082806 EDA
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1. Call to order
2. Roll call
CITY OF NEW HOPE
EDA MEETING
City Hall, 4401 Xylon Avenue North
August 28,2006
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
3. Approval of regular meeting minutes of June 26, 2006
4. Resolution approving interim agreement with Delkar, LLC for the city-owned
parcels at 7601,7621, and 7641 62nd Avenue
5. Adjournment
EDA Minutes
Regular Meeting
CALL TO ORDER
ROLL CALL
APPROVE MINUTES
IMP. PROJECT 795
Item 4
EDA Meeting
Page 1
CITY OF NEW HOPE
4401 XYLON AVENUE NORTH
NEW HOPE, MINNESOTA 55428
June 26, 2006
Ci ty Hall
President Pro tem Sommer called the meeting of the Economic Development
Authority to order at 7:56 p.m.
Present:
Mary Gwin-Lenth, Commissioner
Andy Hoffe, Commissioner
Karen Nolte, Commissioner
Steve Sommer, Commissioner
Absent:
Martin Opem Sr., President
Staff Present:
Dan Donahue, City Manager
Carlos Espinosa, Community Development Intern
Curtis Jacobsen, Community Development Specialist
Valerie Leone, City Clerk
Steve Sondrall, City Attorney
Vince VanderTop, Assistant City Engineer
Motion was made by Commissioner Hoffe, seconded by Commissioner Nolte,
to approve the Regular Meeting Minutes of May 8 2006. Voting in favor:
Gwin-Lenth, Hoffe, Nolte, Sommer; Voting Against: None; Absent: Opem;
Abstained: None. Motion carried.
President Pro tem Sommer introduced for discussion Item 4, Resolution
approving and authorizing signing of the purchase and development
agreement betw"een Q Village, LLC and the Economic Development Authority
in and for the city of New Hope, Minnesota (improvement project no. 740).
Mr. Curtis Jacobsen, community development specialist, explained that the
city attorney has prepared the purchase and development agreement with
Quebec Properties, LLC. He noted the public hearing for the sale of the city-
owned property at 42nd and Quebec took place on June 13, 2005. He stated
upon execution of the agreement, the City will receive payment of $510,000
for the sale of the land.
Commissioner Gwin-Lenth inquired regarding the name of the developer.
Mr. Steve Sondrall, city attorney, indicated the name of the entity that is
purchasing the property is Quebec Properties, LLC. He commented that
Manley Development will remain involved with the project. He also noted the
closing is scheduled to take place on or before August 14, 2006.
June 26, 2006
EDA RESOLUTION
06-05
Item 4
ADJOURNMENT
EDA Meeting
Page 2
President Pro tern Sommer pointed out that the buyer will pay all brokerage
charges, will pay a one-time consulting fee of $30,000 for tenant marketing,
and in the event the buyer cannot locate an acceptable restaurant at the
property within one year, the City will receive an additional $15,000. He
noted the community survey revealed the residents would like a family-style
restaurant and the Council is striving to attain one.
The EDA expressed support for the project and approval of the agreement.
Commissioner Gwin-Lenth introduced the following resolution and moved
its adoption: "RESOLUTION APPROVING AND AUTHORIZING
SIGNING OF THE PURCHASE AND DEVELOPMENT AGREEMENT
BETWEEN Q VILLAGE, LLC AND THE ECONOMIC DEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF NEW HOPE, MINNESOTA
(IMPROVEMENT PROJECT NO. 740)." The motion for the adoption of the
foregoing resolution was seconded by Commissioner Nolte, and upon vote
being taken thereon, the following voted in favor thereof: Gwin-Lenth, Hoffe,
Nolte, Sommer; and the following voted against the same: None; Abstained:
None; Absent: Opem; whereupon the resolution was declared duly passed
and adopted, signed by the president which was attested to by the executive
director.
Motion was made by Commissioner Nolte, seconded by Commissioner Hoffe,
to adjourn the meeting. Voting in favor: Gwin-Lenth, Hoffe, Nolte, Sommer;
Voting Against: None; Absent: Opem; Abstained: None. Motion carried.
The New Hope EDA adjourned at 8:05 p.m.
Respectfully submitted,
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Valerie Leone
City Clerk
June 26, 2006
EDA
Request for Action
Originating Department
Approved for Agenda
Agenda Section
EDA
Community Development
August 28, 2006
Item No.
By: Kirk McDonald, Director CD
Curtis Jacobsen, CD Specialist
Kim Berggren, CD Assistant
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Resolution approving interim agreement with Delkar, LLC for the city-owned parcels at 7601, 7621, and 7641
62nd Avenue.
Requested Action
Staff requests that the Economic Development Authority (EDA) review the attached interim agreement,
which would authorize an exclusive negotiation period with Delkar, LLC for the redevelopment of the city-
owned vacant lots along 62nd A venue, as well as a cost sharing agreement. The current ovvner of the Swift
Gas Station, located at the corner of 62nd Avenue and West Broadway (6113 West Broadway), has requested
to incorporate the three vaqmt city-ovvned lots (7601, 7621, and 764162nd Avenue) into the redevelopment of
the gas station site.
Policy/Past Practice
Strategic goal number 3 in the 2006 City Plan is to encourage maintenance, redevelopment, and reinvestment
of existing properties to improve the tax base. The Comprehensive Plan, :Planning District No.2, says; "The
medium density housing located along 62nd Avenue, between Winnetka Avenue and West Broadway, has
been identified as a redevelopment target area. The poor building and site conditions associated with this
medium den$ity use are a negative influence on the low density neighborhood to the south. Aggressive area
redevelopment is suggested. Due to the limited site and configuration of the site, it is recommended that a
reduction in density from its present condition be made. Medium density residential land uses consisting of
twin homes or townhomes with attached garages would be an appropriate option."
Background
The city acquired the three properties in 1998, and land banked the properties with the intent of redeveloping
the site with medium density housing, possibly tovvnhomes. TI1e city has not actively pursued redevelopment
opportunities on the site due to the number of other redevelopment projects that have taken place in the city
over the ast several years.
Motion by
Second by
To:
I:\RFA\PLANNING\PLANNING\Q - 62nd Ave Swift Station-Anwar Karim-Interium agreement.doc
Request for Action, page 2 of 3
August 28, 2006
The Swift Gas Station, located adjacent to the city-ovvned parcels at the southwest corner of 62nd and West
Broadway (6113 West Broadway), was damaged in a 'smash and grab' robbery in May of this year and is
currently closed. The operator is not interested in continuing operation at the site and the ovmer is interested
in the possibility of redeveloping the site.
At the July 24, 2006, City Council meeting, a general concept proposal for a mixed-use development was
presented to the City Council and the redeveloper was present to provide comments. The Council indicated a
willingness to consider a proposal for the city's lots, and suggested that staff continue to work with the
redeveloper on an agreement for preliminary negotiations. Subsequent to the Council meeting, the city
manager and community development staff met with the redeveloper to discuss several concerns, including
the building height, the need for a market study, and the desire for a plan that includes additional properties
to the west along 62nd Avenue. In follow-up to that meeting, staff prepared a draft interim agreement, which
attempts to require the developer to address some of these issues through the planning process. At the
redeveloper's request, staff and the redeveloper met again on August 17 and August 22, 2006, to review
details of the interim agreement and make minor adjustments. At those meetings, staff discussed the city's
concern about the future success of retail in the 62nd A venue area, and suggested that the redeveloper
consider whether or not medium density housing, such as quality ovvner-occupied townhomes, would be
more appropriate for the site. The redeveloper expressed a general willingness to examine several options for
redevelopment of the site, iJ;lcluding townhomes.
At the August 22 meeting, the redeveloper indicated his support for the revised agreement (attached). The
interim agreement is similar to the agreements that were prepared for the redevelopment of the Bass Lake
Road Apartments site, but was drafted by staff without the assistance of Krass Monroe, the city's financial
consultant. The agreement includes the following items of note:
1. The redeveloper must complete a series of steps toward developing a complete proposal for the EDA's
consideration including:
a. Submit information about its qualifications and members of development team; and
b. Provide a timely market study; and
c. Develop a preliminary concept plan that includes the follmving properties: 7761,7741,7721,
7701,7661,7641,7621,7601 62nd Avenue and 6113 West Broadway. Indicate ability to acquire
included properties voluntarily; and
d. Demonstrate that elements of the proposed project, such as building height, materials,
landscaping and setbacks, are appropriate for the site, and that the site plan adequately
addresses parking, traffic circulation, and screening; and
e. Conduct any analysis it deems necessary of the environmental and geotechnical condition of
the site and the economic feasibility of the proposed redevelopment; and
f. Host a community open house; and
g. Submit a construction pro forma, review of market values and such other financial information.
Request for Action, page 3 of 3
August 28, 2006
2. The city and redeveloper would share the costs of the city's redevelopment/financial consultant, Krass
Monroe, with a budget not to exceed $5,000 ($2,500 each); and
3. The redeveloper must submit a $500 fee and $2,500 deposit for the negotiation period. The deposit is a
deviation from the city's standard $5,000 deposit requirement. The deposit amount is based on the
expected consultant expenses, which are capped at $2,500 for the redeveloper per the agreement.
4. If the development does not move forward, the city would receive copies of the market analysis and
soil and engineering reports; and
5. The agreement expires on December 15, 2006, or the city can terminate it if the redeveloper does not
meet the requirements and deadlines outlined in the agreement.
Funding
If authorized by the EDA, EDA funds would be used to cover costs described in the cost sharing section of the
interim agreement.
Recommendation/Next Steps
If the EDA continues to support the proposed redevelopment of the city-mvned parcels along 62nd A venue,
then staff recommends approval of the attached resolution approving an interim agreement with Delkar,
LLC. The EDA can certainly make adjustments to the attached interim agreement prior to adoption. Staff
believes that this agreement offers an opportunity for the city to study the possibility of redevelopment of the
city-owned parcels along 62nd A venue, without incurring significant expenses. If the EDA approves the
interim agreement, staff will continue to work with the redeveloper, per the agreed upon conditions and
timeline.
Attachment(s)
El Property information
o Map
o Summary table
.. Resolution
. Interim agreement
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City of New Hope
Resolution No. 2006-
Resolution approving interim agreement with Delkar, LLC for the city-owned parcels at 7601,
7621, and 7641 62nd Avenue.
WHEREAS, the 62nd Avenue Redevelopment site (the "Site") consists of approximately 0.86
acres of land with three tax parcels at 7601,7621, and 7641 62nd Avenue North.
The site is vacant land owned by the city of New Hope; and
WHEREAS, the Economic Development Authority of the city of New Hope (the" Authority")
desires for the vacant site to be developed as market-rate for-sale housing or
mixed use development; and
WHEREAS, Delkar, LLC (the "Redeveloper") is proposing to include the site in the
redevelopment of 6113 West Broadway (the "Project") and has requested that
the Authority negotiate exclusively with the Redeveloper while the Project is
being studied; and
WHEREAS, an Interim Agreement (the "Agreement") was drafted, which outlines
respo'nsibilities, cost sharing arrangements, and associated deadlines related to
an exclusive negotiation period benveen the Authority and the Redeveloper;
and
WHEREAS, the Authority is willing to negotiate exclusively with the Redeveloper until
December 15, 2006, provided that deadlines for certain milestones described in
the Agreement are met.
NOW, THEREFORE, BE IT RESOLVED, by the Economic Development Authority of the city of
New Hope, Minnesota, that the Economic Development Authority approves the
Interim Agreement (Attachment A) \vith Delkar, LLC, for the redevelopment of
the city owned parcels at 7601,7621, and 764162nd Avenue North.
Adopted by the Economic Development Authority, of the city of New Hope, Hennepin County,
Minnesota, this 28th day of August, 2006.
President
Attest:
Executive Director
Attachment A
INTERIM AGREEMENT
This INTERIM AGREEMENT entered into effective the _ day of , 2006
by and between the Economic Development Authority in and for the City of New Hope,
Minnesota, a Minnesota public body corporate and politic (the "Authority") and Delkar, LLC
(the "Redeveloper").
WHEREAS, The 62nd Avenue Redevelopment site (the "Site") consists of approximately
0.86 acres ofland with three tax parcels at 7601, 7621, and 7641 62nd Avenue North. The Site is
vacant land owned by the city of New Hope.
WHEREAS, the Authority desires for the vacant Site to be developed as market-rate for-
sale housing or mixed use development.
WHEREAS, the Redeveloper is proposing to include the Site in the redevelopment of
6113 West Broadway Avenue (the "Project") and has requested that the Authority negotiate
exclusively with the Redeveloper while the Project is being studied.
WHEREAS, the Authority is willing to negotiate exclusively with the Redeveloper until
December 15,2006, provided that deadlines for certain milestones described below are met.
NOW, THEREFORE, in consideration of the premises and mutual obligations of the
parties contained herein, each of them does hereby agree as follows:
1. Interim Nature of Agreement. The Authority and the Redeveloper agree that this
Agreement is intended to be preliminary in nature. Before the Authority and the Redeveloper
can make a decision on whether to proceed with the Project, it will be necessary to assemble and
consider information relating to the economics, site assembly, phasing, environmental
remediation and other aspects of the Project. The purpose of this Agreement is to allow the
Redeveloper an opportunity to assemble such infomlation, to prepare a preliminary concept plan
and to negotiate with the Authority concerning the approval of a term sheet (the "Term Sheet")
with a view to eventual execution of a contract for private redevelopment (the "Redevelopment
Agreement") which will set forth the rights and responsibilities of the Authority and the
Redeveloper with respect to the Project.
2. Undertakings of the Redeveloper.
(a) By October 16, 2006, the Redeveloper will complete the following:
· Submit to the city information about its qualifications and
documentation showing examples of involvement in other similar
redevelopment projects; and
· Identify members of development team including the architect,
engineer, and builder; and
II Provide a timely market study related to the proposed housing, retail,
and/or office products; and
II In consultation with the Authority, the City, and City residents,
develop a preliminary concept plan that includes the following
properties: 776l, 7741, 7721, 7701, 7661, 7641, 7621, 7601 62nd
Avenue and 6113 West Broadway. Indicate ability to acquire included
properties voluntarily; and
II Demonstrate that elements of the proposed proj ect, such as building
heights, materials, landscaping and setbacks, are appropriate for the
site, and that the site plan adequately addresses parking, traffic
circulation, and screening; and
II The Redeveloper, at its own expense, shall conduct any analysis it
deems necessary of the environmental and geotechnical condition of
the Site and the economic feasibility of the proposed redevelopment.
(b) By November 20, 2006 the Redeveloper shall:
II Host a community open house to present proj ect plans and solicit
feedback from the neighborhood; and
B Submit a construction pro forma, review of market values and such
other financial information as the Authority may request in order to
assess the feasibility of the project and detennine the price to be paid
by the Redeveloper to the Authority for the land.
(c) By December 15, 2006 the Redeveloper shall:
EI Obtain Authority approval of a term sheet or letter of intent.
(d) During the term of this agreement, the redeveloper shall also:
II Present monthly progress reports to City Council, if requested; and
II If the Redeveloper determines that the Site is not economically
feasible to develop, the Redeveloper shall deliver to the Authority for
its unrestricted use at no cost to the Authority all work product, market
analysis, architectural and engineering reports, construction budget,
research materials and other documentation produced for the Site.
3. Undertakings of the Authority.
(a) The Authority agrees to cooperate with the Redeveloper in the
Redeveloper's undertakings, and agrees that during the term of tIllS Agreement
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the Authority will not negotiate with any third party III connection with
redevelopment of the site.
(b) The Authority will take the following actions:
· By November 20, 2006, determine the Authority's and the City's
willingness to amend its comprehensive plan and zoning to
accommodate the proposed project, if necessary; and
· Through December 15, 2006, negotiate the Term Sheet with the
Redeveloper.
4. Responsibility for Costs and Redeveloper Deposit.
(a) During the term ofthis agreement, the Authority and the Redeveloper
agree to split equally fees incurred by the Authority's redevelopment
Council, Krass Monroe. The budget for these costs is not to exceed
$5,000. lfthe Authority and the Redeveloper agree, the budget for these
costs can be increased with an addendum to this Agreement.
(b) The city shall be responsible for the fees and costs of city consultants as a
result of this agreement including the city engineer, Bonestroo Rosene
Anderlik & Associates; the city attorney, Jensen & Sondrall, P.A.; and the
city planner, Northwest Associated Consultants.
(c) The Redeveloper shall be responsible for:
(1) fees and costs of its counsel and consultants such as financial,
engineering, and architectural services; and
(2) the cost of any predevelopment activities such as environmental
analyses, soil borings, market studies, or surveys performed by the
Redeveloper.
(d) Upon execution of this Agreement, the Redeveloper shall pay a non-
refundable fee of $500.00 to the Authority. The Redeveloper shall also make an initial deposit of
$2,500.00 to be applied by the Authority to reimburse costs and fees incurred by the Authority
for which the Redeveloper is responsible under this Paragraph 4. The Redeveloper shall
replenish this deposit when the balance falls below $500.00 upon request by the Authority.
(e) In accordance with City policy, the Redeveloper will pay all normal and
customary City fees associated with the plan review and approval process.
5. Term of Agreement. This Agreement for exclusive negotiations shall be binding
upon the parties until December 15, 2006, unless terminated sooner by the Authority for the
Redeveloper's failure to timely comply with any of the deadlines set forth in this agreement or
by mutual agreement of the parties.
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6. Citv and Authoritv Use of Work Product. If the Redeveloper decides not to
proceed with redevelopment of the Site, the Redeveloper shall make the market analyses and soil
and engineering reports available at no cost to the City and the Authority for their unrestricted
use.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed in
each of their names as of the date first above written.
(signature pages follow)
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ECONOMIC DEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF NEW HOPE, MINNESOTA
By:
President
By:
Executive Director
Authority Signature Page - Interim Agreement
5
Delkar, LLC
By:
Its:
Redeveloper Signature Page - Interim Agreement
6