would have been
enacted without such invalid provision.
Section 6. It is officially found, determined, and declared that the meeting at which
this Resolution is adopted was open to the public and public notice of the time, place, and
subject matter of the public business to be considered at such meeting, including this
Resolution, was given, all as required by Chapter 551, Texas Government Code, as
amended.
Section 7. This Resolution shall be in force and effect from and after its final
passage, and it is so resolved.
PASSED AND APPROVED, this day of bLkC)�t�_,2025.
CITY OF SCHER Z, TEXAS
Ral6butierWz, Mayor
ATTEST-
Sheree Courney, Deputy City Secret
Exhibit "A"
Subdivision Improvement Agreement for BNSF Schertz Business Park
After Recording:. Please Return To:
City of Schertz
1400 Schertz Parkway
Schertz, Texas 78154
Attention: City Manager
STATE OF TEXAS
COUNTY OF GUADALUPE
KNOW ALL PERSONS BY THESE PRESENTS:
SUBDIVISION IMPROVEMENT AGREEMENT
EASTGROUP INDUSTRIAL PROJECT
This SUBDIVISION IMPROVEMENT AGREEMENT (the "Agreement") is made by and
between EastGroup Properties, L.P., a Delaware limited partnership authorized to do business in
Texas (hereinafter called "EastGroup" or "Developer" and the CITY OF SCHERTZ, a Texas
municipal corporation (the "Cily"), and is effective upon the execution of this Agreement by both
parties (the "Effective Date").
WHEREAS, Developer is pursuing the acquisition of approximately 79.497 acres located
on FM 3009 near Thousand Oaks in Comal County and recorded by the Comal County Appraisal
District as Parcel IDS 147738, 147739, 147740, 147741, Texas, more specifically described on
Exhibit "A" (the "Pro a "); and
WHEREAS, Developer is constructing an industrial development on the Property (the
"Proiect"); and
WHEREAS, the Developer has submitted a Replat Certification for the Property, Replat
Establishing BNSF Schertz Business Park on July 1, 2025, a copy of such Replat Certification
being attached hereto as Exhibit `B"; and incorporated herein by reference; and
WHEREAS, the construction of certain public improvements (the "Sewer Improvements")
are required in conjunction with the replatting of the Property (the "Subdivision"), such as the
construction of a sanitary sewer line as shown on the attached Exhibit "C' ; and
WHEREAS, the Sewer Improvements necessary to provide services to the project are not
yet complete and will be constructed at a future time, as set forth hereinafter, but which will be
after the recording of the final plat for the Subdivision; and
WHEREAS, pursuant to Section 21.4.15 of the City's Unified Development Code
("UDC"), the obligation to construct public improvements that serve a subdivision may be deferred
if a subdivision improvement agreement is executed and if sufficient surety is provided to secure
the obligation to construct the public improvements; and
WHEREAS, the Developer seeks to defer the construction of the Sewer Improvements
associated with the Subdivision to after the recording of the final replat for the Subdivision in the
Comal County Real Property Records (the "Final Replat Recordation_") pursuant to UDC Section
21.4.15(F); and
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Schenz — Subdivision Improvement Agreement
WHEREAS, The City of Schertz Economic Development Corporation entered into an
Economic Development Agreement with Boomerang Interests, LLC and L I Acquisitions, LLC on
September 25, 2023 related to the construction of approximately 1.8 miles of sanitary sewer line
(the "Eastern Sewer Section") that the Sewer Improvements must tie into as depicted on Exhibit
"D" attached hereto; and
WHEREAS, the Developer seeks the ability to utilize an onsite septic system until the
Sewer Improvements and Eastern Sewer Section have been constructed and accepted by the City
of Schertz.
NOW THEREFORE, in consideration of the agreements set forth herein and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and
stipulated, the Developer and the City agree as follows.
AGREEMENT
1. Development of the Property. Developer hereby represents and warrants that, as of
the Effective Date, it is pursuing the acquisition of the Property. Developer understand that this
Agreement is for its sole benefit, and does not extend to other parties, unless provided for otherwise
herein.
2. Sco»e of Improvements. The public improvements addressed and contemplated by
this Agreement to be completed subsequent to Final Replat Recordation consist of the Sewer
Improvements to be undertaken by the Developer which are more specifically described in Exhibit
«C�,
3. Construction of Sewer Imp rovements: Covenants. The Developer and the City
covenant and agree to the following:
(a) The Developer is obligated by UDC Section 21.12.10 to construct, or cause
to be constructed, the Sewer Improvements shown on Exhibit "C"_ prior to filing
the Final Replat of the Property.
(b) The Developer agrees that it will commence construction of the Sewer
Improvements within four (4) years after the date Developer breaks ground on its
development of the Property, and complete such construction in accordance with
City design standards within twenty-four (24) months thereafter, subject to Force
Majeure Delay.
(c) The cost of the Sewer Improvements is estimated to be Six Million: Eight
Hundred Fifty -Eight Thousand, Five Hundred Thirty -One Dollars. and NO cents
($6,858.531.00) (the "Cost Estimate -Improvements"). The Developer and the City
agree that the amount of the Cost Estimate -Improvements set forth herein is a
commercially reasonable estimate of the cost of the Sewer Improvements.
(d) In lieu of the Developer's obligation to construct, or cause to be constructed,
the Sewer Improvements at or before the Final RePlat Recordation, Developer shall
provide to the City, prior to Final Plat Recordation, surety (the "Sure ") in the
form of a letter of credit in an aggregate amount equal to 110% ofthe Cost Estimate-
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Schertz — Subdivision Improvement Agreement
Improvements (the "Improvement Funds") and which Surety shall provide that it
automatically renews in the event that it has not been released at the time of its
expiration. The Surety shall be similar in the form to the letter of credit example
included in Exhibit "D" but may vary provided the Surety is provided. As portions
of the Improvements are constructed and accepted by the City, the Surety may be
reduced by the, the cost of that particular portion.
(e) For the purpose of clarification, and in no way limiting Developer's
obligations under UDC Section 21.4.15, the Parties agree that full completion of
the Sewer Improvements shall not be deemed to have occurred until the City
accepts such Sewer Improvements in the manner prescribed in UDC Section
21.4.15. D.
(f) In the event Developer fails to fully complete construction of the Sewer
Improvements as required per Section 3(b) herein, the City may declare this
Agreement to be in default and at the City's sole discretion,
(i) require that all Improvements as required per this Agreement be
installed by Developer regardless of the extent of completion of the
improvements on the Property at the time this Agreement is declared
to be in default;
(ii) unilaterally draw from the Improvement Funds sufficient amount to
complete the Improvements itself or through a third parry; or
(iii) assign the Improvement Funds to any third party, including a
subsequent owner of the Property, provided that such Improvements
Funds shall only be assigned for the purpose of causing the
completion of construction of the Improvements by such third party
and for no other purpose and in exchange for the subsequent owner's
agreement and posting of security to complete the Improvements.
(iv) If City proceeds under clauses (ii) or (iii) above, it, or its assigns,
may only draw such amounts from the Improvement Funds as are
needed to complete the Improvements, and City and any such
assignee must account for, and refund to Developer, any part of the
Improvement Funds drawn in excess of such amount.
(g) Within 30 days of the City's acceptance of all Improvements, the City shall
release the Surety to Developer and the Parties shall have no further obligation to
each other under this Agreement.
(h)
4. Onsite Septic System. Until such time as the Sewer Improvements and the Eastern
Sewer Section have been completed and accepted by the City and are operational, the City agrees
that Developer may construct and operate an onsite sanitary septic system on the Property to serve
the Project, and the City agrees not to withhold Replat approval, any Certificate of Occupancy or
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Schertz — Subdivision Improvement Agreement
any other approval for the Project based on Developer's use of an onsite sanitary septic system at
the Project.
5. Approval of Agreement. The City has approved the execution and delivery of this
Agreement pursuant to UDC Section 21.4.15(F), and the Developer represents and warrants that
it has taken all necessary action to authorize its execution and delivery of this Agreement.
6. Governmental Immuni,-,-. The City does not waive or relinquish any immunity or
defense on behalf of itself, its officers, employees, Councilmembers, and agents as a result of the
execution of this Agreement and the performance of the covenants and actions contained herein.
7. Force Majeure. Developer shall be excused for the period of any delay and shall
not be deemed in default with respect to the performance of any of its obligations when prevented
from so doing by a cause beyond Developer's reasonable control, including, but not limited to,
labor disputes, fire or casualty, inability to obtain materials or services, inability to obtain
necessary right of way, acts of God, governmental preemption in connection with a national
emergency, pandemics, epidemics or the conditions of supply and demand which have been or are
affected by war or other emergency (each, a "Force Mai eure Dela,, ")
8. Bindin.-_ Effect. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, executors, representatives, successors, and assigns,
and the terms hereof shall run with the Property. Any obligations, benefits, or requirements of this
Agreement shall automatically be assigned to subsequent owners of the Property following
conveyance.
9. Counte,--arts. This Agreement maybe executed in any number of counterparts with
the same effect as if all signatory parties had signed the same document. All counterparts shall be
construed together and shall constitute one and the same Agreement.
10. Inte ,.ration. This Agreement is the complete agreement between the parties as to
the subject matter hereof and cannot be varied except by the written agreement of the Developer
and the City. The Developer and the City each agrees that there are no oral agreements,
understandings, representation* or warranties which are not expressly set forth herein.
11. Notices. Any notice or communication required or permitted hereunder shall be
deemed to be delivered three (3) days after such notice is deposited in the United States mail,
postage fully prepaid, registered or certified mail return receipt requested, or one (1) business day
after such notice is deposited with a nationally recognized overnight courier, and in each case
addressed to the intended recipient at the address shown herein,. Any address for notice may be
changed by written notice delivered as provided herein. All notices hereunder shall be in writing
and served as follows:
If to the Developer:
EastGroup Properties, L.P.
Attention: Matt Troutt
6565 N. MacArthur Blvd, Suite 255
Irving, Texas 75039
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Schertz - Subdivision Improvement Agreement
With coy- \ to:
Butler Snow LLP
Attention: Craig D. Smith
1020 Highland Colony Parkway, Suite 1400
Ridgeland, Mississippi 39157
If to the Cit, :
CITY OF SCHERTZ
1400 Schertz Parkway
Schertz, Texas 78154
Attention: City Manager
With copy to:
Denton Navarro Rocha Bernal Hyde & Zech, P.C.
2517 N. Main Avenue
San Antonio, Texas 78212
Attention: T. Daniel Santee
12. Legal Construction. If any provision in this Agreement is for any reason
unenforceable, to the extent the unenforceability does not destroy the basis of the bargain among
the parties, such unenforceability will not affect any other provision hereof, and this Agreement
will be construed as if the unenforceable provision had never been a part of this Agreement.
Whenever the context requires, the singular will include the plural and neuter include the
masculine or feminine gender, and vice versa. Article and section headings in this Agreement are
for reference only and are not intended to restrict or define the text of any section. This Agreement
will not be construed more or less favorably between the parties by reason of authorship or origin
of language.
13. Recitals, Exhibits. Any recitals in this Agreement are represented by the parties
hereto to be accurate, constitute a part of the parties' substantive agreement, and are fully
incorporated herein as matters of contract and not mere recitals. Further, any exhibits to this
Agreement are incorporated herein as matters of contract and not mere exhibits_
14. No Joint Venture. It is acknowledged and agreed by the parties that the terms hereof
are not intended to, and shall not be deemed to, create a partnership or joint venture among the
parties.
15. Choice of Law. This Agreement will be construed under the laws of the State of
Texas without regard to choice -of -law rules of any jurisdiction. Venue shall be in the State District
Courts of Guadalupe County, Texas with respect to any lawsuit arising out of or construing the
terms and provisions of this Agreement. No provision of this Agreement shall constitute a consent
by suit by any party.
[Signatures and acknowledgments on the following pages]
5
Schou — Subdivision Improvement Agreement
Signature Page to
Subdivision Improvement Agreement
This Subdivision Improvement Agreement has been executed by the parties as of the dates
of the Acknowledgments to be effective as of the Effective Date.
DeveloF,er;
EASTGROUP PROPERTIES, L.P., a Delaware
limited partnership
By EastGroup Properties General Partners, Inc.,
a Delaware corporation, its general partner
By:
Name:
Title:
By:
Name:
Title:
THE STATE OF TEXAS §
COUNTY OF BEXAR §
This instrument was acknowledged before me on the day of , 2025, by
and , the _ and , respectively, of
EastGroup Properties General Partners, Inc., a Delaware corporation, the sole general partner of
EASTGROUP PROPERTIES, L.P., a Delaware limited partnership, on behalf of said corporation
and limited partnership.
(SEAL)
Notary Public in and for
The State of Texas
My Commission Expires:
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Schertz — Subdivision Improvement Agreement
Si.gnature Paye to
Subdivision Improvement Agreement
This Subdivision Improvement Agreement has been executed by the parties as of the dates
of the Acknowledgments to be effective as of the Effective Date.
Cam:
CITY OF SCHERTZ,
a Texas municipal corporation
By:
Name: Steve Williams its City Manager
Date:
THE STATE OF TEXAS §
COUNTY OF GUADALUPE §
This instrument was acknowledged before me on the day of , 2026 by Steve
Williams, City Manager of the City of Schertz, Texas, a Texas municipal corporation, on behalf
of said City.
(SEAL)
Notary Public in and for
The State of Texas
My Commission Expires:
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Schertz — Subdivision improvement Agreement
RXHiRiT "A"
Legal Description -The Property
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EXHIBIT "B"
Re__ jqt Certification BNSF Schertz Business Park
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Scher►z — Subdivision Improvement Agreement
EXHIBIT "C"
Sewer Improvements
[insert cover page for approved Public Infrastructure plans]
(PROJECT COST ESTIMATE)
Item Cost _ LF
I
RC Page Bid $ 4,683,925 9,000
Civil $ 70,000
$/LF
$ 520.44
ROW Surveying
$ 60,000
ROW Acquisition
$ 720,000
9,000
$ 4.00
ROW Acq. Agent
$ 226,800
Contingency
$ 288,036
$ 302,438
Construction Management
Construction Interest
$ 507,332
Total
$ 6,858,532
Schertz— Subdivision Improvement Agreement
EXHIBIT "D"
Eastern Sewer Section
Schertz — Subdivision Improvement Agreement