020821 EDA Meeting Packet
EDA MEETING
City Hall, 4401 Xylon Avenue North
Monday, February 8, 2021
President Kathi Hemken
Commissioner John Elder
Commissioner Andy Hoffe
Commissioner Michael Isenberg
Commissioner Jonathan London
1. Call to order – EDA Meeting of February 8, 2021
2. Roll call
3. Approval of Minutes:
January 11, 2021
4. Resolution approving Purchase Agreement for the acquisition of 3611 Louisiana
Avenue North (improvement project no. 1065)
5. Adjournment
EDA Meeting
Page 1 January 11, 2021
City of New Hope
4401 Xylon Avenue North
New Hope, Minnesota 55428
EDA Minutes January 11, 2021
Regular Meeting City Hall
CALL TO ORDER President Hemken called the meeting of the Economic Development Authority to
order at 8:08 p.m.
ROLL CALL Present:
Kathi Hemken, President
John Elder, Commissioner
Andy Hoffe, Commissioner
Michael Isenberg, Commissioner
Jonathan London, Commissioner
Staff Present:
Kirk McDonald, City Manager
Jeff Alger, Community Development Specialist
Valerie Leone, City Clerk
Jeff Sargent, Director of Community Development
Stacy Woods, Assistant City Attorney
APPROVAL OF
MINUTES
Item 3
Motion was made by Commissioner London, seconded by Commissioner Elder,
to approve the minutes of December 14, 2020. All present voted in favor. Motion
carried.
HOME ENERGY
SQUAD VISITS
Item 4
President Hemken introduced for discussion EDA Item 4, Resolution approving
agreement with Center for Energy and Environment to perform Home Energy
Squad visits in the city of New Hope through December 31, 2023.
Mr. Jeff Sergant, community development department, recommended the EDA
approve an agreement with the Center for Energy and Environment to continue
the Home Energy Squad Visits program through December 31, 2023 with costs not
to exceed $3,000 per year without further authorization. He explained the EDA
initially authorized the program in January of 2013 and since that time, 302
residents have taken advantage of the program. CEE performs visits to help
homeowners identify and implement energy savings opportunities in their
homes, and the program includes the direct install of energy saving materials. The
city buys down the cost of the visits. There are two types of programs offered:
Energy Planner Visit which is intended for homes constructed prior to 2000 and
Energy Saver Visits which is intended for homes constructed after 2000. The city
pays $50 and resident pays $50 for the energy planner visit; and the city pays $35
and resident pays $35 for the energy saver visit. Since 2013 the EDA has spent an
average of $1,887.50 per year on the program. Mr. Sargent stated funds are
available in the EDA budget for the program.
Commissioner Isenberg inquired whether the visits are being conducted during
the pandemic.
EDA Meeting
Page 2 January 11, 2021
Mr. Jeff Alger, community development specialist, indicated CEE is conducting
virtual visits for no charge. He stated this is the first step of determining whether
an on site visit is warranted and if so, the visit is performed in a safe manner.
President Hemken noted the program is a good value for homeowners.
Commissioner London recommended the city promote the program through
social media.
RESOLUTION 2021‐01
Item 4
Commissioner London introduced the following resolution and moved its
adoption “RESOLUTION APPROVING AGREEMENT WITH CENTER FOR
ENERGY AND ENVIRONMENT TO PERFORM HOME ENERGY SQUAD
VISITS IN THE CITY OF NEW HOPE THROUGH DECEMBER 31, 2023.” The
motion for the adoption of the foregoing resolution was seconded by
Commissioner Elder, and upon vote being taken thereon, the following voted in
favor thereof: Hemken, Elder, Hoffe, Isenberg, London; and the following voted
against the same: None; Abstained: None; Absent: None; whereupon the
resolution was declared duly passed and adopted, signed by the president which
was attested to by the executive director.
5213 PENNSYLVANIA
AVE N
(IMPROVEMENT
PROJECT NO. 1062)
Item 5
President Hemken introduced for discussion EDA Item 4, Resolution approving
Purchase Agreement for the acquisition of 5213 Pennsylvania Avenue North
(improvement project no. 1062).
Mr. Jeff Alger, community development specialist, stated the EDA has the
opportunity to purchase the property at 5213 Pennsylvania Avenue North for
$170,000. He stated the property is located in a priority redevelopment
neighborhood and is one of the lowest valued single‐family homes in the city. The
2020 assessed value of the property is $168,000, and the appraisal came in at
$175,000. The home was constructed in 1962 on a concrete slab and has 935 square
feet of living area. Staff believes the property is a good candidate for a demolition
and rebuild project. A new single‐family home at the site could have a 2022 taxable
value of $420,000. It is anticipated that the net loss on the project would be $132,779
based on project expenses of $199,779 less $67,000 for revenue on the sale of the
lot. Mr. Alger stated funding is available in the EDA budget.
Commissioner London commented on the rate of return and inquired of factors
needed for a project to be budget neutral. Commissioner London noted the
benefits to the city if contractors took the initiative to purchase distressed
properties without the city’s involvement.
Mr. Alger reminded the EDA of the goals of the scattered site housing program.
He indicated he could prepare scenarios and factors that would be required to
make a project budget neutral. Mr. McDonald suggested additional review at a
future work session during a broader discussion about funding for the scattered
site housing program.
RESOLUTION 2021‐02
Item 5
Commissioner London introduced the following resolution and moved its
adoption “RESOLUTION APPROVING PURCHASE AGREEMENT FOR THE
ACQUISITION OF 5213 PENNSYLVANIA AVENUE NORTH
(IMPROVEMENT PROJECT NO. 1062).” The motion for the adoption of the
EDA Meeting
Page 3 January 11, 2021
foregoing resolution was seconded by Commissioner Elder, and upon vote being
taken thereon, the following voted in favor thereof: Hemken, Elder, Hoffe,
Isenberg, London; and the following voted against the same: None; Abstained:
None; Absent: None; whereupon the resolution was declared duly passed and
adopted, signed by the president which was attested to by the executive director.
ADJOURNMENT Motion was made by Commissioner Isenberg, seconded by Commissioner Elder,
to adjourn the meeting. All present voted in favor. Motion carried. The New Hope
EDA adjourned at 8:31 p.m.
Respectfully submitted,
Valerie Leone, City Clerk
I:\RFA\COMM DEV\2021\EDA\EDA4 Q ‐ 3611 Louisiana Ave N Acquisition 02‐08‐21.docx
Request for Action
February 8, 2021
Approved by: Kirk McDonald, City Manager
Originating Department: Community Development
By: Jeff Alger, Community Development Specialist;
Jeff Sargent, Director of Community Development
Agenda Title
Resolution approving Purchase Agreement for the acquisition of 3611 Louisiana Avenue North (improvement
project no. 1065)
Requested Action
Staff requests that the Economic Development Authority authorize entering into a Purchase Agreement for the
acquisition of 3611 Louisiana Avenue North for a purchase price of $170,000 with closing costs to be paid by
the EDA.
Policy/Past Practice
The Economic Development Authority has acquired vacant and distressed properties in the past as part of the
city’s scattered site housing program. Goals of the scattered site housing program include removing distressed
and/or blighted properties, providing step‐up housing options in the city, improving the city’s overall housing
stock, investing and instilling confidence into neighborhoods, and increasing home and land values.
Background
The Economic Development Authority (EDA) has directed community development staff to pursue the
acquisition of distressed and functionally obsolete single‐family homes as part of the city’s scattered site
housing program. The property at 3611 Louisiana Avenue North is one of the lowest valued single‐family
homes in the city. The 2020 assessed value of the property was $174,000, according to Hennepin County. This
is lower than approximately 98% of single‐family homes in the city. The existing home is believed to have
been constructed in the 1940s. It has 1,553 square feet of finished above ground space, two bedrooms on the
main level, and an upstairs bedroom with limited clearance due to the height of the ceiling. There is a single‐
stall tuck under garage. The 0.29‐acre parcel is zoned R‐1, Single‐family Residential. The lot is 94 feet wide in
the front yard, decreasing to 30 feet wide in the rear yard. The north side yard is 196 feet long and the south
side yard is 215 feet long. The lot abuts multifamily properties to the south and west and single‐family homes
to the north and east. The property at 3751 Louisiana Avenue North, nine houses to the north of the subject
parcel, was a scattered site demolition and rebuild project that was completed in 2017. Staff believes the
property at 3611 Louisiana Avenue North is a good candidate for a demolition and rebuild project.
After the property owner expressed interest in selling to the EDA, an appraisal was completed on January 21,
2021. The appraisal estimated the value of the property at $170,000. The property owner has agreed to sell the
home for $170,000, with closing costs to be paid by the city, contingent upon approval by the EDA. The
appraised value and offer price reflect the continued increase in home prices and values within the city. Since
2016, the median household value in New Hope has increased from $196,000 to $257,000, an increase of 31%
over four years.
Agenda Section
EDA
Item Number
4
Request for Action, Page 2
Cost & Tax Impact of Improvements
It is anticipated that expenses associated with the project would be approximately $200,761. Revenue from the
sale of the lot is estimated at $67,000, resulting in a net loss of $133,761. The new home would result in a
significant increase in the subject parcel’s taxable market value. If the property were to be valued at $390,000
in 2022, it is estimated that total taxes paid to the city in 2023 would increase by $1,296, or 124%, as compared
to those that will be allocated to the city in 2021.
Taxable Market Value 2020,
Payable 2021
Projected Taxable Value 2022,
Payable 2023
Change Percent Change
$174,000 $390,000 $216,000 124%
Estimated Taxes Allocated to
City 2020, Payable 2021
Projected Taxes Allocated to
City 2022, Payable 2023
Change Percent Change
$1,044 $2,340 $1,296 124%
The following table illustrates the Return On Investment (ROI) and tax benefit associated with the estimated
increase in taxable property value over the next several years:
# of Years
(Year)
Additional Taxes
Collected By City
Total Cost/Revenue Return On
Investment
0 (present) $0 $(133,761.03) ‐100.00%
1 (2023) $1,296.00 $(132,465.03) ‐99.03%
5 (2027) $6,880.64 $(126,880.39) ‐94.86%
10 (2032) $14,857.19 $(118,903.84) ‐88.89%
15 (2037) $24,104.19 $(109,656.84) ‐81.98%
20 (2042) $34,824.01 $(98,937.02) ‐73.97%
25 (2047) $47,251.21 $(86,509.82) ‐64.67%
30 (2052) $61,657.74 $(72,103.29) ‐53.90%
The estimated ROI for the project over 30 years is ‐53.90% and the estimated Internal Rate of Return (IRR) for
the project over 30 years is ‐3.98% (calculations attached). The calculations utilize an estimated 3% tax value
growth rate, which is applied to the original taxable market value for the old home and the increased taxable
market value for the new home, both over 30 years. A cost and tax impact comparison of this project and the
three other projects that have been approved since implementation of an analysis template that utilizes tax
growth rate assumptions is attached.
The primary focus of the scattered site program is to target distressed single‐family properties throughout the
city, with the goal of improving residential neighborhoods. It is understood that potential losses are incurred
on each project, as the cost to acquire and redevelop distressed properties often exceeds the value of the new
or rehabilitated home.
Request for Action, Page 3
Funding
Funding for this project would come from the EDA budget. The city has an annual budget of $250,000 for
scattered site housing projects. If this acquisition is approved, funds from the 2021 annual budget will be
utilized. The project would put the EDA 6.6% over budget for 2021, decreasing funds that would be available
for projects in the future. Staff and Abdo, Eick & Meyers (AEM) will be discussing options to increase the
funding for the scattered site housing program at the May 2021 work session when an update on TIF funds is
presented and prior to the preparation of the 2022 EDA budget.
Project Estimated Net Cost
5213 Pennsylvania Ave N $132,779.12
3611 Louisiana Ave N $133,761.03
Total $266,540.15
Annual Budget (2021) $250,000.00
Under/Over Budget $(16,540.15)
Recommendation
Staff recommends that the EDA approve a resolution approving a Purchase Agreement for the acquisition of
3611 Louisiana Avenue North for a purchase price of $170,000 with closing costs to be paid by the EDA.
Attachments
Resolution
Purchase Agreement
Sample Lot Layout
Appraisal
Budget
Estimated Tax Impact of Improvements
Estimated Return on Investment
Estimated Internal Rate of Return
Tax Calculator
Comparison of Costs & Tax Impact of Recent Projects
CITY OF NEW HOPE
ECONOMIC DEVELOPMENT AUTHORITY
EDA RESOLUTION NO. 21-___
RESOLUTION APPROVING PURCHASE AGREEMENT
FOR THE ACQUISITION OF 3611 LOUISIANA AVENUE NORTH
(IMPROVEMENT PROJECT NO. 1065)
BE IT RESOLVED by the Economic Development Authority in and for the City of New Hope
(“EDA”) as follows:
WHEREAS, on September 22, 2014, the City Council adopted Resolution No.14-126 at the City
Council meeting authorizing City community development staff to actively pursue the acquisition of
distressed properties that can be redeveloped as single family residential lots for potential purchase by the
EDA, as part of the City’s scattered site housing program;
WHEREAS, the City Council has directed City staff to negotiate for the terms most favorable to
the City and EDA, and the execution of purchase agreements so as to secure purchase rights for distressed
real properties, contingent on the review and approval of the EDA to the terms of the purchase agreements;
WHEREAS, City staff have identified the opportunity to purchase certain real property located at
3611 Louisiana Avenue North, New Hope, MN, 55427, P.I.D. 17-118-21-34-0060, and legally described
as “Lot 14, Block 3, Wonderland 1st Addition, Hennepin County, Minnesota” (the “Property”) from Gaile
Lee Carlson, an unmarried person (the “Seller”);
WHEREAS, City staff believes that the best use of the Property is demolition in order to maximize
the tax base by making the lot available for the development of a new residential housing unit;
WHEREAS, the Property will be acquired with EDA funds;
WHEREAS, the EDA has reviewed the proposed acquisition of Property and has determined that
it has no effect or relationship with the New Hope Comprehensive Plan;
WHEREAS, it is in the best interest of the EDA to purchase the Property from Seller, in order to
redevelop the Property in accordance with the City’s scattered site housing program and policy; and
WHEREAS, City staff is hereby seeking approval from the EDA of the Purchase Agreement,
subject to the review and approval by the City Attorney of proper title evidence and other terms relating to
the closing on the sale of the Property.
NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for
the City of New Hope as follows:
1. That the above recitals are incorporated herein by reference.
2. It is in the best interest of the EDA to purchase the Property for demolition and
redevelopment in accordance with the City’s scattered site housing program and policy.
3. That the purchase of the Property by EDA from Seller, for a sum of $170,000.00, with
other terms and conditions as set forth in the Purchase Agreement attached hereto as
Exhibit A, is approved subject to the review and approval by the City Attorney of proper
title evidence and other terms relating to the closing on the purchase of the Property.
4. The proposed acquisition of Property is consistent with the New Hope Comprehensive
Plan.
5. The City and EDA shall use due diligence for demolishing the structure located on the
Property and conducting any necessary cleanup of the Property to pursue redevelopment
and return the Property to the tax rolls for the benefit of all taxing jurisdictions.
6. The President and Executive Director and the New Hope City staff are authorized and
directed to sign all appropriate documents, and to take whatever additional actions are
necessary or desirable, to complete the purchase of the Property in accordance with the
Purchase Agreement.
Dated the 8th day of February, 2021.
____________________________________
Kathi Hemken, President
Attest: _____________________________
Kirk McDonald, Executive Director
P:\Attorney\SAS\1 Client Files\2 City of New Hope\99-11445 3611 Louisiana Ave N\Resolution approving purchase of 3611 Louisiana Ave
N.docx
Exhibit A
Purchase Agreement
See attached.
1
PURCHASE AGREEMENT
Date: February ____, 2021
BUYER: The Economic Development Authority in and for the City of New Hope, a public body
corporate and politic created pursuant to the laws of the State of Minnesota
SELLER: Gaile Lee Carlson, an unmarried person and widow of Richard S. Carlson, deceased
Seller agrees to sell and Buyer agrees to purchase the real property located at:
Street Address: 3611 Louisiana Avenue North
City of New Hope, County of Hennepin, State of Minnesota, 55427 legally described as “Lot 14, Block 3,
Wonderland 1st Addition, Hennepin County, Minnesota” PID 17-118-21-34-0060. Torrens Property –
Certificate of Title No. 476044. Said purchase shall include all improvements, fixtures, and appurtenances
on the property, if any, including but not limited to, the following (collectively the "Property"): garden bulbs,
plants, shrubs, trees, and lawn watering system; shed; storm sash, storm doors, screens and awnings;
window shades, blinds; traverse, curtain, and drapery rods, valances, drapes, curtains, window coverings
and treatments; towel rods; attached lighting and bulbs; fan fixtures; plumbing fixtures; garbage disposals;
water softener; water treatment system; water heating systems, heating systems; air exchange system;
radon mitigation system; sump pump; TV antenna/cable TV jacks and wiring/TV wall mounts; wall/ceiling -
mounted speakers and mounts; carpeting; mirrors; garage door openers and all controls; smoke detectors;
fireplace screens, door and heatilators; BUILT-INS: dishwashers; refrigerators; wine/beverage
refrigerators; trash compactors; ovens; cook -top stoves; warming drawers; microwave ovens; hood fans;
shelving; work benches; intercoms; speakers; air conditioning equipment; electronic air filter;
humidifier/dehumidifier; liquid fuel tanks (and controls); pool/spa equipment; propane tank (and controls);
security system equipment; TV satellite dish; AND the following personal property shall be transferred with
no additional monetary value, and free and clear of all liens and encumbrances:
______________________________________________
Notwithstanding the foregoing, the following item(s) are excluded from the purchase:
_________________________________________________________________________
Seller has agreed to sell the Property to Buyer for the sum of One Hundred Seventy Thousand and
00/100 Dollars ($170,000.00), which Buyer agrees to pay in the following manner:
1. CASH of 100 percent (100%) of the sale price.
The date of closing shall be on or before March 15, 2021, and shall occur at the offices of the City
Attorney for City of New Hope: Jensen, Sondrall, Persellin & Woods, P.A., 8525 Edinbrook Crossing,
Suite 201, Brooklyn Park, MN 55443.
SALE OF BUYER'S PROPERTY CONTINGENCY : This Purchase Agreement IS NOT subject to an
Addendum to Purchase Agreement: Sale of Buyer's Property Contingency . (If answer is IS, see attached
Addendum.) (If answer is IS NOT, the closing of Buyer's property, if any, may still affect Buyer's ability to
obtain financing, if financing is applicable.)
This Purchase Agreement IS NOT subject to cancellation of a previously written purchase agreement dated
_______________________, 20__. (If answer is IS, said cancellation shall be obtained no later than
_____________, 20__. If said cancellation is not obtained by said date, this Purchase Agreement is
canceled. Buyer and Seller shall immediately sign a Cancellation of Purchase Agreement confirming said
cancellation.)
2
Buyer has been made aware of the availability of Property inspections. Buyer does not elect to have a
Property inspection performed at Buyer's expense.
INSPECTION CONTINGENCY: This Purchase Agreement IS NOT subject to an Addendum to Purchase
Agreement: Inspection Contingency. (If answer is IS, see attached Addendum.)
DEED/MARKETABLE TITLE: Upon performance by Buyer, Seller shall deliver a (check one):
Warranty Deed joined in by spouse, if any, conveying marketable title, subject to
(a) building and zoning laws, ordinances, and state and federal regulations;
(b) restrictions relating to use or improvement of the Property without effective forfeiture provisions;
(c) reservation of any mineral rights by the State of Minnesota;
(d) utility and drainage easements which do not interfere with existing improvements;
(e) rights of tenants as follows (unless specified, not subject to tenancies) _____________; and
(f) others (must be specified in writing): ___________________________________________
REAL ESTATE TAXES: Seller shall pay on the date of closing all real estate taxes due and payable in all
prior years including all penalties and interest.
Buyer shall pay PRORATED FROM DAY OF CLOSING real estate taxes due and payable in the year
2021.
Seller shall pay PRORATED TO DAY OF CLOSING real estate taxes due and payable in the year 2021.
If the closing date is changed, the real estate taxes paid shall, if prorated, be adjusted to the new closing
date. If the Property tax status is a part- or non-homestead classification in the year of closing, Seller SHALL
NOT pay the difference between the homestead and non-homestead.
Buyer shall pay real estate taxes due and payable in the year following closing and thereafter, the payment
of which is not otherwise herein provided. No representations are made concerning the amount of
subsequent real estate taxes.
DEFERRED TAXES/SPECIAL ASSESSMENTS:
SELLER SHALL PAY on date of closing any deferred real estate taxes (e.g., Green Acres) or special
assessments, payment of which is required as a result of the closing of this sale.
SELLER SHALL PAY ON DATE OF CLOSING all installments of special assessments certified for
payment, with the real estate taxes due and payable in the year of closing.
SELLER SHALL PAY on date of closing all other special assessments levied as of the date of this Purchase
Agreement.
SELLER SHALL PROVIDE FOR PAYMENT OF special assessments pending as of the date of this
Purchase Agreement for improvements that have been ordered by any assessing authorities.
Buyer shall pay any unpaid special assessments payable in the year following closing and thereafter, the
payment of which is not otherwise herein provided.
As of the date of this Purchase Agreement, Seller represents that Seller HAS NOT received a notice
regarding any new improvement project from any assessing authorities, the costs of which project may be
assessed against the Property. Any such notice received by Seller after the date of this Purchase
Agreement and before closing shall be provided to Buyer immediately. If such notice is issued after the
date of this Purchase Agreement and on or before the date of closing, then the parties may agree in writing,
on or before the date of closing, to pay, provide for the payment of or assume the special assessments. In
the absence of such agreement, either party may declare this Purchase Agreement canceled by written
notice to the other party, or licensee representing or assisting the other party, in which case this Purchase
3
Agreement is canceled. If either party declares this Purchase Agreement canceled, Buyer and Seller shall
immediately sign a Cancellation of Purchase Agreement confirming said cancellation.
POSSESSION: Seller shall deliver possession of the Property no later than date of closing. Seller agrees
to remove ALL DEBRIS AND ALL PERSONAL PROPERTY NOT INCLUDED HEREIN from the Property
by possession date.
LINKED DEVICES: Seller warrants that Seller shall permanently disconnect or discontinue Seller's access
or service to any device or system on or serving the property that is connected or controlled wirelessly, via
internet protocol ("IP") to a router or gateway or directly to the cloud no later than delivery of possession as
specified in this Purchase Agreement.
PRORATIONS: All interest; unit owners' association dues; rents; and charges for city water, city sewer,
electricity and natural gas shall be prorated between the parties as of date of closing. Buyer shall pay Seller
for remaining gallons of fuel oil or liquid petroleum gas on the day of closing, at the rate of the last fill by
Seller.
TITLE AND EXAMINATION: As quickly as reasonably possible after Final Acceptance Date of this
Purchase Agreement:
a. Seller shall deliver to Buyer a Commitment for an ALTA Form B owner's policy of title
insurance (the “Commitment”) issued by Midland Title (“Title Company”) and covering title
to the Property, in the amount of the Purchase Price. Seller agrees to pay the costs
associated with the preparation and issuance of the Commitment; Buyer shall pay the
premium for the owner’s policy, if any, and the lender’s policy, if any, along with the price
for any endorsements requested by Buyer or Buyer’s lender.
b. Buyer shall have fifteen (15) days after receipt of the Commitment to review and approve
the title to the Property and to object to any exception to title that is disclosed in the
Commitment or which is otherwise discovered by Buyer. In the event that Buyer does not
within such fifteen (15) day period give notice to Seller objecting to any such exceptions,
then all such exceptions shall be deemed approved and shall be considered a part of the
Permitted Encumbrances. If Buyer timely objects to an exception to title, then on or before
the tenth (10) day following Buyer’s notice of exception, Seller shall remove the exception
or notify Buyer that Seller is unwilling or unable to remove the exception. Within five (5)
days of any notice by Seller that Seller it is unable to remove an exception to title, Buyer
may elect by notice to Seller to either:
(i) terminate this Agreement, whereupon the parties shall be released from all further
obligations hereunder except obligations under this Agreement which provide for
continued exercise following the cancellation or other termination of this
Agreement; or
(ii) elect to have this Agreement remain in effect, in which event Buyer will be deemed
to have approved the previously-cited exception and the same shall be considered
part of the Permitted Encumbrances.
Seller shall use Seller's best efforts to provide marketable title by the date of closing. Seller agrees to pay
all costs and fees necessary to convey marketable title including obtaining and recording all required
documents, subject to the following:
In the event Seller has not provided marketable title by the date of closing, Seller shall have an
additional 30 days to make title marketable, or in the alternative, Buyer may waive title defects by
written notice to Seller. In addition to the 30-day extension, Buyer and Seller may, by mutual
4
agreement, further extend the closing date. Lacking such extension, either party may declare this
Purchase Agreement canceled by written notice to the other party, or licensee representing or
assisting the other party, in which case this Purchase Agreement is canceled. If either party
declares this Purchase Agreement canceled, Buyer and Seller shall immediately sign a
Cancellation of Purchase Agreement confirming said cancellation.
SUBDIVISION OF LAND, BOUNDARIES, AND ACCESS: If this sale constitutes or requires a subdivision
of land owned by Seller, Seller shall pay all subdivision expenses and obtain all necessary governmental
approvals. Seller warrants that the legal description of the real property to be conveyed has been or shall
be approved for recording as of the date of closing. Seller warrants that the buildings are or shall be
constructed entirely within the boundary lines of the Property. Seller warrants that there is a right of access
to the Property from a public right-of-way.
MECHANIC'S LIENS: Seller warrants that prior to the closing, payment in full will have been made for all
labor, materials, machinery, fixtures or tools furnished within the 120 days imm ediately preceding the
closing in connection with construction, alteration or repair of any structure on, or improvement to, the
Property.
NOTICES: Seller warrants that Seller has not received any notice from any governmental authority as to
condemnation proceedings, or violation of any law, ordinance or regulation. If the Property is subject to
restrictive covenants, Seller warrants that Seller has not received any notice from any person or authority
as to a breach of the covenants. Any such notices received by Seller shall be provided to Buyer immediately.
DIMENSIONS: Buyer acknowledges any dimensions, square footage or acreage of land or improvements
provided by Seller, third party, or broker representing or assisting Seller are approximate. Buyer shall verify
the accuracy of information to Buyer's satisfaction, if material, at Buyer's sole cost and expense.
ACCESS AGREEMENT: Seller agrees to allow reasonable access to the Property for performance of any
surveys or inspections agreed to herein.
RISK OF LOSS: If there is any loss or damage to the Property between the date hereof and the date of
closing for any reason, including fire, vandalism, flood, earthquake or act of God, the risk of loss shall be
on Seller. If the Property is destroyed or substantially damaged before the closing date, this Purchase
Agreement is canceled, at Buyer's option, by written notice to Seller or licensee representing or assisting
Seller. If Buyer cancels this Purchase Agreement, Buyer and Seller shall immediately sign a Canc ellation
of Purchase Agreement confirming said cancellation.
TIME OF ESSENCE: Time is of the essence in this Purchase Agreement.
CALCULATION OF DAYS: Any calculation of days begins on the first day (calendar or Business Days as
specified) following the occurrence of the event specified and includes subsequent days (calendar or
Business Days as specified) ending at 11:59 P.M. on the last day.
BUSINESS DAYS: "Business Days" are days which are not Saturdays, Sundays or state or federal holidays
unless stated elsewhere by the parties in writing.
DEFAULT: If Buyer defaults in any of the agreements herein, Seller may cancel this Purchase Agreement,
and Buyer and Seller shall affirm the same by a written cancellation agreement.
If Buyer defaults in any of the agreements hereunder, Seller may terminate this Purchase Agreement under
the provisions of either MN Statute 559.21 or MN Statute 559.217, whichever is applicable. If either Buyer
or Seller defaults in any of the agreements hereunder or there exists an un fulfilled condition after the date
specified for fulfillment, either party may cancel this Purchase Agreement under MN Statute 559.217, Subd.
3. Whenever it is provided herein that this Purchase Agreement is canceled, said language shall be deemed
a provision authorizing a Declaratory Cancellation under MN Statute 559.217, Subd. 4.
5
If this Purchase Agreement is not canceled or terminated as provided hereunder, Buyer or Seller may seek
actual damages for breach of this Purchase Agreement or specific perform ance of this Purchase
Agreement; and, as to specific performance, such action must be commenced within six (6) months after
such right of action arises.
BUYER HAS NOT RECEIVED A DISCLOSURE STATEMENT RE: SELLER'S PROPERTY.
DESCRIPTION OF PROPERTY CONDITION: See Disclosure Statement: Seller's Property or Disclosure
Statement: Seller's Disclosure Alternatives for description of disclosure responsibilities and limitations, if
any.
BUYER IS NOT RELYING ON ANY ORAL REPRESENTATIONS REGARDING THE CONDITION OF THE
PROPERTY AND ITS CONTENTS.
SELLER WARRANTS THAT THE PROPERTY IS EITHER DIRECTLY OR INDIRECTLY CONNECTED
TO:
CITY SEWER-YES / CITY WATER-YES
SUBSURFACE SEWAGE TREATMENT SYSTEM
SELLER DOES NOT KNOW OF A SUBSURFACE SEWAGE TREATMENT SYSTEM ON OR SERVING
THE PROPERTY. (If answer is DOES, and the system does not require a state permit, see Disclosure.
Statement: Subsurface Sewage Treatment System.)
PRIVATE WELL
SELLER DOES KNOW OF A WELL ON OR SERVING THE PROPERTY. (If answer is DOES and well is
located on the Property, see Disclosure Statement: Well.)
THIS PURCHASE AGREEMENT IS NOT SUBJECT TO AN ADDENDUM TO PURCHASE AGREEMENT:
SUBSURFACE SEWAGE TREATMENT SYSTEM AND WELL INSPECTION CONTINGENCY. (If answer
is IS, see attached Addendum.)
IF A WELL OR SUBSURFACE SEWAGE TREATMENT SYSTEM EXISTS ON THE PROPERTY, BUYER
HAS RECEIVED A DISCLOSURE STATEMENT: WELL AND/OR A DISCLOSURE STATEMENT:
SUBSURFACE SEWAGE TREATMENT SYSTEM.
NOTICE REGARDING PREDATORY OFFENDER INFORMATION: Information regarding the predatory
offender registry and persons registered with the predatory offender registry under MN Statute 243.166
may be obtained by contacting the local law enforcement offices in the community where the Property is
located or the Minnesota Department of Corrections at (651) 361-7200, or from the Department of
Corrections web site at www.corr.state.mn.us.
6
No Home Protection/Warranty Plan is negotiated as part of this Purchase Agr eement.
NOTICE
Seller is not represented by a listing Agent in this
transaction.
(Licensee)
(Real Estate Company Name)
Buyer is not represented by an Agent in this
transaction.
(Licensee)
(Real Estate Company Name)
DUAL AGENCY REPRESENTATION
Dual Agency representation DOES NOT apply in this transaction.
CLOSING COSTS: Buyer agree to pay both Buyer’s and Seller’s traditional closing costs including the
following: (1) title search costs specified above; (2) State Deed Tax; and (3) recording costs for all
documents required to release any mortgages, liens, judgments, etc. that are on the title to the Property.
Seller shall remain responsible for paying the pro-rated real estate taxes and special assessments, if any,
described above.
FOREIGN INVESTMENT IN REAL PROPERTY TAX ACT ("FIRPTA"): Section 1445 of the Internal
Revenue Code provides that a transferee ("Buyer") of a United States real property interest must be notified
in writing and must withhold tax if the transferor ("Seller") is a foreign person and no exceptions from
FIRPTA withholding apply. Buyer and Seller agree to comply with FIRPTA requirements under Section
1445 of the Internal Revenue Code.
Seller shall represent and warrant, under the penalties of perjury, whether Seller is a "foreign person" (as
the same is defined within FIRPTA), prior to closing. Any representations made by Seller with respect to
this issue shall survive the closing and delivery of the deed.
Buyer and Seller shall complete, execute, and deliver, on or before closing, any instrument, affidavit, or
statement reasonably necessary to comply with the FIRPTA requirements, including delivery of their
respective federal taxpayer identification numbers or Social Security numbers.
Due to the complexity and potential risks of failing to comply with FIRPTA, including the Buyer's
responsibility for withholding the applicable tax, Buyer and Seller should seek appropriate legal and tax
advice regarding FIRPTA compliance, as the respective licensee's representing or assisting either
party will be unable to assure either party whether the transaction is exempt from FIRPTA
withholding requirements.
ENTIRE AGREEMENT: This Purchase Agreement and any addenda or amendments signed by the parties
shall constitute the entire agreement between Buyer and Seller. Any other written or oral communication
between Buyer and Seller, including, but not limited to, e-mails, text messages, or other electronic
communications are not part of this Purchase Agreement. This Purchase Agreement can be modified or
7
canceled only in writing signed by Seller and Buyer or by operation of law. All monetary sums are deemed
to be United States currency for purposes of this Purchase Agreement.
ELECTRONIC SIGNATURES: The parties agree the electronic signature of any party on any document
related to this transaction constitute valid, binding signatures.
FINAL ACCEPTANCE: To be binding, this Purchase Agreement must be fully executed by both parties
and a copy must be delivered.
SURVIVAL: All warranties specified in this Purchase Agreement shall survive the delivery of the deed or
contract for deed.
OTHER: Buyer’s obligation to purchase the Property under this Purchase Agreement is contingent on
the following:
(1) Review and approval of the terms of the Purchase Agreement by the Economic Development
Authority in and for the City of New Hope to the terms of the Purchase Agreement
If the above contingenc y is not met, Buyer may declare this Purchase Agreement canceled by written
notice to Seller, or licensee representing or assisting Seller, in which case this Purchase Agreement is
canceled. If Buyer declares this Purchase Agreement canceled due to the failure of one of the above
contingencies, Buyer and Seller shall immediately sign a Cancellation of Purchase Agreement confirming
said cancellation and all earnest money paid shall be immediately returned to Buyer.
Seller will not be required to complete the City of New Hope Point of Sale inspection.
Seller warrants that there are no tenants on the property with a lawful leasehold interest. In the event any
tenant comes forward and claims an interest in the property at the time of or following the purchase,
Seller agrees to fully indemnify Buyer for any and all costs associated with terminating such tenancy and
for any and all relocation assistance and benefits that may be due to such tenant together with attorney’s
fees that Buyer would have to incur in connection with legal action required to resolve any relocation
assistance or benefits dispute with such tenant.
Seller acknowledges that she is not being displaced from the property as a result of the Purchase
Agreement and that she is not eligible for relocation assistance and benefits, that the purchase price
includes compensation for any and all relocation assistance and benefits for which Seller may be eligible.
The provisions of this paragraph shall survive the closing of the transaction contemplated by this
Purchase Agreement.
For purposes of this Purchase Agreement, “relocation assistance and benefits” shall have the meanings
ascribed to them by the Minnesota Uniform Relocation Act, Minn. Stat.§117.50 to 117.56, the Uniform
Relocation Assistance and Real Property Acquisition Policies Act, 42 U.S.C. §§4601 -4655 (the federal
URA) and the regulations implementing the federal URA, 49 C.D.R. Part 24.
ADDENDA AND PAGE NUMBERING: Attached addenda are a part of this Purchase Agreement.
Enter total number of pages of this Purchase Agreement, including addenda : __ pages.
8
NOTE: Disclosures and optional Arbitration Agreement are not part of this Purchase Agreement
and should not be part of the page numbering.
I, the owner of the Property, accept this Purchase
Agreement and authorize the listing broker to withdraw
said Property from the market, unless instructed
otherwise in writing.
I have reviewed all pages of this Purchase
Agreement.
If checked, this Agreement is subject to attached
Addendum to Purchase Agreement: Counteroffer.
FIRPTA: Seller represents and warrants, under penalty
of perjury, that Seller IS NOT a foreign person (i.e., a
non-resident alien individual, foreign corporation, foreign
partnership, foreign trust, or foreign estate for purposes
of income taxation. This representation and warranty
shall survive the closing of the transaction and the
delivery of the deed.
I agree to purchase the Property for the price and on
the terms and conditions set forth above.
I have reviewed all pages of this Purchase
Agreement
Seller Buyer
______________________________________ Economic Development Authority in and for the
Gaile Lee Carlson, an unmarried person City of New Hope, a public body corporate and
politic created pursuant to the laws of the State
of Minnesota
Date: February ____, 2021
By:
Kirk McDonald
Its: Executive Director
Date: February ____, 2021
THIS IS A LEGALLY BINDING CONTRACT BETWEEN BUYER(S) AND SELLER(S).
IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL.
P:\Attorney\SAS\1 Client Files\2 City of New Hope\99-11445 3611 Louisiana Ave N\Purchase Agreement.docx
3611 Louisiana Ave N
R-1, Single-family residential
195.94’30’Buildable Area 94’Poten
t
ial Home
&
Garage
Poten
t
ial Driveway
214.76’
Appraisal Professionals of MN LLC
Jayne Preusse
Eden Prairie, MN 55344
612-267-5269
01/26/2021
Jeff Alger
City of New Hope
Community Development
4401 Xylon Avenue N
New Hope, MN 55428
Re:Property:3611 Louisiana Ave N
New Hope, MN 55427
Borrower:N/A
File No.:AP20427
Opinion of Value: $170,000
Effective Date:01/21/2021
In accordance with your request, we have appraised the above referenced property. The report of that appraisal is
attached.
The purpose of the appraisal is to develop an opinion of market value for the property described in this appraisal
report, as improved, in unencumbered fee simple title of ownership.
This report is based on a physical analysis of the site and improvements, a locational analysis of the neighborhood and
city, and an economic analysis of the market for properties such as the subject. The appraisal was developed and the
report was prepared in accordance with the Uniform Standards of Professional Appraisal Practice.
The opinion of value reported above is as of the stated effective date and is contingent upon the certification and
limiting conditions attached.
It has been a pleasure to assist you. Please do not hesitate to contact me if I can be of additional service to you.
Sincerely,
Jayne Preusse
License or Certification #: 20559939
State: MN Expires: 08/31/2021
jstrikos@msn.com
APPRAISAL OF REAL PROPERTY
3611 Louisiana Ave N
New Hope, MN 55427
OT 014 BLOCK WONDERLAND 1ST ADDITION
City of New Hope
4401 Xylon Avenue N
New Hope, MN 55428
170,000
01/21/2021
Jayne Preusse
Appraisal Professionals of MN LLC
Certified Residential Appraiser
Eden Prairie, MN 55344
612-267-5269
jstrikos@msn.com
Form GA1V - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
LOCATED AT
FOR
OPINION OF VALUE
AS OF
BY
Form UA2 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Richard Carlson
AP20427
3611 Louisiana Ave N New Hope MN 55427
OT 014 BLOCK WONDERLAND 1ST ADDITION Hennepin
17-118-21-34-0060 2020 2,521 0
N/A Richard Carlson
0
New Hope 33460 0215.04
N/A N/A N/A
City of New Hope 4401 Xylon Avenue N, New Hope, MN 55428
Jayne Preusse 7164 Crowne Oak Road, Eden Prairie, MN 55344
95
5
105
500
283
2
98
61
71
2
3
20
Other 4
Cr 9 to the north, Hwy 100 to the east, Int 394 to the south, and State Hwy 169 to the west. Market
trends analysis was from a 1 mile radius from the subject property.
Under present land use, 4% indicates "Other". The primary portion of this amount includes parks, miscellaneous, water and undeveloped
land. This does not indicate any negative impact on the Subject's value & marketability at this time.
Market data indicates overall property values have been increasing for the previous 12 month period prior to the effective date of this
appraisal. Market times are deemed to be in the "0-3 months" range at this time.
92x215x30x196
12,564 sf
R1-Single Family Residential
See Attached Addendum
AMP CB Asphalt
Snow Covered
None
Yes
None
Slants Upward
Average - 12564 sf
Irregular
Average
A;Res/Apartments
Snow Covered
Asphalt
Typical
X 11/04/2016
27053C0213F
Subject is located
with an apartment building to the south side of the subject along with views of another apartment building to the rear.
1
2
Detached
1.5 Story
Existing
60
50
Concrete/Avg
Wd/Cp/Avg
Asphalt/SC
Aluminum/Avg
DbH/Glr/Hge/Av
Full/Avg
N/A
Concrete
N/A
Partial
None
None
None
None
665
85
Open/Finish
SR/Pl/W/Fair
Vyl/Avg
None
Unkn
Unkn
Unkn
Unkn
2 1 1 665
1 1 1 1 2 1 1,130
1 1 423
7 3 1 1,553
WL/Tile/Cp/Vyl/Avg
SR/Pnl/Wd/B/Avg
Wood/Avg
CT/Cp/Avg
CT/Avg
Wood/Avg
Yes
FWA
Gas
Avg
None
None
1
None
2Decks
None
CL
None
Yes
1
5
See Attached Addendum.
C4;The
subject is a "1.5 Story" detached single family home reflecting overall fair-average condition as compared to competing properties of a similar
age and design. The subject property exhibits no apparent effects of functional obsolescence. See attached addendum and photo
addendum.
None known to the appraiser.
Jayne Strikos
Property Description File No.UNIFORM RESIDENTIAL APPRAISAL REPORT
SUBJECTProperty Address
Legal Description
Assessor's Parcel No.
Borrower
Property rights appraised
Neighborhood or Project Name
Sale Price $
Lender/Client
Appraiser
Location
Built up
Growth rate
Property values
Demand/supply
Marketing time
City State Zip Code
County
Tax Year R.E. Taxes $Special Assessments $
Current Owner Occupant:Owner Tenant Vacant
Fee Simple Leasehold Project Type PUD Condominium (HUD/VA only)HOA $/Mo.
Map Reference Census Tract
Date of Sale Description and $ amount of loan charges/concessions to be paid by seller
Address
Address
NEIGHBORHOODPredominant
occupancy
Single family housing Present land use %Land use change
Note: Race and the racial composition of the neighborhood are not appraisal factors.
Predominant
Urban
Over 75%
Rapid
Increasing
Shortage
Under 3 mos.
Suburban
25-75%
Stable
Stable
In balance
3-6 mos.
Rural
Under 25%
Slow
Declining
Over supply
Over 6 mos.
Owner
Tenant
Vacant (0-5%)
Vac.(over 5%)
PRICE AGE
$(000)(yrs)
Low
High
One family
2-4 family
Multi-family
Commercial
Not likely
In process
Likely
To:
Neighborhood boundaries and characteristics:
Factors that affect the marketability of the properties in the neighborhood (proximity to employment and amenities, employment stability, appeal to market, etc.):
Market conditions in the subject neighborhood (including support for the above conclusions related to the trend of property values, demand/supply, and marketing time
-- such as data on competitive properties for sale in the neighborhood, description of the prevalence of sales and financing concessions, etc.):PUDProject Information for PUDs (If applicable) - - Is the developer/builder in control of the Home Owners' Association (HOA)?Yes No
Approximate total number of units in the subject project Approximate total number of units for sale in the subject project
Describe common elements and recreational facilities:SITEDimensions
Site area
Specific zoning classification and description
Zoning compliance
Highest & best use as improved:
Corner Lot Yes No
Legal Legal nonconforming (Grandfathered use)Illegal No zoning
Present use Other use (explain)
Utilities Off-site Improvements
Electricity
Gas
Water
Sanitary sewer
Storm sewer
Public Other Type Public Private
Street
Curb/gutter
Sidewalk
Street lights
Alley
Topography
Size
Shape
Drainage
View
Landscaping
Driveway Surface
Apparent easements
FEMA Special Flood Hazard Area
FEMA Zone
FEMA Map No.
Map Date
Yes No
Comments (apparent adverse easements, encroachments, special assessments, slide areas, illegal or legal nonconforming zoning use, etc.):DESCRIPTION OF IMPROVEMENTSGENERAL DESCRIPTION
No. of Units
No. of Stories
Type (Det./Att.)
Design (Style)
Existing/Proposed
Age (Yrs.)
Effective Age (Yrs.)
EXTERIOR DESCRIPTION
Foundation
Exterior Walls
Roof Surface
Gutters & Dwnspts.
Window Type
Storm/Screens
Manufactured House
FOUNDATION
Slab
Crawl Space
Basement
Sump Pump
Dampness
Settlement
Infestation
BASEMENT
Area Sq. Ft.
% Finished
Ceiling
Walls
Floor
Outside Entry
INSULATION
Roof
Ceiling
Walls
Floor
None
Unknown
ROOMS
Basement
Level 1
Level 2
Finished area above grade contains:Rooms;Bedroom(s);Bath(s);Square Feet of Gross Living Area
Foyer Living Dining Kitchen Den Family Rm.Rec. Rm.Bedrooms # Baths Laundry Other Area Sq. Ft.
INTERIOR Materials/Condition
Floors
Walls
Trim/Finish
Bath Floor
Bath Wainscot
Doors
HEATING
Type
Fuel
Condition
COOLING
Central
Other
Condition
KITCHEN EQUIP.
Refrigerator
Range/Oven
Disposal
Dishwasher
Fan/Hood
Microwave
Washer/Dryer
ATTIC
None
Stairs
Drop Stair
Scuttle
Floor
Heated
Finished
AMENITIES
Fireplace(s) #
Patio
Deck
Porch
Fence
Pool
CAR STORAGE:
None
Garage
Attached
Detached
Built-In
Carport
Driveway
# of cars
COMMENTSAdditional features (special energy efficient items, etc.):
Condition of the improvements, depreciation (physical, functional, and external), repairs needed, quality of construction, remodeling/additions, etc.:
Adverse environmental conditions (such as, but not limited to, hazardous wastes, toxic substances, etc.) present in the improvements, on the site, or in the
immediate vicinity of the subject property.:
Freddie Mac Form 70 6/93 Fannie Mae Form 1004 6/93PAGE 1 OF 2
Form UA2 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
65,000
1,553
665
465
65,000
Richard Carlson
AP20427
Estimated economic life based on 100
total years. The most recent land sales per RMLS include the
following: RMLS #4918324 $78,000 and #4918020 $73,000.
3611 Louisiana Ave N
New Hope, MN 55427
N/A
RMLS/hennCA
Inspection
A;ApartmentB
Fee Simple
12,564 sf
N;Res
1.5 Story
Q5
60
C4
7 3 1
1,553
665sf565sfwu
2rr0br0ba1o
Average
FWA
None
1gb5dw
2Dk
1 FP
CL
01/21/2021
RMLS/HenneCA
6327 31st Ave N
Crystal, MN 55427
0.86 miles SE
168,000
127.27
RMLS#5623731/24DOM
RMLS/HennAssessWeb/Dr-BIns
ArmLth
Conv;0 0
s08/20;Unk 0
N;Res;-4,000
Fee Simple
19602 sf -2,000
B;Woods -5,000
1.5 Story
Q5
71 0
C4
6 3 1.0
1,320 +6,990
1082sf0sfwu +6,780
0sf 0
Average
FWA C/Air -4,000
None
1gbi2dw 0
None +2,000
None +1,000
None 0
1,770
None
169,770
01/21/2021
RMLS/HenneCA
4517 Brunswick Ave N
Crystal, MN 55422
1.10 miles NE
176,000
117.33
RMLS#5507493/21/DOM
RMLS/HennAssessWeb/Dr-BIns
ArmLth
Conv;4000 0
s05/20;Unk +2,640
N;Res;-4,000
Fee Simple
22216 sf -4,000
N;Res;
1.5 Story
Q5
90 0
C4
8 4 1.0 0
1,500 0
1200sf0sfwu +6,780
0sf 0
Average
FWA
None
2dg2dw -5,000
None +2,000
None +1,000
None 0
-580
None
175,420
01/21/2021
05/14/2020-$140,800
RMLS/HenneCA
4055 Oregon Ave N
New Hope, MN 55427
0.59 miles NW
224,900
227.17
RMLS#5664140/20DOM
RMLS/HennAssessWeb/Dr-BIns
ArmLth
FHA;4000 0
s01/21;Unk 0
A;RR;0
Fee Simple
8712 sf 0
N;Res;
1.5 Story
Q5 -15,000
65 0
C4 -4,000
6 3 1.0
990 +14,075
800sf400sfwu +1,980
1rr0br0.0ba1o 0
Average
FWA C/Air -4,000
None
2dg2dw -5,000
EnPor/Pt -2,000
None +1,000
CL/Wd
-12,945
None
211,955
01/21/2021
RMLS/HenneCA
See attached addendum.
The subject property has not been a sale / re-sale during the past 36 months. All comparable sales have not been sales / resales during the
past 12 months, except for Comparable #2 listed in the grid above.
170,000
See Attached Addendum.
Most emphasis was placed on the Sales Comparison Approach to Value. The Income (GRM) Approach and Cost Approach
were both considered with the Sales Comparison Approach weighing in as the most viable approach to value/opinion of value.
01/2021
01/21/2021
170,000
Jayne Preusse
01/26/2021
20559939 MN
Valuation Section File No.UNIFORM RESIDENTIAL APPRAISAL REPORT
COST APPROACHESTIMATED SITE VALUE
ESTIMATED REPRODUCTION COST-NEW-OF IMPROVEMENTS:
Dwelling
Garage/Carport
Total Estimated Cost New
Less
Depreciation
Depreciated Value of Improvements
"As-is" Value of Site Improvements
INDICATED VALUE BY COST APPROACH
Sq. Ft.
Sq. Ft.
Sq. Ft.
@
@
@
$
$
$
Physical Functional External
=
=
=
=
=
$
$
=
=
=
=
=
$
$
$
$
$
Comments on Cost Approach (such as, source of cost estimate, site value,
square foot calculation and for HUD, VA and FmHA, the estimated remaining
economic life of the property):SALES COMPARISON ANALYSIS////
ITEM SUBJECT COMPARABLE NO. 1 COMPARABLE NO. 2 COMPARABLE NO. 3
ITEM SUBJECT COMPARABLE NO. 1 COMPARABLE NO. 2 COMPARABLE NO. 3
DESCRIPTION DESCRIPTION +( )$ Adjust.–DESCRIPTION +( )$ Adjust.–DESCRIPTION +( )$ Adjust.–
Total Bdrms Baths Total Bdrms Baths Total Bdrms Baths Total Bdrms Baths
Sq. Ft.Sq. Ft.Sq. Ft.Sq. Ft.
+–+–+–
$
$$
$
$
$
$
$
$
$
$
$
$
$
$
$$
Address
Proximity to Subject
Sales Price
Price/Gross Living Area
Data and/or
Verification Source
VALUE ADJUSTMENTS
Sales or Financing
Concessions
Date of Sale/Time
Location
Leasehold/Fee Simple
Site
View
Design and Appeal
Quality of Construction
Age
Condition
Above Grade
Room Count
Gross Living Area
Basement & Finished
Rooms Below Grade
Functional Utility
Heating/Cooling
Energy Efficient Items
Garage/Carport
Porch, Patio, Deck,
Fireplace(s), etc.
Fence, Pool, etc.
Net Adj. (total)
Adjusted Sales Price
of Comparable
Comments on Sales Comparison (including the subject property's compatibility to the neighborhood, etc.):
Date, Price and Data
Source, for prior sales
within year of appraisal
Analysis of any current agreement of sale, option, or listing of subject property and analysis of any prior sales of subject and comparables within one year of the date of appraisal:
INDICATED VALUE BY SALES COMPARISON APPROACH
INDICATED VALUE BY INCOME APPROACH (if Applicable) Estimated Market Rent /Mo.x Gross Rent Multiplier =RECONCILIATIONThis appraisal is made "as is"subject to the repairs, alterations, inspections or conditions listed below subject to completion per plans & specifications.
Conditions of Appraisal:
Final Reconciliation:
The purpose of this appraisal is to estimate the market value of the real property that is the subject of this report, based on the above conditions and the certification, contingent
and limiting conditions, and market value definition that are stated in the attached Freddie Mac Form 439/FNMA form 1004B (Revised ).
Signature
Name
Date Report Signed
State Certification #State
Or State License #State
Signature
Name
Date Report Signed
State Certification #State
Or State License #State
Inspect Property
Did Did Not
I (WE) ESTIMATE THE MARKET VALUE, AS DEFINED, OF THE REAL PROPERTY THAT IS THE SUBJECT OF THIS REPORT, AS OF
(WHICH IS THE DATE OF INSPECTION AND THE EFFECTIVE DATE OF THIS REPORT) TO BE $
APPRAISER:SUPERVISORY APPRAISER (ONLY IF REQUIRED):
Freddie Mac Form 70 6/93 Fannie Mae Form 1004 6-93PAGE 2 OF 2
Richard Carlson
AP20427
Form UADDEFINE1 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
File No.
UNIFORM APPRAISAL DATASET (UAD) DEFINITIONS ADDENDUM
(Source: Fannie Mae UAD Appendix D: UAD Field-Specific Standardization Requirements)
Condition Ratings and Definitions
C1
The improvements have been recently constructed and have not been previously occupied. The entire structure and all components are new
and the dwelling features no physical depreciation.
Note: Newly constructed improvements that feature recycled or previously used materials and/or components can be considered new dwellings
provided that the dwelling is placed on a 100 percent new foundation and the recycled materials and the recycled components have been
rehabilitated/remanufactured into like-new condition. Improvements that have not been previously occupied are not considered “new” if they
have any significant physical depreciation (that is, newly constructed dwellings that have been vacant for an extended period of time without
adequate maintenance or upkeep).
C2
The improvements feature no deferred maintenance, little or no physical depreciation, and require no repairs. Virtually all building components
are new or have been recently repaired, refinished, or rehabilitated. All outdated components and finishes have been updated and/or replaced
with components that meet current standards. Dwellings in this category are either almost new or have been recently completely renovated and
are similar in condition to new construction.
Note: The improvements represent a relatively new property that is well maintained with no deferred maintenance and little or no physical
depreciation, or an older property that has been recently completely renovated.
C3
The improvements are well maintained and feature limited physical depreciation due to normal wear and tear. Some components, but not every
major building component, may be updated or recently rehabilitated. The structure has been well maintained.
Note: The improvement is in its first-cycle of replacing short-lived building components (appliances, floor coverings, HVAC, etc.) and is
being well maintained. Its estimated effective age is less than its actual age. It also may reflect a property in which the majority of
short-lived building components have been replaced but not to the level of a complete renovation.
C4
The improvements feature some minor deferred maintenance and physical deterioration due to normal wear and tear. The dwelling has been
adequately maintained and requires only minimal repairs to building components/mechanical systems and cosmetic repairs. All major building
components have been adequately maintained and are functionally adequate.
Note: The estimated effective age may be close to or equal to its actual age. It reflects a property in which some of the short-lived building
components have been replaced, and some short-lived building components are at or near the end of their physical life expectancy; however,
they still function adequately. Most minor repairs have been addressed on an ongoing basis resulting in an adequately maintained property.
C5
The improvements feature obvious deferred maintenance and are in need of some significant repairs. Some building components need repairs,
rehabilitation, or updating. The functional utility and overall livability is somewhat diminished due to condition, but the dwelling remains
useable and functional as a residence.
Note: Some significant repairs are needed to the improvements due to the lack of adequate maintenance. It reflects a property in which many
of its short-lived building components are at the end of or have exceeded their physical life expectancy but remain functional.
C6
The improvements have substantial damage or deferred maintenance with deficiencies or defects that are severe enough to affect the safety,
soundness, or structural integrity of the improvements. The improvements are in need of substantial repairs and rehabilitation, including many
or most major components.
Note: Substantial repairs are needed to the improvements due to the lack of adequate maintenance or property damage. It reflects a property
with conditions severe enough to affect the safety, soundness, or structural integrity of the improvements.
Quality Ratings and Definitions
Q1
Dwellings with this quality rating are usually unique structures that are individually designed by an architect for a specified user. Such
residences typically are constructed from detailed architectural plans and specifications and feature an exceptionally high level of workmanship
and exceptionally high-grade materials throughout the interior and exterior of the structure. The design features exceptionally high-quality
exterior refinements and ornamentation, and exceptionally high-quality interior refinements. The workmanship, materials, and finishes
throughout the dwelling are of exceptionally high quality.
Q2
Dwellings with this quality rating are often custom designed for construction on an individual property owner’s site. However, dwellings in
this quality grade are also found in high-quality tract developments featuring residence constructed from individual plans or from highly
modified or upgraded plans. The design features detailed, high quality exterior ornamentation, high-quality interior refinements, and detail. The
workmanship, materials, and finishes throughout the dwelling are generally of high or very high quality.
UAD Version 9/2011 (Updated 4/2012)
Form UADDEFINE1 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
UNIFORM APPRAISAL DATASET (UAD) DEFINITIONS ADDENDUM
(Source: Fannie Mae UAD Appendix D: UAD Field-Specific Standardization Requirements)
Quality Ratings and Definitions (continued)
Q3
Dwellings with this quality rating are residences of higher quality built from individual or readily available designer plans in above-standard
residential tract developments or on an individual property owner’s site. The design includes significant exterior ornamentation and interiors
that are well finished. The workmanship exceeds acceptable standards and many materials and finishes throughout the dwelling have been
upgraded from “stock” standards.
Q4
Dwellings with this quality rating meet or exceed the requirements of applicable building codes. Standard or modified standard building plans
are utilized and the design includes adequate fenestration and some exterior ornamentation and interior refinements. Materials, workmanship,
finish, and equipment are of stock or builder grade and may feature some upgrades.
Q5
Dwellings with this quality rating feature economy of construction and basic functionality as main considerations. Such dwellings feature a
plain design using readily available or basic floor plans featuring minimal fenestration and basic finishes with minimal exterior ornamentation
and limited interior detail. These dwellings meet minimum building codes and are constructed with inexpensive, stock materials
with limited refinements and upgrades.
Q6
Dwellings with this quality rating are of basic quality and lower cost; some may not be suitable for year-round occupancy. Such dwellings
are often built with simple plans or without plans, often utilizing the lowest quality building materials. Such dwellings are often built or
expanded by persons who are professionally unskilled or possess only minimal construction skills. Electrical, plumbing, and other mechanical
systems and equipment may be minimal or non-existent. Older dwellings may feature one or more substandard or non-conforming additions
to the original structure
Definitions of Not Updated, Updated, and Remodeled
Not Updated
Little or no updating or modernization. This description includes, but is not limited to, new homes.
Residential properties of fifteen years of age or less often reflect an original condition with no updating, if no major
components have been replaced or updated. Those over fifteen years of age are also considered not updated if the
appliances, fixtures, and finishes are predominantly dated. An area that is ‘Not Updated’ may still be well maintained
and fully functional, and this rating does not necessarily imply deferred maintenance or physical/functional deterioration.
Updated
The area of the home has been modified to meet current market expectations. These modifications
are limited in terms of both scope and cost.
An updated area of the home should have an improved look and feel, or functional utility. Changes that constitute
updates include refurbishment and/or replacing components to meet existing market expectations. Updates do not
include significant alterations to the existing structure.
Remodeled
Significant finish and/or structural changes have been made that increase utility and appeal through
complete replacement and/or expansion.
A remodeled area reflects fundamental changes that include multiple alterations. These alterations may include
some or all of the following: replacement of a major component (cabinet(s), bathtub, or bathroom tile), relocation
of plumbing/gas fixtures/appliances, significant structural alterations (relocating walls, and/or the addition of)
square footage). This would include a complete gutting and rebuild.
Explanation of Bathroom Count
Three-quarter baths are counted as a full bath in all cases. Quarter baths (baths that feature only a toilet) are not
included in the bathroom count. The number of full and half baths is reported by separating the two values using a
period, where the full bath count is represented to the left of the period and the half bath count is represented to the
right of the period.
Example:
3.2 indicates three full baths and two half baths.
UAD Version 9/2011 (Updated 4/2012)
Form UADDEFINE1 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
UNIFORM APPRAISAL DATASET (UAD) DEFINITIONS ADDENDUM
(Source: Fannie Mae UAD Appendix D: UAD Field-Specific Standardization Requirements)
Abbreviations Used in Data Standardization Text
Abbreviation Full Name Fields Where This Abbreviation May Appear
ac Acres Area, Site
AdjPrk Adjacent to Park Location
AdjPwr Adjacent to Power Lines Location
A Adverse Location & View
ArmLth Arms Length Sale Sale or Financing Concessions
ba Bathroom(s)Basement & Finished Rooms Below Grade
br Bedroom Basement & Finished Rooms Below Grade
B Beneficial Location & View
Cash Cash Sale or Financing Concessions
CtySky City View Skyline View View
CtyStr City Street View View
Comm Commercial Influence Location
c Contracted Date Date of Sale/Time
Conv Conventional Sale or Financing Concessions
CrtOrd Court Ordered Sale Sale or Financing Concessions
DOM Days On Market Data Sources
e Expiration Date Date of Sale/Time
Estate Estate Sale Sale or Financing Concessions
FHA Federal Housing Authority Sale or Financing Concessions
GlfCse Golf Course Location
Glfvw Golf Course View View
Ind Industrial Location & View
in Interior Only Stairs Basement & Finished Rooms Below Grade
Lndfl Landfill Location
LtdSght Limited Sight View
Listing Listing Sale or Financing Concessions
Mtn Mountain View View
N Neutral Location & View
NonArm Non-Arms Length Sale Sale or Financing Concessions
BsyRd Busy Road Location
o Other Basement & Finished Rooms Below Grade
Prk Park View View
Pstrl Pastoral View View
PwrLn Power Lines View
PubTrn Public Transportation Location
rr Recreational (Rec) Room Basement & Finished Rooms Below Grade
Relo Relocation Sale Sale or Financing Concessions
REO REO Sale Sale or Financing Concessions
Res Residential Location & View
RH USDA - Rural Housing Sale or Financing Concessions
s Settlement Date Date of Sale/Time
Short Short Sale Sale or Financing Concessions
sf Square Feet Area, Site, Basement
sqm Square Meters Area, Site
Unk Unknown Date of Sale/Time
VA Veterans Administration Sale or Financing Concessions
w Withdrawn Date Date of Sale/Time
wo Walk Out Basement Basement & Finished Rooms Below Grade
wu Walk Up Basement Basement & Finished Rooms Below Grade
WtrFr Water Frontage Location
Wtr Water View View
Woods Woods View View
Other Appraiser-Defined Abbreviations
Abbreviation Full Name Fields Where This Abbreviation May Appear
UAD Version 9/2011 (Updated 4/2012)
Twelve Month Listing History of Subject Property
An extensive search of the subject property was completed and there were no listings of the subject
in the previous twelve months.
Sources used were Hennepin County Records and Northstar Multiple Listing Service.
Market Conditions
Overall market conditions for this report were based on the statistics for page one of the URAR.
Market statistics for page one of the URAR concluded the following: the median sold price of all single
family homes within a one mile radius from the subject property from 01/21/2019-01/20/2020 was
$257,700 (data of 172). Whereas, the median sold price of all single family homes from 01/21/2020-01/20/2021
was $275,000 (data of 213). An increase of approximately 6%. The average priced homes of the same statistics
per RMLS indicate increasing market conditions.
Both statistics were taken under consideration, with the final observation of an increase in overall
market conditions.
National Emergency Concerning the Novel Coronavirus Disease (COVID-19) Outbreak
On March 13, 2020, the United States Government declared a "National Emergency Concerning the Novel
Coronavirus Disease (COVID-19) Outbreak", which was in effect on the Effective Date of this Appraisal Report.
In addition, on March 25, 2020 the State of Minnesota Government declared a "stay at home order", which was in
effect on the Effective Date of this Appraisal Report. This appraisal report was performed pursuant to the Uniform
Standards of Professional Appraisal Practice (USPAP) and was based on information and comparable sales
available on that date. The effect of COVID-19 on the future value of the Subject Property or the value of the real
estate market in the area of the Subject Property is unknown and not possible to predict.
Reconciliation
The effect COVID-19 will have on the real estate market in the region is currently unknown and will largely depend
on both the scale and longevity of the pandemic. At this stage Tourism, F&B and Retail sectors are the first
impacted, due to the increased response by local and global authorities including home quarantine, restriction of
travel and international concerns. A prolonged pandemic could have a significant (and yet unknown or quantifiable)
impact on other sectors of the property market.
President Donald Trump on Friday 03/27/2020 signed a $2.2 trillion coronavirus economic stimulus bill, putting in
motion desperately needed financial relief for millions of Americans set back by the pandemic. The more than $2
trillion bill is the largest economic relief package in modern U.S. history.
This appraisal report was performed pursuant to the Uniform Standards of Professional Appraisal Practice
(“USPAP”) and was based on information and comparable sales available as of the effective date. At this time, the
effect of COVID-19 on the future value of the Subject Property or the value of the real estate market in the area of
the Subject Property is unknown and not possible to predict.
This valuation is based on the information available as of the effective date. Given the heightened uncertainty, a
degree of caution should be exercised when relying upon this report. Values may change more rapidly and
significantly than during standard market conditions.
The analysis is being performed with as much current information and market feedback as possible. However, the
appraiser can only work with what is available.
The appraisal is being performed at a point in time and that the market value opinion is - as of a certain date - the
effective date. changes after the date may affect the value. Analysis is being performed as quickly as possible to
measure the impacts, if any, to the subject's market as a result of this event.
Neighborhood Description
The subject property is located in the southern section of the City of New Hope MN within the County of Hennepin.
The immediate neighborhood consists primarily of detached single family homes all that generally
conform with one another in style, size and price range.
All neighborhood conveniences including shopping public schools, parks and highway access are
within reasonable distances. There has traditionally been an average demand for housing in this
neighborhood. The subject's immediate neighborhood is a mix of single family detached homes.
Subjects neighborhood is mainly a residential neighborhood with easy access to other suburban
areas via State Highway 169/Highway 100 and connecting to other main arteries.
No adverse conditions were observed.
Subject Site
The subject is an interior site that is typical in parcel size and appeal of the neighborhood. The
topography slants slightly upward at the front, and continues to slant slightly upward to the parcel rear and
does not allow for a walkout basement. There is an asphalt driveway that is entered from a lightly
Supplemental Addendum
Form TADD - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
AP20427
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Borrower
Lender/Client
Property Address
City County State Zip Code
File No.
does not allow for a walkout basement. There is an asphalt driveway that is entered from a lightly
trafficked residential street to the tuck under garage. There is a concrete walkway/steps from the driveway
that leads to the front entrance. The subject views detached single family homes on the north side, to the front and
an apartment building to the south side and to the rear. In short, the subject parcel is observed to be an average
and is considered to be a suitable place for the home improvements.
There are no apparent easements or encroachments, other than typical utility easements.
In making this appraisal report, we are not aware of any testing for the existence of presence of
radon, asbestos, toxic substances, or other environmental pollutants in the building, land, or other
surrounding areas, and that the value assigned herein to the land and buildings assume that no
such contaminants exist. We further recommend that if you have knowledge of or reason to subject
the existence of such pollutants, that you obtain an environmental assessment of the property.
To the best of our knowledge, there are no environmental risk factors which may affect the real
estate being appraised.
Additional Features
Exterior features of the subject include a wood deck at the front, a wood deck at the rear, a shed and a chain link
fence around the parameter of the backyard.
Main level features include a fireplace in the main level living room and a master bedroom, with a master bath.
The first level consists of a foyer, sunroom, living room, dining room, kitchen, laundry, full bath, one bedroom and a
master bedroom with a master bath. The second level consists of a sitting room and one bedroom.
The basement is partial, partially finished and is not a walkout. The basement consists of two dens and a utility
room.
The appraiser manually measured the subject with 1553 GLA.
The subject's water, electricity and heat were on and working at the time of the appraisal inspection.
The subject has an exposed pipe in the basement from the well. It was undetermined by viewing from the top of the
pipe if the well has been capped. Per Jeremy Carlson, he advised that the well has been capped at the time of the
appraisal inspection.
"This assignment was completed in full compliance with the appraisal independence
regulations".
Highest and Best Use
Highest and best use is defined in The Dictionary of Real Estate Appraisal, Fifth Edition, Appraisal Institute, at Page
93, as follows: The reasonably probable and legal use of vacant land or an improved property, which is physically
possible, appropriately supported, financially feasible, and that results in the highest value.
The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility,
and maximum profitability. Alternatively, the probable use of land or improved property – specific with respect to the
user and timing of the use – that is adequately supported and results in the highest present value.
The subject as improved is a legally permissible use based on its current zoning. Also, the lot size, shape, physical
condition and land to building ratio allow the present structure and indicate a good utilization of the improvements.
Based on current market conditions, the present use and structure as a single family residence is its financially
feasible and maximally productive use.
The subject property is currently being utilized as a residential single family home and is being
appraised as a residential single family home.
The subject home is presently occupied by a family member.
Comments on Sale Comparison
Your appraiser has performed a detailed search for comparables to the subject in location, design,
utility and appeal. After extensive research, the comparable sales chosen were deemed the best
available. The appraiser has researched, reviewed, analyzed and documented the sales. The
appraiser has made peer acceptable, unbiased, and impartial adjustments for items of significant variation.
Search parameters included the following:
- location of being in the City of New Hope and within one mile from the subject property
- similar design style, age, condition and amenities
- similar parcel size and view.
The subject is a 1.5 story designed detached single family home. The subject is considered to be overall
fair-average condition. Three sold comparables were utilized for the overall opinion of value.
Supplemental Addendum
Form TADD - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
AP20427
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Borrower
Lender/Client
Property Address
City County State Zip Code
File No.
fair-average condition. Three sold comparables were utilized for the overall opinion of value.
Comparables #1, #2 and #3 are observed to be good viable comparables to the subject, many of the search
parameters, and being close in proximity to the subject. Comparables #1 and #2 were given most
weight in the determination of the opinion of value due to being close in proximity to the subject
while being similar in most of the original search parameters. Due to limited similar comparables with the overall
similar condition of the subject, going into the neighboring City of Crystal was necessary in locating similar
comparables.
Comparable #3 best represents the current market conditions of being sold within 90 DOM.
Effective ages were taken under consideration for the sales comparison grid. GLA along with the other parameters
were the next most viable attributes in locating similar comparables to the subject.
Parcel adjustments were based on Hennepin County Assessor Website values, land sales, parcel size,
amenities of the parcels, view and overall utility. Each individual parcel was observed for all
attributes, and therefore may not be completely defined by the specific square foot/acres per parcel.
Due to extending the search parameters, recommended guidelines were exceeded in GLA and line item
adjustments for finished basement sf to the subject property.
GLA for the comparables utilized within this report have been researched per the individual listings, RMLS Realist
and Hennepin County Assessor Website and each analyzed to the best judgment of the most accurate GLA of each
comparable.
Adjustments
TIME ADJUSTMENTS:
Comparable #2 has been adjusted to the current market conditions.
LOCATION:
The location adjustments, if any, considered accessibility, degree of conformity to adjoining
properties, and the overall appeal and marketability of the respective neighborhoods in relation
to the subject. Comparables #1 and #2 are located with no external.
SITE/VIEW:
Adjustments for site/view were made on the basis of lot value and the availability of public utilities
rather than size alone.
DESIGN/STYLE:
Adjustments are made on the basis of interior and exterior appeal characteristics.
QUALITY/CONDITION:
Adjustments are made on the basis of MLS photos, an inspection from the street and the appraiser's
experience and judgment.
Comparable #3 is observed to be superior in quality upgrades/updates and condition to the subject per the RMLS
description and photos in exterior updates of newer paint and interior updates of refinishing wood flooring and
miscellaneous.
ROOM COUNT/PROPERTY FEATURES:
Adjustment were made based on the price-point of the residence and on the appraiser's experience
and judgment.
GLA- 25.00 Finished Basement sf - 12.00 (The lower basement finished sf adjustments were due to overall
condition of the subject's finished basement sf.
The subject and comparables have different size amenities, and the size of each was taken under consideration and
therefore may not be completely defined by the specific adjustments as described for each above.
- No adjustments were utilized for GLA or Finished Basement sf within 100 sf due to the margin of
error of the RMLS comparables utilized in the report.
Assessed Market Value for Tax Purposes
According to Hennepin County Assessor Website records the subjects 2021 estimated assessed value is
as follows: Land $65,000, Building $104,000 with a total of $169,000.
Cost Approach
The cost approach has not been developed by the appraiser as an analysis to support the opinion
of the property's market value. The cost approach may not be a reliable indication of
replacement or reproduction cost due to changing costs of labor and materials, due to
changing building codes, governmental regulations and requirements, age of the subject
and speculative depreciation.
Intended Used of Appraisal
The Intended User of this appraisal report is the Lender/Client. The Intended Use is to evaluate
Supplemental Addendum
Form TADD - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
AP20427
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Borrower
Lender/Client
Property Address
City County State Zip Code
File No.
The Intended User of this appraisal report is the Lender/Client. The Intended Use is to evaluate
the property that is the subject of this appraisal for a full appraisal per the client request for market value,
subject to the stated Scope of Work, purpose of the appraisal, reporting
requirements of this appraisal report form, and Definition of Market Value. No additional
intended Users are identified by the appraiser.
Scope of the Appraisal
The appraiser has viewed all readily accessible areas of the dwelling (and any other building
structure located on the property). This complete visual inspection is not intended to be the
same depth or for the same purpose as a home inspection. The appraiser has viewed the
property solely for the valuation purposes and to observe property characteristics that a typical
purchaser would consider in their decision making process, as well as those items outlined in
the assumptions and limited conditions and certifications to this appraisal. Personal property or
chattel was not included in the appraised value.
Zoning
Comments about the zoning compliance of the subject property are intended by the appraiser to
be in general terms. A detailed analysis about every aspect of the subject property's improvements
and the site characteristic with respect to current zoning and building codes are beyond the scope
of this assignment and was not performed. The subject is considered to be in compliance with
current zoning requirements in a general sense. It is a Single family residential improvement in
an area zoned for single family residential use.
Site Conditions
No obvious adverse site conditions or external factors were observed. Unless otherwise stated,
typical drainage, utility and right of way easements do not adversely impact value. However, the
discovery of many site related issues often require special expertise or data sources not customary
or available in the performance of an appraisal. A fundamental site analysis such as this is beyond
the scope of this assignment. A detailed site or location survey, which may reveal adverse easements,
encroachments, zoning violations, environmental issues or other matters that could impact the
analysis or opinions, was not available to the appraiser.
Sketch
The subject's sketch is used for representational purposes only. The subject's sketch is to comply
with The American National Standard Institute process for calculating gross living area; however,
due to the complexity of the subject property and the limitations of the appraisal software it is not
possible to develop a blue print of the subject property. The subject's sketch is not intended to be
used for any other purpose. The subject's sketch and actual dimensions will very. The appraiser
is not a structural engineer. If the lender requires a precise blue print of the subject property it is
the lenders responsibility to have the building surveyed by a structural engineer. See Statement
Of Assumptions And Limiting Conditions.
At the time of inspection, the appraiser physically measured the exterior/interior of the improvement.
The appraiser's measurements may differ from that of the assessor's and/or builder's documentation
for the subject's gross living area. The appraiser has no knowledge as to if the assessor physically
measured the subject property or used blueprint documentation for the gross living area. Since the
appraiser physically measured the subject property on the effective date of this report, the appraiser
deems their calculations to be accurate and reliable. The subject's sketch is used for representational
purposes only. The subject's sketch is to comply with The American National Standard Institute
process for calculating gross living area; however, due to the complexity of the subject property,
and the limitations of the appraisal software, it is not possible to develop a blue print of the subject
property. The subject's sketch is not intended to be used for any other purpose. The subject's sketch
and actual dimensions will vary. The appraiser is not a structural engineer. If the lender requires a
precise blue print of the subject property it is the lenders responsibility to have the building surveyed
by a structural engineer. See Statement Of Assumptions And Limiting Conditions.
Land Value
Development of a land value has been attempted by the appraiser . The use of this data, in whole
or in part, for other purposes is not intended by the appraiser. Nothing set forth in the appraisal
should be relied upon for the purpose of determining the amount or type of insurance coverage to
be placed on the subject property. The appraiser assumes no liability for and does not guarantee
that any insurable value estimate inferred from this report will result in the subject property being
fully insured for any loss that may be sustained. Further, the land value may not be reliable
indication of replacement or reproduction cost for any date other than the effective date of this
appraisal due to changing costs of labor and materials and due to changing building codes and
governmental regulations and requirements.
Supplemental Addendum
Form TADD - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
AP20427
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Borrower
Lender/Client
Property Address
City County State Zip Code
File No.
Form PICPIX.SR - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Subject Photo Page
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Subject Front
Sales Price
Gross Living Area
Total Rooms
Total Bedrooms
Total Bathrooms
Location
View
Site
Quality
Age
3611 Louisiana Ave N
N/A
1,553
7
3
1
A;ApartmentB
N;Res
12,564 sf
Q5
60
Subject Rear
Subject Street
Borrower
Lender/Client
Property Address
City County State Zip Code
Form PICSIX2 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Photograph Addendum
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Living Kitchen
Foyer Dining
Main Floor Bath Bedroom
Borrower
Lender/Client
Property Address
City County State Zip Code
Form PICSIX2 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Photograph Addendum
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Master Bedroom Master Bath
Front Sunroom Living
Second Floor Sitting Second Floor Bedroom
Borrower
Lender/Client
Property Address
City County State Zip Code
Form PICSIX2 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Photograph Addendum
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Basement Den Basement Den
Electrical Panel Well - Advised that well is capped per
Jeremy Carlson
HVAC Subject Side
Borrower
Lender/Client
Property Address
City County State Zip Code
Form PICSIX2 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Photograph Addendum
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Driveway Garage
Garage Storage Views to the south side
Views to the rear Shed
Borrower
Lender/Client
Property Address
City County State Zip Code
Form PICSIX2 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Photograph Addendum
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Subject Side Front Deck
Apartments Adjacent to the Rear
Borrower
Lender/Client
Property Address
City County State Zip Code
Form PICPIX.CR - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Comparable Photo Page
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Comparable 1
Prox. to Subject
Sale Price
Gross Living Area
Total Rooms
Total Bedrooms
Total Bathrooms
Location
View
Site
Quality
Age
6327 31st Ave N
0.86 miles SE
168,000
1,320
6
3
1.0
N;Res;
B;Woods
19602 sf
Q5
71
Comparable 2
Prox. to Subject
Sale Price
Gross Living Area
Total Rooms
Total Bedrooms
Total Bathrooms
Location
View
Site
Quality
Age
4517 Brunswick Ave N
1.10 miles NE
176,000
1,500
8
4
1.0
N;Res;
N;Res;
22216 sf
Q5
90
Comparable 3
Prox. to Subject
Sale Price
Gross Living Area
Total Rooms
Total Bedrooms
Total Bathrooms
Location
View
Site
Quality
Age
4055 Oregon Ave N
0.59 miles NW
224,900
990
6
3
1.0
A;RR;
N;Res;
8712 sf
Q5
65
Borrower
Lender/Client
Property Address
City County State Zip Code
Form SKT.BLDSKI - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Building Sketch
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Borrower
Lender/Client
Property Address
City County State Zip Code
Plat
Form SCNLGL - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Form MAP.LOC - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Aerial
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Borrower
Lender/Client
Property Address
City County State Zip Code
Form MAP.LOC - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Aerial
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Borrower
Lender/Client
Property Address
City County State Zip Code
Form MAP.LOC - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Location Map
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
Borrower
Lender/Client
Property Address
City County State Zip Code
Richard Carlson
AP20427
N/A
3611 Louisiana Ave N
New Hope Hennepin MN 55427
City of New Hope
None.
None. Sources for data were from RMLS and Hennepin County
Assessor Website.
0-90
0-90
Jayne Preusse
01/26/2021
20559939
MN
08/31/2021
01/21/2021
Form ID14EC - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Borrower
Lender/Client
USPAP Compliance Addendum
Loan #
File #
Property Address
City County State Zip Code
APPRAISAL AND REPORT IDENTIFICATION
This Appraisal Report is one of the following types:
Appraisal Report This report was prepared in accordance with the requirements of the Appraisal Report option of USPAP Standards Rule 2-2(a).
Restricted Appraisal Report This report was prepared in accordance with the requirements of the Restricted Appraisal Report option of USPAP Standards Rule 2-2(b). The
intended user of this report is limited to the identified client. This is a Restricted Appraisal Report and the rationale for how the appraiser arrived
at the opinions and conclusions set forth in the report may not be understood properly without the additional information in the appraiser's workfile.
ADDITIONAL CERTIFICATIONS
I certify that, to the best of my knowledge and belief:
The statements of fact contained in this report are true and correct.
The report analyses, opinions, and conclusions are limited only by the reported assumptions and are my personal, impartial, and unbiased professional analyses,
opinions, and conclusions.
I have no (or the specified) present or prospective interest in the property that is the subject of this report and no (or specified) personal interest with respect to the
parties involved.
I have no bias with respect to the property that is the subject of this report or the parties involved with this assignment.
My engagement in this assignment was not contingent upon developing or reporting predetermined results.
My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause
of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of
this appraisal.
My analyses, opinions, and conclusions were developed and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice.
This appraisal report was prepared in accordance with the requirements of Title XI of FIRREA and any implementing regulations.
PRIOR SERVICES
I have NOT performed services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period
immediately preceding acceptance of this assignment.
I HAVE performed services, as an appraiser or in another capacity, regarding the property that is the subject of this report within the three-year period immediately
preceding acceptance of this assignment. Those services are described in the comments below.
PROPERTY INSPECTION
I have NOT made a personal inspection of the property that is the subject of this report.
I HAVE made a personal inspection of the property that is the subject of this report.
APPRAISAL ASSISTANCE
Unless otherwise noted, no one provided significant real property appraisal assistance to the person signing this certification. If anyone did provide significant assistance, they
are hereby identified along with a summary of the extent of the assistance provided in the report.
ADDITIONAL COMMENTS
Additional USPAP related issues requiring disclosure and/or any state mandated requirements:
MARKETING TIME AND EXPOSURE TIME FOR THE SUBJECT PROPERTY
A reasonable marketing time for the subject property is day(s)utilizing market conditions pertinent to the appraisal assignment.
A reasonable exposure time for the subject property is day(s).
APPRAISER SUPERVISORY APPRAISER (ONLY IF REQUIRED)
Signature
Name
Date of Signature
State Certification #
or State License #
State
Expiration Date of Certification or License
Effective Date of Appraisal
Signature
Name
Date of Signature
State Certification #
or State License #
State
Expiration Date of Certification or License
Supervisory Appraiser Inspection of Subject Property
Did Not Exterior-only from Street Interior and Exterior
USPAP Compliance Addendum 2014 Page 1 of 1
Appraisal License
Form SCNLGL - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
E & O Insurance
Form SCNLGL - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE
Budget for 3611 Louisiana Ave N
EXPENSES AMOUNT
Acquisition (170,000.00)$
Closing costs for purchase (estimated)(3,300.00)$
Legal costs for purchase (estimated)(1,500.00)$
Appraisal (350.00)$
Demolition survey (650.00)$
Demolition and site prep (estimated)(20,000.00)$
Real estate taxes (estimated at 6 months)(1,761.03)$
Lawn services (estimated)(400.00)$
Utility billing (estimated)(200.00)$
Public hearing notice (estimated)(100.00)$
Closing costs for sale (estimated)(1,500.00)$
Legal costs for sale (estimated)(1,000.00)$
TOTAL (200,761.03)$
REVENUE AMOUNT
EDA (estimated lot sale proceeds)67,000.00$
TOTAL 67,000.00$
TOTAL COST/REVENUE (133,761.03)$
Taxable Market Value 2020,
Payable 2021
Projected Taxable Value 2022,
Payable 2023 Change Percent Change
174,000.00$ 390,000.00$ 216,000.00$ 124.14%
Estimated Taxes Allocated to
City 2020, Payable 2021
Projected Taxes Allocated
to City 2022, Payable 2023 Change Percent Change
1,044.00$ 2,340.00$ 1,296.00$ 124.14%
Projected Project Expenses (200,761.03)$
Lot Sale Revenue 67,000.00$
Total Cost/Revenue (133,761.03)$
# of Years
(Year)
Additional Taxes
Collected By City
Total Cost/
Revenue
Return On
Investment
0 (present)-$ (133,761.03)$ -100.00%
1 (payable 2023)1,296.00$ (132,465.03)$ -99.03%
2 (payable 2024)2,630.88$ (131,130.15)$ -98.03%
3 (payable 2025)4,005.81$ (129,755.22)$ -97.01%
4 (payable 2026)5,421.98$ (128,339.05)$ -95.95%
5 (payable 2027)6,880.64$ (126,880.39)$ -94.86%
10 (payable 2032)14,857.19$ (118,903.84)$ -88.89%
15 (payable 2037)24,104.19$ (109,656.84)$ -81.98%
20 (payable 2042)34,824.01$ (98,937.02)$ -73.97%
25 (payable 2047)47,251.21$ (86,509.82)$ -64.67%
30 (payable 2052)61,657.74$ (72,103.29)$ -53.90%
*Based on new home valued at $390,000
Estimated Tax Impact of Improvements at 3611 Louisiana Ave N
Estimated Return on Investment for 3611 Louisiana Ave N
Description Taxable Market Value
Change Cash Flow
Investment -$ (133,761.03)$
Return, Year 1 216,000.00$ 1,296.00$
Return, Year 2 222,480.00$ 1,334.88$
Return, Year 3 229,154.40$ 1,374.93$
Return, Year 4 236,029.03$ 1,416.17$
Return, Year 5 243,109.90$ 1,458.66$
Return, Year 6 250,403.20$ 1,502.42$
Return, Year 7 257,915.30$ 1,547.49$
Return, Year 8 265,652.75$ 1,593.92$
Return, Year 9 273,622.34$ 1,641.73$
Return, Year 10 281,831.01$ 1,690.99$
Return, Year 11 290,285.94$ 1,741.72$
Return, Year 12 298,994.52$ 1,793.97$
Return, Year 13 307,964.35$ 1,847.79$
Return, Year 14 317,203.28$ 1,903.22$
Return, Year 15 326,719.38$ 1,960.32$
Return, Year 16 336,520.96$ 2,019.13$
Return, Year 17 346,616.59$ 2,079.70$
Return, Year 18 357,015.09$ 2,142.09$
Return, Year 19 367,725.54$ 2,206.35$
Return, Year 20 378,757.31$ 2,272.54$
Return, Year 21 390,120.03$ 2,340.72$
Return, Year 22 401,823.63$ 2,410.94$
Return, Year 23 413,878.34$ 2,483.27$
Return, Year 24 426,294.69$ 2,557.77$
Return, Year 25 439,083.53$ 2,634.50$
Return, Year 26 452,256.03$ 2,713.54$
Return, Year 27 465,823.71$ 2,794.94$
Return, Year 28 479,798.43$ 2,878.79$
Return, Year 29 494,192.38$ 2,965.15$
Return, Year 30 509,018.15$ 3,054.11$
Total Returns 61,657.74$
Investment Cost 200,761.03$
Selling Price 67,000.00$
Return on Investment -53.90%
Description Amount
Investment (133,761.03)$
Return, Year 1 1,296.00$
Return, Year 2 1,334.88$
Return, Year 3 1,374.93$
Return, Year 4 1,416.17$
Return, Year 5 1,458.66$
Return, Year 6 1,502.42$
Return, Year 7 1,547.49$
Return, Year 8 1,593.92$
Return, Year 9 1,641.73$
Return, Year 10 1,690.99$
Return, Year 11 1,741.72$
Return, Year 12 1,793.97$
Return, Year 13 1,847.79$
Return, Year 14 1,903.22$
Return, Year 15 1,960.32$
Return, Year 16 2,019.13$
Return, Year 17 2,079.70$
Return, Year 18 2,142.09$
Return, Year 19 2,206.35$
Return, Year 20 2,272.54$
Return, Year 21 2,340.72$
Return, Year 22 2,410.94$
Return, Year 23 2,483.27$
Return, Year 24 2,557.77$
Return, Year 25 2,634.50$
Return, Year 26 2,713.54$
Return, Year 27 2,794.94$
Return, Year 28 2,878.79$
Return, Year 29 2,965.15$
Return, Year 30 3,054.11$
Total Returns 61,657.74$
Internal Rate of Return -3.98%
Estimated Internal Rate of Return for 3611 Louisiana Ave N
Year
Original Taxable
Market Value (assumes
growth in value over
time)
Improved Taxable
Market Value
(assumes growth in
value over time)
New Taxable Value
Projected City Taxes on
New Taxable Market
Value
1 174,000.00$ 390,000.00$ 216,000.00$ 1,296.00$
2 179,220.00$ 401,700.00$ 222,480.00$ 1,334.88$
3 184,596.60$ 413,751.00$ 229,154.40$ 1,374.93$
4 190,134.50$ 426,163.53$ 236,029.03$ 1,416.17$
5 195,838.53$ 438,948.44$ 243,109.90$ 1,458.66$
6 201,713.69$ 452,116.89$ 250,403.20$ 1,502.42$
7 207,765.10$ 465,680.40$ 257,915.30$ 1,547.49$
8 213,998.05$ 479,650.81$ 265,652.75$ 1,593.92$
9 220,417.99$ 494,040.33$ 273,622.34$ 1,641.73$
10 227,030.53$ 508,861.54$ 281,831.01$ 1,690.99$
11 233,841.45$ 524,127.39$ 290,285.94$ 1,741.72$
12 240,856.69$ 539,851.21$ 298,994.52$ 1,793.97$
13 248,082.39$ 556,046.75$ 307,964.35$ 1,847.79$
14 255,524.87$ 572,728.15$ 317,203.28$ 1,903.22$
15 263,190.61$ 589,909.99$ 326,719.38$ 1,960.32$
16 271,086.33$ 607,607.29$ 336,520.96$ 2,019.13$
17 279,218.92$ 625,835.51$ 346,616.59$ 2,079.70$
18 287,595.49$ 644,610.58$ 357,015.09$ 2,142.09$
19 296,223.35$ 663,948.89$ 367,725.54$ 2,206.35$
20 305,110.05$ 683,867.36$ 378,757.31$ 2,272.54$
21 314,263.35$ 704,383.38$ 390,120.03$ 2,340.72$
22 323,691.26$ 725,514.88$ 401,823.63$ 2,410.94$
23 333,401.99$ 747,280.33$ 413,878.34$ 2,483.27$
24 343,404.05$ 769,698.74$ 426,294.69$ 2,557.77$
25 353,706.17$ 792,789.70$ 439,083.53$ 2,634.50$
26 364,317.36$ 816,573.39$ 452,256.03$ 2,713.54$
27 375,246.88$ 841,070.59$ 465,823.71$ 2,794.94$
28 386,504.29$ 866,302.71$ 479,798.43$ 2,878.79$
29 398,099.42$ 892,291.79$ 494,192.38$ 2,965.15$
30 410,042.40$ 919,060.55$ 509,018.15$ 3,054.11$
Tax Value Growth Rate 3%
City Rate 60%
The equation for calculating property taxes, in its most simplistic form, is Taxable Market Value X Property Tax Class Rate X City Tax
Rate. The Taxable Market Value in this calculation is assumed based on the city's projections for growth in property value due to the
improvements. The Property Tax Class Rates are set by the State of MN and stay fairly consistent from year to year (there have been
changes in commercial industrial, however; residential is mostly constant). The city’s Tax Rate changes every year based on the levy
certified and the overall tax value of the city. So, the Tax Rate used in this illustration is an assumption. The city’s rate has varied
between 58-63% in recent years. Property taxes are calculated on taxable market value, not estimated market value. It is of
important note, that this calculation does not take into consideration the market value exclusion which is applied to residential
properties under $413,800 in value.
Tax Calculator for 3611 Louisiana Ave N
Comparison of Costs & Tax Impact for Recent Projects
Since implementation of analysis template that utilizes tax growth rate assumptions (September of 2020)
3611 Louisiana
Avenue North
5213 Pennsylvania
Avenue North
4215 Louisiana
Avenue North
4637 Aquila
Avenue North
Number of Units 1 1 1 1
Project Description Demolition &
rebuild
Demolition &
rebuild
Demolition &
rebuild
Demolition &
rebuild
Year Acquired TBD TBD 2020 TBD
Projected or Actual Projected
(at time of offer)
Projected
(at time of offer)
Projected
(at time of lot sale)
Projected
(at time of offer)
Expenses $(200,761.03) $(199,779.12) $(170,441.53) $(110,085.69)
Revenue $67,000.00 $67,000.00 $69,000.00 $67,000.00
Total Cost/Revenue $(133,761.03) $(132,779.12) $(101,441.53) $(43,085.69)
*Additional Taxes
Collected by City - 1 year
$1,296.00 $1,512.00 $786.00 $984.00
*Additional Taxes
Collected by City - 30 years
$61,657.74 $71,934.03 $37,394.28 $46,814.21
*Return On Investment -
30 years
-53.90% -45.82% -63.14% 8.65%
*Internal Rate of Return -
30 years
-3.98% -3.20% -5.01% 0.47%
*Assumed 3% tax value growth rate