DEVELOPER AGREEMENT UP FOR VOTE : COUNCIL TO CONSIDER ARTS PLAZA PACT.

Byline: Enrique Rivero Daily News Staff Writer

In a major step toward developing the Civic Arts Plaza's private side, the city will decide Tuesday whether to enter into a formal development agreement with Kilroy Industries to build a retail/entertainment center.

After months of negotiations with the city, public hearings, forums and workshops with the community, the city may be on the threshold of entering into an agreement with the El Segundo-based developer to build the 230,000 square-foot center.

``It's a major step,'' Councilman Michael Markey said. ``That means they will spend dollars to do their architectural plans, go back to the community and present those and do the work they need to do for a project.

``If it's approved, they will be the ones who will be given the contract to build it,'' he added.

The city will hold a public hearing on the matter at Tuesday's City Council meeting.

Kilroy has been in exclusive negotiations with the city to build the complex on the 11.5-acre parcel on the eastern side of the Civic Arts Plaza.

The city has long sought a project that would give it a return on its investment in that land, while giving the community a project that it wants.

Working with the city and the public, Kilroy had come up with a conceptual site plan that includes a two-level United Artists multi-screen theater and virtual reality center, fitness center, dinner house, food concessions, restrooms, a parking structure, office space, walkways, water features and public plaza.

It could also include the proposed Discovery Center children's hands-on science museum.

It would be built in two phases.

Under the terms of the development agreement to be considered Tuesday, Kilroy must pay the city's Redevelopment Agency $1 million for the phase one parcel and provide the following:

$20 per square foot for all office space up to 20,000 square feet, for a total of $400,000.

$15 per square foot for all office space above 20,000 square feet, for a total of $300,000.

$50 per square foot for retail and office space in Phase IIA, totaling $1.5 million.

$20 per square foot for Phase IIB, for $400,000.

And other fees and options ranging up to $425,000.

Revenues to the Redevelopment Agency could be as high as $5.75 million at build-out, according to documents from the city.

The agreement, however, by no means guarantees that Kilroy will come up with an acceptable project - or that Kilroy will ultimately build it.

According to city officials, Kilroy must still take the plan beyond the conceptual stage and produce architectural and other plans that must be evaluated by the Planning Commission and the City Council.

Tuesday's hearing only sets out the terms under which Kilroy would build and finance the project, said Dave Armanetti, director of development services for Kilroy. If approved, it would give Kilroy the rights to the land.

``It's strictly a contractual hearing,'' he said. ``It formalizes it and becomes a legal contract with the city that we have to perform under.''

Kilroy officials expect to be the ones to ultimately build the center. ``If all goes well, we would have our site plans and architectural drawings approved . . . sometime this spring, and go to construction sometime this summer,'' he said.

They hope to have the project ready in late 1998, he said.

The City Council will meet Tuesday at 6 p.m. in the Forum Theatre in the Civic Arts Plaza, 2100 Thousand Oaks Blvd.