041105 EDAOfficial File Copy
CITY OF NEW HOPE
EDA MEETING
City Hall, 4401 Xylon Avenue North
April 11, 2005
EDA Meeting will commence upon
adjournment of the City Council Meeting
President Martin Opem Sr.
Commissioner Mary Gwin-Lenth
Commissioner Andy Hoffe
Commissioner Karen Nolte
Commissioner Steve Sommer
1. Call to order
2. Roll call
3. Approval of regular meeting minutes of March 28, 2005
4. Resolution authorizing approval of a term sheet between the New Hope Economic
Development Authority and Frey Development and Manley Land Development Inc.
for the redevelopment of 7500-7528 42® Avenue North of the former Electronic
Industries site (improvement project no. 740)
5. Adjournment
CITY OF NEW HOPE
4401 XYLON AVENUE NORTH
NEW HOPE, MINNESOTA 55428
EDA Minutes
Regular Meeting
March 28, 2005
City Hall
CALL TO ORDER
ROLL CALL
APPROVE MINUTES
IMP. PROJECT 740
Item 4
EDA Meeting
Page 1
President Opem called the meeting of the Economic Development Authority
to order at 10:40 p.m.
Present:
Martin Opem Sr., President
Mary Gwin-Lenth, Commissioner
Andy Hoffe, Commissioner
Karen Nolte, Commissioner
Steve Sommer, Commissioner
Motion was made by Commissioner Gwin-Lenth, seconded by
Commissioner Sommer, to approve the Regular Meeting Minutes of
February 28, 2005. All present voted in favor. Motion carried.
President Opem introduced for discussion Item 4, Discussion and update
regarding concept plans for the proposed development of city-owned
property at 7500-7528 42nd Avenue North, the former Electronic Industries
site (improvement project no. 740).
Mr. Shawn Siders, community development specialist, stated staff is seeking
direction regarding the proposed office/condominium/restaurant and
ancillary retail development on the city-owned property at 7500-7828 42-d
Avenue North. Over the past ten years, the city has acquired and
demolished all three industrial parcels at the intersection of 42nd and Quebec
Avenues to promote community development and clean up the
contaminated former Electronic Industry site. The properties were acquired
and demolished with tax increment finance funds. In order to expedite the
contaminated site clean up, the city made a successful application to the
State of Minnesota and Hennepin County to fund the clean-up of the
ground water. He noted Electronic Industries covered the cost sharing
portion of that grant and to date, the environmental remediation efforts are
complete and development can commence. In order to receive a "close out"
letter from the Minnesota Pollution Control Agency (MPCA), the city must
submit the proposed redevelopment site plan to MPCA to ensure it
conforms to the Declaration of Environmental Restriction Covenants
agreement that was approved by the city and MPCA. Mr. Siders reported
that monitoring of the ground water will be permanently required and the
costs will always be the responsibility of Electronic Industries.
He stated in November of 2003, the city approved a purchase agreement
with JCS Development and Frey Development for the redevelopment of the
property. The proposal included a Culver's restaurant on the western
portion of the property and Frey Development had proposed to develop
March 28,2005
EDA Meeting
Page 2
eight office condominium units on the eastern half of the property. The total
purchase price for the two sites was $510,000 plus brokerage fees.
In April of 2004, JCS Development notified the city that it was canceling the
approved purchase agreement for the western half of the property. JCS
identified the close proximity of this site to other Culver's Restaurants as the
principal reason for canceling the purchase agreement. I~e stated when JCS
Development withdrew from the approved purchase agreement; the city
council approved an exclusive representation agreement with Retail Site
Development Services (RSDS) to assist in securing a suitable restaurant for
the western half of the site. That agreement expired in November of 2004,
and there is a six month provision which lists Frey Development as a
"protected developer" by RSDS. Because of that status, the brokerage fees
for this developer will apply and Frey Development will pay the brokerage
fees. Further, he stated Frey Development will issue the city an
indemnification letter against any brokerage fees in the future for this site.
In January of 2005, Frey Development and Manly Land Development
submitted a redevelopment proposal to construct eight office condominium
units on the easterly half of the site and to construct an approximate 9,000
square foot restaurant/retail use on the western half of the site. He stated
Viva Italia is the restaurant use that is expected to occupy 5,000 to 6,000
square feet. He stated Frey Development will work with the city to identify
suitable tenants for the remaining 3,000 square feet of retail space.
Mr. Siders illustrated the proposed site plan. He noted the mayor, city
manager, and director of community development recently visited the Viva
Italia restaurant in Eagan. He stated Viva Italia has expressed its desire to
apply for an on-sale liquor license.
Mr. Siders stated if the council is supportive of the concept, the next steps
involve preparation of a term sheet with the developer. He stated the
proposed purchase price of $510,000 is the same price previously approved
with JCS Development and Frey Development. He stated the property
acquisition will be contingent upon the development being able to secure
planning approval. He emphasized that the redevelopment must conform to
the Declaration of Environmental Restrictive Covenants as approved by
MPCA. Once the term sheet is approved, the city attorney will prepare a
purchase agreement and a public hearing will be scheduled.
He introduced Bernie Frey (Frey Development) and Kurt Manley (owner of
Viva Italia). Mr. Frey was recognized and welcomed questions from the city
council.
Commissioner Sommer acknowledged that the plan hasn't changed from
the previous proposal except for the restaurant use. He expressed support
for the owner-occupied office condominiums and the full service Viva Italia
restaurant.
Commissioner Nolte suggested that the developer consider occupying one
of the retail spaces with a Panera Bread store. Mr. Manely noted he has
March 28, 2005
IMP. PROJECT 775
Item 5
EDA Meeting
Page 3
several proposed tenants in mind.
Commissioner Gwin-Lenth pointed out that the parking lot's traffic pattern
has changed. She questioned whether the driveway locations will remain.
Mr. Frey stated there are no other options for the driveway locations. He
stated the traffic pattern may slightly change as the site plans are developed.
He noted there may be a restaurant with a drive-thru window.
Mr. Siders called attention to the site plan with parking in the center. He
noted this layout is required so that it will comply with the MPCA
requirements. He stated the area delineated as parking lot is the area with
the greatest concentration of the contaminated soils.
Commissioner Hoffe asked whether Electronic Industry has a permanent
responsibility relative to the groundwater contamination and monitoring
requirements.
Mr. Siders responded affirmatively. He stated the MPCA will ensure that
the site continues to be monitored forever.
The EDA expressed support of the development and directed staff to
prepare a term sheet.
President Opem introduced for discussion Item 5, Discussion and direction
regarding redevelopment plans for'5207 Pennsylvania Avenue North
(improvement project no. 775).
Mr. Shawn Siders, community development specialist, stated his intention
to discuss redevelopment of the site at 5207 Pennsylvania and to share a
scattered site housing program (independent of block grant funding) that
was modeled after the city of Crystal.
Mr. Siders explained the proposed scattered site redevelopment program by
outlining the program objectives, acquisition of property, property selection
criteria, property evaluation procedures, establishment of fair market value,
and the acquisition procedures.
Mr. Siders reviewed specifications for construction of a single-family house
at 5207 Pennsylvania Avenue North. He stated staff recommends a
minimum target lot price of $75,000, and a minimum target value of the
land and building after redevelopment at $300,000. He stated staff will work
with the Hennepin County assessor's office to determine the property value.
Mr. Siders stated staff recommends that the EDA require the developer to
complete the development within five months after property conveyance in
order to avoid a land banking scenario. He reviewed the building standards
and stated the house will be required to have three bedrooms and two
bathrooms. The basement must have a "rough in" for a three-quarter bath,
and the basement must have an egress window to allow for the expansion
of living space. Mr. Siders also stated the house must include low
maintenance exterior materials and fit in with the neighborhood.
March 28, 2005
4415 NEVADA
Item 6
EDA Meeting
Page 4
Mr. Siders emphasized that with procedures in place, the EDA can attain its
objectives of providing additional move up housing in the city of New
Hope.
Commissioner Hoffe inquired of whether the city would lose money on
each project.
President Opem noted that it will depend on the criteria established by the
city. He noted the city of Crystal has been successful with a similar
program.
Commissioner Gwin-Lenth complimented Mr. Siders on the aspects of the
program and for articulating that this is a program that the city can use to
deal with a blighted property in a neighborhood. She emphasized the need
to pay less attention to the dollar-for-dollar payback and to consider its use
as an investment in neighborhoods and to improve property values.
Commissioner Gwin-Lenth asked how the city determines the level of
hazardous materials in a property prior to redevelopment.
Mr. Siders stated there are non-evasive testing procedures available that are
good indicators of hazardous materials such as asbestos.
Commissioner Sommer pointed out that page two of the proposed program
does make reference to conducting an investigation as to the existence of
any hazardous materials.
Commissioner Sommer explained that he views this type of program to
improve a blighted property on a different level than some prior larger scale
acquisitions made by the city that involved substantial money. He
supported the scattered site redevelopment program as outlined by Mr.
Siders.
Mr. Siders stated if the EDA is receptive to the proposal, staff will prepare a
formal policy for adoption at a future meeting.
The EDA expressed support of the proposed scattered site redevelopment
program and the specifications for 5207 Pennsylvania Avenue North.
President Opem introduced for discussion Item 6, Discussion and direction
regarding proposed purchase of 4415 Nevada Avenue North.
President Opem stated the property is an oversized lot located north of the
Northwest Community Revitalization Corporation (NCRC) project
involving three twin-homes. He stated the appraised value of 4415 Nevada
is $109,000 to $124,000. He stated the property owner is asking $160,000
which is high based on its present condition.
Commissioner Sommer suggested that the city contact NCRC to inquire of
funding options and whether they would like to increase their current
project by pursing a joint venture with the city to include this property. He
March 28, 2005
pointed out his desire to explore a potential project that would not result in
a large expense by the city.
Commissioner Nolte asked whether the owner of 4415 Nevada would
consider purchasing a PPL condominit~m. Mr. Siders noted NCRC had
previously inquired of the individual's interest in one of the accessible twin-
homes and was told that the property owner would like to move to the
Buffalo area to be closer to family members.
President Opem emphasized the need to negotiate the purchase price as it
would not be fiscally responsible to the New Hope taxpayers to pay more
than an appraised value.
Commissioner Hoffe questioned available revenue sources such as grants
that may be available to assist with the property acquisition. Mr. Siders
noted that NCRC could pay the asking price for the property but would
encounter problems based on the funding limitations set by HUD. He stated
Commissioner Sommer's suggestion of a joint venture may be an avenue to
pursue.
Commissioner Sommer concurred with President Opem that the city should
not pay more than the appraised value when acquiring property. However,
he stated this situation would involve a willing seller so there would be no
relocation costs. He pointed out that a settlement and joint venture may be
possible that could benefit both the city and another agency.
Mr. Kirk McDonald, director of community development, asked the EDA if
staff is authorized to negotiate for the purchase of 4415 Nevada Avenue
North.
The EDA directed staff to contact NCRC to inquire of their interest in the
property or a larger project.
Commissioner Nolte inquired whether the property owner would be
eligible for funding or special programs to assist her with a relocation to
Buffalo. She noted that the owner could reduce the asking price if there
were other financial resources made available to her.
Mr. Siders stated the asking price was based on what the property owner
and her family have identified as suitable living arrangements in Buffalo.
He stated he would inquire of any available programs or financial
assistance.
EDA Meeting
Page 5
Commissioner Gwin-Lenth expressed support for the creative ideas and the
recommendation to approach NCRC.
President Opem stated he would not be opposed to purchasing the property
if the price was closer ~o the appraised value. He noted the lot could be
divided and would support two single-family homes.
Commissioner Hoffe acknowledged that the NCRC obtained an appraisal
March 28, 2005
IMP. PROJECT 770
Item 7
MOTION/REQUEST
ESTIMATE
Item 7
ADJOURNMENT
EDA Meeting
Page 6
for $105,000.
Mr. Siders stated NCRC had the property appraised at $105,000 and the
property owner received an appraisal for $124,000. He noted both
appraisals are subjective and are lower than the asking price.
Commissioner Nolte requested that NCRC reconsider its twin-home design
to include two bathrooms rather than one bathroom in the accessible units.
Mr. Siders stated he has asked them to review the design. He reported that
it is possible to include two bathrooms, but the disadvantage of adding a
second bathroom is that the main bath and the entryway to the house are
reduced in size. He also pointed out that smaller areas make it more
difficult to navigate within the space.
The EDA agreed with two options relating to the 44~5 Nevada Avenue
property: 1) consult NCRC regarding possible joint venture; or 2) undertake
it as an EDA project if the asking price can be negotiated closer to its
appraised value.
President Opem introduced for discussion Item 7, Motion authorizing staff
to request engineering estimate from Xcel Energy for burial of overhead
utilities from north side of Bass Lake Road to 58~h Avenue North in
conjunction with Winnetka Townhomes redevelopment project
(improvement project no. 770).
President Opem stated the two options relating to the burial of overhead
utilities along the east side of Winnetka Avenue, north of Bass Lake Road
include: 1) to 5620 Winnetka Avenue North; or 2) 58th Avenue North.
Mr. Kirk McDonald, director of community development, stated the city
needs to select one option so that a more detailed engineering estimate can
be completed.
Motion was made by Commissioner Sommer, seconded by Commissioner
Gwin-Lenth, authorizing staff to request engineering estimate on option 2
from Xcel Energy for burial of overhead utilities from north side of Bass
Lake Road to 58~h Avenue North in conjunction with Winnetka
Townhomes redevelopment project (improvement project no. 770). Ali
present voted in favor. Motion carried.
Motion was made by Commissioner Sommer seconded by Commissioner
Nolte to adjourn the meeting. All present voted in favor. Motion carried.
The New Hope EDA adjourned at 11:25 p.m.
ectfully submitted,
Valerie Leone
City Clerk
March28, 2005
EDA
. REi UEST FOR ACTION
Originating Department Approved for Agenda Agenda Section
Community Development f~ 4-11-05 EDA
Item No.
By: Kirk McDonald, Director of CD B
Shawn Siders, CD Specialist 4
RESOLUTION AUTHORIZING APPROVAL OF A TERM SHEET BETWEEN THE NEW HOPE ECONOMIC
DEVELOPMENT AUTHORITY AND FREY DEVELOPMENT AND MANLEY LAND DEVELOPMENT, INC.
FOR THE REDEVELOPMENT OF 7500-7528 42ND AVENUE NORTH THE FORMER ELECTRONIC
INDUSTRIES SITE (IMPROVEMENT PROJECT NO. 740).
REOUESTED ACTION
Staff is requesting EDA consideration of the enclosed resolution prepared by the City Attorney approving a
term sheet between the EDA and Frey Development and Manley Land Development, Inc. The proposed
development would construct eight owner occupied office condomfrdums on the eastern half of the property
and 8,500-9,000 square feet of retail space on the western half of the property. Approximately 5,500-6,000
square feet of the retail space will be occupied by Viva Italia, a full service Italian restaurant.
POLICY/PAST PRACTICE
City goal #2 is to emphasize the maintenance and redevelopment of commercial and residential properties
within the city. The EDA has been addressing the commercial portion of this goal through the city's many
development activities, including coordinating with potential developers for the 'sale and development of city
owned property.
BACKGROUND
On January 3, 2005, Frey Development and Manley Land Development submitted a redevelopment proposal
for the entire site in conformance with previous discussions. The concept plan outlines the proposed
development of this site. Frey Development has agreed to purchase the site from the city for $510,000. The
developer will have to pay all customary fees for the development of this parcel which include but not limited
to stormwater fees, building permit fees and SAC charges as they may apply. Frey Development has also
agreed to provide the city with an indemnification agreement regarding brokerage fees.
On March 28, 2005, city staff presented the proposed redevelopment plans to the EDA for its discussion and
direction. At that meeting, the EDA indicated their support of the proposed project and directed staff to work
with the developer to finalize the terms of the sale and proceed with the potential redevelopment.
MOTION BY ~)~'}~ SECOND BY ~
To: £Ok) s'- O I
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I: \ RFA \ PLANNING \ Electronic Industries \ R-Term Sheet Fre~ & Manle~.doc
Request for Action Page 2 April 11, 2005
City staff and the City Attorney have developed the enclosed term sheet which outlines the terms of the sale
and redevelopment of the city owned property at 7500-7528 42nd Avenue North. Staff is recommending that
the terms of the sale be the same as what was originally negotiated with Frey Development and ]CS
Development. Those terms are as follows:
Land Acquisition Price - $510,000;
Brokerage Fees - To be paid by Frey Development and Manley Land Development, Inc.
Developers to provide city with indemnification agreement against brokerage fees;
Property is being transferred in an "as is" condition;
Buyer must receive all planning approvals prior to closing;
Buyer will obtain necessary approvals from the Minnesota Pollution Control Agency (MPCA)
prior to closing;
Buyer will provide cross easements for shared access and parking for all tenants on the entire site;
Buyer agrees to pay all fees associated with the redevelopment of this site;
RECOMMENDATION
Staff supports the terms and conditions as outlined above. The proposed terms of sale are the same as what
was previously approved with JCS Development, Inc. and Frey Development.
ATTACHMENTS
o Resolution
o Term Sheet
EDA RESOLUTION NO. 05-
RESOLUTION APPROVING TERM SHEET ON PROPOSED SALE OF PROPERTY TO
FREY DEVELOPMENT, INC.
AND MANLEY DEVELOPMENT
(7500-7528 42na AVENUE NORTH - Project No. 740)
BE IT RESOLVED by the Economic Development Authority in and for the City of New Hope,
Minnesota as follows:
WHEREAS, the Economic Development Authority of the City of New Hope (hereafter "EDA") is the
fee owner of three (3) parcels of real property more commonly known as 7500, 7516 and 7528 42nd
Avenue North, City of New Hope, which real property is legally described on Exhibit A attached hereto
and made a part hereof (collectively, the "Property").
WHEREAS, it has been proposed that the EDA enter into a purchase agreement whereby it would sell
the Property to FREY DEVELOPMENT, INC. and MANLEY LAND DEVELOPMENT (collectively,
the "Redeveloper") for redevelopment; and
WHEREAS, the EDA has determined that such transfer, if made pursuant to terms substantially similar
to those outlined in Exhibit B attached hereto and made a part hereof, would serve the goals and
mission of the EDA and would be beneficial to the citizens of the City of New Hope.
NOW, THEREFORE, BE IT RESOLVED by the EDA as follows:
1. That the above recitals are incorporated herein by reference.
2. That the Term Sheet attached hereto as Exhibit B is hereby approved.
3. That the Executive Director and EDA staff are authorized and directed to enter into
negotiations for a purchase agreement to govern sale of the Propertyto the Redeveloper,
with the terms of such agreement to be substantially similar to those enumerated in the
attached Exhibit B.
4. That, in the event mutually-agreeable sale terms can be negotiated, the Executive
Director and EDA staff are directed to present a final draft purchase agreement to the
EDA Commissioners for review and approval.
-1-
This resolution is hereby adopted by the EDA this 11th day of April, 2005.
Martin E. Opem Sr., President
Attest:
Daniel J. Donahue, Executive Director
P :kAttomey\Cmk\Clients\CNH\99-11293\99-11293-002-res approving term sheet, doc
-2-
EXHIBIT A
LEGAL DESCRIPTIONS
Real property situated in the County Hennepin, State of Minnesota, described as follows:
That part of Lot 5, "Auditor's Subdivision Number 324, Hennepin County, Minnesota"
described as follows: Commencing at the point of intersection of the North hne of Rockford
Road and the East line of said Lot 5; thence North along said East line a distance of 350 feet;
thence West parallel with the North line of Rockford Road a distance of 100 feet; thence South a
distance of 350 feet to a point on the North line of Rockford Road which is distant 100 feet
West of the point of beginning; thence East along said North line a distance of 100 feet to the
point of beginning.
Address. 7500 42nd Avenue North, New Hope, MN.
Proper .ty Identification Number. 17-118-21-22-006.
Together with
The West 95 feet of the East 195 feet of the South 350 feet of Lot 5, Auditor's Subdivision No.
324, Hennepin County, Minnesota.
Address. 7516 42~d Avenue North, New Hope, MN.
Proper .ty Identification Numb er. 17-118-21-22-0007.
And further together with
That part of Lot 5, "Auditor's Subdivision Number 324, Hermepin County, Minnesota"
described as follows: Commencing at a point on the North line of Rockford Road distant 195.0
feet Westerly of the East hne of said Lot 5; thence North parallel with the East line of said Lot 5
a distance of 350.0 feet; thence West parallel with the North line of Rockford Road a distance of
125.4 feet, more or less, to a point 48.95 feet East of the West line of said Lot 5, as measured at
right angles thereto; thence South parallel with the West line of said Lot 5 a distance of 350.0
feet to the North line of Rockford Road; thence Easterly along the North line of Rockford Road
a distance of 125.4 feet, more or less to the point of beginning.
Address. 7528 42nd Avenue North, New Hope, MN.
Proper .ty Identification Number. 17-118-21-22-0008.
-3-
TERM SHEET
New Hope EDA/Frey Development, Inc. & Manley Land Development
Sale of Land at 7500, 7516 and 7528 42nd Avenue North
(Former Electronic Industries Site)
Seller:
Redeveloper:
Redevelopment Property:
Purchase Price:
Earnest Money:
Title Review:
Due Diligence Period:
Closing:
"As Is" Condition:
Survey:
Redeveloper Contingencies:
The Economic Development Authority in and for the City of New
Hope, Minnesota
Frey Development, Inc. & Manley Land Development, collectively
the "Redeveloper". The Redeveloper's rights and obligations
under the purchase agreement cannot be assigned without prior
consent of the EDA.
3 parcels of land at the intersection of 42nd and Quebec Avenues, City
of New Hope, currently identified in the County tax records as:
17-118-21-22-0006
17-118-21-22-0007
17-118-21-22-0008
Collectively, the "Redevelopment Property"
$510,000
$2,000
EDA to pay for and provide a title insurance commitment within
ten (10) days of final execution of the purchase agreement.
Redeveloper will examine commitment and either make or waive
any title objections within ten (10) days of receipt.
120 days from final execution of Purchase Agreement
Within 15 calendar days after Redeveloper Contingencies have
been satisfied, but in no event later that 150 days from final
execution of the Purchase Agreement
Title to be conveyed by quitclaim deed in "as is" condition.
EDA to provide to Redeveloper, to be prepared in accordance with
minimum standard detail requirements for ALTA/ASCM and to
include information items as reasonably requested by Redeveloper
Redeveloper's obligation to purchase the Redevelopment Property
to be contingent upon:
a. Marketable title (subject to the attached list of Permitted
Encumbrances)
b. Approval for ingress and egress & direct access to a public street
c. Approval of any zoning, variance, special use permit,
subdivision or other governmental approvals reasonably
required for the above-referenced structures
d. Corporate approval from Viva Italia, if not akeady obtained
e. Financing pursuant to terms reasonably acceptable to Redeveloper
Construction:
Redeveloper to begin construction of an 8-unit office-condo
building on the eastern portion of the site no later than October 1,
2005 and to begin construction of a multi-tenant retail building
(approximately 8,500 to 9,000 square feet in size), on the westem
portion of the site by this same date. Both structures to be
completed no later than January 31, 2006.
Occupancy:
Approximately 5,000 to 6,000 square feet of the multi-tenant retail
building to be occupied by a Viva Italia restaurant. Redeveloper to
allow EDA input as to remainder of tenant mix.
Access & Parking:
Prior to closing the Redeveloper will provide cross easements in a
form reasonably acceptable to the EDA in order to facilitate
user/tenant access and parking throughout the Redevelopment
Property
Development Costs:
Redeveloper to pay all redevelopment costs associated with the
Redevelopment Property and to cooperate with EDA as to any
necessary State or federal approvals. All redevelopment costs
imposed by EDA and/or City of New Hope to be at customary rates.
Broker Fees:
Redeveloper to warrant that it will pay all brokerage fees due to
Retail Site Development Services (RSDS) with respect to the
Redevelopment Property and further that Redeveloper will
indemnify the EDA from claims by any other broker for activities
relating to the Redevelopment Property.
Effect of Term Sheet: This Term Sheet outlines the terms under which the parties are
willing to enter into a purchase agreement and does not constitute
an offer or acceptance on the part of either party. All rights and
obligations with respect to the Redevelopment Property shall be
only as provided for in a signed purchase agreement with terms
approved by the EDA's Board of Commissioners and by
appropriate representatives of the entities that comprise the
Redeveloper.
P:~AT'fORNEY\CMK\CLIENTS\CNFI~99-11293X99-11293-001-TERM SH~ET3.DOC
PERMITTED ENCUMBRANCES
1. Any real estate taxes not yet due and payable
Rights-of-way (if any) reasonably necessary for drainage ditches, drain tiles,
feeders, laterals and underground pipes
3. All dedicated rights-of way
All easements, restrictions, covenants and agreements which are currently
included in the public records, so long as the Buyer's intended use of the Property
is not materially impaired by such matters of record, provided that the Declaration
of Covenants dated November 23, 2003 and entered into by the EDA and the
Minnesota Pollution Control Agency shall not be considered to "materially
impair" the Redeveloper's intended use of the Property.