08-04-03 Special
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Special Meeting
August 4, 2003
The meeting was called to order by Chair Harms at 7:00 p.m.
HRA Members
Present:
Thomas Harms; Joan Heimberger; Kristal Stokes; Michael Sandahl; and
Dan Linnihan.
Staff Present:
Steven Devich; Acting Executive Director/Acting City Clerk; John Stark,
Acting Community Development Director; John Dean, HRA Attorney.
Item #1
The agenda was approved by unanimous consent.
Item #2
A. Approved agreement with LHB Engineers and Architects for preparation of construction
documents and construction administration at 6819 Oliver Avenue S.R. No. 40
B. Approved stipulation of settlement of condemnation for 7600 Lyndale Avenue in the Lyndale
Gateway West condemnation action S.R. No. 41
C. Approved settlement of relocation benefits for 7609 Aldrich Avenue in the Lyndale Gateway
West Area S.R. No. 42
D. Approved CSM request to enter proposed subordination agreement with CSM and its lender
as part of refinancing of Shops at Lyndale S.H. No. 43
M/Helmberger, S/Sandahl to approve the Consent Calendar.
Special HRA Meeting Minutes
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August 4, 2003
Motion carried 5-0.
Item #3
Acting Community Development Director Stark provided a brief review of Staff Report No.
44 regarding consideration of a First Amended and Restated Contract for Private Redevelopment
with Lyndale Gateway, LLC.
HRA Attorney Dean described the significant elements of an Option Agreement between
Lyndale Gateway, LLC and the HRA. He stated that the redevelopment agreement provides for
the City to provide up front funding for property acquisition to be repaid by the developer; and the
Option Agreement provides a mechanism for the HRA to obtain title to all the property in the event
that the redeveloper does not obtain funding of its construction financing. This would allow the
HRA to seek to obtain another redeveloper and proceed with redevelopment of the site within a
timeframe that would allow for the timely repayment of the bonds.
A suggestion was also provided by Chair Harms that a contract provision be added that
expanded the HRA's rights to secure another developer under certain conditions.
Mr. Dean stated that this Option Agreement is only an exhibit to the entire agreement for
redevelopment with Lyndale Gateway, LLC.
Commissioner Linnihan asked if the HRA needs to check the language of the purchase
agreements with buyers who will ultimately be tenants.
HRA Attorney Dean stated that they would do so. He stated that he believed that the HRA
may need to contact each of the buyers and renegotiate the agreements.
Chair Harms stated that he was concerned that something may be in the agreements that
could cloud the title and hinder the HRA's ability to bring in a new developer. Mr. Harms also
stated that if the addition of this provision caused a problem with the entire agreement, that the
issue be brought back to the HRA at the call of the Chair.
Mr. Dean stated that there are also some loose ends with the lender including:
. 3.2 (07) paragraph 1 - regarding minimum sale prices upon default.
. 3.2 (09) - HRA does not want the lender to fund any proceeds from construction loan
until presale/pre-lease requirements have been met; presale criteria cannot be changed
without HRA approval.
. 3.4 (01) - regarding when proceeds are released to the HRA.
Acting Community Development Director Stark stated that the HRA is contributing an
additional $755,000 to the developer on a temporary basis under the terms of the agreement.
Heidi Kurtze, Lyndale Gateway, LLC representative, reported on the current project status.
Ms. Kurtze stated that there was a great deal more traffic at the project site since relocating the
trailer there. She informed the HRA that she now has 20 reservations and commitments for the
residential units and that the retail portion includes tenants such as Chipolte, Starbucks and Taste
of Scandinavia. Ms. Kurtze stated that another 4,000 square feet of commercial space is currently
under negotiations and that there will be a featured home in the Fall Parade of Homes.
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August 4, 2003
M/Sandahl, S/Stokes to approvelhe' First Amended and Restated Contract for Private
Redevelopment with Lyndale Gateway. LLC. subiect to administrative amendments authorized by
the Executive Director substantiallY in the form presented with the addition of the changes in
sections 3.1 (07) paragraph 1. 3.1 (09) and section 3.4 (01) as verbally presented and subiect to
approval of expanded contract language to include other rights necessary to maximize the ability of
the HRA to find a substitute developer.
Motion carried 5-0.
-,d
A
The meeting was adjourned by unanimous conse