IP #811PROJECT NO. 811
7601, 7621, and 7641 62nd Avenue North
EDA Item 4 10/23/06 Update regarding the potential redevelopment of the city -owned parcels at 7601, 7621,
and 7641 62nd Avenue North (improvement project no. 811)
EDA Item 4 12/11/06 Update regarding the potential redevelopment of the city -owned parcels at 7601, 7621,
and 7641 62nd Avenue North and motion approving First Amendment to Interim
Agreement (improvement project no. 811)
EDA Item 4 01/08/07 Update regarding the Northgate market study and possible involvement/participation in
the project by Northwest Community Revitalization Corporation (NCRC) (improvement
project no. 811). EDA requested review of revised site plan prior to expending city funds
for financial analysis by Krass Monroe.
EDA Item 4 2/12/07 Update regarding the Northgate project, its financial feasibility and request to terminate
interim agreement (improvement project no. 811). Terminate agreement
o ,
IL
HL 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
B y; '
4
Kim Berggren, CD Assistant
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 Avenue, as well as a cost sharing agreement. The current owner of the Swift
Gas Station, located at the corner of 62nd Avenue and West Broadway (6113 West Broadway), has requested
to incorporate the three vacant city -owned lots (7601, 7621, and 7641 62nd 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 density 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 townhomes. The 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 past several years.
Motion by Second by w
To: / Ji
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 -owned 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 owner 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 Avenue area, and suggested that the redeveloper
consider whether or not medium density housing, such as quality owner- occupied townhomes, would be
more appropriate for the site. The redeveloper expressed a general willingness to examine several options for
redevelopment of the site, including 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 following 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 -owned parcels along 62nd Avenue,
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 Avenue, 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)
Property information
• Map
• Summary table
Resolution
0 Interim agreement
City of New Hope
EDA Resolution No. 2006 -06
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
responsibilities, cost sharing arrangements, and associated deadlines related to
an exclusive negotiation period between 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 Econoric Development Authority approves the
Interim Agreement (Attachment A) with Delkar, LLC, for the redevelopment of
the city owned parcels at 7601, 7621, and 7641 62nd Avenue North.
Adopted by the Economic Development Authority, of the city of New Hope, Hennepin County,
Minnesota, this 28th day of August, 2006.
.Attest:
Executive Director
1 4 res4dent J
Attachment A
INTERIM AGREEMENT
This INTERIM AGREEMENT entered into effective the O day of ZZ , 2006
by and between the Economic Development Authority in and for the City o New Hope,
Minnesota, a Minnesota public body corporate and politic (the "Authority ") and Delkar, LLC
(the "Redeveloper ").
WHEREAS, The 62 Avenue Redevelopment site (the "Site ") consists of approximately
0.86 acres of land with three tax parcels at 7601, 7621, and 764162 nd 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 information, 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
■ Provide a timely market study related to the proposed housing, retail,
and/or office products; and
■ In consultation with the Authority, the City, and City residents,
develop a preliminary concept plan that includes the following
properties: 7761, 7741, 7721, 7701, 7661, 7641, 7621, 7601 62"
Avenue and 6113 West Broadway. Indicate ability to acquire included
properties voluntarily; and
■ Demonstrate that elements of the proposed project, 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
■ 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:
■ Host a community open house to present project plans and solicit
feedback from the neighborhood; and
■ 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 determine the price to be paid
by the Redeveloper to the Authority for the land.
(c) By December 15, 2006 the Redeveloper shall:
■ Obtain Authority approval of a term sheet or letter of intent.
(d) During the term of this agreement, the redeveloper shall also:
■ Present monthly progress reports to City Council, if requested; and
■ 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 this Agreement
2
the Authority will not negotiate with any third party in 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 of this 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. If the 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.
3
6. City and Authority 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 WBEREOF, 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)
0
ECONOMIC DEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF NEW HOPE, MINNESOTA
Authority Signature Page — Interim Agreement
Delcari, LLC
By:
Its: i ' C
Redeveloper Signature Page — Interim Agreement
Q 62.5 125 250 Feet
=0
62nd Avenue Properties
Last sale
Property
Acres
Est. Land
Value
Est. Building
Value
Total Market
Value
Year
built
Owner
Date
Price
6113 West Broadway
0.53
225,000
75,000
300,000
1969
AAK Inc
Jun -99
285,000
7601 62nd Ave N
0.28
vacant
city of New Hope
May -98
140,000
7621 62nd Ave N
0.29
vacant
city of New Hope
Jan-981
118,900
7641 62nd Ave N
0.29
vacant
city of New Hope
May -98
111,000
7661 62nd Ave N
0.29
100,000
262,000
362,000
1961
TODD N HANDELAND
Jan -96
119,000
7701 62nd Ave N
0.36
126,000
226,000
352,000
1962
ROSS G TAORMINA
May -01
1,070,000
7721 62nd Ave N
0.36
126,000
226,000
352,000
1962
ROSS G TAORMINA
Feb -84
181,250
7741 62nd Ave N
0.34
126,000
226,000
352,000
1962
ROSS G TAORMINA
Feb -84
181,250
7761 62nd Ave N
0.39
126,000
226,000
352,000
1962
ROSS G TAORMINA
Feb -84
181,250
6108 62nd Ave N
1 0.431
10,000
1 86,000
1 96,000
1977
UYET DO
Jul -05
264,500
TOTAL
1 3.551
EDA
Originating Department
Community Development
Approved for Agenda
December 11, 2006
Agenda Section
EDA
Item No.
By: Kirk McDonald, Director CD
Curtis Jacobsen, CD Specialist I By:
Kim Berai4ren, CD Assistant
4
Update regarding the potential redevelopment of the city -owned parcels at 7601, 7621, and 7641 62nd Avenue
and motion approving First Amendment to Interim Agreement (Improvement Project No. 811)
Requested Action
Staff requests to update the Economic Development Authority- (EDA) on the developer's progress related to
the proposed redevelopment of the city -owned parcels at 7601, 7621, and 7641 62nd Avenue and recommends
approval of a motion approving the First Amendment to Interim Agreement. Per the interim agreement
adopted on August 28, 2006, the current owner of the Swift Gas Station, located at the corner of 62nd Avenue
and Nest Broadway (6113 West Broadway), is working on plans to incorporate the three vacant city -owned
lots and the five properties to the west of the city -owned lots 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.
Background
At the October 23, 2006, Economic Development Authority (EDA) meeting an update on the project was given
and the EDA generally supported the continuing effort by the developer and the city staff to work through
the items in the interim agreement with Delkar, LLC, for the redevelopment of the city -owned vacant lots
along 62nd Avenue, and to amend the interim agreement and timeline accordingly. Staff has continued to
work with the redeveloper on the proposed project.
The project intent is to redevelop the area from 6113 West Broadway to 7761 62nd Avenue into a townhome
project. The EDA directed the developer to include the El Dorado Apartments and the additional 4 -plex in the
ect area.
Motion by yt �� I Second by
FRO
1 I:\RFA \PLANNING \PLANNING \Q - 62nd Ave Swift Station -Anwar Karim - update Dec 11 .doc
Request for Action, Page 2 of 2
December 11, 2006
Per the EDA meeting on October 23, 2006, the developer has been asked to obtain a professional market study
and to work toward agreement with the owner of El Dorado Apartments on the sale of that property and also
the adjacent 4 -plex.
The developer has met with two marketing firms. The developer has reached agreement with the McComb
Group, Ltd. to conduct a site specific market study for the site on 62nd Avenue, The McComb Group has told
the developer that they would have a completed market study by December 15, 2006.
The developer has continued to meet with the owner of El Dorado Apartments and the owner of the four -plex
regarding acquisition of their property and both have expressed a willingness to sell their property if offered
a fair price. Both of the rental property owners are currently experiencing vacancies at unacceptable levels.
Therefore, while some of the steps outlined in the agreement that are required of the developer are taking
longer than anticipated to accomplish, the developer is following through on their commitments and staff
recommends that the city continue to work with the developer.
Recommendation /Next Steps
As described in the amended interim agreement, by April 15, 2007, the Redeveloper is to complete the
following:
1. By December 15, 2006, the Redeveloper will complete the following:
• Provide a current site specific market study related to the proposed housing products; and
2. By February 15, 2007, the Redeveloper shall:
■ Indicate ability to acquire additional properties voluntarily; and
■ 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
determine the price to be paid by the Redeveloper to the Authority for the land.
3. By March 15, 2007, the Redeveloper shall:
• Complete financial analysis with Krass Monroe and Authority
4. By April 15, 2007, the Redeveloper shall:
• Host a community open house to present project plans and solicit feedback from the
neighborhood; and
■ Obtain Authority approval of a term sheet or letter of intent.
5. During the term of this agreement, the redeveloper shall also:
Request for Action, Page 3 of 2
December 11, 2006
■ Present monthly progress reports to EDA, if requested; and
■ 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.
Undertakings of the Authority
1. The Authority agrees to cooperate with the Redeveloper in the Redeveloper's undertakings, and
agrees that during the term of this Agreement the Authority will not negotiate with any third
party in connection with redevelopment of the site.
2. The Authority will take the following actions:
• By March 15, 2007, 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 April 15, 2007, negotiate the Term Sheet with the Redeveloper.
Summary
No funds have yet been expended with Krass Monroe on a financial analysis. It is staffs intent that the
following EDA updates would be presented the first part of 2007:
• February EDA meeting — present results of market study and discuss agreements with
property owners.
• April EDA meeting — present results of financial feasibility.
• May EDA meeting — present results of community open house.
Attachment(s)
• Interim agreement
o Addendum /amended timeline
• Engagement Letter McComb Group, Ltd.
• Map
• Proposed site plan
First Amendment
INTERIM AGREEMENT
This INTERIM AGREEMENT first entered into and effective the 28th day of August,
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 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.
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 w =hile the Project is being studied.
WHEREAS, the Authority at the October 23, 2006, EDA meeting was generally
supportive of the concept presented by the Redeveloper and directed that staff update the
Authority in December and amend the current agreement and timeline; and
WHEREAS, the Authority is willing to negotiate exclusively with the Redeveloper until
May 15, 2007, provided that amended 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 information, 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
G: \CommDev \Curtis \Misc Housing \ amended Interim Agree for city owned parcels at 62nd Ave.doc
(a) By December 15, 2006, the Redeveloper will complete the following:
■ Provide a current site specific market study related to the proposed
housing products; and
(b) By February 15, 2007, the Redeveloper shall:
• Indicate ability to acquire additional properties voluntarily; and
• 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 determine the price to be paid
by the Redeveloper to the Authority for the land.
(c) By March 15, 2007, the Redeveloper shall:
■ Complete financial analysis with Krass Monroe and Authority.
(d) By April 15, 2007, the Redeveloper shall:
■ Host a community open house to present project plans and solicit
feedback from the neighborhood; and
■ Obtain Authority approval of a term sheet or letter of intent.
(e) During the term of this agreement, the redeveloper shall also:
• Present monthly progress reports to City Council, if requested; and
■ 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 this Agreement
the Authority will not negotiate with any third party in connection with
redevelopment of the site.
(b) The Authority will take the following actions:
G: \CommDe -,- \Curtis \Misc Housing \amended Interim AZree for city owned parcels at 62nd Ave.doc
• By March 15, 2007, 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 April 15, 2007, negotiate the Term Sheet with the
Redeveloper.
4. Responsibility for Costs and Redeveloper Deposit
(a) During the term of this 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.
If the 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.
6. City and Authority 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.
G:\CommDev\ Curtis \ Misc Housing \ amended Interim Agee for city owned parcels at 62nd Ave.doc
ECONOMIC DEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF NEW HOPE, MINNESOTA
By:
President
By:
Executive Director
Delkar, LLC
By:
Its:
Date:
Date:
(Date of Amendment)
(Date of Amendment)
G: \CommDev \Curtis \Misc Housing \ amended Interim Agree for city owned parcels at 62nd Ave.doc
November 28, 2006
Mr. Anwar Abdel -Karim
5400 Matterhorn Drive
Fridley, Minnesota 55432
Dear Mr. Abdel- Karim:
In response to a request from Frank Drake, we have prepared an engagement letter to conduct
market research for a 36 -unit townhouse development at 62 and West Broadw=ay in New Hope,
Minnesota.
WORK PROGRAM
The work program described below contains descriptions of the work tasks to determine market
potential for townhomes at the proposed site. Specific work tasks include:
♦ Site Evaluation
The proposed development site will be inspected to evaluate its physical characteristics
and suitability for residential development. Factors to be considered include, but are not
limited to: location, size, physical characteristics, and relationship to other uses in the
area.
♦ Market Area
The market area for the proposed townhome development will be identified. The market
area will be determined based on community size, geography, and McComb Group
experience. Demographic characteristics and trends in the market area will be analyzed
to determine housing demand including population, household growth, household
income, building permits, and other factors that support housing demand.
♦ Residential Homes Sales
Residential homes sales in the market area will be evaluated including average and
median sales prices, number of units sold, and other pertinent data.
The results of our work will be documented in a final report designed to meet client needs. The
report will contain appropriate graphics, tabular information, and summary of principal findings,
conclusions and recommendations.
Mr. Anwar Abdel -Karim
November 28, 2006
Page 2
QUALIFICATIONS AND EXPERIENCE
McComb Group, Ltd. is a full- service retail and real estate consulting firm specializing in market
research and financial feasibility. The firm has extensive experience in the retail industry and
has conducted market research for retail stores and shopping centers of all types including
regional malls, community centers and specialty centers.
McComb Group, Ltd. has a team that is qualified to conduct the research described in this
proposal. McComb Group's professional staff associated with this engagement includes the
following:
♦ James B. McComb, President, founded the predecessor of McComb Group in 1974
following six years as a member of the corporate staff with Dayton Hudson Corporation.
His experiences at Dayton Hudson and daily association with merchants and shopping
center developers provided the impetus for McComb Group's approach to shopping
center and retail market research and financial feasibility, which includes strong elements
of design and merchandise sensitivities. The firm's approach to shopping center research
and marketing has undergone continuous development and refinement over the past 20
years.
♦ William A. Gorton, Executive Associate, has over 25 years experience developing
supermarkets and retail shopping centers, representing supermarket chains as well as
prominent independent supermarket owners. Mr. Gorton provides advice and assistance
related to real estate development, leasing and contract negotiations, business
acquisitions, project management, sales forecasting, site evaluation and market analysis,
financing, capital planning, financial forecasting, business planning, strategy
development, business development and the marketing of programs and services.
Mr. Gorton has provided these services while employed by Fairway Foods, Inc.,
subsidiary of Holiday Stationstores, Inc.; Kohl's Food Stores, Inc., subsidiary of the
Great Atlantic & Pacific Tea Company; SuperValu, Inc.; Loblaw's, Inc.; and Stearns
Bank N.A. St. Cloud, MN. He received a JD from William Mitchell College of Law and
is a member of the Minnesota State Bar Association.
♦ Linda Oie, Senior Associate, conducts market research, demographic and consumer
analysis for client engagements. Ms. Oie manages the firm's geographic information
systems (GIS) and demographic databases using a variety of computer platforms and
proprietary software.
Prior to joining McComb Group, Ms. Oie was employed as Marketplace Information
Manager at SuperValu, Inc. Her responsibilities included conducting strategic consumer -
based analysis of existing and prospective supermarkets, profiling SuperValu customers,
and delineating trade areas for existing and proposed stores.
♦ Susan Nache, Consultant, performs market research, demographic analysis, and
Mr. Anwar Abdel -Karim
November 28, 2006
Page 3
consumer research tasks. Ms. Nache conducts consumer research analysis and cross -
tabulation on McComb Group's survey processing software; and is familiar with software
programs used by McComb Group for financial feasibility and statistical analysis.
Mr. McComb will be responsible for managing and directing the overall research program and
will participate directly in findings and conclusions. Individual work tasks will be assigned to
personnel within the firm based on qualifications and experience.
1
The professional fees for the services and expenses outlined in this proposal total $3,800 and will
be performed at a price not -to- exceed that amount. The budget is based on the amount of time
required to perform the work tasks and our normal hourly billing rates of $250 for principals,
$190 for executive associates, $150 for senior associates, $100 for associates, and $75 -$100 for
consultants.
Company policy requires a retainer of approximately one half the estimated budget for the
project or $1,900. The retainer will be applied to the final invoice as a credit for billing of
professional services and expenses. The remaining $1,900 will be due upon delivery of the final
report.
Standard billing terms are net ten days. A finance charge of 1.5 percent will be charged on all
unpaid balances outstanding more than 30 days.
This proposal was prepared with the understanding that the results of our work will be submitted
to the City of New Hope in support of its development application. Our report will be prepared
for that purpose and will be subject to the following qualifications:
♦ Our analysis will not ascertain the legal and regulatory requirements applicable to this
project, including zoning, other state and local government regulations, permits and
licenses. No effort will be made to determine the possible effect on the proposed project
of present or future federal, state or local legislation, or any environmental or ecological
matters.
♦ Our report and analysis will be based on estimates, assumptions and other information
developed from research of the market, knowledge of the industry and discussions with
the client. Some assumptions inevitably will not materialize and unanticipated events
and circumstances may occur; therefore, actual results achieved will vary from the
analysis.
♦ Our analysis will not evaluate management's effectiveness or be responsible for future
marketing efforts and other management actions upon which actual results are dependent.
♦ Our report will be intended solely for the purpose described above and should not be used
for any other purpose without our prior written permission. Permission for other use of
the report will be granted only upon meeting company standards for the proposed use.
Mr. Anwar Abdel -Karim
November 28, 2006
Page 4
These qualifications will be included in our final report. If the report is used for purposes other
than specified above, we reserve the right to review the materials for proper use of our work.
ACCEPTANCE PROCEDURES
To indicate acceptance of the proposal, please sign a copy of the proposal and return it to us
together with your check for the retainer as authorization to proceed with this engagement.
We appreciate the opportunity to submit this proposal and look forward to hearing from you
soon. If you have any questions concerning the proposal, please call me at (612) 339 -7000.
Accepted By: McComb Group, Ltd.
Company:
Title:
James B. McComb
Date: President
Page I of I
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6073 QUEBEC AVE N NEW HOPE, MN 55428 $214,000 $2,739.34
'FhP data contained on this page is derived frcwn a compilation ,if records and maps and may contain discrepancies that can orily
be dlsc.fosecl by an accurate sur'vey performied by a iicersed lano surveyor. The perimeter and area (square footage and acres)
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Hz. nepin Couma.y does not gUararit:ee the accuracy of matenal herein contained and is not responsible for any inisuse or
rni represcntahon of this inforrnaUon or its derivatives.
http://wwwl 3.co.hennepin.mn.us/publicparcelimage/Print.aspx?CMD=INIT&IMAGELJRL=http://wAw1 12/5/2006
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December 13, 2006
Anwar Karim
5400 Matterhorn Dr.
Fridley, MN 55432
Dear Anwar Karim:
Subject: Interim Agreement for 62 Avenue North
As you. are aware, at its December 11, 2006 meeting, the New Hope Economic
Development Authority (EDA) approved the amended interim agreement for an
exclusive negotiation period related to the proposed redevelopment of the city-owned
parcels at 7601., 7621, and 7641 62nd Avenue North. The amended interim agreement
has incorporated numerous changes to the timelines for the project.
As you know, the first deadline in the amended interim agreement is December 15,
2006. Enclosed for your signature are two copies of the amended interim. agreement. If
staff can assist you in, any way, please contact Kim Berg-ren at 763-531-5196 or I can be
reached at 763-531-513
Sincerely,
Curtis Jacobsen
Copnmuni 'L� Developn-,ent Special L
Kirk McDonald
Community Development Director
Enclosure
cc: Valerie Leone, project file
Frank Drake
4401 Xvlon,Avenue North * New Hope, Minnesota 55428-4898� wwN'V. ci.new-hope.mn.us
City Hall: 763-531-5100 t Police (non-emergency): 763-531-5170 t Public Works: 763-592-6777 TDID: 763-531-5109
..it Hall Fax: 763- 36 - Police Fa,,,: 7"3- 531 -5174 * Public NA,`orks IF?: 763-592-6776