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032700 EDA CITY OF NEW HOPE EDA MEETING City Hall, 4401 Xylon Avenue North March 27, 2000 President W. Peter Enck Commissioner Sharon Cassen Commissioner Don Collier Commissioner Pat LaVine Norby Commissioner Mark Thompson 1. Call to Order 2. Roll Call 3. Approval of Regular Meeting Minutes of February 28, 2000 4. Motion Authorizing Staff to Negotiate with Property Owner for Potential Acquisition of 8113 Bass Lake Road by City (Improvement Project No. 677) 5. Adjournment CITY OF NEW HOPE 4401 XYLON AVENUE NORTH NEW HOPE, MINNESOTA 55428 Approved EDA Minutes Regular Meeting February 28, 2000 City Hall CALL TO ORDER ROLLCALL APPROVE MINUTES ELDORADO COURTS APTS. Item 4 MOTION Item 4 7610 BASS LAKE ROAD Item 5 New Hope EDA Page 1 President Enck called the meeting of the Economic Development Authority to order at 7:51 p.m. Present: W. Peter Enck, President Sharon Cassen, Commissioner Don Collier, Commissioner Pat LaVine Norby, Commissioner Mark Thompson, Commissioner Motion was made by Commissioner Collier, seconded by Commissioner Thompson, to approve the Regular Meeting Minutes of February 14, 2000. Voting in favor: Cassen, Collier, Norby, Thompson; Abstained: Enck. Motion carried. President Enck introduced for discussion Item 4, Motion Authorizing Staff to Obtain Appraisal of Eldorado Courts Apartments at 7701/7721/7741/7761 62"d Avenue North. Mr. Kirk McDonald, Director of Community Development, indicated the property is for sale and staff would like the EDA's authority to obtain an appraisal of the four- unit complex by BCL Appraisals for a cost of $3,200. Mr. McDonald reported that the estimated market value of the property for taxes payable in 2000 is $140,000 per property or a total of $560,000. The realtor has indicated the current asking price is $880,000. Mr. McDonald stated the Eldorado Apartments are located in an area designated in the City's Comprehensive Plan for future redevelopment. The EDA expressed support for possible redevelopment. Motion was made by Commissioner Cassen, seconded by Commissioner Norby, to authorize staff to obtain an appraisal of Eldorado Courts Apartments at 7701/7721/7741/7761 62"d Avenue North. All present voted in favor. Motion carried. President Enck introduced for discussion Item 5, Discussion Regarding Concept Redevelopment/Rehabilitation Project at 7610 Bass Lake Road. Mr. Kirk McDonald, Director of Community Development, introduced Barb McCormick and Chris Wilson of PPL and George Gamett, Executive Director of Northwest Community Revitalization Corporation. Mr. McDonald explained that staff would like to determine whether the EDA has an interest in pursuing the redevelopment/rehabilitation of the l l-unit apartment complex at 7610 Bass Lake Road in conjunction with Project for Pride in Living February 28, 2000 ADJOURNMENT (PPL), the Northwest Community Revitalization Corporation (NCRC) and a variety of funding agencies. The collaborative project consists of two separate sites: one at 7610 Bass Lake Road in New Hope and the second at 5111-5211 56th Avenue North in Crystal. The projects in both cities, would be submitted to funding agencies for consideration under a single funding request. Mr. Chris Wilson explained the proposed project stating the existing I 1-unit apartment building would have exterior improvements, attractive landscaping, an expanded and resurfaced drive, and construction of garages. Interior work will include new cabinets and counters, new carpeting, updated electrical, and wall repair and painting. The market rate rents would range from $600 to $1,000 depending on unit size. He explained the rental criteria. The total cost of the development is approximately $4.6 million. President Enck questioned PPL's intentions to utilize the on-site manager from the nearby PPL site for these additional units. Mr. Wilson indicated a manager can normally handle 80 units. He pointed out the existing New Hope site has 34 and the proposed project would add 24 units for a total of 58 units. Discussion ensued regarding support services offered by PPL. President Enck questioned whether they would offer a parenting class. Resources such as area churches and the Thorson Resource Center were identified. Ms. McCormick indicated she would review PPL's self sufficiency management programs already planned as well as the funding allocations. Mr. Wilson noted that the project would be a partnership with PPL and the Northwest Community Revitalization Corporation (also known as the Community Housing Development Corporation/CHDO). The ownership structure has not been determined yet. Mr. George Garnett responded to the EDA's questions concerning funding. He stated the financial request from New Hope would be $350,000. Mr. McDonald reminded the EDA that at this time staff is seeking 'concept' approval only. The EDA expressed support for the project, but directed staff to determine the City's financial commitments for such a project as well as available funding sources before additional effort is expended. Motion was made by Commissioner Collier, seconded by Commissioner Thompson, to adjourn the meeting. All present voted in favor. Motion carried. The New Hope EDA adjourned at 8:17 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA Page 2 February28,2000 EDA RF~D'EST FOR ACTION Originating Department Approved for Agenda Agenda Section EDA Community Development 3-27-0-~ Item No. BY:Kirk McDonald By:. i/~// 4 MOTION AUTHORIZING STAFF TO NEGOTIATE WITH PROPERTY OWNER FOR POTENTIAL ACQUISITION OF 8113 BASS LAKE ROAD BY CITY (IMPROVEMENT PROJECT NO. 677) REQUESTED ACTION Staff is requesting approval of a motion authorizing staff to negotiate with the property owner for the potential acquisition of the fourplex property at 8113 Bass Lake Road by the City for redevelopment purposes. POLICY/PAST PRACTICE IN 1993, the EDA established a loan program directed at maintaining multi-family rental housing and also has considered the purchase/demolition/redevelopment of targeted multi-family properties in the City, such as Regent Apartments. The new Comprehensive Plan update identifies this property as a potential redevelopment site. BACKGROUND In May 1999, the City received correspondence from the new owner of this property requesting consideration of financial assistance to make improvements to the property, including new roof windows, exterior doom, drain tile, parking area and landscaping. The property has no garages. The EDA responded that they did not know if the financial investment in the property would be worthwhile and to inquire if the owner would be interested in selling the property, and staff conveyed that response to the owner in correspondence. In February 2000, staff received new correspondence from the owner stating that he is interested in selling the property, with a proposed sale price of $185,000. If the City is not interested, the letter states, the owner will sell the building outright. (cont'd.) · o: 7La /a r . / RFA-O01 ~ Request for Action Page 2 3-27-00 At the February 14 EDA meeting, staff requested authorization to obtain an appraisal of the property, which the EDA authorized. The appraisal has now been completed and the estimated market value of the property is $171,000. Staff is requesting authorization to meet with the property owner and potentially negotiate the purchase of the property based on the appraisal and other factors, such as the terms of the leases, which would have an impact on relocation benefits. The building was constructed in 1958 and has a 1999 market value for tax purposes of $136,000 (land $26,000/building $110,000). There is a twin fourplex building located adjacent to this building (8109 Bass Lake Road) that is under separate ownership. Both properties are located on the south side of Bass Lake Road, just west of Lyndale Garden Center, and have a shared access off of Bass Lake Road. These properties have been designated in the Comprehensive Plan for either redevelopment or substantial rehabilitation. If the City pursues the acquisition of the property, the plan would be to demolish the structure, potentially acquire the adjacent property, and redevelop the site. The City Manager and Community Development Director have recently met with New Hope resident Duane Reynolds regarding a possible development by Vinland Center/Living Works Ventures of a lodge on the site for individuals with disabilities (see attached information). FUNDING The property is currently not located in an area where TIF funds can be expended, therefore, EDA or CDBG funds would be used to pay for the cost of the appraisal. ATTACHMENTS Appraisal 1/27/00 Correspondence from Owner 5/12/99 City Correspondence 5/10/99 EDA Minutes 4/24/99 Correspondence from Owner Map/Comprehensive Plan Information Vinland Center Information ~ . BCL Appraisals " February 29, 2000 City of New Hope 4401 Xylon Avenue North New Hope, Minnesota 55428 File Number: 00-0476J To Whom It May Concern: In accordance with your request, I have personally inspected and appraised the real property at: 8113 Bass Lake Road New Hope, MN 55428 The purpose of this appraisal is to estimate the market value of the subject property, as improved. The property rights appraised are the fee simple interest in the site and improvements. In my opinion, the estimated market value of the property as of February 29, 2000 is: $171,000 One Hundred Seventy-One Thousand Dollars The attached report contains the description, analysis and supportive data for the conclusions, final estimate of value, descriptive photographs, limiting conditions and appropriate certifications. Julie Bjorklund JB:lb 2852 Anthony Lane South, Minneapolis, Minnesota 55418 sMALL'RESIDENTIAL INCOME APPRAISAL REPORT 00-047~ ~ 8113 Bass Lake Road ~ St~. MN ~5428 , See Attached Addendum. iNO. 06-118-21.-41-0008 Sa~ ~ $ N/A Date c~ Sale NIA orklund Location Urban Bull up [] Over 75% Growth rate ~ Rapid ~ C~ PropMty values Incraas~g TeMn~ Demand/supply Sh~tage IXI Vac~ ~) Und.r 3 me& Typical 2.4 family bldg. Type Side x Side No. ,t;ms I No. uaila 2 r~s$ 450 los 700 [] ~;;~,a~,; ~ [] T~ Est. neighlx,flo~ apt. v~ ~ [] Increasing [] Stable Ra,tcontro~a []y. []No F~L~,~ ~esora.~,d.,,~. TaxYMr 1999 R.F_Taoae$3,387 ~aSNone ~Rda~nc~ 91-C1 Census Trad 5.02 Cun~d Owr~ Steven Martinetfi HOA$ NIA/Mo. D,~..,;~, and S an~unt al'ken ,;.~.,~..T --= -'~ to Im paid b/sukrN/A /,,~,eaa 4401 X¥1on Avenue North~ New Hope~ Minnesota 55428 AG,;,~ 2852 Anthon Lane South ~5418 ~i.,~;~tnant Sinole ;--i~,;;y housing ;'.,,~,,;~Inant 2.4 family Single Family PRICE AGE 2.4 Family PRICE AGE Occupancy $ (000) (yrs} Occupancy $ (000) (yrs) 100 Lo~ 120 vacm (0~) eredo.~a~ 145 35 150 35 .~e 35 ~ PmMnt land ute % Land use change 2-4 famly -- [] In Ixocess to: Nots: Rmca and the racial composition of the neighborhood raze not apprll~l flctorl. Neighborhood boundaries and characteristics: See Attached Addendum. Factors that affect the marketability of the properties in the neighborhood (proximity to employment and amenities, sn~doyment atablity, appeal to ,,.,~,e[, etc.): is located on Bass Lake Road~ which is County Road 10~ providing convenient access to neighborhood Crystal Airport is two miles to the east of the subject. Neighborhood parks such as re within one-half mile of the subject. ~ felmveg avalable ~ represent the most current, simlar, and proximate competitive propel/es to tim au bjm:~ pmF~'ty ~ the subj~d neighlx~. This analysis is intended to evaluate the inve~ee/ctm~[~/co the make{ competing w/ih tho su b.iect pmp~ty in tim subject neighbotflood end recent ~ and marketing time trends affeding the subjed properly. cod a considered a · the rental or sale corn for sale. ITEM SU&IECT COMPARABLE USTING NO. t COMPARABLE USTING NO. 2 COMPARABLE USTING NO. 3 8113 Bass Lake Road 3616 Ma~land Avenue North 2.5 Miles South $ N/A Fum. $ : Data source 3e MLS i# UrasffeL mls/BPJBA ! 960 ' 1962 N/A 1/11/00 ~ oflistingsto subjed properly:, See Attached Addendum. :MLS MLS Market conditions that affect 2-4 family properties in the subject neighborhood (including the above neighborhood indicators of growth rata, property values, demand/supply, and marketing time) and the prevalence and impact in the subject market area regarding loan discounts, interest buydowne and concessions, and identification of trends in listing prices, average days on market and any change over the past year, etc.: There are very few rental properties available on the market today in the northern suburbs, and that could even be said of the entire Twin Cities metropolitan area. Rental rates are for listings is increasinq. Dbensions 80' X 240' Approximately Si~earea Approx 21,880 Sq. Ft./.5Acre ComerLo~ [~No [~Yes Specificzoning classification and deSCription R3 Medium Density Residential Zoningcomplianca []Legal [:~Legah~,~,i,~.~anclab~amduse) ~]lilega~ [] Nozoning Highest & best use as imlxoved: [] Present use [] OthM use (explain) Utilities Public Other Eiedrk~y [] (4) 100 Amp CB Gas [] Natural Gas Water [] Santary w [] Storm sew~' Cff-~t. Imla-ovement~ Type Pul:ac; Private Curtdgutte~ Concrete [] Sidewalk Concrete [] Streel lightsYes [] A~e¥ No [~ Topography Level Size Average Shape Mostly Rectangular Drainage View County Land~ Average Driveway Asphalt Apparent easements Driveway FEMA Special Rood Hazard N'ea FEMAZone C MapDate 1/'2/81 FEMA Map No. 270177-0001B Cornments (apparent adverse easements, encroachments, special assessments, slide areas, illegal or legal nonconforming zoning, use, etc.): See Attached Addendum. Freddie Mac Fa'm 72 10-94 PAGE 1OF 4 Fsunie Mae Fa'm 1025 10-94 SMALL RESIDENTIAL INCOME APPRAISAL REPORT Gm~ral dasgrlpflon Sted~ One Plus Type (der/att.) Detached Design (style) Side x Side Edsa~romsed Existing Under mmbucam No Year Buit 1960 411 Foundation Concrete Block-Avemg, Ed~ B~icl(/Wo0d-Average Roof sun'ace Asphalt Shingle-Avg G~tt~ & dwr~ No W'r~v type Dble Hun~/Alum/Vinyl S~m sash/Soa~ Yes 00-0476J Slab No Claim No Sur~Pump Yes + Drain Tile Dar,asea= None Noted ~ None Noted Infestation None Noted ~ 100 % dlst Icorama In~ulaUon (R,~abe Ibx~m) A~luacy Average Energy elficient iJern~ Er~l~eage(.~) 25-30 Years '(co~ies with the HUD Marm'radursd Housing ~---,,=~rrah 100%~ Including , None C~nstmdicn and Safet~ Standards.) Utility Impmvwments contain: 16 Roorm; 8 Badr~s): 4 Bath(s); 3t654 $~_,_-,e f~t of GROSS BUILDING AREA GROSS BUILDING AREA (GBA) IS DEFINED AS THE TOTAL FINISHED AREA (INCLUDING COMMON AREAS) OF THE IMPROVEMENTS BASED UPON EXTERIOR MEASUREMENTS. surfaces (Materiols/coadilion) P, oa~ HW/Cpt/Vinyl/Av-G Wails Drywall/PaneI-Avg Trimt~ish Oak-Average Bath IIm~ Vinyl/Average-Gal I~th wahsc~ Fiberglass-Average ~ Flush/Oak-Average Heating Type Hot Water Fual Natural Gas Conditi~ Average Cooling Centre No Othe~ Window Condition Unknown #0 Kitchen equip. (#1unil~nd.) R~gemer 1/Unit-Average Range~n 1/Unit-Average Di~lx~d None ~ None Fan/hood None ~or None ','~;,~' Leased Microwave None Intecom None Attic D~p ct~¥ UnfinJdned Condition of the improvements, mpai*a needed, quality of constmalke, addilional features, medemizatkm, et=: The current owner purchased the property one and in the interveninq time has been attempting to do some needed repairs and improvements. He has spent approximately i new exterior windows to the home~ but that proiect is not yet completed. All ofthe apartments have been repainted. number one in the basement has new kitchen fioodncJ~ new bathroom flooring~ and a new refrigerator. Apartment number two in the basement has new carpetingI appliancesr and kitchen vinyl. Apartment number three upstairs has new kitchen appliances and bedroom carpetingr and apartment number four upstairs has a new bathroom floorr including a new subfloor~ as well as new )roblems with water in the basement~ especially visible in the laundry room. There is now a sump in the bas~.,ent with drain tile in the rear. As previously mentionedr the owner has also reqraded the far south end of the site in order to remedy some of the drainage problems on the property. Remaining items left to be upgraded on the property include finishinc the installation of the exterior windows, a new roof, and perhaps a new motor for the gas hot water heat boiler. Also the owner started ' some of the exterior wood trimr and that is not yet finished. D~,~-.;,,;ion (physical, f~ncticnal, and external inadequaces, et=): The subiect is located on busy Bass Lake Road, County Road 10~ but the four-plax is set further back on the site. Busy streetlocations do not seemto bea detriment to investment properties, as tenants appreciate close to arterial streets. Physical depreciation for that property is noted because of the upkeep of the pro~,er~y, both in the interior and the exterior. The upstairs units have hardwood flooring, and some of the bedroom and living room carpeting has been and downstairs, but there are still several areas where there is older and stained carpeting. General life expectancy tables for four-unit properties indicate an average economic life for a property from 50-55 years. After co~padng the subject to other in the area and other investment properties, it is estimated that the subject has an effective age of 30 years, with remaininc~ economic life of 20 years. Adverse environmental conditions (such as, but not limited Io, hazardous wastes, toxic substances, etc.) present in the improvements, on the site, or in the immediate vicinity of/he subject properly: No adverse environmental conditions were noted at the time of the time of the inspection. VALUATION ANALYSIS ESTIMATED SITE VALUE ............................. =$ 65~00( ESTIMATED REPRODUCTION COST*NEW OF IMPROVEMENTS: 1827 Sq. Ft. ~ $ 70 00 =$ 127r890 1827 Sq. Fl.~$ ~300 =$ 115~101 Sq. Ft. @ $ =$ sq. Ft. 0 $ = $ Sq. Ft. 0 $ =s Appliances~ Ceiling Fans, Water Heater = $ 11,000 =$ =$ =$ =$ Special Energy Efficient Items = $ Porches, Patios, etc. = $ Total Eslimaled Cost New ............................. = $ 253r991 Physical Fundicnal External Le'.a 60% Delxeciaticn =S 152,395 Depreciated Value of Impmvernent~ ..................... = $ 101 r59~ 'As Is' Value of Site Impravement~l ...................... = $ COST APPROACH ............... =$ 176,60~ Freddie Mac Form 72 10-94 PAGE 2 OF 4 Comments on Cost Approach (such as, source of cost estimate, site value, square foot calculation and, for HUD and VA, the estimated remaining economic life of the property): Cost estimates were made using the Marshall Swift Residential Cost Guide for multi-family units. Site value is estimated usinq market sales and allocation methods, and estimated at $3.00 per square foot. The remaininc) economic life of the property was estimated to be 20 years, with the property 60% depreciated. Fannie Mae Fcrm 1025 10-94 1AL INCOME APPRAISAL REPORT oo-o4~J propm4ies os s,muar ina p~oxlmaro t.o tn.a =uu.j.~ I,,,,~,~.,x --__~_;_:. ~*.~;'.o'~Ts~'-r~-~o~ should assure tho reader that tho units on" propomos salecrea as are not tho aim comparabloa used re. tho seas comparison ..1,7-,.., ...- --rr--- ...... ,'a" --~'"+ tho rental madmt for the subied r~opedy (unless comparablos are comparabil to tho subJeCt proplfty (both tho unila led tho overel properly) ind accufit.; r ....... othmwbe slated wilhin the r,poit). ITEM T SUBJECT COMPARABLE RENTAL NO. 1 COMPARABLE RENTAL NO. 2 COMPARABLE RENTAL NO. 3 8113 Bass Lake Road 553g Maryland Avenue North 3616 Maryland Avenue North Address New Hope Crystal New Hope ~,,~dates(i.: ~?,~) N/A N/A N/A Runt survey data 2/29/00 5/99 1/00 Data source Inspection MLS MLS None None None Ne. Urals4 Ne. VanO N~Ur~4 ~V= 0 ~m- 1979 N~Unts4 I~Va~ 0 yom' 1962 N~Urd~ N~V~ Description of Yr. Bit.: 1960 o1- units, T~wnhouse style 4 Plex Walk-up mgn, appel, Side by Side Brick/Stucco Ext. and conditions Brick/Stucco Rm. Count Size Rm Count Size Total Rnt Count Si~ Totd Rm CmJnt Size Total Tatar Ba Sq. Ft. Tot Br Ba Sq. Ft. klonU~Rmrd Tot Br Ba ISq. Ft. Mord~Raot Tot Br Ba Sci. Ft. kk~bN~R~l Individual 41 2 1 914 4 2 1 1144 706 4 ~ 1 884 600 unit breakdown Heat~ water~ sewer~ Utilities paid by renter Heat~ water~ sewer paid by Utilities, trash paid by owner owner furniture, and amenities included in rent Basement laundry Full basement Full basement Functional utility, GHWANindow GFWA/Central Air GHW basement, Onsite parkina (4) 2 Car garages Onsite parkin~ ~eating/cooling, xoject amenities, et~'. Analysis of rental data and supl~ for estmatad rna~et rents for the individual subjuct units ('mctuding the adjustments used, the adequacy of compamblee, rental cartoons, etc.) All of the subject units have been rented to new tenants over the previous year~ as the new owner had to evi~ all of the previous tenants after he purch~_~_~d the property in February of 1999. The most reoently rented units in the subject ara rented for $675.00~ which appears to be at the top of the current rental market. Comparable rental number one is a townhouse style and more contemporary four-ptex~ a side by side brick and stucco building. One year ago when the property was sold~ rents were $706.00 for a larger unit than the subject. That also included a two car attached garage for each unit. Comparable rental number two units have been renting for $600.00. The owner of that property indioated that was below market rent, but ha has had those renters for a long period of time~ and did not want to increase rent rapidly. SubJact*e rent schedule The rent schedule reconciles the applicable i~dicated monthly market rents to the appropriate subject unit, and provides the estimated rents for the subject property. The appraiser must review the rent characteristics of the comparable sales to determine whether estimated rents should reflect actual or market rents. For example, if actual rents were available on the sales comparabias and used to derive the gross rent multiplier (GRM), actual rents for the subject should bs used. If market rents were used to construct the comparables' rents and derive tho GRM, market rents should be used. The total gross estimated rent must represent rent characiadsflcs consistent with the saJes comparab4e data us~:l to de~ve tho GRM. 'J'ha total gro~ entimatad ant is not ndjustad f~' vacancy. LEASES ACTUAL RENTS ESTIMATED RENTS Lease Date ' u~ P~ Unil Tctal Pe~ Unit Total Unit Begin End w=. Unfumishnd Fumishnd Rents Unfumishnd Fumishad Rents I 10/99 10/00 0 $ 675.00 $ $ 675.00 $ 675.00 $ $ 675.00 2 8/99 8~00 0 650.00 650.00 675.00 675.00 3 12/99 12/00 0 675.00 675.00 675.00 675.00 4 Month to Month 0 675.00 675.00 675.00 $ 675.00 Othermc~hlykxx~e~m~ze) Laundry - washer and dryer leased $ 100.00 Vacancy:. Actualiastyear 3 % Previous yea' N/A % Estimated: 3 % $ 972.00 Annu~y Tctalgr~mestimatndmnt $ 2~800.00 Uffiitissindudndinectimatadrents: [-")Electric C~W~Sewor ~lGas-';~O! 'T~-Treshc~iadion {--1 Comments on the rent schedule, actual rents, estimated rents (especially regarding differences between actual and estimated rents), utiliiias, etc.: As previously mentioned, the subiect currently has three units renting for $675.00 and one for $650.00. The $676.00 appears to be currently at the top of the rental range for two bedroom units in the area. Total gross estimated rent also includes approximately $100.00 of monthly income from the laundry facilities. The washer and dryer in the building are leased by the owner. Freddie Mac Fern 72 10-94 PAGE 3 OF 4 Fannie Mae Fa'm 1025 10-94 ~ .... ' ~'~ ~ ~:~ ~' "~ ~-~: ~':~**~ SMALL RESIDENTIAL INCOME APPRAISAL REPORT ..... ~.,~ ~ · ~ -': * ,: '~ ~._ :* 00-0476.1 ITEM SUBJECT 8113 Bass Lake Road Addre~ New Hope N/A N/A 5900-56th Avenue North Crystal 1.5 Miles East []Unf. [~Fum. S 149,900 $ 43.09 $ 2,800 $ N/A Gmsu mo. m~ ntdL H) Data am:Ua' Verracotio~ Sources ADJUSTMENTS Sales or financing con~infl$ Loc~ion of mrmmction Condition Gross Suidin; Ama Unit Ixeakdown N/A $ I37~475 $ 9T369 Inspection Plat Systems I County Records . DESCPJP'rlON I DESCRJPllON ; + (-) s .,~mw~ Conventional , No Points Suburban Suburban Fu,~;u,,al utiity Clsd 10/7/98 ; +24,000 180 x 240/.5 Acre 80 x 1341.25 Acre Road Thru Street 4-Plex Walk-up 2732 Xylon Avenue North New Hope 13.5 Miles South []Uof. ~-J Fum. $ 182,000 $ 56.88 $ 2100/Market 86.67 $ 45,500 $ 12~133 S MLS - 1 Day Plat Systems DESCPJPTION Conventional No Points Clsd 4/28/99 Suburban Fee Simple ,. 100x150L34 Acre Residential 4-Plex Walk-up ', 4-Plax Walk-up e-Brick ; Years Years ; 37 Years 3~654 Sq. ft. Full-Walk-up Average 3,479 Sc~.fl.; Full-Walk-up +18,200 -9~000 -18,200 +3,500 +9~100 Good 3r200 S~.ff.i Full-Walk-up 5211-56th Avenue North Crystal 2 Miles East [X]u.~. I~]F.m. $ County Records Plat Systems DESCPJP310N 143~500 43.56 N/Al N/A Conventional No Points Clsd 5/'26/99 35,875 8r969 Suburban Fee Simple 81 x 180/.33 Acre Thru Street ; +12,900 4-Plex Walk-up Average-Stucco 41 Years Average 3~294 Sq.ft. Full-Walk-up , +7,200 Average : Average : Average H=d;;,,~,'c~,~i,-~ GHW/~/indow , GFVVNNone +1 000 GHVV/Wall i GFVVNNone ~ +lr000 Parkin~ on/off sits 6 Spaces on Site ! 6 Spaces on Site i '4 Car Dat. Gar. : -9~000 7 Spaces On Site Prc,~,;t arnenitiosand Deck, Shed Fence ', Shed JNone " +1 0001 Net Adi.(tota~) [] , ~] . $' 21,000 L~] * []. $' 8 9001 [] · L~ - $' 22,100 ~0'3~ !:~lro.~' sates Comparison (irlcJu ding reconci~iat ,Oll o; :i,Oi~,~..~i u~ ~ o f YatO: 7.sO~9oOc~Ollsiet en ~!~,'~',ive :l'e~gt h1:3dl :vOalOu !~io ~1'"~ ;~'~y4p~ '~ o~sJpu 11~16:st~6 s00 rnmr~a~on n mat market): See Attached Addendum. Date, Price and Data $153,000 None None None Sotace for rd~r salsa 2/2/99 MLS ' Records Analysis of any ~. m ,l a~,m~,,ant of sale, option, or listing of the subject prop~ty and analysis of any Ixior aales at' sul~ed and mmparal~s ~ one ~ af the date of appraisal: aCt sold for $153~000, closing on 2./2/99. It is not currently for sale, nor could any other listings for the other three comparable sales be found over the previous year~ other than those sales mentioned above. Tetalgrosarronthlyestirmtedrent$ .. 2~800 xD'ossrentmultiplier(GRM) 65.00 =$ 18210C0 INDICATED VALUE BY INCOME APPROACH Comments on income aplzoach (including expense rateS, iF evalal:de, and recondiation of fha GRM) As mentioned above in the Sales Comparison Analysis~ a Gross Rent Multiplier of 65 was estimated~ slightly higher than ts rate one year a,qo, at 60. INDICATED VALUE aY SALES COMPARISON A~PROACH INDICATED VALUE BY INCOME APPROACH ..................................... $ 171 ~000 INDICATED VALUE BY COST APPROACH ............................................ $ 182~000 .................. . ........ $ 176,600 Thisappcatsalistmde [] 'aais' E]sub~cltothemPa~aiterat~nS, inspectiomcrcotldit-~r~te~:ll~ ..... I*-*]subjedtocompletion'P~.l~a~aandspecificotion$' ~and CondliomofN3preisat ]'he photographs included with this appraisal are digital or electronic images, and they have not been enhanced or altered in any way. F'~al Rc-,;~.=.::..~ See Attached'Addendum The pui-p,~ ..... of this app, a;~,4 is to ~;b~.ie the. market value of the. mai property that is the. subject of this repo~, based on the above conditions and the corlification, contingent and limning conditions, and market value definihon that are stated m the affachad Freddm Mac Form 43g/Fannie Mae Fon'n 10048 (Revised 8/93 ). I (WE) ESTIMATE THE MARKET VALUE, AS DEFINED, OF THE REAL PROPERTY THAT IS THE SJJBJECT OF THS REPORT, AS OF ._Februan/29, 2000 (WHICH IS THE DATE OF INSPECTION AND THE EFFECTIVE DATE OF THIS REPOR'r) TO BE $ 171,000. APPRAISER: (~~ SUPERVISORY APPRAJSER (ONLY IF REQUIRED): Signature ~ Signeture Narco Julie Bic~klund [] Did [] Did Not DEteR S' Februa 29 2000 Name InspedProp~y State C~ti~x~inn # CRRPA State MN State Certk%:ation # State License # 4000579 State MN Or State License # mnm as ~mtats . BCL Appraisals ~Address: 8113 Bas~ Road Lender. City of New Hope ADDENDUM Case No.: State: MN ~5428 Legal Description Unplatted 06 118 21 E 80 Ft of W 580 Ft of that part of W 1/2 of NE 1/4 of SE 1/4 lying N or S 292 5/10 Ft thereof and S of road Neighborhood boundaries and characteristics The subject's immediate neighborhood is bordered by 62nd Avenue North to the north, Douglas Drive or County Road 102 to the east, Medicine Lake Road or County Road 70 to the south, and U.S. Highway 169 to the west. Those borders generally mark the borders of the city of New Hope, but also include parts of the City of Crystal on the east_ New Hope is a northwestern Hennepin County suburban community with a population of approximately 22,000 residents. There is an area of industrial land use contiguous to Highway 169, with multi-family and commercial development located along Bass Lake Road, Winnetka Avenue, and Medicine Lake Road. New Hope ia in the Robbinsdale School District, with Hostermann Middle School and Winnetka Elementary School located very close to the subject. Comparison of listings to subject property The Multiple Listing Service currently does not have any listings of 4-plexes within New Hope or the immediate northern suburbs. The only listing available was taken off the market in January after 18 days. It is generally found that investment properties of four units or larger are either sold by word of mouth or else an investment broker. The only listing that is mentioned here was put on the Multiple Usting Service by the owner/broker. It is a property similar to the subject in size and vintage. It was taken off the market after the owner decided to keep the property. Comments Current R3 zoning for the property is medium density residential, and the subject's lot size would allow up to five units on that site, so the subject does conform. However, current zoning also requires covered parking space for each unit, but the subject property was built in 1960, so its surface parking lot is grandfathered into the parking requirements. The subject property also shares an adjacent parking lot with the property owner at 8109 Bass Lake Road. In order to reach the parking lot of the subject, one must drive across the rear of the adjacent propen'7 at 8109 Bass Lake Road. The two property owners share maintenance and upkeep for the parking lot. During the summer of 1999 the two property owners regraded the south end of both sites, in an attempt to improve drainage on the property. Comments on Sales Comparison Two of the comparable sales are located in the adjacent city of Crystal, from one and one-half to two miles east of the subject. Comparable sale number two is in New Hope, the same city as the subject, but is three and one-half miles south. They are all four-plexes of similar vintage, design and quality. Major adjustments had to be made for condition, square footage, and date of sale. Because of the aforementioned rising market both in demand for listings and also sale pdces, Twin Cities Realtors report an average increase in sales prices for both residential and investment properties in the New Hope/Crystal/Robbinsdale neighborhood of approximately 12%. Median values have been increasing. The Minneapolis Star Tribune recently reported statistics from the Multiple Listing Service for 1998 and 1999 home sales. The City of New Hope had a 1998 median home sale of $125,000, and in 1999 a median home sale of $139,000, an increase of 11.2%. Crystal reported an increase of 13.9%, and Robbinsdale reported a 17.2% increase. Because of the aforementioned dearth of rental properties available for sale, average sale prices for rental properties also have been increasing. Therefore a date of sale or time adjustment was made for the three comparabies at a 12% annualized rate. The first comparable is a similar vintage four-plex with slightly smaller square footage. Its location was similar. An approximate 5% condition adjustment is given for the better external condition of the buiiding. The home did not have window air conditioning. There is some fencing surrounding the property. The second comparable was listed on the Multiple Listing Service, and sold after only one day on the market. The Realtor stated that the property was in very good condition, with all new carpeting and paint and units very well kept. Therefore a 10% condition adjustment is applied. It has a slightly better location, as it is only one block from shopping, but located in a more residential and single family neighborhood. There was also a four car detached garage, slightly under 1,000 square feet, making covered parking available for each tenant. Therefore a 5% adjustment is applied for its location and parking facilities. The third comparable is a four-ptex similar to the subject and comparable number one. Its condition, however, is similar to the subject, so positive adjustments are only made for the smaller square footage and the date of sale. It also lacks the window air conditioning units. The three comparable sales indicate a range of value for the subject from $165,600 to $173,100. Sales one and two would indicate a value on the higher end, as they have slightly more upgrades than the subject. Sale number three was on the lower end of the range because of fewer upgrades. As the subject does have some newer windows and also some newer floor coverings, a value towards the h;gher end of the range would be indicated. Therefore the indicated market value for the subject is $171,000. A gross rent multiplier for the subject was difficult to determine, as available gross rent multipliers for the three comparable sales were difficult to find. The subject at the time of its sale one year ago had approximate gross rent multiplier of 60, but gross rent multipliers have been rising because of the increasing rents and sales prices. Therefore the gross rent multiplier for the subject was estimated to be 65. Final Reconciliation: AJI three approaches to val{Je were considered in arriving at an indicated fair market value for the subject. The cost approach is not as reliable for a 40 year old building. Prospective buyers of income property most likely look at the anticipated income stream, and would most consider the sales per unit price of properties that have sold within the immediate market. The sales comparison analysis has proven to be the most reliable. That would indicate a current market value for the subject of $171,000. This report has been prepared according to the Uniform Standards of Professional Appraisal Practice. The intended use of the appraisal report is to establish a market value for the property in ADDENDUM File No.: 00.0476J Property Address: 8113 Bass Lake Road Case No.: State: MN City:. New Hope Lender. City of New Hope Zip: 55428 order for the city to determine the cost for a potential city purchase, The intended users are the employees of the City of New Hope, including the community development department and city attorney, and all of their assignees. -- BCL APPRAISALS Property Address 55428 8113 Bass Lake Road New Hope MN ..- ~ my .~ Z~Code General Insfl'uctlons: This form is to be prepared jointly by the loan applicant, the ,~p~,raiser, and the lender's underwriter. The applicant must complete the following schedule indicating each unit's rental status, lease expiration date, current rent, market rent, and the responsibility for utility expenses. Rents figures must be based on the rent for an 'unfurnished' unit. - -/- ....' ' -_...,~F~: :.. ':'- '-.:...- Currently Expiration CulTent Rent Market Rent Paid Paid . ~- .~..~ ..... :~..' ..,j:.:~:,.- ~. : ...,L~ .... Rented Date Pm' Month Per Month Utility Expense BLOOmer B~.~enant ·" ..... ' Unit No. 1 Yes X No Oct. 2000 $ 675 $ 675 EJectricity ......... Unit No. 2 Yes X No ~ Aug. 2000 $ 650 $ 675 Gas ............. Unit No. 3 Yes X No __ Dec. 2000 $ 675 $ 675 Fuel Oil .......... ._L .~'~ Unit No. 4 Yes. X No Month to Month $ 675 $ 675 Fuel (Other) ....... ~J ,- .......{......... -.... Total $ 2~675 $ 27700 TrashWater/SewerRemoval ....... ..... - .. .,::_ ~ - . The applicant should complete all of the income and expense projections and for existing properties provide actual year-end operating .!_- .~ .~:-.f~ .: ........ statements for the past two years (for new properties the applicanl'e projects# income an# ezpense# must Aa provi#e#). This Operating - - . ~.- ..?:.--. Income Statement and previous operating statements the applicant provides must then be sent to the appraiser for review, corn- : ment, and/or adjustments next to the applicant's figures (a.~., Applicant/Appraise! 2~/$00). If the appraiser is retained to complete the form instead of the applicant, the lender must provide to the appraiser the aforementioned operating statements, mortgage iasur- -~. ....... ance premium, HOA dues, leasehold payments, subordinate financing, and/or any other relevant information as to the income and '; --' expenses of the subject property received from the applicant to substantiate the projections. The underwriter should carefully review .. the applicant'slappraiser's projections and the appraiser's comments concerning those projections. The underwriter should make any final adjustments that are necessary to more accurately reflect any income or expense items that appear unreasonable for the market. (Real estate/axes and insurance on these lypae nf prnper/iae ara inc/u#e# in PITI and not cal~ulala# aa an annual expan#e item.) Income should be based on current rents, but should not exceed market rents. When there ara no current rents because the property is proposed, new, or currentl~ vacant, market rents should be used. Annual Income and B~pense Projection for Next 12 months Adjustments by Income (DO no~ ~/u~ ~con~ for ow#er-~=~p~duni$) By ApplicantJAppraiser Lender's Underwriter GrossAnnualRental(~vnun~f$)foberenled) ...................... $ 32~400 $ Other Income ('~fu#e sources) La~j o d ~. .......................... + 1~200 + Total .................................................. $ 33~600 Less Vacancy/Rent Loss ..................................... - 1008.00(3%) ( %) Effective Gross Income ...................................... $ 32r592 $ Expenses (Do not kdude e~enses f~' owr~-o~upedun/s) E ectricity ............................................... 400 Gas ................................................... 1 ~400 Fuel Oil ................................................. Fuel ........................... (Type: ) Water/Sewer ............................................. 1,600 Trash Removal ........................................... 800 Pest Control ............................................. Other Taxes or Licenses ..................................... Casual Labor ............................................. This includes the costs for public area cleaning, snow removal, etc., even though the applicant may not elect to contract for such services. Interior Paint/Decorating ..................................... 600 This includes the costs of contract labor and materials that are required to maintain the interiors of the living units. General Repairs/Maintenance ................................. 1,200 This includes the costs of contract labor and materials that are required to maintain the public corridors, stairways, roofs, mechanical systems, grounds, etc. Management Expenses ..................................... These are the customary expenses that a professional manage- ment company would charge to manage the property. Supplies ............................................... 600 This includes the costs of items like light bulbs, janitorial supplies, etc. Total Replacement Reserves - See Schedule on Pg. 2 ............... 1 ~821 Total Operating Expenses ................................ $ 8~421 BCL APPRAISALS - 00-0476J Replacement Reserve Schedule Adequate replacement reserves must be calc~Jlate regardless of whether actual reserves are provided for on the owner's operating statements or are customary Jn the local market. This represents the total average yearly reserves. Generally, all equipment and com- ponents that have a remaining life of more than one year-such as refrigerators, stoves, clothes washers/dryers, trash compactors, furnaces, roofs, and carpeting, etc.-=hould be expensed on a replacement cost basis. Equipment Replacement Remaining By Applicant/ Lender Cost Life Appraiser Adjustments StovesJRanges ..... {~$ 500.00 ea.+ 9 Yrs. x 4 Units=$ 222.00 Refrigerates ........ ~$ 500.00 ea.. 9 Yrs. x 4 Units=$ 222.00 Dishwashers ........ ~$ ea.+ Yrs. x Units =$ NCUnits .......... {~$ 500.00 ea.+ 4 Yrs. x 4 Units=$ 500.00 C. Washer/Dfyem .... ~$ ea.+ Yrs. x Units =$ HWHeaters ......... {~$ lr000.00 ea.+ 10 yrs. x I Units=$ 100.00 Fa'nace(s) .......... @$ 3r400.00 ea.. 15 yrs. x I Units =$ 227.00 (Other) ........... ~$ ea.+ Yrs. x Units =$ Roof .............. ~$ 5,000.00 + 5 Yrs. x One Bldg. = $ 1~000.00 Carpeting 0Nail to Wall) Remaining Life (Units) 300 TotalSq. Yds.~$ 15.00 PerSq. Yd. + 10 yrs.= $ 450.00 (Public Areas) Total Sq. Yds. {~ $ Per Sq. Yd.. Yrs. = $ Total Replacement Reserves. (Enter on Pg. 1) $ lr821.00 $ Operating Income Reconciliation $ 32,592.00 -$ 8,421.00 =$ 24,171.00 +12=- $ 2,014.00 Effective gross Income Total Operating Expenses Operating Income Monthly Operating Income $ 2,014.00 - $ N/A =$ N/A Monthly Operating Income Monthly Housing Expenses Net Cash Flow (Nots: Monthly Housing Expense includes principal and interest on the mortgage, hazard insurance premiums, real estate taxes, mort- gage insurance premiums, HOA dues, leasehold payments, and subordinate financing payments.) Underwriter's instructions for 2-4 Family Owner-Occupied Properties · If Monthly Operating Income is a positive number, enter as "Net Rental Income" in the "Gross Monthly Income" section of Freddie Mac Form 65/Fannie Mae Form 1003. if Monthly Operating Income is a negative number, it must be included as a liability for qualification purposes. · The borrower's monthly housing expense-to-income ratio must be calculated by comparing the total Monthly Housing Expense for the subject property to the borrower's stable monthly income. Underwriter's instructions for 1-4 Family Investment Properties · If Net Cash Flow is a positive number, enter as "Net Rental Income" in the 'Gross Monthly Income" section of Freddie Mac Form 65/Fannie Mae Form 1003. If Net Cash Flow is a negative number, it must be included as a liability for qualification purposes. · The borrower's monthly housing expense-to-income ratio must be calculated by comparing the total monthly housing expense for the borrower's primary residence to the borrower's stable monthly income. App,-aise~'s Comments C~/ud*~9 ~ur~s fo~ data a/~ Cost estimates derived from Marshall S~ft Valuation Guide, as well as interviews with local apartment owners. Bior ,und Februa 2g, 2000 Julie Appraiser Name App~iser Signature ~ Date Underwfiter's Coi~ents and Rationale for Adjustments Underwriter Name Underwriter Signahxe Date F,- ~G,f.~ Mac PACE 2 OF 2 F(:rrn 998 Aug 88 ~.~mm.~,*~.~C~D.,.k~..~.~.~ee, z34~z1 BCL Appraisals Fannie Mae Fcrm 216 Aug88 1. UnLess otherwise indicated in this report, the date of this r~port is the sim date a· the dice of the il:prat·iL. 2. unless otherwise indicated in this report, 8 fjnlncJeL Institution intends to use this report to dot·mine the market value of the subject property for purposes of granting ·fedar·LLy releted nortgege Loon. 3. ~flLess otherwise indicated in this report, the ·ubject proper~Y°· market vuLus ~8· besed off the cash price. /,. UnLess otherwise indicated in this reports eLL Usual v·tusttofl approaches uere utilized. .' UnLess otherwise indicated in this report, no extrsordinsrY influence· (e.g., easements, restriction, encumbrances, Leases, reservations, covenants, contracts° ·poctst assessments) on-market value exist. UnLess otherwise indicated and specificaLLy itemized with · value estimate, no personal property, trade fixtures, or intangible items are included in the appraisal of the subject property. 7. UnLess otherwise indicated in this report, the subject property ts not currently Listed for ·aLe or subject to any sale agreement or option. UnLess other, ise indicated in this report and speciaLLy itemized, according to public records, Listing services sad the ham·gun·r, the subject property has not been transferred In the pest 12 moflths. 9. UnLess otherwise indicated in this report, the estimated marketing time for the subject property uss determined fr~ avaiLabLe data services and Listing services. UnLess othervJse indicated Jn this report, Information from such data and Listing services is believed to be reLiabLe and usa considered in the final reconciliation of market value. 10. UnLess otherwise indicated in this reports the reasoning used to determine the ·eLection of .increasing", "stabLe", or · 'decLining" in the neighborhood section of current market conditions mad trends of this reports vas be·ed off information provided by avaiLabLe data services and Listing services. 11. UnLess otherwise indicated in this reports this report is based on current Land use regulations sad the probability of modification of current Land use regulations is unLikeLy. 12. UnLess otherwise indicated in this report, the site value Listed in the appraisal is determined as though the Lind is vacant and avaiLabLe for development to its highest investment use and the appraisal of Improvements is based on their actual contribution to the site. UnLess otherwise indicated in this reports the appraised value i· not affected by anticipated public or private improvements. 1~,. UnLess otherwise indicated in this report, if proposed improvement· were appraised the foLLowing uars (end remain avaiLabLe to be) inspected; PLans, specifications and related documentation to identify ·cope and character of improvements; evidence indicating probable time of completion; and clear and appropriate evidence supporting deveLol~Mnt costs, anticipated earnings, occupancy projections and anticipated competition on completion. 15. UnLess otherwise indicated in this report, the subject property is not a fracttormL interest, physical segment, component or partial holding of a property. 16. UnLess otherwise indicated in this report, information on rental date, operating expenses and capitalization was not obtained due to the Lack of reLiabLe rental date for single fmatLy hc~es in the subject proporty*s neighborhood. 17. UnLess otherwise indicated in this report, the subject property is not · Leased fas or Lease hold estate. 18. UnLess otherwise indicated in this report, the existence of hazardous ·ubstl~c;es, including without Limitation, asbestos, poLychLorinsted biphenyLs, petroleum Leakage, or agricuLturaL chemicaL·, which may or may not be present on the property, or other environmental conditions, uare not caLLed to the attontJon of nor did the ·pprmt·er become suers of such during the appraiser's inspection. The appraiser has no I~ouLedge of existence of such materials on or in the property unless otherwise stated. If the presence of such substances, such as a·bestns, ures*formaLdahyda, form insulation, or other hazardous s',hstances or environmental condttJon8 may Iffact the value of the property, the value estimated ia predicted on the assyrian that there is no such condition on or in the property or in such proximity thereto that it would cause a Loss in value. 19. UnLess otherwise indicated in this report, no other Limiting conditions or extraordinary assu~%otions (e.g., pending Lease, at~icaL financing, co~oketion of i~korovements) directly affect the appraisal or the analyses, opinions, and conclusion stated herein. 20. Addition6L certifications: A. UnLess otherwise stated in this report, in accordance with the co4npetenc¥ provision of the Uniform Standards of Professional Appraisal Practice, ] have verified that n~y kno, Ledgs ·nd exporJenoe mrs sufficient to aLLow me To consistently coflxoLete this a~oraisaL. B. I have no personal interest or bias with respect to the parties InvoLved or the subject property. C. The appraisal assignment was not bask on a reduested mintm~ valuation, a specific valuation, or the approval of o Loan, and my co~(~ertcatJon ia not contingent upe~ direction in vmLua that favors the cause of the client, the amount of the value estiMte, the attair~neflt of I stipulated result or the o¢currenoe of a lubaeduant event. D. My analyses, opinions, and conclusions were developed, and this report has been prepared in conformity with Unifor~m Standards of Professional Appraisal Practice. The departure provision of the uniform States,erda of Professional ApG)raisat Practice was not utilized in preparation of this report. E. The report analyses, opinions and conclusion are Limited only by the reported nissei·ns, Limiting conditions and are n~, peri·ask, unbiased ~nsLyses, opinions mad conclusion. F. UnLess otherwise stated in this report, no one provided siDntficant professfo~L ssststlnce to M in the preparation alc this report. G. ! certify that, to the best of my knowledge and belief, the Stat·meats contained in this report ira true and correct. H. ] certify that on the date of the a~rlisaL repert I was ICtiVILy Licensed by the appropriate state agency to perform the subject &~:~AraisaL. Signat~/e -of Appraiser0 ' Date Signature of Review Apprsi. ser (If oppL Ir, abLe) Borrowe~. N/A F'de No.: 00-0476.1 Properly Address:8113 Bass Lake Road Casa No.: Cit~. New Hope State: MN Zip: 55428 Lender. City of New Hope !., ~, Bed Bath Bed Bed Bathi Bed Room Room ~ Room ~ Ro~m d IOtchen Room ! Room IOtche~ #3 63.0' upper Level I I Bed Bath Bed ~ Bed Bath Bed Room 3 Room Room Kitchen Room I '[ Room KJtcherJ #1 65.0' #2 Lower Level Iii !!ii [ ! AREA CALCULATIONS surv~,IARy t. IVING+ AREA :BRF.~,KDOWN :i : : [caai ! i iOe.~ s=. T~.~. TOTAL LIVABLE (rounded) 3654 2 Areas To~al (rounded) 3654 ly Lane South, Minneapolis, Minnesota 55418 FRONT VIEW OF SUBJECT PROPERTY Appraised Date: February 29, 2000 Appraised Value: $171,000 REAR VIEW OF SUBJECT PROPERTY STREETSCENE . ~:..::~ ii .'i~!' I PropertyAddress:8113 Bass Lake Road CaseNo.: I City: New Hope State: MN Zip: s5428 ! Lender:. City of New Hope REAR DRAINAGE AREA COMPARABLE SALE #1 5900-56th Avenue North Crystal Sale Date: Clsd 10/7/98 Sale Price: $149,900 COMPARABLE SALE #2 2732 Xylon Avenue North New Hope Sale Date: Clsd 4/28/99 Sale Price: $182,000 COMPARABLE SALE #3 5211-56th Avenue North Crystal Sale Date: Clsd 5/26/99 Sale Price: $143,500 SUBJECT -- Z iN (~)Crystal COMP 1 COMP 3 Z Z z ~N z COMP INPARK mz NEW HOPE ~ 86 12 -I i REVISED JUNE 1994 Fie Ne. 00-0476J GEFINmON OF MARKET VALUE: The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (1) buyer and seller are typically motivated; (2) both parties are well informed or well advised, and each acting in what he considers his own best interest; (3) a reasonable time is allowed for exposure in the open market; (4) payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and (5) the price represents the normal consideration for the property sold unaffected by special or c~eative financing or sales concessions' granted by anyone associated with the sale. *Adjustments to the comparables must be made for special or oreative financing or sales concessions. No adjustments are necessary for those costs which are normally paid by sellers as a result of tradition or law in a market area; these costs are readily identifiable since the seller pays these costs in virtually ali sales transactions. Special or oreative financing adjustments can be made to the comparable property by comparisons to financing terms offered by a third party institutional lender that is not already involved in the property or transaction. Any adjustment should not be calculated on a mechanical dollar for dollar cost of the financing or concession but the dollar amount of any adjustment should approximate the markers reaction to the financing or concessions based on the Appraiser's judgment. STATEMENT OF LIMITING CONDITIONS AND APPRAISER'S CERTIFICATION CONTINGENT AND LIMITING CONDITIONS: The appraiser's certification that appears in the appraisal report is subject to the following conditions: 1. The appraiser will not be responsible for matters of a legal nature that affect either the property being appraised or the title to it. The appraiser assumes that the title is gooc[ and marketable and, therefore, will not render any opinions about the title. The property is appraised on the basis of it being under responsible ownership. 2. The appraiser has provided a sketch in the appraisal report to show approximate dimensions of the improvements and the sketch is included only to assist the reader of the report in visualizing the property and understanding the appraiser's determination of its size. 3. The appraiser has examined the available flood maps that are provided by the Federal Emergency Management Agency (or other data sources) and has noted in the appraisal report whether the subject site is located in an identified Special Flood Hazard Area. Because the appraiser is not a surveyor, he or she makes no guarantees, express or implied, regarding this determination. 4. The appraiser will not give testimony or appear in court because ha or she made an appraisal of the property in question, unless specific arrangements to do so have been made beforehand. 5. The appraiser has estimated the value of the land in the cost approach at its highest and best use and the improvements at their contributory value. These separate valuations of the land and improvements must not be used in conjunction with any other appraisal and are invalid if they are so used. 6. The appraiser has noted in the appraisal report any adverse conditions (such as, needed repairs, depreciation, the presence of hazardous wastes, toxic substances, etc. ) observed during the inspection of the subject property or that he or she became aware of during the normal research involved in performing the appraisal. Unless otherwise stated in the appraisal report, the appraiser has no knowledge of any hidden or unapparent conditions of the property or adverse environmental conditions (including the presence of hazardous wastes, toxic substances, etc. ) that would make the property more or less valuable, and has assumed that there are no such conditions and makes no guarantees or warranties, express or implied, regarding the condition of the property. The appraiser will not be responsible for any such conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because the appraiser is not an expert in the field of any ronmental hazards, the appraisal report must not be considered as an environmental assessment of the property. 7. The appraiser obtained the information, estimates, and opinions that were expressed in the appraisal report from sources that he or she considers to be reliable and believes them to be true and correct. The appraiser does not assume responsibility for the accuracy of such items that were furnished by other parbes. 8. The appraiser will not disclose the contents of the appraisal report except as provided for in the Uniform Standards of Professional Appraisal Practice. 9. The appraiser has based his or her appraisal report and valuation conclusion for an appraisal that is subject to satisfactory completion, repairs, or alterations on the assumption that completion of the improvements will be performed in a workmanlike manner. 10. The appraiser must provide his or her prior written consent before the lender/client specified in the appraisal report can distribute the appraisal report (including conclusions about the property value, the appraiser's identity and professional designations, and references to any professional appraisal organizations or the firm with which the appraiser is associated ) to anyone other than the borrower; the mortgagee or its successors and assigns; the mortgage insureri consultants; professional appraisal organizations; any state or federally approved financial institution; or any department, agency, or instrumentality of the United States or any state or the District of Columbia; except that the lender/client may distribute the property description section of the report only to data collection or reporting service(s) without having to obtain the appraiser's prior written consent. The appraiser's written consent and approval must also be obtained before the appraisal can be conveyed by anyone to the public through advertising, public relations, news, sales, or other media. Fredd~ Mac Form 439 6-93 Page 1 of 2 Fannie Mae Form 10048 6-93 APPRAISERS CERTIFICATION: The Appram~ certes and ~;rses th~ 1. I have researched the subject market area and have selected a minimum of three recent sales of properties m0~'*t s~milor and proximate to the subject property for consideration in the sales comparison analysis and have made a dofiar adjustment when appropriate to reflect the market reaction to those items of significant variation. If a significant item in a comparable property is superior to, or more favorable than, the subject property, I have mede a negative adjustment to reduce the adjusted sales price of the comparable and, ~f a signiticant item in a comparabis property is inferior to, or less favorable than the subject property, I have made a positive adjustment to increase the adjusted 2. I have taken into consideration the factors that have an impact on value in my development of the estimate of market value in the appraisal report. I have not knowingly withheld any significant information from the appraisal report and I believe, to the best of my kno~ed~e, that all statements and information in the appra~sel report are frue and correct. 3. I stated in the appraisal report only my own personal, unbiased, and professional analysis, opinions, and conclusions, which are subject only to the contingent and limiting cond~ons sped~d in th~s form. 4. I have no present or prospective interest in the property that is the subiect to this report, and I have no present or prospective personal interest or bias with respect to the participants in the transaction. I did not base, either partially or completely, my analysis andJor the estimate of market value in the appraisal report on the race, color, religion, sex, handicap, familial status, or national arigin of either the prospective owners or occupants of the subject property or of the present owners or occupants of the properties in the vicinity of the subject property. 5. I have no present or contemplated future interest in the subject property, and neither my current or future employment nor my compensation for pedorming this appraisal is contingent on the appraised value ofrne property. 6. I was not required to report a predetermined value or direction in value that favors the cause of the client or any related party, the amount of the value estimate, the attainment of a specific result, or the occurrence of a subsequent event in order to receive my compensation and/or employment for performing the appraisal. I did not base the appraisal report on a requested minimum valuation, a specific valuation, or the need to approve a specific mortgage loan. 7. I performed this appraisal in conformity with the Uniform Standards of Professional Appraisal Practice that were adopted and promulgated by the Appraisal Standards Board of The Appraisal Foundation and that were in place as of the effective date of this appraisal, with the exception of the departure provision of those Standards, which does not apply. I acknowledge that an estimate of a reasonable time for exposure in the open market is a condition in the definition of market value and the estimate I developed is consistent with the marketing time noted in the neighborhood section of this relx~t, unless I have othenvise stated in the reconciliation section. 8. I have personally inspected the interior and exterior areas of the subject property and the exterior of all properties listed as comparables in the appraisal report. I further certify that I have noted any apparent or known adverse conditions in the subject improvements, on the subject site, or on any site within the immediate vicinity of the subject property of which I am aware and have made adjustments for these adverse conditions in my analysis of the property value to the extent that I had market evidence to support them. I have also commented about the effect of the adverse conditions on the marketability of the subject property. 9. I personally prepared all conclusions and opinions about the real estate that were set forth in the appraisal report. If I relied on significant professional assistance from any individual or individuals in the performance of the appraisal or the preparation of the appraisal report, I have named such individual(s) and disclosed the specific tasks performed by them in the reconciliation section of this appraisal report. I certify that any individual so named is qualified to perform the tasks. I have not authorized anyone to make a change to any item in the report;, therefore, if an unauthOriZed change is mede to the appraisal report, I will take no responsibility for it. SUPERVISORY APPRAISER'S CERTIFICATION: If a supervisory appraiser signed the appraisal report, he or she certifies and agrees that: I directly supervise the appraiser who prepared the appraisal report, have reviewed the appraisal report, agree with the statements and conclusions of the appramer, agree to be bound by the appraiser's certifications numbered 4 through 7 above, and am taking full responsibility for the appraisal and the appraisal report. ADDRESS OF PROPERTY APPRAISED: 8113 Bass Lake Road, New Hope~ MN 55428 APPRAISER: SUPERVISORY APPRAISER (only if required) Name: Julie Bj~rklund (,/ Name: Date Signed: February 29, 2000 Date Signed: State Certification#: CRRPA State Certification~. or State License ~ 4000579 or State License State: MN State: Expiration Date of Certitication or License: 8/31/00 Expiration Date of Certification or License: [] D)d [] Did Not Inspect Proper~ Freddie Mac Form 439 6-93 Page 2 of 2 Fannie Mae Form 1004B 6-93 BCL APPRAISALS 2852 ANTHONY LANE SO., MINNEAPOLIS, MINNESOTA 55418 (612)781-0605 Fax: 781-7826 RON LACHENMAYER, SPA LESLIE I. (I~E) RACINE, JR., SPA BRAD BJORKLUND, MAI, SPA REAL ESTATE APPRAISERS & CONSULTANTS APPRAISING QUALIFICATIONS OF JULiE BJORKLUND EDUCATION Bachelor of Science in Education, With Distinction: of Minnesota 1973 University American Institute of Real Estate Appraisers Courses successfully completed: Real Estate Appraisal Principles 1989 Basic Valuation Procedures 1989 Residential Valuation 1990 Standards of Professional Practice 1990, 1995 Minnesota Appraiser License ID#4000579 Real Property Appraiser Certified Residential Passed Level II: General Appraisal Examination PROFESSIONAL ASSOCIATIONS SRA Associate Member, Appraisal Institute WORK EXPERIENCE 1989 to present: Staff Appraiser, BCL Appraisals, specializing in residential properties; have assisted in commercial appraisals over the past five years. 1985 to present: Bookkeeper, BCL Appraisals 1982 to 1990: School Board Member, St. Anthony-New Brighton Schools 1976 to 1980: Schools Reserve Teacher, Minneapolis Public CLIENTS Single and multi-family residential appraisals for the following: Steven A. Martinetti 6305 Camden AvenudNorth #103 Brooklyn Center, MN 55430 (612)$61-0513 January 27, 2000 Mr. Kirk McDonald Director of Community Development City of New Hope 4401 Xylon Avenue North New Hope, MN 55428 Dear Mr. McDonald, I am the owner of the fourplex located at 8113 Bass Lake Road in New Hope. Last year we discussed the possibility of rehabbing the building with some financial help from the City of New Hope. The city' s response included an offer to buy the building for demolition rather than investing a considerable amount in rehab. After giving this serious consideration, I am interested in selling the building. I propose a sale price of $185,000. If the city is not interested, I will sell the building outright. I would appreciate your consideration of this proposal and a response at your earliest convenience. Sincerely, Steve Martinetti ~.4401Xylon Avenue North New Hope,-Minnesota 55428-4898 City Hall: - 612-531-5100 Police: 612-531-5170 Public Works: 612-533.4823 TDD: 612-531-5109 City Hall Fax: 612.531.5135 Police Fax:. 612.531-5174 Public Works Fax: 612-533.7650 Fire Depl. Fax. 612-531.5175 May 12, 1999 Mr. Steven Martinetti 8113 Bass Lake Road, Apt. 2 New Hope, MN 55428 Subject: Request for Financial Assistance for Potential Rehabilitation Project at 8113 Bass Lake Road Dear Mr. Martinetti: ' At the May 10 New Hope Economic Development Authority meeting, the EDA discussed your request for financial assistance in the form of a loan to rehabilitate the fourplex property you recently purchased at 8113 Bass Lake Road (see attached EDA request). The EDA was pleased that you want to improve' the property. Due to the fact that your property is located in an area designated by the City's Comprehensive Plan for potential redevelopment, the EDA directed staff to pursue two potential options: 1. Inquire if you might be interested in selling the property to the City for redevelopment purposes. The City would try to acquire several adjacent properties, demolish the structures, and market the property for redevelopment of townhomes. 2. Pursue the rehabilitation option. If you do not want to sell the property, the EDA may be interested in working with you to upgrade the property. However, the EDA questioned whether a significant re- investment in the property would be worthwhile for you financially. If you are interested in potentially selling the property to the City, the first step the City would take would be to obtain an appraisal of your property to determine the fair market value. If the rehab option is pursued, we should meet to discuss the specific improvements you would like to make along with the cost estimates. Per the EDA report, we would also need to have a financial consultant review your records to determine your ability to repay the loan. Family Styled City ~ For Family Living Now is an opportune time to l'~:ommence discussion with the property owner regarding the EDA's purdmse of 7500 42'" Avenue. The opponumty presents itself due to the pending vacation of the property by the current tenant, Ardel Engineenng, by June 1. He stated the enclosed resolution authorizes the EDA to obtain an updated appraisal of the property and commence negotiations with the property owner for acquisition of the property as of June 1, when the properly officially becomes vacant and unoccupied. This will allow the City to avoid payment of tenant relocation expenses, which has been the policy for acquisition of all properties initiated by an owner's request to sell to the City or £DA under the scattered site acquisition policy. The owner has recently obtained his own appraisal of the property indicating a market value of $545,000. Once the City has its appraisal on the property updated, the EDA will need to determine the dollar amount it is willing to authorize as a ceiling for acquisition. The owner has also indicated that he wants to be reimbursed for lost rent during the month of June in the event he agrees to keep the property vacant, so there should be som~ discussion concerning the amount of a non-refundable payment to the property owner in consideration for his agreement to keep the property vacant during the negotiation period~ Mr. McDonald also noted that since the dealings in 1997, the anomey for the property owner has become a panner of the City Attorney, and the City Attorney requested that the EDA be made aware of this fact. The EDA expressed support for the acquisition. In response to questions concerning possible soil contamination, City Attorney Sondrall noted there does not appear to be soil contamination on the Ardel property. Mr. Donahue, City Manager, interjected that the property will be examined prior to any purchase. Mr. Sonclrall discussed the two paragraphs in the proposed resolution which have blanks (//4 and #5). He stated the ftrst blank will be completed to authorize the Executive Director to commence negotiations for a fair negotiated amount but at a · price not to exceed the amount of the appraisal. He commented that paragraph//5 concerning a non-refuodable fee would be deleted from the resolution. EDA Commissioner Norby introduced the following resolution and moved its adoption: RESOLUTION 99-07 "RESOLUTION AUTHORIZING APPRAISALS AND COMMENCEMENT OF NEGOTIATIONS TO ACQUIRE 7500 42~ AVENUE NORTH (IMPROVEMF_,NT PROJECT NO. 474) ". The motion for the adoption of the foregoing resolution was seconded by Commissioner Collier, and upon vote being taken thereon, the following voted in favor thereof: Enck, Cassen, Collier, Norby, Thompson; 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. 8113 BASS LAKE RD ~'~President Enck introduced for discussion Item 5, Discussion Regarding Request for Item 5 Financial Assistance for Potential Rehabilitation Project at 8113 Bass Lake Road. ..... Mr. McDonald, Director of Commlmity Development, provided background of the fourplex property al 8113 Bass Lake Road. He stated the property formerly owned New Hope-EDA Page 2 May 10, 1999 ADJOURNMENT by David Espeland is now und~ new ownership. The building was constructed in 1958 and has a market val~ of $136,000 (land $26,000/building $110,000). The building has a brick exterior, but is in need of substantial repairs, including roof and window replacement, rain gutters, exterior doors, drain tile, a boiler and general .interior upgrading. The parking area needs resurfacing, additional landscaping is needed and no garages are available on the site. The owner has estimated the project cost at $15,000, however, staff estimate it will be at least twice that amount. There is a twin fourplex building located adjacent to this building (8109 Bass lake Road) that is under separate ownership. Both properties are located on the south side of Bass Lake Road, just west of Lyndale Garden Cemer, and have a shared access off of Bass Lake Road. Mr. McDonald explained that these properties have been designated in the Comprehensive Plan for either redevelopment or substantial rehabilitation. Staff is pleased that the new owner wants to cooperate with the City on potential improvements to the property. Staff is requesting direction from the g-DA as to whether or not it is interested in pursuing a rehabilitation project at this site in cooperation with the new owner. If the £DA determines to proceed, staff would like authorization to meet with the property owner to determine the necessary improvements, and approach the owner of the adjacent building to inquire of their participation in the project. President Enck questioned the fmancial investmen~ and whether redevelopment should be explored rather than rehabilitation of the property. Mr. McDonald reiterated that the Comprehensive Plan Update calls for rehab or redevelopment of this area. Mr. McDonald suggested obtaining a fin~n,~al analysis similar to the one recently prepared for Regent Apartments. Councilmember Cassen pointed out that the City has received numerous complaints regarding this property m the past. The EDA was receptive to exploration of all options, and directed staff to contact the property owner to discuss redevelopment or rehabilitation options. Motion was made by Commi,sioner Collier, seconded by Commissioner Cassen, to adjourn the meeting. All present voted in favor. Motion carried. The New Hope EDA adjourned at 8:42 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA Page 3 May I0, 1999 Steven A. Martinetti 8113 Bass Lake Road, Apt. 2 New Hope, MN 55128 April 24,' 1999 Mr. Kirk McDonald Director 'of Community Development City of New Hope 4401 Xylon Avenue North New Hope, ~ 55428 Dear Mr. McDonald, I am the owner ofa fourplex apartment building located at 8113 Bass Lake Road in New Hope. You may already be familiar with this property (the eyesore it is). I plan on making significant improvements and want to make it among the best rental properties in New Hope. Among the improvements will be a new roof, rain gutters, windows, exterior doors, and paint inside and out. In addition, the lower apartments will likely need to be drain tiled (I am currently attempting to correct the grade, but if this is not successful in stopping the water problem, drain tile is the nex~ step). Finally, the parking area will need to be resurfaced and the area relandscaped. While I am anxious to complete these improvements, my funds are quite limited. I am very interested in any financial assistance the City of New Hope may have available. I am having the roof and windows estimated, and will forward these as you request. I (roughly) estimate the entire project at somewhere near fifteen thousand dollars. I appreciate your help and look forward to hearing fi.om you soon. You may call me at my daytime (work) phone, (612) 348-2156, or you may leave a message at (651) 777- 7490. Steve ~netti Owner / Resident Manager Mr. Steven Martinetti Page 2 May 12, 1999 Please give these options some thought and call me (531-5119) at your convenience or stop at City Hall so we can discuss further. Kirk McDonald Director of Community Development Enclosure: EDA Report CC: Dan Donahue, City Manager Steve Sondrall, City Attorney Doug Sandstad, Building Official Jean Coone, Acting General Inspector Sue Henry, Community Development Specialist Valede Leone, City Clerk 2.5 910.3 OXo <3 <3 ,0<3 <3 901 .8 X ~. '1 ,,~J~', '---., ,'~: -. .... ,,"~: - i IM I---..-.i~! ~, !~ .g-,Ia ,1~ , : '< ' "°'""' ~' '--1 ' ' ' .... ' ..... Al/, '!-~ .- ~.:~, .iai ,,,e, ..... .1~'"" To ~. i o " ".. ! ,~i ," ....~._!.'.. ..... J L ....... L....-,' '.--.,----:- .... -" .... "' ..... ":... i .'r,.:~-'a.33 ~ . SeTH AVE: N, ....,_ ....... : ..... ,- ..... , '. ~ · X' : .. --;,- ~. ....... ~ ...... ~""- t'- "T' . ~ ' '.~ - · : ' -A i ' J · i j . ; e,J ; · ! 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" ' "' ".4 ...... !_--~ - i : :"'-::: ..... !~=': ~ :: ," · .-:: '-'.: .... :'-'.-:'-'.---.'::'.-.' ':: 2' '"...: ...................... ':. ~ ............ ,:: .................... Iii- · ...... '- -~OSTERMAN HIGH SCHOOL ? : aJ3J .' ~31 i : TiCn ~mer11' ecfion desig, ... i-truct~ issues v, uh'~cmil -- 19 strer:.. ape (mul urisdi o. i of medium and high I densi17 resicte~al area / redevelopment sites redevelopment si'es / E~ss Lake intersection realignment Vacant Ires Hedium densh'y redevelopme,"- Vacant (Pond Place developme-- opportunities) Indus'rrial redeveJopment site., (demolish exi~ng building) expansion / c~opercr~e rearrangement wL*h C~ 5ires Pork pcri~ng one ~,mar~nd ~.5~ngle fomily r~elopmen, Commerdol redevetoomenr ~ 42nd Avenue. XWon and 4.5~ streetsca~ Pledium dens~ redevelopmem- oppo~uni~ ~win Homes) ~ in place indusl'riol issues Drainage issues Irregular Oty boundary Community Perspectives The industrial park is nearly fully developed. Future industrial growth will consist of in-place expansion and site redevelopment. The appearance of outdoor storage areas within the industrial park is an issue.' Intersection at 49th and Boone is in need of improvement to accommodate the turning radius of semi-trucks and trailers. District 6 District 6 contains a variety of housing types from single family to very high density. For the most part, the high density housing in Distdct 6 is very well maintained. Issues related to District 6 include: pistrict 6 Issues FcFoOUr-plexes along Bass Lake Road are in bad condition. These sites should be'~"'"', nsidered for redevelopment. Single family homes around Begin Park are on small lots and are in poor condition. City staff has identified this area as a redevelopment area. City of New Hope 30 Comprehensive Plan Updat; Planning Tactics Goal 3: Promote multiple family housing altematives as an attractive life cycle housing option. Policies: Redevelop substandard multiple family properties that display deteriorated building conditions, no site amenities, poor site design, or incompatible land use patterns when it is judged not economically feasible to correct the deficiencies. Adhere to the highest community design and construction standards for new construction and redevelopment projects. C Accompany medium and high density development with ade uate accesso-~ ..... ities such as garages, parking, open space, landscaping, and recreational ~. ~acilities to insure a safe, functional, and desirable living environment. ~' Do Consider mixed land uses as an altemative land use option in planning and redevelopment of obsolete commercial or industrial sites. Encourage neighborliness through block clubs, block parties or neighborhood associations. COMMERCIAL GOALS Goal 1: Policies: Ao Bo Maintain and improve New Hope's commercial areas as vital retail and service locations. Do Work with local business people to gain an understanding of the changing needs of the business environment. Promote a full and broad range of office, service, retailing, and entertainment uses within the commercial areas of New Hope. Attract new businesses to New Hope that are complementary to existing businesses and will contribute to the customer attraction and business interchange of the local commercial areas. Promote the redevelopment and expansion of existing businesses within the City to obtain a higher level of sales and business attraction. 5 Bo Aggressively continue housing redevelopment programs throughout the City. Encourage the private redevelopment of substandard, obsolete or blighted properties. Public assistance may be applicable where the redevelopment is consistent with the goals of the New Hope Comprehensive Plan and within the financial capabilities of the City. D..~~nvestigate opportunities for redevelopment or renewal of deteriorating multipl"~e ~ family sites. ~ Eo Redevelop select, commercial/industrial properties which display deteriorated building conditions, obsolete site design, incompatible land use arrangements and high vacancy levels. Goal 4: Policies: B. Co Do Eo A cohesive land use pattern which ensures compatibility and strong functional relationships among activities is to be implemented. Fo Maintain and strengthen the character of individual neighborhoods. Prevent over-intensification of land use development, that is, development which is not accompanied by a sufficient level of supportive services and facilities (utilities, parking, access, etc.). Investigate remedies to correct or eliminate existing land use compatibility problems. Examine requested land use changes in relation to adjoining land uses, site accessibility, utility availability, and consistency with the City's Comprehensive Plan and policies. Accomplish transitions between distinctly differing types of land uses in an orderly fashion which does not create a negative (economic, social or physical) impact on adjoining developments. Infill development of compatible land uses shall be strongly encouraged. Where practical, conflicting and non-complementary uses shall be eliminated through removal and relocation. 3 Mr. Kirk McDonald Director of Community Development City of New Hope 4401 Xylon Avenue North New Hope, MN 55428 March 9, 2000 Dear Kirk: Thank you for agreeing to meet with us on March 15 to discuss the possibility of LivingWorks Ventures establishing a second lodge in New Hope for individuals with disabilities. As you know, we already have a $120,000 commitment from MHFA for this project, and are submitting funding proposals to the Federal Home Loan Bank of Des Moines Affordable Housing Program and the Hennepin County HOME program later this month. We also intend to seek funding from the HUD MeKinney program, the McKnight Foundation, and other local foundations that have an interest in housing and employment for people with disabilities. Items we would be interested in discussing with you at our meeting on the 15t~ include: 1. What is the status of the City of New Hope's plans to purchase the Bass Lake Road properties we have discussed? What is the expected timeline for purchase to be completed? At what point might the City of New Hope be interested in entering into a redevelopment contract with LivingWorks for the Bass Lake Road property? What preliminary steps need to be made before this could happen - and how long would you expect those steps to take? Would the City of New Hope be willing to sign a statement to the effect that the property is not viable and cannot be rehabilitated? If so, could we submit your signed statement to AHP and HOME to support our request for new construction dollars (rather than rehab)? What kinds of assistance might the City of New Hope be able to provide to LivingWorks in relation to preparing the site for our propose use? Any or all of the following would essentially be "gifts in kind" that would facilitate LivingWork's ability to carry out the project. Your assistance would also demonstrate a level of local commitment that could enhance the credibility of LivingWorks in the eyes of potential funders. Areas in which we would especially value your assistance are: Environmental assessment of the property (Phase I) Clean-up and/or abatement of any pollution found in the Phase I · Relocation of existing tenants · Demolition of existing structures Soil testing and, if necessary correction. · CDBG assistance on the new project Lake Independence · P.O. Box 308 · Lorelto, Minnesota 55357 Voice and TTY: (612) 479-3555 · Fax: (612) 479-2605 website: www. vinlandcenter, org ~'~,~ Printed w,th agr,based inks on recycJecl paper .J~ Th~nk you again, Kirk, for your interest in this project. I look forward to meeting with you on March 15. Duane Reynolds Chemical Health Program Director, Vinland Center VINLAND NATIONAL CENTER VINLAND LODGE NEW HOPE, MINNESOTA SITE PLAN Z VINLAND NATIONAL CENTER VINLAND LODGE NEW HOPE, MINNESOTA FIRST FLOOR PLaN S Z VINLAND NATIONAL CENTER VlNLAND LODGE NEW HOPE, MINNESOTA FIRST FLOOR PI_~N VINLAND NATIONAL CENTER VlNLAND LODGE NEW HOPE. MINNESOTA FIRST FLOOR PlaN