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061713completeagenda CITY OF RICHFIELD, MINNESOTA MONDAY, JUNE 17, 2013 RICHFIELD MUNICIPAL CENTER 6700 PORTLAND AVENUE REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING COUNCIL CHAMBERS 7:00 P.M. AGENDA Call to order Roll call 1. Approval of minutes of (1) Regular HRA Meeting of April 15, 2013; (2) Special HRA Meeting of April 23, 2013; and (3) Special HRA/City Council/Housing Visioning Task Force Meeting of May 7, 2013 2. HRA approval of agenda 3. Consent Calendar contains several separate items which are acted upon by the HRA in one motion. Once the Consent Calendar has been approved, the individual items and recommended actions have also been approved. No further HRA action on these items is necessary. However, any HRA Commissioner may request that an item be removed from the Consent Calendar and placed on the regular agenda for HRA discussion and action. All items listed on the Consent Calendar are recommended for approval. A. Consideration of approval of a resolution authorizing the HRA to affirm the monetary limits on municipal tort liability established by MN Statutes 466.04 S.R. No. 32 B. Consideration of approval of a resolution affirming and ratifying submittal of an application to the Minnesota Housing Community Fix-Up Fund Program and Community Homeownership Impact Fund for a program to write down the interest rate on home improvement loans S.R. No. 33 C. Consideration of approval of an amendment to the Subordination and Satisfaction Policy S.R. No. 34 D. Consideration of approval of a resolution affirming and ratifying submittal of an application to the Minnesota Housing Community Homeownership Impact Fund for gap funds to develop three affordable new homes through the HRA's New Home Program S.R. No. 35 Notes: 4. Public hearing and consideration of a resolution authorizing the sale of 7229-1St Avenue to Endres Custom Homes, Inc. and a Contract for Private Development with Endres Custom Homes, Inc. for the construction of a single family home under the Richfield Rediscovered Program Staff Report No. 36 Notes: 5. Consideration of a proposal from Sherman Associates for the Cedar Point Phase II Housing Redevelopment Area Staff Report No. 37 Notes: 6. HRA discussion items Notes: 7. Executive Director Report Notes: 8. Claims and Payroll Adjournment Auxiliary aids for individuals with disabilities are available upon request. Requests must be made at least 96 hours in advance to the City Clerk at 612-861-9738. HOUSING AND REDEVELOPMENT ed AUTHORITY MEETING MINUTES geCO"e Richfield, Minnesota Regular Meeting April 15, 2013 CALL TO ORDER The meeting was called to order by Acting Chair Quam at 7:00 p.m. ROLL CALL HRA Members Steven J. Quam, Acting Chair, Doris Rubenstein; Debbie Goettel; Present: and David Gepner HRA Members Sue Sandahl, Chair Absent: Staff Present: John Stark, Acting Executive Director/Community Development Director; Karen Barton, Assistant Community Development Director; and Nancy Gibbs, City Clerk. Item #1 APPROVAL OF MINUTES OF (1) REGULAR HRA MEETING OF MARCH 18, 2013 M/Gepner, S/Rubenstein to approve the minutes of(1) Regular HRA Meeting of March 18, 2013. Motion carried 4-0. Item #2 HRA APPROVAL OF AGENDA M/Rubenstein, S/Gepner to approve the agenda. Motion carried 4-0. Item #3 CONSIDERATION OF A RESOLUTION AUTHORIZING THE PURCHASE OF REAL PROPERTY LOCATED AT 7427 PILLSBURY AVENUE THROUGH THE RICHFIELD REDISCOVERED PROGRAM S.R. NO. 28 Assistant Community Development Director Barton presented Staff Report No. 28. HRA Meeting -2- March 18,2013 M/Rubenstein, S/Goettel that the following resolution be adopted and that it be made part of these minutes: HRA RESOLUTION NO. 1152 RESOLUTION AUTHORIZING PURCHASE OF REAL PROPERTY LOCATED AT 7427 PILLSBURY AVENUE UNDER THE RICHFIELD REDISCOVERED PROGRAM Motion carried 4-0. This resolution appears as HRA Resolution No. 1152. Item #4 PUBLIC HEARING AND CONSIDERATION OF A RESOLUTION AUTHORIZING THE SALE OF HRA PROPERTY LOCATED AT 301 WEST 77TH STREET TO LAMETTRY COLLISION INC. S.R. NO. 29 Acting Executive Director/Community Development Director Stark presented Staff Report No. 29. M/Gepner, S/Goettel to close public hearing. Motion carried 4-0. M/Rubenstein, S/Gepner that the following resolution be adopted and that it be made part of these minutes: HRA RESOLUTION NO. 1153 RESOLUTION AUTHORIZING THE CONVEYANCE OF INTEREST IN CERTAIN LAND Motion carried 4-0. This resolution appears as HRA Resolution No. 1153. Item #5 CONSIDERATION OF A RESOLUTION APPROVING A FIRST AMENDMENT TO THE CROSS ACCESS EASEMENT AGREEMENT WITH CANDLEWOOD MINNEAPOLIS, MN, LLC S.R. NO. 30 Acting Executive Director/Community Development Director Stark presented Staff Report No. 30. M/Quam, S/Rubenstein that the following resolution be adopted and that it be made part of these minutes: HRA RESOLUTION NO. 1154 RESOLUTION APPROVING FIRST AMENDMENT TO CROSS ACCESS EASEMENT AGREEMENT BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA AND CANDLEWOOD MINNEAPOLIS, MN, LLC Motion carried 4-0. This resolution appears as HRA Resolution No. 1154. Item #6 HRA DISCUSSION ITEMS Commissioner Goettel asked for an update on the Housing Visioning Task Force. HRA Meeting -3- March 18,2013 Acting Executive Director/Community Development Director Stark presented an update on the task force. Item #7 EXECUTIVE DIRECTOR REPORT Acting Executive Director/Community Development Director Stark reported on the Home Energy Squad Program. Commissioner Rubenstein stated that she spoke with Stacy Boots Camp, Center for Energy and Environment, and was told that to qualify for the Home Energy Squad Program the homeowner must be a customer of both Xcel and Centerpoint Energy. Acting Executive Director/Community Development Director Stark stated that he was going to contact Ms. Boots Camp to inquire about exceptions to that requirement. Commissioner Rubenstein extended condolences to the people of Boston after the explosions during the Boston Marathon. Item #8 CLAIMS AND PAYROLL M/Goettel, S/Gepner that the following claims and payrolls be approved: U.S. BANK 04/15/2013 Section 8 Checks: 123252 - 123371 $ 158,186.25 HRA Checks: 31718 - 31745 $ 60,922.94 TOTAL $ 219,109.19 Motion carried 4-0. ADJOURNMENT The meeting was adjourned by unanimous consent at 7:20 p.m. Date Approved: June 17, 2013 Steven J. Quam Acting Chair Nancy Gibbs John Stark City Clerk Acting Executive Director HOUSING AND REDEVELOPMENT AUTHO RITY MEETING MINUTES gel/CO:eject, Richfield, Minnesota Special HRA Meeting April 23, 2013 CALL TO ORDER The meeting was called to order by Chair Sandahl at 5:30 p.m. ROLL CALL HRA Members Sue Sandahl, Chair, Steven J. Quam; Doris Rubenstein; Debbie Goettel; Present: and David Gepner Staff Present: John Stark, Acting Executive Director; and Cheryl Krumholz, Executive Coordinator. Item #1 CONSIDERATION OF A REVISION TO THE RICHFIELD REDISCOVERED GUIDELINES TO ALLOW A REDUCTION IN THE PRICE OF A LOT IN AN AMOUNT EQUAL TO 75 PERCENT OF THE COST OF SOUND ATTENTUATION MEASURES, UP TO A MAXIMUM OF 7,500, IN CASES WHERE THE LOT IS LOCATED WITHIN THE 65-69 AND 70-74 DNL ZONES S.R. NO. 31 Acting Executive Director Stark presented Staff Report No. 31. He also discussed the 1996 and 2007 DNL contours and the consent decree with the Metropolitan Airports Commission. Commissioner Gepner questioned the mandating of reducing the price of a lot and asked about the practicality of changing the agreement with the Metropolitan Airports Commission since no Richfield homes are in the 2012 DNL zones. Tom Fitzhenry, 6737 Park Avenue, Noise Oversight Committee representative, suggested the HRA proceed with this lot reduction revision and consider renegotiating sound attenuation measures when the exit pass with the RNAV is completed. Acting Executive Director Stark suggested the motion include that the revised guidelines be in effect as long as the consent decree with the Metropolitan Airports Commission dated 2007 is in place. M/Sandahl, S/Goettel to approve a revision to the Richfield Rediscovered Guidelines to allow a reduction in the price of a lot in an amount equal to 75 percent of the cost of sound attenuation measures, up to a maximum of$7,500, in cases where the lot is located within the 1996 65+ and/or 2007 63-64 DNL contours. The change to the guidelines is in effect as of the date of the meeting for all properties sold after that date, and any contracts for private development involving properties that have not been conveyed by that date should be amended to allow for the reimbursement, giving authority to the Chair and Executive Director to execute the amendments. Special HRA Meeting -2- April 23,2013 This approval shall be in effect as long as the 2007 consent decree with the Metropolitan Airports Commission is in place. Motion carried 5-0. ADJOURNMENT The meeting was adjourned by unanimous consent at 5:45 p.m. Date Approved: June 17, 2013 Suzanne M. Sandahl Chair Cheryl Krumholz John Stark Executive Director Acting Executive Director HOUSING AND REDEVELOPMENT AUTHORITY MINUTES gc/C*etot Richfield, Minnesota Special HRA/City Council/ Housing Visioning Task Force Meeting May 7, 2013 HRA Members Sue Sandahl, Chair; Debbie Goettel; Steven Quam; and Doris Rubenstein Present: HRA Members David Gepner Not Present: Council Members Debbie Goettel, Mayor; Sue Sandahl; and Edwina Garcia Present: Council Members Pat Elliott and Tom Fitzhenry Not Present: Housing Visioning Mike Andrews; Ghislaine Ball; Ann Dougherty; Michelle Dowell; Adam Task Force Members Fleitman; Heidi Gaibor; Alison Groebner; Gordon Hanson; Jeremy Larson; Present: Jen Lux; Catherine Ragozzino; James Rudolph; Steve Schneeberger; John Suek; and Tom Zarth The City Council participated in a discussion of current community development conditions, as presented by the Urban Land Institute. Date Approved: June 17, 2013 Suzanne M. Sandahl Chair Cheryl Krumholz Steven L. Devich Executive Coordinator Executive Director AGENDA ITEM#: 3A REPORT#: 32 STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING JUNE 17, 2013 REPORT PREPARED BY: STEVEN L. DEVICH,EXECUTIVE DIRECTOR NAME,TITLE REPORT PRESENTER: STEVEN L. DEVICH,EXECUTIVE DIRECTOR NAME,TITLE DEPARTMENT DIRECTOR REVIEW: L7 . _,Aik mill- aer — ,,_-- 'trip:WI REVIEWED BY EXECUTIVE DIRECTOR: il, Av, 4_, ITEM FOR HRA CONSIDERATION: Consideration of resolution authorizing the HRA to affirm the monetary limits on statutory municipality tort liability. I. RECOMMENDED ACTION: By Motion: Adopt a resolution authorizing the HRA to affirm the monetary limits on municipal tort liability established by Minnesota Statutes 466.04. II. EXECUTIVE SUMMARY • The HRA purchases its insurance from the League of Minnesota Cities Insurance Trust (LMCIT). Each year, the HRA must either affirm or waive its statutory limits of liability by July 1. After reviewing cost considerations measured against potential risk, the HRA has, historically, affirmed the liability limits which are $500,000 for an individual claimant and $1,500,000 per occurrence. Staff is recommending the same course of action for the current period. III. BASIS OF RECOMMENDATION 0617Tort Liability A. BACKGROUND • A requirement of insurance coverage through the LMCIT is an annual affirmation or waiver of statutory limits of liability. • The current statutory limits of liability for Minnesota cities are $500,000 for an individual claimant and $1,500,000 per occurrence. Cities can waive these limits to allow an individual claimant to recover more than $500,000, up to the $1,500,000 per occurrence limit, if excess liability insurance is purchased. However, the cost of excess liability insurance continues to be very expensive. An additional $1,000,000 of coverage would cost the City approximately $65,000 annually. • Slightly more than half of the cities in Minnesota do not waive its limits of liability. B. POLICY • The State Statute establishing liability limits for cities at the current $1,500,000 level was established fairly recently and appears to be a reasonable limit. • Historically, just over one-half of the municipalities in Minnesota have not waived the monetary limits on municipality tort liability as was established by Statutes 466.04. • The HRA could waive its statuary limits in future years if the Commissioners should decide to do so. • The City of Richfield has historically not waived its limits of liability. C. CRITICAL TIMING ISSUES • The HRA's insurance policy with the League of Minnesota Cities Insurance Trust renews on July 1, 2013. This action must be completed before that time. • The HRA does not have to make a decision on purchasing excess liability coverage at this time. Coverage such as excess liability may be added at any time. D. FINANCIAL • There is a slight premium savings for political entities that affirm the statutory monetary limits. For the Richfield HRA, the savings would be less than $1,000 for the coverage year. • The HRA has historically not purchased excess liability coverage because of the relatively high cost of such coverage. The cost for $1,000,000 of excess coverage would likely be between $6,000 and $8,000 per year. E. LEGAL • The tort liability limits established by Minnesota statutes have historically protected cities and no Minnesota court has ever established a monetary award in excess of the statutory limits against a municipality. • Each municipal entity must annually decide whether the City would voluntarily waive the statute for both the single claims each occurrence limits. IV. ALTERNATIVE RECOMMENDATION(S) • If the HRA feels that any single claimant should receive more than the $500,000 limit, the HRA could elect to waive the statutory monetary limits. • If the HRA feels that the $1,500,000 per occurrence limit is not adequate, the HRA could purchase excess liability coverage. V. ATTACHMENTS • Resolution. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None. HRA RESOLUTION NO. RESOLUTION AFFIRMING MUNICIPAL TORT LIABILITY LIMITS ESTABLISHED BY MINNESOTA STATUTES 466.04 WHEREAS, Minnesota Statute 466.04 provides for Municipal tort liability limits for Minnesota cities and for other municipal entities like the Richfield Housing and Redevelopment Authority; and WHEREAS, the League of Minnesota Cities Insurance Trust has asked that each participating entity review the tort liability limits and determine if the respective entity would choose to waive its limits; and WHEREAS, such decision to affirm or waive the tort liability limits must be filed with the League of Minnesota Cities Insurance Trust at the insurance renewal date. NOW, THEREFORE, BE IT RESOLVED that the Executive Director is directed to report to the League of Minnesota Cities Insurance Trust that the Richfield HRA does not waive the monetary limits on the municipal tort liability established by Minnesota statutes 466.04. Approved by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 17th day of June, 2013 Suzanne M. Sandahl, Chair ATTEST: Doris Rubenstein, Secretary AGENDA ITEM#: 3B REPORT#: 33 STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING JUNE 17, 2013 REPORT PREPARED BY: JULIE URBAN, HOUSING SPECIALIST NAME,TITLE REPORT PRESENTER: KAREN BARTON, ASSISTANT COMMUNITY DEVELOPMENT DIRECTOR NAME,TITLE DEPARTMENT DIRECTOR REVIEW: REVIEWED BY EXECUTIVE DIRECTOR: 1401/ 4110 ITEM FOR HRA CONSIDERATION: Consideration of support for an application to Minnesota Housing for Community Fix-Up Funds and a Community Homeownership Impact Fund grant to continue a program to write down the interest rate on rehabilitation loans. I. RECOMMENDED ACTION: Adr4'/K By Motion: Approve the submission of an application to Minnesota Housing for Community Fix-Up Funds Designation and a Community Homeownership Impact Fund grant. II. EXECUTIVE SUMMARY The Housing and Redevelopment Authority (HRA) partners with the Greater Metropolitan Housing Corporation (GHMC) and the cities of Crystal and Brooklyn Center to offer a Fix-Up Fund home improvement loan at an interest rate of three percent. This rate is written-down from 5.99 percent using grant funds from Minnesota Housing along with matching funds from the three partner cities. This program has proven to be very successful in Richfield with eleven loans originated through the first quarter of 2013. The initial grant period is set to expire at the end of 2013. Richfield, GMHC and the partner cities are seeking additional funds to continue the program. HRA matching funds would be budgeted for the program in the 2014 and 2015 budgets. 06172013 Impact Fund Support Resolution Fix Up Fund.doc III. BASIS OF RECOMMENDATION A. BACKGROUND • In 2011, the HRA partnered with the cities of Crystal and Brooklyn Center and the Greater Metropolitan Housing Corporation (GMHC) to submit an application for funds to create a Fix-Up Fund Loan Write- Down Program. • Through the first quarter of 2013, 16 loans had been issued through the program. Eleven of the loans were to Richfield homeowners. • Through the first quarter, Richfield homeowners have utilized $58,000 of the total $111,000 grant. • Prior to offering the reduced interest rate, the average Fix-Up Fund loan was approximately $15,000. With the reduced interest rate, the average Fix-Up Fund loan has been $27,000. B. POLICY • The proposed loan program will help accomplish Goals and Policies from the Richfield Comprehensive Plan. o Goal #1 is to "Maintain and enhance Richfield's image as a community with strong, desirable and livable neighborhoods." The policies supporting this goal include: 1. Support the rehabilitation and upgrading of the existing housing stock. 2. Encourage the creation of `move-up' housing through new construction and home remodeling. 3. Support ongoing maintenance and upkeep of residential properties. o Goal #2 is to "Ensure sufficient diversity in the housing stock to provide for a range of household sizes, income levels, and needs." The policies supporting this goal include: 1. Promote the development of a balanced housing stock that is available to a range of income levels. 2. Encourage improvements to the housing stock to better serve families with children and seniors. 3. Promote additional housing diversity to serve families at all stages of their life-cycle through assistance, incentive programs, and the exploration of possible partnerships. 4. Promote the development, management, and maintenance of affordable housing in the City through assistance programs; alternative funding source; and the creation of partnerships whose mission is to promote low to moderate income housing. C. CRITICAL TIMING ISSUES • The application to the Community Homeownership Impact Fund is due to Minnesota Housing on July 11, 2013 • The Impact Fund grants are awarded once per year. • Evidence of local support and a commitment of matching funds must be submitted with the application. • MN Housing will award the funds in November, 2013. • Funds must be spent within a 20-month time period after contracts are signed. D. FINANCIAL • Through the first quarter of 2013, the average cost per homeowner to write down the interest rate was $5,300. • Based on this past average, an HRA contribution of$40,000 from the HRA General Fund over a two-year period could leverage a total of 14 loans, if the application is funded. • If the program is not awarded Impact Funds, the cities may elect to continue the program using only local funds in conjunction with the Fix-Up Fund loan program to offer the reduced interest rate. • GMHC receives funds to administer the loan program from Minnesota Housing through the Fix-Up Fund. E. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S) • Deny support for the application and proposed matching funds. V. ATTACHMENTS • Resolution VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A 3S- 1 RESOLUTION NO. RESOLUTION AFFIRMING AND RATIFYING SUBMITTAL OF AN APPLICATION TO MINNESOTA HOUSING COMMUNITY FIX-UP FUND PROGRAM AND COMMUNITY HOMEOWNERSHIP IMPACT FUND FOR A PROGRAM TO WRITE DOWN THE INTEREST-RATE ON HOME IMPROVEMENT LOANS WHEREAS, Minnesota Housing has issued a Request for Proposals for the Community Homeownership Impact Fund; and WHEREAS, the cities of Richfield, Brooklyn Center, and Crystal work together with Greater Metropolitan Housing Corporation to offer a home-improvement incentive loan program to stabilize neighborhoods affected by foreclosures and declining property values; and WHEREAS, the participating entities have the institutional, managerial and financial capability to ensure adequate project and grant administration; and WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield certifies that it will comply with all applicable laws and regulations as stated in the contract grant agreements; and WHEREAS, local matching funds are required for the application and the Housing and Redevelopment Authority in and for the City of Richfield seeks funding to complement locally-funded single family housing programs; therefore NOW, THEREFORE BE IT RESOLVED, that the Housing and Redevelopment Authority in and for the City of Richfield is supportive of making an application with Greater Metropolitan Housing Corporation to receive Community Fix-Up Fund designation and Community Homeownership Impact Funds, and is supportive of including local funds in the 2014 budget in the case that the application is approved. BE IT FURTHER RESOLVED, that the Executive Director is hereby authorized to execute such agreements as are necessary to implement the program on behalf of the applicant. Adopted by the Housing and Redevelopment Authority in and for of the City of Richfield, Minnesota this 17th day of June, 2013. Suzanne M. Sandahl, Chairperson ATTEST: Doris Rubenstein, Secretary AGENDA ITEM#: 3C REPORT#: 34 STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING JUNE 17, 2013 REPORT PREPARED BY: JULIE URBAN, HOUSING SPECIALIST NAME,TITLE REPORT PRESENTER: KAREN BARTON,ASSISTANT COMMUNITY DEVELOPMENT DIRECTOR NAME,TITLE DEPARTMENT DIRECTOR REVIEW: / __ `4� r`" S/GNAT /U REVIEWED BY EXECUTIVE DIRECTOR: me All /.......111110 , _leJ ice ITEM FOR HRA CONSIDERATION: Consideration of an amendment to the Subordination and Satisfaction Policy. I. RECOMMENDED ACTION: By Motion: Approve an amendment to the Subordination and Satisfaction Policy. II. EXECUTIVE SUMMARY A proposed amendment to the Housing and Redevelopment Authority's (HRA) Subordination and Satisfaction Policy would give discretion to the Executive Director to grant subordinations in cases where superior debt is increasing more than 50 percent. Subordinations could be granted only when the Executive Director finds that superior debts are unusually low and sufficient equity protection exists. III. BASIS OF RECOMMENDATION A. BACKGROUND • In January 2013 the HRA directed staff to make changes to the Subordination and Satisfaction Policy to allow the Executive Director additional discretion in cases where superior debt is increasing more 06172013 Subordination Policy Amendment.doc than 50 percent but mitigating factors are present that reduce the HRA's risk. B. POLICY • The Subordination and Satisfaction Policy currently requires that superior debt not be increased by more than 50 percent. Exceptions may be granted by the HRA in cases where superior debts are found to be unusually low with sufficient equity protection. The proposed amendment would give discretion to the Executive Director to grant this exception. C. CRITICAL TIMING ISSUES • Enabling the Executive Director to grant exceptions allows subordination requests to be processed in a more timely fashion. D. FINANCIAL • The policy amendment would require that homeowners have low debt and sufficient equity protection before a subordination would be granted, thereby protecting the HRA's financial interests. E. LEGAL • The HRA Attorney has reviewed the proposed changes. IV. ALTERNATIVE RECOMMENDATIONS) • Approve the proposed change to the Subordination and Satisfaction policy with revisions. • Do not approve the proposed change to the Subordination and Satisfaction policy. V. ATTACHMENTS • Subordination and Satisfaction policy showing the proposed changed. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A 3C RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY SUBORDINATION & SATISFACTION POLICY EFFECTIVE JULY 2012JUNE 2013 Subordinations Richfield Housing and Redevelopment Authority (HRA) loan recipients requesting subordination of the interest of the HRA in real property must submit a Subordination Request Form, the required supporting documentation, and a processing fee. Forms are available on the City of Richfield website (http://www. cityofrichfield.org/) or by calling the Community Development Department at 612-861-9760. Requests will not be considered until all documents and the processing fee have been received. Required Documents The following information must be submitted with the Subordination Request Form: 1. A typed letter dated and signed by the mortgagor, stating the reason for the requested subordination and the use of any equity being removed as part of the loan transaction. 2. A copy of the current appraisal (dated within six months of application) or other evidence of market value of the property that is acceptable to the HRA. 3. A copy of current title work (must indicate all debt against the property). 4. Explanation of remaining debts or liens with supporting documentation (i.e. most recent mortgage bill). 5. Estimated closing costs/settlement statement, where applicable. 6. A copy of the mortgagor's loan application. 7. Additional documentation may be required. Evaluation Criteria The Richfield HRA will subordinate its mortgage interest if all of the following conditions are met, to the extent that they are applicable: 1. Closing costs are reasonable. Generally this shall mean that the sum of all discount points, origination fees, and lender ancillary fees generally shall not exceed 3% of the new first mortgage amount. 2. If the HRA believes that the payment terms of the refinance are within the financial means of the borrower. 3. The total debt secured by the property, including the HRA lien and all superior mortgages, does not exceed 80% of the documented market value of the property. 4. Any equity being removed beyond the cost of the loan transaction will be used to improve the property. A typed letter, dated and signed by the applicant, must be submitted stating the use of any equity being removed. 5. The overall value of superior debt must not be increased by more than 50%. 6. If no more than one subordination request has been approved by the HRA in the past five years. 7. Property taxes, if not escrowed by the superior mortgage holder, must be current. The HRA will not subordinate to reverse mortgages. In most cases, interest-only loans or loans with interest-only options, revolving lines of credits or debt consolidation will not be allowed unless the HRA determines that an acceptable reason warrants this type of loan. The HRA may approve other subordination requests not meeting the conditions above on a case-by-case basis that are clearly in the best interests of the HRA, where the security of the HRA loan remains acceptable, and denial of the request will cause or contribute to a documented hardship on the part of the borrower. As a condition of approval, the HRA may require the Borrower to receive financial counseling. While many courses are available at no charge, the Borrower is responsible for any costs associated with the counseling. The course must be approved by the HRA. Fees The fee for a subordination request is established by the HRA. If the subordination request is denied, the fee will be returned with a letter explaining the reason(s) for denial. An additional fee is required for an appeal to the HRA and is non-refundable. Processing Subordination requests will be processed by HRA staff,who will submit the request with a recommendation for action, to the Executive Director. The Executive Director has the authority to grant a subordination request when, based on his or her discretion, the subordination is reasonable based on the criteria set forth in this Policy.The Executive Director may request review and final decision by the HRA. Requests for subordination should be submitted 30 days prior to the date the agreement to subordinate is needed. Exceptions may be made on a case-by-case basis. Appeal Process In cases where a subordination request does not meet the Policy, the Executive Director may grant an administrative appeal under the following circumstances: • Loan-to-value (LTV) ratio is greater than 80%, but no greater than 85%; or • Equity being removed for anything other than property improvements does not exceed $5000; or E The amount of financing superior to the HRA lien does not increase more than the cost of settlement charges related to the refinancing; or • The overall superior debt increases more than 50% but the value of superior de bt is unusually low and/or sufficient equity protection exists.- If an application is denied, the applicant may request an appeal in writing. Appeals will be submitted by staff to the HRA at the next regularly scheduled meeting, provided the request is made at least 10 days prior to that meeting. The HRA meets on the third Monday of each month. Satisfactions When a loan made by the HRA is paid in full, a document satisfying the lien will be prepared by the HRA, executed by the Executive Director or his or her delegate and delivered to the borrower for recording. The borrower is responsible for the cost of recording the satisfaction. AGENDA 1TEM#: 3D REPORT#: 35 .11.Aidi STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING JUNE 17, 2013 REPORT PREPARED BY: JULIE URBAN, HOUSING SPECIALIST NAME,TITLE REPORT PRESENTER: KAREN BARTON,ASSISTANT COMMUNITY DEVELOPMENT DIRECTOR NAME,TITLE DEPARTMENT DIRECTOR REVIEW: Q- 4./ r ow .. /0,., , ,,w-A REVIEWED BY EXECUTIVE DIRECTOR: 441111k, 1 ITEM FOR HRA CONSIDERATION: Consideration of support for an application to Minnesota Housing for a Community Homeownership Impact Fund to provide gap funds to develop three properties through the New Home Program. I. RECOMMENDED ACTION: By Motion: Approve the submission of an application to Minnesota Housing for a Community Homeownership Impact Fund award to provide gap funds to develop three properties through the New Home Program. II. EXECUTIVE SUMMARY The Housing and Redevelopment Authority (HRA) is proposing to partner with the Greater Metropolitan Housing Corporation (GMHC) to develop three lots through the New Home Program. New homes would be built on the two lots at 7316 Clinton and the north lot at 7225 1st Avenues. One of the three homes would be built as an accessible home and all three would be affordable to households earning up to 80 percent of the area median income. GMHC and the HRA would apply to Minnesota Housing for a Community Homeownership Impact Fund award to fill the gap between the cost of development and the end-value of the home to make it affordable. 06172013 Impact Fund Support Resolution New Home Program. doc III. BASIS OF RECOMMENDATION A. BACKGROUND • The HRA has purchased nine substandard properties since 2008 for the New Home Program. The substandard homes have been removed and the lots land-banked until such time that market demand for new homes returned. • The HRA has partnered with the Greater Metropolitan Housing Corporation (GMHC) to develop three new homes through the program in the past. • The HRA purchased 7316 Clinton Avenue in 2008. Federal Community Development Block Grant (CDBG) funds were used for part of the purchase. CDBG funds require that 51% or more of the development be affordable to households making 80% or less of area median income. • The New Home Program is the "affordable" equivalent of the Richfield Rediscovered Program. Since 2009, 6 properties designated for New Home development and 15 properties for Richfield Rediscovered development have been acquired, of which one New Home and nine Richfield Rediscovered properties have been sold and new houses constructed. B. POLICY • The 2008-2018 Richfield Comprehensive Plan states as policy: • Encourage the creation of"move-up" housing through new construction and home remodeling. • Promote the development of a balanced housing stock that is available to a range of income levels. • Through the City's New Home Program, the HRA purchases and removes substandard and functionally obsolete housing and replaces it with new homes designed for families and made available to households earning no more than 80 percent of the AMI. • The homes would be built to Minnesota Green Communities standards providing additional long-term affordability to the future homeowners. C. CRITICAL TIMING ISSUES • The application to the Community Homeownership Impact Fund is due to Minnesota Housing on July 11, 2013. • Evidence of local support and a commitment of matching funds must be submitted with the application. • The Impact Fund grants are awarded once per year. • Minnesota Housing will award the funds in November, 2013. • Funds must be spent within a 20-month time period after contracts are signed. • The HRA purchased 7316 Clinton Avenue in 2008. Federal Community Development Block Grant (CDBG) funds were used for part of the purchase. The Department of Housing and Urban Development (HUD) is encouraging the City to complete the development of these properties within the next two years. D. FINANCIAL • 7316 Clinton Avenue was purchased with a combination of Housing and Redevelopment Fund and CDBG funds. • 7225 1st Avenue was purchased through the Housing and Redevelopment Fund utilizing New Home funds. • Minnesota Housing funds would be used to fill the gap that exists between the cost of developing the property and what the home value will be upon completion of construction. The end-value of the home is estimated at $200,000. The cost of development, including the land value is estimated to exceed the end-value. Minnesota Housing funds would be used to fill this value gap. • An additional gap may exist between what the home will be sold for and what the homeowner can afford. Through the New Home Program, this gap could be filled through the use of a second mortgage which is due and payable upon the sale of the home or after thirty years. • If Impact Funds are awarded, a Contract for Development with GMHC laying out the responsibilities and financial terms would be brought to the HRA for approval. E. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S) • Deny support for the application. V. ATTACHMENTS • Resolution VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A 3D- I RESOLUTION NO. RESOLUTION AFFIRMING AND RATIFYING SUBMITTAL OF AN APPLICATION TO MINNESOTA HOUSING COMMUNITY HOMEOWNERSHIP IMPACT FUND FOR GAP FUNDS TO DEVELOP THREE AFFORDABLE NEW HOMES THROUGH THE HRA'S NEW HOME PROGRAM WHEREAS, Minnesota Housing has issued a Request for Proposals for the Community Homeownership Impact Fund; and WHEREAS, the Richfield Housing and Redevelopment Authority (HRA) proposes to work together with the Greater Metropolitan Housing Corporation to construct three new affordable homes through the HRA's New Home Program; and WHEREAS, the HRA currently owns three single-family residential properties that are ready for new home construction through its New Home Program; WHEREAS, the participating entities have the institutional, managerial and financial capability to ensure adequate project and grant administration; and WHEREAS, the HRA certifies that it will comply with all applicable laws and regulations as stated in the contract grant agreements; and WHEREAS, local matching funds are required for the application and the HRA seeks funding to complement locally-funded single family housing programs; therefore NOW, THEREFORE BE IT RESOLVED, that the HRA is supportive of making an application with Greater Metropolitan Housing Corporation to receive Community Homeownership Impact Funds, and is supportive of including local funds in the 2014 budget in the case that the application is approved. BE IT FURTHER RESOLVED, that the Executive Director is hereby authorized to execute such agreements as are necessary to implement the program on behalf of the applicant. Adopted by the Housing and Redevelopment Authority in and for of the City of Richfield, Minnesota this 17th day of June, 2013. Suzanne M. Sandahl, Chairperson ATTEST: Doris Rubenstein, Secretary AGENDA ITEM#: 4 REPORT#: 36 STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING moommom JUNE 17, 2013 REPORT PREPARED BY: JULIE URBAN, HOUSING SPECIALIST NAME, TITLE REPORT PRESENTER: KAREN BARTON,ASSISTANT COMMUNITY DEVELOPMENT DIRECTOR NAME,TITLE DEPARTMENT DIRECTOR REVIEW: SIGNATURE REVIEWED BY EXECUTIVE DIRECTOR: I ` ITEM FOR HRA CONSIDERATION: Public hearing and consideration of a resolution authorizing the sale of 7229 1st Avenue to Endres Custom Homes, Inc. and a Contract for Private Development with Endres Custom Homes, Inc. for the construction of a single family home under the Richfield Rediscovered Program. I. RECOMMENDED ACTION: By Motion: Conduct and close the public hearing and by motion: 1. Approve a resolution authorizing the sale of 7229 1st Avenue to Endres Custom Homes, Inc.; and 2. Authorize execution of a Contract for Private Development with Endres Custom Homes, Inc., for the development of a single family home under the Richfield Rediscovered Program. II. EXECUTIVE SUMMARY Endres Custom Homes has submitted an application to purchase the lot at 7229 1st Avenue and construct a new home under the Richfield Rediscovered Program. The new two-story home will have 1,926 square feet, three bedrooms, two-and-a-half baths, and an attached two-stall garage. The home will have an estimated end- value of $250,000. Construction is expected to begin once a building permit is approved and will be completed 60 days after the permit is issued. 06172013 7229 1st(Endres) RR Contract.docx • III. BASIS OF RECOMMENDATION A. BACKGROUND • The Housing and Redevelopment Authority (HRA) purchased the double lot at 7225-29 1st Avenue in 2012 and divided the lot into two separate lots. • The existing house was demolished earlier this year and the lot cleared for development. B. POLICY • The proposed project meets the objectives of the Richfield Rediscovered Program: o Provides new, higher valued housing. o Alleviates a shortage of housing choice for families. o Facilitates the HRA's "Market Rate Initiatives" by providing a three-bedroom, owner-occupied house designed for a family. • The project meets the Housing Design and Site Development Criteria, as defined in Exhibit B of the Contract for Private Redevelopment. C. CRITICAL TIMING ISSUES • Per the Contract for Private Development, the house construction must be completed by January 31, 2014. The Builder anticipates applying for a building permit shortly after HRA approval. Closing on the lot will occur once a building permit is ready to be issued and is required to occur no later than September 1, 2013. • A provision has been added to all Richfield Rediscovered contracts authorizing staff the ability to grant an extension to these deadlines for a period up to six months. D. FINANCIAL • The appraised value of the lot is $45,000. • The HRA acquired the property in 2012 for $105,000, razed the existing house, and subdivided the property into two lots. • Under the terms of the Contract, the $45,000 will be due at closing. • The Builder proposes to build the house to achieve MnGreen Path certification. If the certification is obtained, the Builder will qualify for a $5,000 credit. • Under the terms of the Contract, the minimum market value of the house will be $250,000. • Under the terms of the Contract, the Builder must submit a $10,000 cash escrow to be held until construction is completed as provided in the Contract. E. LEGAL • The HRA Attorney has prepared the Contract for Private Development. IV. ALTERNATIVE RECOMMENDATION(S) • Amend the Contract for Private Development and direct staff to work with the Builder to revise the proposal. • Do not execute the Contract for Private Development. V. ATTACHMENTS • Contract for Private Development • Site Plan • Elevations VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Dustin Endres, Endres Custom Homes, Inc. Li CONTRACT FOR PRIVATE DEVELOPMENT Between HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD and Endres Custom Homes,Inc. for property located at 7229 1st Avenue South This Instrument Drafted by: `1 The Housing and Redevelopment Authority in and for the City of Richfield 6700 Portland Avenue South Richfield,Minnesota 55423 Telephone: (612) 861-9760 • 401253v7 CBR RC125-65 CONTRACT FOR PRIVATE DEVELOPMENT THIS AGREEMENT,made and entered into as of this day of s 20_, by and between the Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate and politic under the laws of the State of Minnesota, having its principal office at 6700 Portland Avenue, Richfield, Minnesota (HRA) and Endres Custom Homes, Inc. (Builder). WITNESSETH: WHEREAS, the City of Richfield (City) and the HRA have previously created and established a Redevelopment Project (Project) pursuant to the authority granted in Minnesota Statutes, Sections 469.001 through 469.047 (collectively, the Act); and WHEREAS, pursuant to the Act, the City and the HRA have previously adopted a redevelopment plan for the Project(Redevelopment Plan); and WHEREAS, in order to achieve the objectives of the Redevelopment Plan and particularly to make specified land in the Project available for development by private enterprise for and in accordance with the Redevelopment Plan, the HRA has determined to provide substantial aid and assistance to finance development costs in the Project; and WHEREAS, the Builder has proposed a development as hereinafter defined within the Project which the HRA has determined will promote and carry out the objectives for which the Project has been undertaken, will assist in carrying out the obligations of the Redevelopment Plan, will be in the vital best interests of the City and the health, safety and welfare of its residents and is in accord with the public purposes and provisions of the applicable state and local laws and requirements under which development in the Project has been undertaken and is being assisted. NOW, THEREFORE, in consideration of the mutual covenants and obligation of the HRA and the Builder, each party does hereby represent, covenant and agree with the other as follows: ARTICLE I. DEFINITIONS,EXHIBITS,RULES OF INTERPRETATION Section 1.1. Definitions. In this Agreement, the following terms have the meaning given below unless the context clearly requires otherwise: Building Plans. Detailed plans for the Improvements to be constructed on the Property, as required by the local building official for issuance of a building permit. 401253v7 CBR RC125-65 1 L . ?� Construction Plans. The construction plans approved by the HRA pursuant to Section 4.1 of this Agreement. The Construction Plans include a schedule for construction of the Improvements, preliminary plans and schematics of the Improvements to be constructed, and a landscaping plan. Development. The Property and the Improvements to be constructed thereon according to the Construction Plans approved by the HRA. Event of Default. Event of Default has the meaning given such term in Section 8.1. Guidelines. The Richfield Rediscovered Program Guidelines Lot Sale Program, revised April 23, 2013 and attached as Exhibit B to this Agreement. Homeowner. The individuals purchasing the Property from Builder and who will be living in the home following purchase. Improvements. Each and all of the structures and site improvements constructed on the Property by the Builder, as specified in the Construction Plans to be approved by the HRA. Minimum Market Value. $250,000, which is the minimum market value for the land and Improvements as confirmed by the Hennepin County Assessor. Mortgage. A mortgage obtained by the Builder from a third party lender in accordance with Section 7.2 of this Agreement. Property. The real property legally described as: Lot 11,Block 1, Scheubles First Addition,Hennepin County,Minnesota Located on land having a street address of: 7229 1St Avenue South Unavoidable Delays. Delays which are the direct result of strikes, labor troubles, fire or other casualty to the Improvements, litigation commenced by third parties which results in delays or acts of any federal, state or local government, except those contemplated by this Agreement, which are beyond the control of the Builder. Section 1.2. Exhibits. The following Exhibits are attached to and by reference made a part of this Agreement: A. Form of Certificate of Completion B. Program Guidelines—Lot Sale Program C. Form of Quit Claim Deed 401253v7 CBR RC 125-65 2 D. Well Disclosure Section 1.3. Rules of Interpretation. (a) This Agreement shall be interpreted in accordance with and governed by the laws of the State of Minnesota. (b) The words "herein" and "hereof' and words of similar import, without reference to any particular section or subdivision refer to this Agreement as a whole rather than any particular.section or subdivision hereof. (c) References herein to any particular section or subdivision hereof are to the section or subdivision of this Agreement as originally executed. (d) Any titles of the several parts, articles and sections of this Agreement are inserted for convenience and reference only and shall be disregarded in construing or interpreting any of its provisions. ARTICLE II. REPRESENTATIONS AND UNDERTAKINGS Section 2.1. By the Builder. The Builder makes the following representations and undertakings: (a) The Builder has the legal authority and power to enter into this Agreement and has duly authorized the execution, delivery and performance of this Agreement; (b) The Builder has the necessary equity capital or has obtained commitments for financing necessary for construction of the Improvements; (c) The Builder will construct the Improvements in accordance with the terms of this Agreement and all local, state and federal laws and regulations; (d) The Builder will obtain, in a timely manner, all required permits, licenses and approvals, and will meet, in a timely manner, the requirements of all local, state and federal laws and regulations which must be obtained or met before the Improvements may be constructed; (e) The plans for the Improvements have been prepared by a qualified draftsperson or architect; and (0 The Builder has read and understands the Guidelines and agrees to be bound by them. 401253v7 CBR RC125-65 3 Section 2.2. By the HRA. The HRA makes the following representations as the basis for the undertaking on its part herein contained: (a) The HRA is authorized by law to enter into this Agreement and to carry out its obligations hereunder; and (b) The HRA will, in a timely manner, subject to all notification requirements, review and act upon all submittals and applications of the Builder and will cooperate with the efforts of the Builder to secure the granting of any permit, license, or other approval required to allow the construction of the Improvements. ARTICLE III. ACQUISITION OF PROPERTY; CONVEYANCE TO BUILDER Section 3.1. Purchase of Property by Builder. The HRA agrees to sell the Property to Builder and the Builder agrees to purchase the Property from the HRA in an "as-is" condition. The sale of the Property is contingent upon the Builder providing the HRA with evidence satisfactory to the HRA that Builder has entered into a binding legal commitment, in the form of a Purchase Agreement for the resale of the Property to a Homeowner following completion of the Improvements. The HRA agrees to convey the Property to the Builder by Quit Claim Deed in the general form of Exhibit C. The HRA's deed to the Builder will contain the right of reverter required in Section 8.3. The purchase price for the Property, payable at Closing, will be $45,000 ("Purchase Price"). Section 3.2. Title and Examination. As soon as reasonably possible after execution of this Contract for Private Development by both parties, (a) HRA shall surrender any abstract of title and a copy of any owner's title insurance policy for the property, if in HRA's possession or control, to Builder or to Builder's designated title service provider; and (b) Builder shall obtain the title evidence determined necessary or desirable by Builder or Builder's lender, including but not limited to title searches, title examinations, abstracting, a title insurance commitment or an attorney's title opinion, at Builder's selection and cost, and provide a copy to the HRA. The Builder shall have 20 days from the date it receives such title evidence to raise any objections to title it may have. Objections not made within such time will be deemed waived. The HRA shall have 90 days from the date of such objection to effect a cure; provided, however, that the HRA shall have no obligation to cure any objections, and may inform Builder of such. The Builder may then elect to close notwithstanding the uncured objections or declare this Agreement null and void, and the parties will thereby be released from any further obligation hereunder. 401253v7 CBR RC 125-65 4 Section 3.3. Taxes and Special Assessments. Real estate taxes and installments of special assessments will be prorated between the HRA and Builder as of the date of closing. Section 3.4. Soil Conditions and Hazardous Wastes. The Builder acknowledges that the I-IRA makes no representations or warranties as to the conditions of the soils on the Property, its fitness for the construction of improvements or any other purpose for which the Builder may use the Property, or regarding the presence of hazardous wastes on the Property. The HRA will allow reasonable access to the Property for the Builder to conduct such tests regarding soils conditions and hazardous wastes as the Buyer may desire. Permission to enter the Property to conduct such tests must be given in writing under reasonable terms and conditions established by the HRA. Section 3.5. Site Clearance. The HRA will be responsible for clearance of all buildings as required to prepare the Property for development. All other site preparation is the responsibility of Builder. Builder will comply with all of the provisions of the Guidelines relating to tree protection, preservation and replacement. Section 3.6. Other Preconditions to Closing. Closing may not take place until the I-IRA is satisfied that the Project is in all respects in full compliance with the provisions of the Guidelines contained in Exhibit B. It is anticipated that the Builder will involve the Homeowner in the various activities required under the Guidelines so that the Homeowner will have an opportunity to contribute suggestions concerning development of the Property. Section 3.7. Closing. Closing must take place on or before September 1, 2013, or such other date as may be agreed to by the Builder and HRA in writing. At Closing, the Builder will provide the HRA with a cash deposit for the escrow account established pursuant to Section 5.1, in addition to the Purchase Price. Section 3.8. Closing Costs. The Builder will pay: (a)the closing fees charged by its title insurance company or other closing agent, if any, utilized to close the transaction for Builder; (b)title services chosen by Builder pursuant to Section 3.2 above, including the premium for title insurance policy, if any, and (c)the recording fees for the Contract for Private Development and the deed transferring title to the Builder. HRA will pay all other fees normally paid by sellers, including (a) any transfer taxes, and (b) fees and charges related to the filing of any instrument required to make title marketable. Each party shall pay its own attorney fees. Section 3.9. Sewer and Water. HRA warrants that city water is available at the lot line and city sewer is available at the curb. Section 3.10. ISTS Disclosure. HRA is not aware of any individual sewage treatment system on the property. Buyer is responsible for all costs of removing any individual sewage treatment system that may be discovered on the Property. Section 3.11. Well Disclosure. HRA's knowledge of wells on the Property is disclosed in Exhibit D. 401253'7 CBR RC 125-65 5 ARTICLE IV. CONSTRUCTION OF IMPROVEMENTS Section 4.1. Construction of Improvements. The Builder shall construct the Improvements on the Property in accordance with the Guidelines and the Construction Plans, shall cause the Improvements to meet or exceed the Minimum Market Value specified in Section 1.1, and shall maintain, preserve and keep the Improvements in good repair and condition. The Builder shall provide his or her proposed construction plans to the HRA for review; if the proposed construction plans are in conformity with this Agreement and the Guidelines, the HRA will approve the Construction Plans following review and comment by the Homeowner. Section 4.2. Construction Plans. No building permit will be issued by the City unless the Building Plans are in conformity with the Guidelines, the Construction Plans, the Builder's Minimum Market Value, other requirements contained in this Agreement, and all local, state and federal regulations. The Builder shall provide the HRA with a set of Building Plans to be used in connection with any application for a building permit. The HRA shall, within 25 days of receipt of the Building Plans review the same to determine whether the foregoing requirements have been met. If the HRA determines such Building Plans to be deficient, it shall notify the Builder in writing stating the deficiencies and the steps necessary for correction. Issuance of the building permit by the City shall be a conclusive determination that the Building Plans have been approved and shall satisfy the provisions of this Section 4.2. Section 4.3. Schedule of Construction. Subject to Unavoidable Delays, construction of the Improvements shall be completed prior to January 31, 2014. All construction shall be in conformity with the approved Construction Plans and the Guidelines. Periodically during construction the Builder shall make reports in such detail as may reasonably be requested by the IIRA concerning the actual progress of construction. If at any time prior to completion of construction the IIRA has cause to believe that the Builder will be unable to complete construction of the Improvements in the time permitted by this Section 4.3, it may notify the Builder and demand assurances from the Builder regarding the Builder's construction schedule. If such assurances are not forthcoming or are deemed by the HRA at its sole discretion to be inadequate, the HRA may declare an Event of Default and may avail itself of any of the remedies specified in Section 8.2 of this Agreement. Section 4.4. Certificate of Completion. After notification by the Builder of completion of construction of the Improvements, the HRA shall inspect the construction to determine whether the Improvements have been completed in accordance with the Construction Plans and the terms of this Agreement, including the date of the completion thereof. In the event that the HRA is satisfied with the construction, and upon closing on the sale of the Property to the Homeowner, the HRA shall furnish the Builder with a Certificate of Completion in the form attached hereto as Exhibit A. Such certification by the HRA shall be a conclusive determination of satisfaction and termination of the agreements and covenants in this Agreement. Issuance of the Certificate of Completion shall also serve as a satisfaction of any obligation of Builder 401253v7 CBR RC 125-65 6 secured by the escrow account established under Section 5.1, and the cash in the escrow account will be released to the Builder. At the time a Certificate of Completion is issued, the HRA will also provide Builder with a $5,000 cash rebate if Builder has obtained Green Community Concepts certification through LEED for Homes, Minnesota GreenStar, Minnesota Green Communities or Minnesota Green Path. If the HRA shall refuse or fail to provide certification in accordance with the provisions of this Section 4.4, the HRA shall within 15 days of such notification provide the Builder with a written statement, indicating in adequate detail in what respects the Builder has failed to complete the Improvements in accordance with the provisions of this Agreement necessary, in the opinion of the HRA, for the Builder to take or perform in order to obtain such certification. Section 4.5. Failure to Construct. In the event that construction of the Improvements is not completed as provided in Section 4.3 of this Agreement, an Event of Default shall be deemed to have occurred, and the HRA may proceed with its remedies under Section 8.2. ARTICLE V. REDEVELOPMENT ASSISTANCE Section 5.1. Establishment of Cash Escrow. Builder acknowledges that although it is purchasing the Property at its fair market value as raw land, the HRA has incurred significant costs in acquiring and preparing the Property for development by Builder. At Closing, Builder will deliver to the HRA $10,000 to be placed in a non-interest bearing escrow account pursuant to the Escrow Agreement, dated as of the date hereof, between Builder and HRA. The obligation to pay the $10,000 to the HRA will be forgiven, and the cash in the escrow account will be returned to Builder if: (i) the Builder receives a Certificate of Completion; and (ii) the Builder is not otherwise in default of any of its obligations hereunder. If such have not occurred, an Event of Default shall be deemed to have occurred and the HRA may exercise its remedies under Section 8.2. ARTICLE VI. FINANCING Section 6.1. Financing. HRA acknowledges that Builder has submitted evidence of financing for the Improvements in compliance with the provisions of Section 2.1(b) of this Agreement. Builder must notify HRA immediately of any changes to or withdrawal of the approved financing, HRA shall have 10 days to approve or disapprove changes in financing. If the HRA rejects a change in the approved financing or if the approved financing is withdrawn, the Builder shall have 30 days or such additional period of time as the Builder may reasonably require from the date of the HRA's notification to submit evidence of financing satisfactory to the HRA. If the Builder fails to submit such evidence or fails to use due diligence in pursuing financing, the HRA may terminate this Agreement and both parties shall be released from any 401253v7 CBR RC 125-65 7 4 CI further obligation or liability hereunder. Closing shall not take place until Builder has provided HRA with acceptable evidence of financing for construction of the Improvements. Section 6.2. Copy of Notice of Default to Lender. Whenever the HRA shall deliver any notice or demand to the Builder with respect to any Event of Default by the Builder in its obligations or covenants under this Agreement,the HRA shall at the same time forward a copy of such notice or demand to each holder of any Mortgage authorized by the Agreement at the last address of such holder shown in the records of the HRA. Section 6.3. Subordination. In order to facilitate obtaining financing for the construction of the Improvements by the Builder, the HRA may, in its sole and exclusive discretion, agree to modify this Agreement in the manner and to the extent the HRA deems reasonable, upon request by the financial institution and the Builder. ARTICLE VII. PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER Section 7.1. Representation as to Redevelopment. The Builder represents and agrees that its undertakings pursuant to the Agreement, are for the purpose of development of the Property and not for speculation in land holding. The Builder further recognizes that, in view of the importance of the Development to the general welfare of Richfield and the substantial financing and other public aids that have been made available by the HRA for the purpose of making the Development possible, the qualification and identity of the Builder are of particular concern to the HRA. The Builder further recognizes that it is because of such qualifications and identity that the HRA is entering into this Agreement, and, in so doing, is further willing to rely on the representations and undertakings of the Builder for the faithful performance of all undertakings and covenants agreed by the Builder to be performed. Section 7.2. Prohibition Against Transfer of Property and Assignment of Agreement. For the reasons set out in Section 7.1 of this Agreement, the Builder represents and agrees as follows: (a) Except as specifically allowed by this section, Builder has not made or created, and, prior to the issuance of the Certificate of Completion, Builder will not make or create, or suffer to be made or created, any total or partial sale, assignment, conveyance, or any trust in respect to this Agreement or the Property or any part thereof or any interest therein, or any contract or agreement to do any of the same, without the prior written approval of the HRA. (b) This provision shall not be deemed as preventing the Builder from entering into a Purchase Agreement for the sale of the Property to a Homeowner. (c) This provision does not prohibit conveyances that are only by way of security for, and only for the purpose of obtaining financing necessary to enable the Builder or any successor in interest to the Property, or any part thereof, to perform its obligations with respect to the 401253v7 CBR RC]25-65 8 - Io Development under this Agreement, and any other purpose authorized by this Agreement. Any Mortgage obtained by the Builder must be disclosed to the HRA, and must be subordinate to this Agreement. The Builder must provide the HRA with an address for the holder of the Mortgage for purposes of providing notices as may be required by this Agreement. ARTICLE VIII. EVENTS OF DEFAULT Section 8.1. Events of Default Defined. The following shall be deemed Events of Default under this Agreement and the term shall mean, whenever it is used in this Agreement, unless the context otherwise provides, any one or more of the following events: (a) Failure by the Builder to pay when due the payments required to be paid or secured under any provision of this Agreement; (b) Failure by the Builder to observe and substantially perform any covenant, condition, obligation or agreement on its part to be observed or performed hereunder, including the time for such performance; (c) If the Builder shall admit in writing its inability to pay its debts generally as they become due, or shall file a petition in bankruptcy, or shall make an assignment for the benefit of its creditors, or shall consent to the appointment of a receiver of itself or of the whole or any substantial part of the Property; (d) If the Builder, on a petition in bankruptcy filed against it, be adjudicated as bankrupt, or a court of competent jurisdiction shall enter an order or decree appointing, without the consent of the Builder, a receiver of the Builder or of the whole or substantially all of its property, or approve a petition filed against the Builder seeking reorganization or arrangement of the Builder under the federal bankruptcy laws, and such adjudication, order or decree shall not be vacated or set aside or stayed within 60 days from the date of entry thereof; or (e) If the Development is in default under any Mortgage and has not entered into a work-out agreement with the holder of the Mortgage. Section 8.2. Remedies on Default. Whenever any Event of Default occurs, the HRA may, in addition to any other remedies or rights given the BRA under this Agreement, take any one or more of the following actions following written notice by the HRA to the Builder as provided in Section 9.3 of this Agreement: (a) Suspend its performance under this Agreement until it receives assurances from the Builder, deemed reasonably adequate by the HRA, that the Builder will cure its default and continue its performance under this Agreement; (b) Cancel or rescind this Agreement; 401253v7 CBR RC 125-65 9 (c) Exercise its right under Section 8.3; (d) [Draw the full amount of the Letter of Credit ][Withdraw all funds in the escrow account established in Section 5.1]; (e) Withhold the Certificate of Completion; or (f) Take whatever action at law or in equity may appear necessary or desirable to the HRA to enforce performance and observance of any obligation, agreement, or covenant of the Builder under this Agreement; provided, however, that any exercise by the HRA of its rights or remedies hereunder shall always be subject to and limited by, and shall not defeat, render invalid or limit in any way(a) the lien of any Mortgage authorized by this Agreement and (b) any rights or interest provided in this Agreement for the protection of the holders of a Mortgage; and provided further that should any holder of a Mortgage succeed by foreclosure of the Mortgage or deed in lieu thereof to the Builder's interest in the Property, it shall, notwithstanding the foregoing, be obligated to perform the obligations of the Builder under this Agreement to the extent that the same have not therefore been performed by the Builder. Section 8.3. Revesting Interest in HRA Upon Happening of Event of Default Subsequent to Conveyance of Property to Builder. In the event that subsequent to the closing or the sale of the Property to the Builder and prior to the issuance of the Certificate of Completion: (a) The Builder fails to begin construction of the Improvements in conformity with this Agreement, and such failure is not due to Unavoidable Delays; (b) The Builder, after commencement of the construction of the Improvements, defaults in or violates obligations with respect to the construction of the Improvements, including the nature and the date for the completion thereof, or abandons or substantially suspends construction work, and such act or actions is not due to Unavoidable Delays; (c) The Builder or successor in interest fails to pay real estate taxes or assessments on the Property or any part thereof when due, or places thereon any encumbrance or lien unauthorized by this Agreement, or suffers any levy or attachment to be made, or any supplier's or mechanic's lien, or any other unauthorized encumbrance or lien to attach; (d) There is, in violation of Article VII of this Agreement, any transfer of the Property or any part thereof; or (e) The Builder fails to comply with any of its covenants under this Agreement, then the HRA shall have the right upon 30 days' written notice to Builder and the Builder's failure to cure within such 30 days period, to re-enter and take possession of the Property and to terminate and revest in the HRA the interest of the Builder in the Property; provided, however, 401253v7 CBR RC 125-65 10 that such revestiture of title shall be subject to the lien of any prior encumbrance permitted under this Agreement, or any right of a Homeowner pursuant to a valid Purchase Agreement authorized by this Agreement. Section 8.4. No Remedy Exclusive. No remedy herein conferred upon or reserved to the HRA is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the HRA or the Builder to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in this Article VIII. Section 8.5. No Additional Waiver Implied by One Waiver. In the event of the occurrence of any Event of Default by either party, which Event of Default is thereafter waived by the other party, such waiver shall be limited to the particular Event of Default so waived and shall not be deemed to waive any other concurrent, previous or subsequent Event of Default. ARTICLE IX. ADDITIONAL PROVISIONS Section 9.1. Conflict of Interests; Representatives Not Individually Liable. No HRA officer who is authorized to take part in any manner in making this Agreement in his or her official capacity shall voluntarily have a personal financial interest in this Agreement or benefit financially there from. No member, official, or employee of the HRA shall be personally liable to the Builder, or any successor in interest, for any Event of Default by the HRA or for any amount which may become due to the Builder or successor or on any obligations under the terms of this Agreement. Section 9.2. Non-Discrimination. The provisions of Minnesota Statutes Section 181.59, which relate to civil rights and non-discrimination, and any affirmative action program of the City shall be considered a part of this Agreement and binding on the Builder as though fully set forth herein. Section 9.3. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand or other communication under this Agreement by either party to the other shall be sufficiently given or delivered if it is sent by mail, postage prepared, return receipt requested or delivered personally: 401253v7 CBR RC t25-65 11 (a) As to the HRA: Richfield HRA Executive Director 6700 Portland Avenue South Richfield, MN 55423 (b) As to the Builder: Endres Custom Homes, Inc. 15690 Duck Pond Way Apple Valley, MN 55124 or at such other address with respect to either such party as that party may, from time to time, designate in writing and forward to the other as provided in this Section 9.3. Section 9.4. Counterparts. This Agreement may be simultaneously executed in any number of counterparts, all of which shall constitute one and the same instrument. Section 9.5. Extensions. Any extension to the Closing Date and/or extension to Construction Completion Date that exceeds 6 months from the date agreed to in Section 3.7 and 4.3, respectively, must be approved by the HRA Board. HRA staff is authorized to extend the Closing Date to a date less than 6 months from the Closing Date agreed to in Section 3.7 and extend the Construction Completion Date to a date less than 6 months from the Construction Completion Date agreed to in Section 4.3. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the day and year first above written. [signature pages follow] 401253v7 CBR RC125-65 12 g - L Signature Page for HRA THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD,MINNESOTA By Its Chairperson By Its Executive Director STATE OF MINNESOTA ) ) SS COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 20 , by , the Chairperson of the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, a public body corporate and politic under the laws of Minnesota, on behalf of the authority. Notary Public STATE OF MINNESOTA ) ) SS COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 20 , by , the Executive Director of the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, a public body corporate and politic under the laws of Minnesota, on behalf of the authority. Notary Public 401253.7 CBR RC 125-65 13 Signature Page for Builder Builder. >1)--C_S 6-bvtrt ikertel ....-----1, Its `Ian 0461 STATE OF MINNESOTA ) SS COUNTY OF 11-1f t ) The foregoing instrum nt was acknowledge before me this .j 1,) day of , 201 , by IDLE vi (iI1 "�-t S� , the �, CIO of tf'VfrS -Lfc k Li!jar_ � , a CL�/ 101 under the laws of Mi n n tSC k' , on behalf of the IDA ' i Notary Public JANINE C.HANSON Ly,.,. Nary Pub is31 s .:1.1i -;- My Co„n,ieston EXpileit 401253v7 CBR RC 125-65 14 EXHIBIT A FORM OF CERTIFICATE OF COMPLETION The undersigned hereby certifies that , has fully and completely complied with its obligations under that document entitled "Contract for Private Development", between the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota and dated filed as Document No. (the "Contract") with respect to the construction of the approved construction plans at , legally described as and is released and forever discharged from its obligations under such Contract. DATED: THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY RICHFIELD By: Its: Executive Director STATE OF MINNESOTA ) SS COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of , 20_, by the Executive Director of the Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate and politic under the laws of the State of Minnesota on behalf of the public body corporate and politic. Notary Public This instrument was drafted by: Kennedy&Graven, Chartered 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis, MN 55402 A-1 401253v7 CBR RC125-65 " w.s "' h EXHIBIT B PROGRAM GUIDELINES—LOT SALE PROGRAM RICHFIELD REDISCOVERED PROGRAM GUIDELINES LOT SALE PROGRAM REVISED: April 23, 2013 401253v7 CBR RC125-65 B—1 Lk. 1Y PROGRAM OBJECTIVES 3 DEFINITIONS 3 PROGRAM BASICS 3 APPLICATION REQUIREMENTS 4 ADDITIONAL REQUIREMENTS 5 HOUSE DESIGN AND SITE DEVELOPMENT REQUIREMENTS 5 New House Standards 6 Site Standards 6 Construction Requirements, 6 General Standards 7 Green Community Concepts 8 CITY REVIEW PROCEDURE 8 LOT SALE TO BUILDER/BUYER 9 PROGRAM MARKETING 9 DATA PRIVACY 9 B-2 401253v7 CBR RC125-65 ,r — )CC This document has been developed as a guidance tool for program administration. It should not be interpreted as constituting any contractual agreement or liability by the City or Housing and Redevelopment Authority(HRA). The HRA may modify or divert from the guidelines where it deems appropriate. I.Program Objectives 1. To remove substandard, functionally obsolete housing on scattered sites throughout the City and replace with new, higher-valued housing. 2. To eliminate the blighting influence of substandard housing, thus improving residential neighborhoods. 3. To alleviate the shortage of housing choices for families. 4. To facilitate the construction of larger three- to four-bedroom, owner-occupied homes designed for families. 5. To facilitate the construction of multi-unit, owner-occupied homes designed to expand family opportunities or to serve elderly residents. These objectives will be achieved through the sale of lots by the Housing and Redevelopment Authority to Builder/Buyer teams for the development of newly constructed homes. II. Definitions Applicant:An individual who submits an application for a Richfield Rediscovered lot. The Applicant may be a Builder or the end Buyer. If the Applicant is a Builder, an end Buyer should be identified. If the Applicant is the Buyer, the Applicant must submit a signed contract between the Builder and the Buyer to build a home on the lot identified in the application. Buyer.An individual(s)who will build, own and occupy a new housing unit in Richfield. The Buyer will occupy the property and not offer it for rent. The Buyer may not also function as the Builder on a Richfield Rediscovered project. The Buyer and Builder must be unrelated separate legal entities. A speculative project by a Buyer may be considered if all other program requirements can be met. However, neither the Buyer, the Buyer's Builder or Builder's subcontractors, or the Builder's realty agents may occupy or purchase the property. Buyers, unless licensed in the trade specified, may not put any sweat equity into the construction of the foundation, wall/roof framing, shingling, exterior work, electrical/plumbing/HVAC systems or interior carpentry. Builder. Contractor who has signed a contract with the Buyer to build a home on the lot identified in the application. Contract for Private Development: A contract between the HRA and the Builder or Buyer that establishes the conditions under which the lot will be sold and the proposed house will be developed. Green Community Concepts Plan: A written plan indicating how the proposed development will incorporate green building features and concepts. Priority will be given to projects that incorporate green building features. HRA: Housing and Redevelopment Authority in and for the City of Richfield. Lot List: A listing of available lots for sale. Information regarding the lot location, size and sale price is provided. III. Program Basics 1. HRA publishes a list of available vacant lots for purchase including sale price and development criteria. B-3 401253v7 CBR RCI 25-65 y 2. Builder/Buyer team proposes a plan for a lot consistent with development criteria and program requirements and makes an offer to purchase. 3. HRA approves lot sale. 4. Lot is sold to Builder or Buyer. 5. Builder constructs new home. 6. Projects must be completed within one year of HRA approval of the project. IV.Application Requirements The following must be submitted for application to the program: 1. $525 application fee An application fee must be paid at the time of application. This fee is non-refundable and is not part of the lot price. 2. Application Form 3. Blueprints The layout of all levels, including basement and unfinished space, must be provided. 4. Elevations Elevations of all four sides of the house, including view of garage shall be provided. Colored renderings may also be required. 5. Site plan The site plan shall indicate the location of the new house,walkways and garage. 6. Landscaping plan A landscaping plan must indicate the location and type of trees, shrubbery, flowers and landscaping materials (e.g. rocks, mulch) and any existing trees to be preserved. 7. Detail of construction materials to be used on the project. 8. Green Community Concepts Plan The plan should indicate what Green Community Concepts will be incorporated into the project. 9. Construction timeline Construction must be completed with one year of the purchase of the property. 10. Signed contract with Builder 11. Purchase agreement If the Builder plans to purchase the lot, the application must include a valid purchase agreement between the Buyer and the Builder for the lot to be developed. 12. Financial capability statement A statement from a financial institution indicating willingness to provide sufficient construction capital to complete the project must be provided. 13. Builder References a. Five previous customers b. Three major suppliers, one being the construction supplier c. Building inspectors from two cities where the Builder has constructed new housing within the past three years 14. Proof of Builder's Comprehensive General Liability with Property Damage Protection. B-4 401253v7 C13R RC125-65 15. Proof of sufficient worker's compensation insurance coverage by the Builder. 16. Written warranty program To be provided to the Buyer, which guarantees at a minimum, warranted repairs as required by Minnesota State Statute. V.Additional Program Requirements 1. The Applicant is expected to meet with an architectural/design consultant prior to submitting an application. A two-hour consultation is available through the HRA at a cost of$25 to the applicant. See the City's website (www.cityofrichfield.orq) for more information. This requirement may be waived if the applicant is using an architect for the project. 2. The site will be sold to the Builder or Buyer at the fair market value as appears on the Lot List. The HRA will not accept offers for less than the established sale price. 3. A Contract for Private Development is signed by the HRA and the Builder or the Buyer. The Contract is a standard form which includes conditions for acquisition and development of the property. The Contract will also establish a minimum required end-value for the property based on construction estimates provided by the applicant. The Builder or Buyer will be expected to agree to the terms of the Contract before the application can be scheduled on the HRA agenda. 4. All lots will have a required minimum end value that will be established in the Contract for Private Redevelopment. 5. The lot can be sold to either the Builder or the Buyer. If the lot is sold to the Builder, the Builder will pay cash for the lot at closing and submit a Letter of Credit or cash escrow for$10,000. The Letter of Credit must be from a financial institution incorporated in the Twin Cities metropolitan area. The cash escrow will be held in a non-interest bearing account. The Letter of Credit or cash escrow will be released once the construction and landscape work are completed and a final Certificate of Occupancy is issued. 6. If the lot is sold to the Builder and the Builder fails to complete construction as approved by the HRA, the Letter of Credit or cash escrow may be drawn upon by the HRA. In addition, the Contract for Private Development will contain a reverter provision, which will enable the HRA to reclaim ownership of the property in the event of a default in the Contract. In the event that the Builder fails to complete construction, the HRA may exercise its rights under the reverter provision, as well as draw upon the Letter of Credit or cash escrow. 7. If the lot is sold to the Buyer, the Buyer will pay cash for the lot at closing and a $10,000 mortgage in favor of the HRA will be filed on the property. The mortgage will be in first position. The HRA may consider subordinating its interest in appropriate cases. 8. If the lot is sold to the Buyer and the Buyer fails to complete construction as approved by the HRA, the HRA may exercise its rights provided in the mortgage. VI. House Design and Site Development Requirements The development of all sites shall meet the development criteria listed below, as reviewed and approved by the HRA. To maximize the development of a given lot, the HRA reserves the right to explore all development options without obligating the HRA to support any specific proposal, idea or solicitation. Housing design is a critical element of the program. Siding materials, exterior façade presentation, roof, window, siding and building line variability, finished landscape, interior space function and use are all important issues of design to the HRA. The design requirements were created to ensure that the homes built on the HRA-sold lots blend in with the surrounding neighborhood and respond to the specific concerns of the HRA. B-5 401253v7 CBR RC 125-65 All new houses built under the Richfield Rediscovered Program must meet the requirements of the City's Zoning Code and additional criteria, as listed in this document. A. New House Standards 1. New dwelling must be owner-occupied. 2. Three finished bedrooms are required. 3. Two finished bathrooms are required. 4. Two-car garage is required. 5. A full basement is required, unless the selected design results in a split-level or a garden-level type of basement. In the case of an "accessible" house, a basement may be omitted if it would otherwise prohibit accessible design elements. B. Site Standards 1. After construction, the site must be fully landscaped, including plantings around the foundation. The entire grounds shall be landscaped and be aesthetically pleasing in all seasons. Land forms and plant materials shall be used to define the site and blend neatly with adjoining properties. Specific lot line blending requirements may be required, as appropriate,for specific sites. At a minimum, the applicant must meet the "Landscaping and Screening Requirements" in the City's Zoning Code under Section 544.03, Subd. 4, General landscaping requirements and Subd. 5, Residential sites. The code is available on the City's website: http://www.ci.richfield.mn.us To the greatest extent possible, existing trees should be preserved. Any trees removed must be replaced (they do not have to be the same species or in the same location) and should be labeled on the required landscape plan. 2. Utility meters shall be screened from street view and locations must be specified on plans. 3. Site drainage should be accommodated on the site so that water is directed away from the new home and the neighboring properties. Neighboring properties must not be disturbed by the creation of drainage swales. Specific storm water management requirements may be required, as appropriate, including the addition of gutters or on-site management for specific sites. Construction and the finished structure must not have a detrimental impact on storm water drainage patterns in the neighborhood. 4. All air conditioning units must be located in the rear yard of the house, or as approved by the HRA. C. Construction Requirements 1. Existing trees identified on the landscape plan as being preserved, must be protected during construction. A tree wrap with board reinforcements shall be used on trees directly adjacent to active grading and construction areas. Damaged or destroyed trees must be replaced. 2. The construction site, neighboring properties and adjacent public streets shall be kept free of construction debris at all times. 3. No construction workers, construction equipment or construction material shall encroach upon neighboring properties. B-6 401253v7 CBR RC 125-65 4. The property shall have a new sanitary service line installed to the City sanitary sewer main consisting of schedule 40 PVC or equivalent. If there is an existing 6"sewer stub at the property line, it must be lined with 4" schedule 40 PVC or equivalent to the City's sanitary main, and it must include a"donut"at the end with cement. The line must be televised after installation to ensure the following: 1. There are no obstructions in the line. 2. The PVC liner is not protruding into the City's sanitary sewer main line. D. General Standards 1. The value of the new home must meet or exceed the minimum value specified in the Contract for Private Redevelopment. 2. All homes in the Richfield Rediscovered Program must be stick-built or high-quality modular, new construction. 3. Exterior materials (siding, soffit, doors and windows) should be low-maintenance and durable. Brick, aluminum, vinyl and fiber cement siding are preferred. Natural cedar lap is acceptable if properly stained or painted. Hardboard panels or hardboard lap siding are prohibited. Roof valleys must have metal valleys and not be woven. 4. Unit height and mass of the new house shall be compatible with the scale of the surrounding homes in the neighborhood. 5. Plans must present a balanced and pleasing distribution of wall, door and window areas from all views. 6. The dominance of the garage door must be minimized through placement, architectural detail, door design and utilization and design of windows. Garages, where the garage door faces the street, shall not be located closer to the front lot line than the foremost facade of the principal building facing the front property line. Garage sidewalls that face the street should appear to contain habitable space. This can be accomplished by incorporating windows and other design elements into the garage wall that are in character with the remainder of the dwelling. For lots that have alley access,the garage should be oriented to access the alley. 7. All building plans must have been prepared in consultation with an architect or qualified draftsperson. All requirements by the Building Inspections Division must be met. 8. All Richfield Rediscovered houses must meet or exceed Minnesota Energy Code requirements. 9. All new homes shall be built to provide high quality sound insulation. Recommendations for sound insulation measures may be provided on a site-by-site basis. All construction must conform to current sound attenuation building standards for properties located within the 1996 65+and/or 2007 63-64 DNL contours. In cases where sound attenuation standards are required and an increase in costs can be documented, the HRA may consider a reduction in the price of the lot in an amount equal to 75 percent of the cost of sound attenuation measures up to a maximum of $7,500. 9. If a variance is required to construct the proposed development,the HRA may, at its sole discretion, choose to reject the application. 10. If the HRA accepts an application that needs a variance(s), sale of the property will be contingent upon the applicant obtaining the necessary variance(s). The Applicant is responsible for applying for the variance(s) at its own expense. The HRA, as owner of the property,will, however, cooperate with the application. B-7 401253v7 CBR RC125-65 L . a i E. Green Community Concepts Priority will be given to projects incorporating the green community concepts listed below. Any concepts the applicant would like considered during the application process should be explained in a written plan submitted with the application. A $5,000 rebate will be provided to the Applicant for projects that obtain certification through LEED for Homes, Minnesota GreenStar or Minnesota Green Communities. 1. Protect and conserve water and soil. To reduce water consumption, consider the use of water- conserving appliances, fixtures, and landscaping. Steps should be taken to minimize the loss of soil and sediment during construction and occupancy to reduce storm-water sediment and air pollution. 2. Minimize energy consumption. Reduce energy consumption by taking advantage of natural heating, cooling and day lighting, and by using energy-efficient appliances, equipment and lighting. 3. Enhance indoor environmental quality. Use non-toxic materials, ventilation and exhaust systems, and moisture control products and systems. 4. Use environmentally-preferable materials and resources. Use locally-produced, salvaged and/or manufactured materials, products with recycled content or from renewable sources, recyclable or reusable materials, and low-VOC-emitting materials. 5. Reduce waste. Reduce and manage wastes generated during the construction process and operation of buildings. If demolition occurs, sort and recycle leftover materials and debris. VII. City Review Procedure 1. Applicant reviews proposed project with HRA staff before plans are finalized. 2. Applicant submits application, plans, and application fee at least 45 days prior to the HRA meeting. 3. An application is considered to be received when delivered personally to HRA staff in a pre- arranged meeting. Following this meeting and upon receipt of the application fee, the lot will be considered reserved and no additional applications will be accepted for the proposed lot while the application is under review. 4. If an application is determined to be incomplete, the applicant will have 30 days to submit a complete application. If a complete application is not received within 30 days, the application will be rejected and the lot will be made available for new applications. 5. HRA staff review application to ensure conformance with House Design and Site Development Requirements. 6. HRA staff may reject or accept an application at its sole discretion. 7. The Builder or Buyer executes a Contract for Private Redevelopment. 8. An application is determined to be complete and the Contract executed at least three weeks prior to the HRA meeting. 9. HRA staff publishes a legal notice of the public hearing and prepares a report and recommendation for the HRA. 10. HRA reviews application, conducts a public hearing, and takes action at the HRA meeting. B-8 401253v7 CBR RC 125-65 L\ 11. If approved,the Contract for Private Redevelopment is executed by the HRA. VIII.Lot Sale to Builder or Buyer 1. Upon approval of the application by the HRA, a closing will be scheduled between the HRA and the Builder or Buyer. 2. The HRA will prepare all statements, affidavits, documents, and general release forms required for closing. 3. The Builder applies for a building permit prior to closing. The Builder is responsible for acquiring the necessary building permits with the City of Richfield Building Inspections Division. If changes to the plans are required by the Inspections Division, the applicant must notify HRA staff. 4. The Applicant provides evidence to HRA staff that all requirements to proceed with construction, as determined in the Contract for Private Redevelopment, have been met. 5. The HRA conveys the property to the Builder or Buyer by Quit Claim Deed. The site will be sold to the Builder or Buyer at the fair market value as appears on the Lot List. 6. At closing with the Builder, the Builder provides a Letter of Credit or cash escrow for$10,000 to the HRA. 7. At closing with the Buyer, the Buyer signs a mortgage and promissory note for$10,000 in favor of the HRA. 8. Upon completion of the project, the Letter of Credit or cash escrow is released to the Builder or the Buyer's mortgage is released. A Certificate of Completion is executed by the HRA, releasing the obligations of the Contract for Private Redevelopment. IX.Program Marketing Richfield Rediscovered program marketing is entirely at the discretion of the HRA. It may include the following: 1. Buyer Solicitation. The HRA may market the program to potential Buyers through promotional articles, direct mail, the Internet, or other methods as deemed appropriate. Buyers may be any financially capable individual or household, including first-time buyers, move-up buyers or empty- nesters. 2. Public Promotion. a. The HRA will periodically provide information about the program through articles in city publications, on the City's web site, on the Community Cable channel, or via press releases to promote community awareness. b. A public open house may be held to provide an opportunity for residents and other interested parties to collectively view the finished homes. The Parade of Homes Fall Showcase and Spring Preview may also accomplish this. A program information package will be mailed to all interested participants. The information packet may include the following: 1. Lot List 2. Richfield Rediscovered Lot Sale Procedural Guidelines 3. Application Form 4. Sample Contract for Private Redevelopment X. Data Privacy All information secured through the program is subject to the Data Privacy Act. B-9 401253v7 CBR RC125-65 L\ * .(P EXHIBIT C QUIT CLAIM DEED STATE DEED TAX DUE HEREON: $ Date: FOR VALUABLE CONSIDERATION, Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate and politic under the laws of the State of Minnesota, Grantor, hereby conveys and quit claims to , a under the laws of the State of , Grantee, real property in Hennepin County, Minnesota, described as follows: , according to the map or plat thereof on file or of record in the office of the Hennepin County Recorder. This deed is subject to that certain Contract for Private Development between Grantor and Grantee, dated , 20_ (the "Contract"), recorded , 20 , in the office of the Hennepin County Recorder/Registrar of Titles as Document No. . The Contract provides that the Grantee's rights and interest in the real property described above are subject to the Grantor's right to re-enter and revest in Grantor title to the Property under conditions specified therein, including but not limited to termination of the Grantor's right to re-enter and revest upon issuance of a Certificate of Completion as defined in the Agreement. (if more space is needed, continue on back) together with all hereditaments and appurtenances. ❑The Seller certifies that the seller does not know of any wells on the described real property. DA well disclosure certificate accompanies this document. ❑I am familiar with the property described in this instrument and I certify that the status and number of wells on the described real property have not changed since the last previously filed well disclosure certificate. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD Affix Deed Tax Stamp Here By Its Chairperson By Its Executive Director C-1 401253v7 CBR RC125-65 STATE OF MINNESOTA } ss. COUNTY OF HENNEPIN The foregoing was acknowledged before me this day of , 20 , by , the Chairperson of the Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate and politic under the laws of Minnesota, on behalf of the corporation, Grantor. NOTARIAL STAMP OR SEAL(OR OTHER TITLE OR RAM) SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT STATE OF MINNESOTA } ss. COUNTY OF HENNEPIN The foregoing was acknowledged before me this day of , 20_, by , the Executive Director, of Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate and politic under the laws of the State of Minnesota, on behalf of the corporation, Grantor. SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT NOTARIAL STAMP OR SEAL(OR OTHER TITLE OR RAM) Check here if part or all of the land is Registered(Torrens)❑ Tax Statements for the real property described in this instrument should be sent to (include name and address of Grantee): This instrument drafted by: Kennedy&Graven, Chartered 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis, MN 55402 C-2 401253v7 CBR RC125-65 EXHIBIT D WELL DISCLOSURE ❑ The Seller certifies that the seller does not know of any wells on the described real property. ❑ A well disclosure certificate accompanies this document. [form attached] ❑ The status and number of wells on the described real property have not changed since the last previously filed well disclosure certificate. D-1 401253v7 CBR RC125-65 SCI Minnesota Department of Health Well Management Section MPH- St.F..O.Box 64975 Paul,Minnesota 55164-0975 651-201-4587 or 800-383-9808 1717:T;1I,II'iM;II<I CI t'tnrhealth.stare.inn.rrs.'d,s/eleiueits WELL DISCLOSURE STATEMENT Prior to signing an agreement to sell or transfer real property,the seller must always disclose in writing(swell disclosure statement)the location and status(well status defined below)of all wells on the property to the buyer. along with the legal description and county of the property.and a sketch map showing the location of each well or indicate there are no wells on the property. WELL DISCLOSURE CERTIFICATE A Well Disclosure Certificate is required to be filed when there are wells on the property. • At the time of closing,the well disclosure statement information.along with the property buyer's name and mailing address,must be provided on a Well Disclosure Certificate(WDC)form.When recording a eked or other instillment of conveyance requiting a Certificate of Real Estate Value(CRV).a completed WDC must be filed with the county recorder,including a$50 fee payable to the county recorder. • If there is a previously filed WDC and the number of wells author the well status has changed,a new\?4DC must be filed. You may search for previously filed WDCs at: wwm v.bealth.state.urn.us/dips/eh/u'ells/disclosures/disclairner.l+tml. • If the number and status of wells on the property remain unchanged since the previously filed WDC,a statement must be placed on the deed or other instrument of conveyance that reads "I am familiar with the property described in this instrument and I certify that the status and number of wells on the described real properly have not changed since the last previously filed well disclosure certificate."This statement must be certified by the buyer or seller and no WDC is required. If there are no wells on the property,a Well Disclosure Certificate is not required to be filed.However,the Seller nmst certify a statement on the deed or other instrument of conveyance that reads "The Seller cer.tifies that the Seller does not know of any wells on the described real property." INSTRUCTIONS FOR COMPLETING THE WELL DISCLOSURE CERTIFICATE A$50 fee nmst be included when submitting this forum to tile.county recorder's office.The fee is to be paid by the buyer or person filing the deed.Please make the check payable to the County Recorder.A copy of this WDC should be provided to the property buyer at the time of closing. PROPERTY,BUYER,AND SELLER INFORMATION A. PROPERTY LOCATION LEGAL DESCRIPTION-Provide the county name:"unplatted"a metes and bounds description(quartile[one quarter section is required]or goverunent lot,section.township,and range number): and'or:.platted"(lot number andror block nmmnber.and addition name);property street address(if applicable),and city(this is the physical location of the property not the mailing address):property ID number or- parcel number(optional).Attach a complete legal description of the property. B. PROPERTY BUYER MAILING ADDRESS AFTER CLOSING-Provide the buyer's full name(or company name if buyer is a company).full address.and phone renumber(including area code).Be sure to include a complete mailing address.If the property is jointly owned.provide the name and complete mailing address of the contact person. Seller's Name—Please provide the name of the seller in space provided(please print). • D-2 401253v7 CUR RC125-65 / _30 C. CERTIFICATION BY SELLER-The seller(or designated representative)should sign this certificate before it is submitted to the county recorder's office.If the seller is unable to sign the document,the buyer(or designated representative)may sign the certificate before it is submitted to the county recorder's office. D. CERTIFICATION BY BUYER-If the seller is unable to sign the document,the buyer(or designated representative)may sign the certificate before it is submitted to the county recorder's office.Where deeds are given in fulfillment of a Contract for Deed the WDC must be signed by the buyer or the person authorized to act on behalf of the buyer. Signature Required-There must be at least one signature on the certificate, WELL INFORMATION E. WELL LOCATION LEGAL DESCRIPTION-For each well being disclosed the following physical location information is required: • county name,quartile(one quarter section is required).section,township,and range number;and/or • county name.government lot,section,township.and range number:and/or • county name,lot number and or block cumber.and addition name WELL STATUS.INFORMATION-Indicate the status of each well.Check only one box. In Use-A well is"in use"if the well is operated on a daily.regular,or seasonal basis.A well"in use"includes a well that operates for the purpose of irrigation,fire protection,or emergency pumping. Not In Use-A well is"not in use"if the well does not meet the definition of"in use"above and has not been sealed by a licensed well contractor. • If the well is"not in use."is there a Minnesota Department of Health(MDH)valiance for this well?Please provide the variance tracking number(TN).if known. • If the well is"not in use,"is there an MDH maintenance permit for this well?Please provide the permit number, if known. Sealed-A well is"sealed"if a licensed well contractor has completely filled a well by pumping grout material tlnoughout the entire well after removal of any obstructions from the well.A Well and Boring Sealing Record nmst be on file with the MDH.Contact the MDH to verify if a sealing record is on file.A well is"capped"if it has a metal or plastic cap or cover which is threaded.bolted.or welded onto the top of the well to prevent entry into the well. A"capped"well is not a"sealed"well. Important Well Status Lnformation: • The MDH will follow-up with the property buyer regarding any wells disclosed as"not in use."If a well is"not in use."the property owner must either retain the well to"in use."have the well"sealed"by a licensed well contractor.or obtain an annual maintenance permit from the MDH for 5175. • Maintenance permits are not transferable.If a well is"in use."a maintenance permit is not required. • If the well has been"sealed"by someone other than a licensed well contractor or a licensed well sealing contractor.check the well status as`'not in use." Additional Well Information-Provide the following information,if known: Minnesota Unique Well Number or Sealing Record Number.date of well construction or sealing,and name of licensed well contractor. SKETCH MAP-Complete the sketch map as instructed on the WDC.The location of each well roust be indicated, If the location of a well is not known.have the well located by a person qualified to locate wells.such as a licensed well contractor. If you have questions.please contact the MDH Well Management Section at 651-201-4587 or 800-3S3-9808. To request this document in another format.call 651-201-47600.Deaf and hard-of-hearing: TTY 651-201-5797. Visit the MDH Well Management Section.Well Disclosure Program website at: uniw.lcealili.stare.mu..rrs/dies/ehhrells/disclosm'es. D-3 401253'7 CBR RC125-65 _! 3 COUNTY USE ONLY MDH USE ONLY MINNESOTA DEPARTMENT OF HEALTH Well Management Section,P.O.Bas 64975,St.Paul:Minnesota 55164-0975 651-201-4587 or 800-383-9808 WELL DISCLOSURE CERTIFICATE PI RASE TYPE OR PRINT ALL INFORLL427ON Person filing deed must include a$50 fee payable to the county recorder. A. PROPERTY LOCATION LEGAL DESCRIPTION Attach a legal description of the property. County Section No. Township No. Range No. Quarter(or Govenunent Lot) Hennepin Lot No(s). Block No. Addition Name Outlot Tract Property Street Address City Township ZIP Code Property ID No./Parcel No.(optional) Richfield 55423 B. PROPERTY BUYER MAILING ADDRESS AFTER CLOSING First Name Middle Initial Last Name Company Name(if applicable) Mailing Address Mailing Address City State/Province ZIP Code Telephone No.(including area code) Provide ame of Seller(please print) Housing and Redevelopment Authority in and for the City of Richfield C. CERTIFICATION BY SELLER I certify that the information provided on this certificate is accurate and complete to the best of my knowledge. Signature of Seller or Designated Representative of Seller Date D. CERTIFICATION BY BUYER For fulfillment of a contract for deed,the buyer or person authorized to act on behalf of the buyer,must sign a Well Disclosure Certificate if there is a well on the property. In the absence of a seller's signature,the buyer,or person authorized to act on behalf of the buyer may sign this Well Disclosure Certificate.No signature is required by the buyer if the seller has signed above. Based on disclosure information provided to me by the seller or other available information,I certify that the information on this certificate is accurate and complete to the best of my knowledge. Signature of Buyer or Designated Representative of Buyei Date IMPORTANT NOTE: The Minnesota Department of Health(MDH)will follow-up with the property buyer regarding any wells disclosed as not in use.If a well is not in use,the properly owner must either return the well to use,have the well sealed by a licensed well contractor,or obtain an annual maintenance permit front the MDH for$I 75.A copy of this Well Disclosure Certificate should be provided to the property buyer at the time of closing. D-4 401253v7 CBR RC 125-65 LICI;1t7MUUI MINNESOTA DEPARTMENT OF HEALTH MDH 1 WELL DISCLOSURE CERTIFICATE Indicate Total Number of 1 .1 PLEASE TYPE OR PRINT ALL Iri INFORMATION Indils on Property Fill out a separate well information page if more than two wells are located on the property. E. WELL LOCATION LEGAL DESCRIPTION WELL#1—If the property legal description has more than one section,township,or range number;quarter(or government lot);or lot or block number;provide specific legal description information regarding the physical location of this well. County Section No. Township No. Range No. Quarter(or Government Lot) Hennepin Lot No. Block No. Addition Name Outlot Tract MN Unique Well No.or Sealing Record No. WELL STATUS(Check only one box) Date of Well Construction or WELL IS: ❑ In Use(1) ❑ Not in Use(2) ❑ Sealed by Licensed Well Contractor(3)* Sealing "Call M1)H to verify sealing record is on file, Name of Licensed Well Contractor lithe well has been sealed by someone other than a licensed well contractor or a licensed well sealing contractor,check the well status as not in use. Also see"IMPORTANT NOTE"on page 1. If well is not in use,is there an MDH variance for this well? If the well is not in use,is there an MDH maintenance permit for ❑ Yes ❑ No this well? ❑ Yes ❑ No If yes_provide the variance tracking number(TN) If yes,provide the permit number WELL#2—If the property legal description has more than one section,township,or range number;quarter(or government lot);or lot or block number;provide specific legal description information regarding the physical location of this well. County Section No. Township No. Range No. Quarter(or Government Lot) Lot No. Block No. Addition Name Outlot Tract MN Unique Well No.or Sealing Record No. WELL STATUS(Check only one box) Date of Well Construction or WELL I5: ❑ In Use(1) ❑Not in Use(2) ❑ Sealed by Licensed Well Contractor(3)" Sealing "Call MUll to verify sealing record is on file. Name of Licensed Well Contractor !lilac well has been sealed by someone other than a licensed well contractor or a licensed well sealing contractor.check the well status as not in use_ Also see"IMPORTANT NOTE"on page 1. If well is not in use-is there an MDH variance for this well? If the well is not in use,is there an MDH maintenance permit for [1 Yes ❑ No this well? ❑ Yes ❑ No If yes,provide the variance tracking number(TN) If yes,provide the permit number SKETCH 11AP—Sketch the location of the well(s)and include estimated distances from roads,streets,and buildings.If inure than one well on property,use the well location ssinber above to identify each well.The location of the well(s)must be provide&If the location of a well is not known,have the well located by a person qualified to locate wells,such as a licensed well contractor. Information provided on this form is classified as public information under Minnesota Statutes,Chapter 13. To request this document in another format,call 651-201-4600.Deaf and hard-of-hearing: TTY 651-201-5797. 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'e 2� O 1 .4 .: 34.x - b m r a& 5 N �, 95 =-.u�w 4 CW 5 a s¢1° n Ili'a � II-.2,f o v _ I. 3 __ o CD ...—.4 L I 3 t:i li � I; � II � Q x � 'l i 1 i. � g,„,i, -.9/EZ-.9 .Z(96-.9 .9196-.9—.•.—.Z140..9—.—,0l 9..5— .9-.94 -'9' '� g.,ili.i I� . , -21110= _ , :!. --- 30 1 ,g, ! :: '-It t i i> CI =irr MEDD 1 IfI I1111-! =-1.miwi� ILII 15JI o ,:-_1_ .,_,_.,44.:141L,,, s 1 ' _ vii: s_I O12 a H iIII!EIi1IihI , �a EIIYII:.III ;11 I .It i AGENDA ITEM#: 5 REPORT#: 37 mrillill STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING JUNE 17, 2013 REPORT PREPARED BY: KAREN BARTON, ASSISTANT COMMUNITY DEVELOPMENT DIRECTOR NAME,TITLE REPORT PRESENTER: KAREN BARTON,ASSISTANT COMMUNITY DEVELOPMENT DIRECTOR NAME,TITLE DEPARTMENT DIRECTOR REVIEW: E ' f am" SIGN , RE REVIEWED BY EXECUTIVE DIRECTOR: n r- ' 41! / AI f . .___..4110 I - ITEM FOR HRA CONSIDERATION: Consideration of a proposal from Sherman Associates for the Cedar Point Phase II Housing _Redevelopment Area. I. RECOMMENDED ACTION: By Motion: Direct staff to work with Sherman Associates towards the redevelopment of the Cedar Point Phase II Housing Redevelopment Area. II. EXECUTIVE SUMMARY In 2005 the City adopted a Master Redevelopment Plan for the Cedar Point Redevelopment Area that included development of higher-density residential housing in the two blocks known as the Phase II Housing Redevelopment Area. The main impetus of the plan was and is to convert single-family land uses and structures that are incompatible with noise generated by the Minneapolis/St. Paul Airport. The Cedar Point Phase II Housing Redevelopment Area is bounded by 17th Avenue/Richfield Parkway to the east, 16th Avenue to the west, 63rd Street to the north, and 65th Street to the south. The area is comprised of 29 single-family residential properties, fourteen of which are in the process of being acquired by the 06172013 Cedar Point Housing Redevelopment Proposal City and Housing and Redevelopment Authority (HRA) for the construction of Richfield Parkway. On January 28th of this year staff distributed a Request for Qualifications (RFQ) to 17 developers for the redevelopment of the Cedar Point II area. Three developers responded to the RFQ and upon review of their qualifications, they were subsequently sent a Request for Proposal on April 22nd for the redevelopment of the site. Staff received one formal proposal, from Sherman Associates for the development of 188 units of senior housing, which includes 120 units of assisted living and 66 units of 55+ senior living. The development would also include 6,500 square feet of office/retail to be built in a later phase. Staff is requesting direction from the HRA to work with Sherman Associates towards the redevelopment of the Cedar Point Phase II Housing Redevelopment Area. A Contract for Private Development Agreement would be drafted and presented to the HRA for approval prior to any development occurring on the site. III. BASIS OF RECOMMENDATION A. BACKGROUND • The Cedar Point Phase II Housing Redevelopment Area has been designated for redevelopment since 2005. • The City of Richfield Public Works department is in process of acquiring fourteen residential properties in the redevelopment area for the completion of Richfield Parkway north of 66th Street. • The HRA has agreed to take ownership of the properties once acquired and to pay the special assessments for the road improvements until the property is subsequently sold for redevelopment. B. POLICY • The Cedar Point Phase II Housing Redevelopment Area has been identified as an area in need of redevelopment due to the impacts of low-frequency noise associated with the Minneapolis/St. Paul International Airport. • The proposed development includes high-density senior housing components, which are compatible with the Comprehensive Plan. C. CRITICAL TIMING ISSUES • The City is in the process of acquiring the properties along 17th Avenue for the development of Richfield Parkway. • The HRA has agreed to take ownership of the remnant parcels and begin paying special assessments upon completion of the northern portion of Richfield Parkway; • The current housing market provides the opportunity to acquire the remaining properties fronting 16th Avenue at a reasonable cost. D. FINANCIAL • Given the significant land-assembly costs associated with the redevelopment of this area, it is likely that some type of public funding will be required in order for redevelopment to occur. • The HRA has agreed to take ownership of the properties once acquired and to pay the special assessments for the road improvements until the property is subsequently sold for redevelopment. • The developer will be requested to reimburse the HRA for financial and legal costs associated with the development. E. LEGAL • A Contract for Private Development will be drafted by the HRA attorney for the redevelopment of the area and brought to the HRA for approval at a later date. IV. ALTERNATIVE RECOMMENDATION(S) • Do not direct staff to work with Sherman Associates for the redevelopment of the Cedar Point Phase II Housing Redevelopment Area. V. ATTACHMENTS • Sherman Associates Proposal VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Representatives from Sherman Associates. \ .....1 i..:Hi:I "744,:lp,. 1 1 ji_ '1 ttattv. i .T.,71.. tte,„,,...,_.._, ...] .., -. -----------_, - -_ f i - - I Response x May 24t', 2013 _ el -11 .,. H IIL•L i F -< • --,.., -t`,t 1 tiv Sherman ASSOCIATES 1......ry ,, C A B C D E F onte A. Develop Sherman Attachme Attachme Attachme Attachme B. Design T Kaas Wi Bryan C Consulta Attachme Attachme Attachme C. Concep Project D Residen Unit & B Affordab Attachme Attachme D. Project E. Financia F. Additio Attachme ents per Inform n Associate ent A.1: Sherm ent A.2i: Simil ent A.2ii: Simi ent A.2iii: Sim Team & C ilson Archit Carlson Plan ant Dennis ent B.1: Archit ent B.2: Lands ent B.3: Consu ptual Design Description tial & Comm Building Fea bility Matri ent C.1: Conc ent C.2: Propo Timeline al Informat nal Docum ent F.1: Letter ation es Developm man Associate ar Projects – lar Projects – ilar Projects – onsultant I tects nning & Lan O’Donnell tect Relevant scape Archite ultant Danny n n mercial Bre atures ix ceptual Rende osed Site Plan tion mentation r of Support – ment LLC es Company Heritage Par – Blaine Town – Falcon Heig Informatio ndscape Ar t Experience ct Relevant E O’Donnell R eakdown erings n – Mt Calvary Profile rk Senior Cam n Square ghts Town Sq on rchitecture Experience Resume & Exp Lutheran Ch mpus quare Senior perience hurch Red Cedar Poin developmen t t SE DE ECT EVE TION ELO N A OPE A ER Red Cedar Poin developmen t t DE Bac Minn Wisc mana and l settin With 2,500 retail The d Dev Presi Vice Deve Cons Add Sherm Inc. a Sherm 233 P Minn O: 6 EVELOP kground neapolis-based consin, Iowa, agement com ease-up. The ngs to small a hin the past d 0 residential a l and comme diverse range velopment ident: Presidents: elopment Tea struction Man ditional Info man Associat a Corporation man Associat Park Avenue neapolis, MN 12-332-3000 For a full PER d Sherman As Missouri, and pany, Sherma e scale of the apartment pro ecade, Sherm apartments, in rcial space we e of experienc Team Geo Susa Chri am: Paul And Sara nager: Rich ormation tes Developm n solely owne tes Developm South | Suite 55415 | F: 612-332 l list of comple ssociates, Inc. d Colorado o an Associates se projects ra ojects in rura man Associate ncluding appr ere added to ce allows orge E. Sherm an A. Fauver, istopher L. Sh Keenan, Pro rew Hughes, a Schoonmake hard Kiemen, ment LLC is a ed by George ment LLC 201 2-8119 eted projects, m refer to the C . has complet ver the past 3 s focuses on t anges from la l areas. es’ portfolio e roximately 2,0 the portfolio man, Principal General Cou herman, Proje oject Manager Project Mana er, Asst Proje Craftsman C Minnesota Li e E. Sherman. managed prop Company Resu ted over $2 B 35 years. As the big picture arge neighbor expanded to i 000 under lea o along with t / gsherman@ unsel / sfauver ect Managem r / pkeenan@ ager / ahughe ect Manager / Construction / imited Liabilit erties, develop ume included w Billion in real an industry-l e: from the in rhood redeve nclude the de ase-up or con the developm @sherman-ass r@sherman-a ent / csherma @sherman-asso es@sherman- / sschoonmak / rkiemen@s ty Company o pment highligh within Attachm estate develo leading prope nception of an lopment proj evelopment o nstruction. Ov ment two hote sociates.com associates.com an@sherman ociates.com -associates.co ker@sherman herman-assoc operating und t and recent p ment A.1 Red opment acros erty developm n idea throug jects in high-d or rehabilitati ver 365,100 s el projects in m n-associates.c om n-associates.c ciates.com der Sherman publications, pl Cedar Poin developmen ss Minnesota, ment and gh completion density urban on of over square feet o Minnesota. om com Associates, lease t t n f RE Sherm Liste Her Hous Proje Refer Blai Hous Proje Refer Falc Hous Proje Refer EFEREN man Associat d below are r ritage Park sing Type: Se ect Size: 48 rences: Em M ne Town S sing Type: Se ect Size: 87 rences: B con Height sing Type: Se ect Size: 56 rences: M For a mo CES tes strives to references fro k – Feeney enior, Assiste 8 Apartments milio Bettagli ebetta Michael Ander mande Square / Bla enior Indepen 7 Apartments ryan Schafer, bschaf ts Senior / F enior Indepen 6 Apartments Michelle Tesse mische ore detailed loo build strong om three pro Manor / M ed Care, Mem s [24 Memory o, Deputy Ex aglio@mplsph rson, Develop erson@mplsp aine, Minn ndent Apartm s Director of fer@ci.blaine. Falcon Hei ndent Apartm s er, Interim Ci elle.tesser@fa ok at each of t and lasting re ojects similar inneapolis, mory Care y Care, 24 As xecutive Direc ha.org | 612-3 pment Coord pha.org | P: 6 esota ments Community D .mn.us | P: 76 ights, Minn ments ty Administra alconheights.o these developm elationships w to the propo , Minnesota ssisted Living] ctor, Minneap 342-1419 dinator, Minne 12-342-1213 Development 63-785-6144 nesota ator, City of F org | P: 651-7 ments, please r with each of th osed senior de a ] polis Public H eapolis Public t, City of Blai Falcon Height 792-7600 refer to Attach he parties inv evelopment a Housing Autho c Housing Aut ne ts hment A.2: De Red volved in a de at Cedar Poin ority thority eveloper Highli Cedar Poin developmen evelopment. nt. ights. t t Sherma Attac an Associ chment A iates Com A.1 mpany Profile Red Cedar Poin developmen t t COMPANY PROFILE Building Communities, Enriching Neighborhoods Sherman Associates is committed to the production of quality urban housing products. With the belief that the healthiest neighborhoods are comprised of a variety of people and uses, we strive to create mixed- use developments which incorporate a variety of housing types and leverage multiple fnancing tools. Because these projects are never easy, we endeavor to continually develop strong relationships with government and fnancial institutions that believe in the same vision—strong urban projects with housing opportunities for all. Mission Statement 233 Park Avenue South, Suite 201 • Minneapolis, MN 55415 Phone: (612) 332-3000 • Fax: (612) 332-8119 www.sherman-associates.com COMPANY PROFILE: Contents INTRODUCTION Welcome Capacity and Process Department Biographies DEVELOPMENT EXPERIENCE Completed Projects Selected Project Details PUBLIC PROFILE Selected Awards Press & Media CONTENTS COMPANY PROFILE: Introduction INTRODUCTION Sherman Associates Sherman Associates, Inc. is an award-winning development firm specializing in the design, construction and financing of quality commercial and housing properties in Minnesota, Wisconsin, Iowa, Missouri and Colorado. Having earned a strong reputation for quality and follow-through, cities around the country have turned to Sherman Associates to pioneer redevelopment in their highest priority urban neighborhoods. Over the past 35 years, Sherman Associates has become an industry leader in tax credit, affordable housing and tax increment financing projects. Such developments have been successful for the participating cities, investors, residents and businesses. Sherman Associates has developed approximately 8,500 multifamily, townhouse and single-family homes, and 600,000 square feet of commercial and hotel space. COMPANY PROFILE: Introduction Capacity and Process Sherman Associates specializies in both new construction, the rehabilitation of existing buildings, or historic adaptive reuse. With over 35 years of development and construction experience, Sherman Associates has developed or rehabilitated housing, retail, office, hotel, and warehouse buildings. Within these multiple facets, our team is able to offer the following diverse range of services in the commercial, single-family and multi-family markets: • Development Services • Design-Build Services • Financial Analysis/Feasibility • Knowledge of Federal, State and Local Housing Programs • Property Management • Construction • Site Analysis • Marketing Plans and Feasibility • Equity and Debt Funding Sherman Associates has established an impressive and prolific track record, completing over $2 billion in real estate development. On a yearly basis, our pipeline consists of $200 million to $250 million in development of commercial and residential projects. COMPANY PROFILE: Introduction Biographies and Staffing George Sherman George Sherman has planned and delivered multi- and single-family housing for more than 35 years. As principal in developing more than 7,000 rental units and more than 1,200 for-sale housing units, to date the total value of his development portfolio exceeds $2 billion. Development: Led directly by George Sherman, the development department has a proven track record of successfully leveraging complex financing packages and strong relationships with local governments and community leaders. It is made up of experts in multiple disciplines, including commercial real estate, affordable housing finance and conventional real estate finance, who continue to build strong relationships throughout the major markets in which Sherman Associates operates. Key Staff: George Sherman, Tony Kuechle, Paul Keenan, Chris Sherman, Jackie Nickolaus, Andrew Hughes Legal: Sherman Associates’ in-house legal team spearheads the closing of all projects while also navigating issues that arise in a diverse real estate company. Consisting of staff with high-level knowledge of real estate and land use matters, as well as affordable housing and conventional real estate finance, this team is essential to the Sherman Associates process. Led by Susan Fauver, the team works hand-in-hand with the development group to ensure the stability and long-term success of Sherman Associates projects. Key Staff: Susan Fauver, Anne Stephenson, Lis Peterson, Lisa Merk Residential Property Management and Affordable Housing Compliance: Sherman Associates’ professional management team is made of industry veterans with substantial knowledge and experience in the management of low-income, market-rate and special-needs housing projects. The department consists of over 200 employees ranging from caretakers and maintenance staff to upper-level property management and compliance staff. This dynamic and diverse team, led by Don Cappaert, manages both the day-to-day and global processes that allow Sherman Associates’ robust, multi-faceted rental portfolio to remain financially successful and to cater to the needs of some 20,000 residents throughout the Midwest and Colorado. Key Staff: Don Cappaert, Shiva Anderson, Eduardo Christ, Simone Achkar, Joe Keilen Condominium Sales: With a vast portfolio ranging from single-family homes to multi-million dollar high-end luxury condominiums, Brad Goering has led the for-sale department at Sherman Associates through numerous successful sales. His extensive knowledge of homeowner association matters, together with his ability to manage multiple selling agents, marketing efforts and homeowner association warranty concerns in multiple regional markets, has allowed Sherman Associates to progress and continue to grow in spite of the recent economic recession and the significant downturn in the home ownership market. Key Staff: Brad Goering, Lisa Merk COMPANY PROFILE: Introduction Commercial Property Management: The commercial team at Sherman Associates manages real estate and brokerage throughout the five-state portfolio. Leveraging important community connections and strong tenant relationships, this group has been a key on-the- ground presence. They have added important community amenities to Sherman Associates’ mixed-use developments, ensuing the long-term growth of the neighborhoods and local economies in which they are located. Key Staff: Rob Kost, Katherine Marinac, Heather Nelson, Tony Kuechle Hotel Operations Sherman Associates’ hotel operations have added a key component to our ever-expanding portfolio of diverse and highly-acclaimed projects. Boasting a hotel ranked in the top five of all Sheraton hotels nationwide, the aloft and the Sheraton have continually operated with high occupancy and regional acclaim. With the second largest staff pool in the company, consisting of upwards of 175 employees, this department is professionally managed by leaders with decades of experience in the field. Key Staff: Adam Herbranson, Troy Whelan, Karen Pionk, Doug Bremer, Deanna Somvong Construction and Facilities Management: The construction and facilities management team at Sherman Associates is one of the most essential components to the completion of development projects and the continued maintenance of the portfolio. Led by Rich Kiemen, this team coordinates with general contractors, architects, engineers and the property management staff on a daily basis. Their continued diligence has been integral to Sherman Associates in staying on schedule and within budget to deliver new construction, occupied rehabilitation and historic rehabilitation projects. This group is also responsible for the oversight of day-to-day maintenance operations and preparation for numerous required site inspections throughout the portfolio. Key Staff: Rich Kiemen, Ron Wagner, Gordy Willey Accounting: With the complexity of financing in many projects, along with the vast diversity and sheer volume of products offered, the accounting department at Sherman Associates is fundamental to the daily operations of the company. Managing property accounting, financial reporting, relationships with financial institutions, support of the property management, commercial, and home ownership teams, the department acts as the core linkage between the internal and external transactions for the company. Led by Deanna Somvong, the team consists of staff with expertise in residential accounting, commercial accounting and high-level auditing. Key Staff: Deanna Somvong, Renee DeRosia COMPANY PROFILE: Development Experience DEVELOPMENT EXPERIENCE Completed Projects and Selected Experience The following pages outline a full list of Sherman Associates’ completed projects in Rental Housing, Commercial Real Estate, Hotels and For Sale Housing. We have also included detailed descriptions of selected projects that successfully demonstrate Sherman Associates’ commitment to producing effective quality developments in urban markets with opportunities for users of all income levels. COMPANY PROFILE: Development Experience Completed Rental Projects Project Name City State Year Completed# Units Project Type LIHTC Historic Mixed Use 1.3100 Clinton Minneapolis MN 1990 12 Rehabilitation■ 2.3100 Fourth Avenue Minneapolis MN 1992 10 Rehabilitation 3.Autumn Ridge Brooklyn Park MN 2007 366 Rehabilitation■ 4.Bell Building Minneapolis MN 1985 25 Rehabilitation 5.Blaine Town Square Senior Apartments Blaine MN 2005 87 New Construction 6.Bottineau Commons Apartments Minneapolis MN 2003 119 New Construction■ 7.Bottineau Lofts Minneapolis MN 2003 37 Adaptive Reuse■■ 8.Boulevard Apartments Milwaukee WI 2007 235 Rehabilitation■ 9.Browns Meadow Coon Rapids MN 1992 148 New Construction 10.Castle Apartments Minneapolis MN 1990 11 New Construction 11.Central Avenue Lofts Minneapolis MN 2007 66 New Construction■■ 12.Community Plaza St. Paul MN 1999 40 Rehabilitation■ 13.Cromwell Commons (Marvin Gardens)Minneapolis MN 1996 18 Rehabilitation■ 14.East Phillips Commons Minneapolis MN 2004 34 New Construction■ 15.Falcon Heights Multifamily Falcon Heights MN 2004 119 New Construction■■ 16.Falcon Heights Senior Apartments Falcon Heights MN 2004 56 New Construction 17.Farmington Townhomes Farmington MN 2001 16 New Construction■ 18.Gateway Terrace Grand Forks ND 1994 New Construction 19.Grand Boulevard Lofts Kansas City MO 2009 134 Adaptive Reuse■■■ 20.Grande Market Place Burnsville MN 2003 113 New Construction■■ 21.Greysolon Apartments Duluth MN 2006 150 Adaptive Reuse■■■ 22.Guardian Angels of Hastings Hastings MN 2002 30 New Construction■■ 23.Harrison Lofts Davenport IA*UC 60 New Construction■ 24.Highland Chateau Duluth MN 1999 60 Rehabilitation 25.Highland Park Milwaukee WI 2008 150 Rehabilitation■ 26.Irving School Duluth MN 2011 44 Rehabilitation 27.Jefferson Square Apartments Duluth MN 2000 25 Rehabilitation 28.Le Sueur Meadows Apartments Le Sueur MN 2002 40 New Construction■ 29.Lexington Shores Shoreview MN 2002 68 New Construction■■ 30.Lodge at Little Canada Little Canada MN 2003 79 New Construction■ 31.Longfellow Station Minneapolis MN*UC 180 New Construction■ 32.Lyons Court*St. Paul MN 2005 60 New Construction■ 33.Merritt School Duluth MN 2004 19 Adaptive Reuse 34.Metro Lofts Des Moines IA 2010 111 New Construction■ 35.Midtown Exchange Minneapolis MN 2005 219 Adaptive Reuse■■■ 36.Mount Royal Manor Duluth MN 2002 114 Adaptive Reuse 37.New Paris Apartments Benson MN 1985 40 Rehabilitation 38.Phalen Senior Lofts St. Paul MN 2006 73 New Construction■ 39.Phoenix on the Fax Denver CO 2012 50 New Construction■ 40.River Run Apartments Minneapolis MN 2005 74 New Construction■ 41.Riverside Plaza Minneapolis MN 2012 1303 Rehabilitation■■ 42.Rumely Lofts Des Moines IA 2009 66 Adaptive Reuse■■■ 43.Russell Lamson Des Moines IA 2012 90 Adaptive Reuse■ 44.Seward Flats (2)Minneapolis MN 1997 123 Rehabilitation 45.Sibley Court Apartments*St. Paul MN 2003 122 New Construction■■ 46.Sibley Park Apartments*St. Paul MN 2001 114 New Construction■■ 47.Stradford Flats Minneapolis MN*UC 62 Rehabilitation■ 48.Straus Apartments St. Paul MN 2003 49 Adaptive Reuse■■■ 49.Syndicate Trust St. Louis MO 2007 70 Adaptive Reuse■■■ 50.The Chateaus (3 Buildings)Duluth MN 1998 141 Rehabilitation 51.The Crossings at Valley View Bloomington MN 2009 50 New Construction■ 52.The Roosevelt Cedar Rapids IA 2008 96 Adaptive Reuse■■■ 53.Vine Street Lofts*Des Moines IA 2004 110 New Construction■ 54.West Gate Townhomes Duluth MN 2001 28 New Construction■ 55.West Side Flats St. Paul MN*UC 178 New Construction TOTALS:5,894 38 8 16 COMPANY PROFILE: Development Experience Completed Condominium Projects Project Name City State Completed# Homes Project Type Housing Type 1.Zenith - Phase I Minneapolis MN 2008 64 New Construction Condominiums 2.The Syndicate St. Louis MO 2007 102 Adaptive Reuse Condominiums 3.311 Superior Duluth MN 2007 33 New Construction Condominiums 4.Vista San Jacinto San Jacinto CA 2007 34 New Construction Townhomes 5.Homes of Emerson Hill West St. Paul MN 2007 35 New Construction Townhomes 6.Groveland Terrace Minneapolis MN 2007 128 Adaptive Reuse Condominiums 7.The Villas of Little Canada Little Canada MN 2007 45 New Construction Townhomes 8.The Brownstones at River Run Minneapolis MN 2007 10 New Construction Townhomes 9.The Bridges of Blaine Blaine MN 2006 12 New Construction Townhomes 10.The Chicago Minneapolis MN 2006 88 Adaptive Reuse Condominiums 11.Printer's Row*St. Paul MN 2006 42 New Construction Condominiums 12.Midtown Lofts*Minneapolis MN 2005 72 New Construction Condominiums 13.Keene Creek Townhomes Hermantown MN 2005 44 New Construction Townhomes 14.9th Street Lofts*St. Paul MN 2005 49 Adaptive Reuse Condominiums 15.Water Street Brownstones*Des Moines IA 2004 37 New Construction Condominiums 16.Bottineau Commons Townhomes Minneapolis MN 2003 27 New Construction Townhomes 17.The Dakota*St. Paul MN 2003 32 New Construction Condominiums 18.Capital Heights City Homes St. Paul MN 2003 25 New Construction Townhomes 19.Landings at Sawmill Run Minneapolis MN 2003 58 New Construction Townhomes 20.The Shores Shoreview MN 2003 15 New Construction Townhomes 21.The Essex*St. Paul MN 2002 38 New Construction Condominiums 22.City Homes on Park Avenue Minneapolis MN 2000 29 New Construction Mix 23.3100 Fourth Avenue Minneapolis MN 1992 9 New Construction Single Family 24.3100 Clinton Minneapolis MN 1990 8 New Construction Single Family 25.Parkway Terrace Maplewood MN 1990 90 New Construction Single Family 26.Highland Terrace Minneapolis MN 1990 22 New Construction Single Family 27.Kenwood Isles Minneapolis MN 1988 40 New Construction Townhomes 28.Lakes Citihomes Minneapolis MN 1985 83 New Construction Townhomes 29.Boardwalk and Park Place Townhomes Minneapolis MN 1982 63 New Construction Townhomes 1,270 * Lander-Sherman Development COMPANY PROFILE: Development Experience Completed Commercial Projects Project Name City State Completed Project Type 1.Zenith Commercial Minneapolis MN 2007 10,000 SF New Construction 2.Syndicate Trust Building St. Louis MO 2007 20,000 SF Rehabilitation 3.Wentworth Commons West St. Paul MN 2007 13,000 SF New Construction 4.Blaine Town Square Blaine MN 2005 50,000 SF New Construction 5.Robert Street Retail St. Paul MN 2005 4,400 SF New Construction 6.Garfield Business Park Duluth MN 2005 50,000 SF New Construction 7.Grande Market Square Burnsville MN 2004 30,000 SF New Construction 8.Village of Little Canada Little Canada MN 2004 20,000 SF New Construction 9.Grande Market Place Burnsville MN 2004 14,000 SF New Construction 10.The Lodge at Little Canada Little Canada MN 2004 12,000 SF New Construction 11.Deephaven Court Deephaven MN 2003 18,200 SF Rehabilitation 12.Sibley Park Place*St. Paul MN 2003 12,000 SF New Construction 13.The Straus Building St. Paul MN 2003 10,000 SF Rehabilitation 14.233 Park Minneapolis MN 2001 60,000 SF Rehabilitation 15.Deephaven Square Deephaven MN 1999 25,000 SF Rehabilitation 16.Canal Park Square Duluth MN 1998 60,000 SF Rehabilitation 17.Hawthorne Crossings Minneapolis MN 1997 50,000 SF New Construction 18.Camden Center Minneapolis MN 1997 15,000 SF New Construction 473,600 SF HOTEL PROPERTIES Project Name City State Completed Project Type 1.Aloft Hotel Minneapolis MN 2007 155 rooms New Construction 2.Sheraton Duluth Hotel Duluth MN 2007 147 rooms New Construction 302 rooms Size Size COMPANY PROFILE: Development Experience RIVERSIDE PLAZA Project Details • Historic Rehabilitation and Stabilization • 1,303 Total Apartments in 11 Buildings • 1,174 Tax Credit Units (60% AMI) • 669 Project-Based Section 8 Units • Project Value: $132 Million • Financing: Federal 4% LIHTC Equity, HUD- Guaranteed 1st Mortgage, Federal and State Historic Tax Credits, MN Housing Finance Agency EDHC & PARIF, City of Minneapolis AHTF, Greater Metro Housing Corp Funds, Met Council LHIA, Family Housing Fund, Met Council/ Brownfield TBRA, Hennepin County/Brownfield Environmental Response Fund, Deferred Developer Fee Role: Developer, General Partner, Property Manager Rehabilitation Completed: November 2012 Awards and Recognition: • 2012 Best in Real Estate: Multifamily Development or Redevelopment Minneapolis, MN Riverside Plaza represents the largest housing development project in the state of Minnesota and one of only two projects in the United States that were built as part of a HUD pilot program called “New Town, In Town.” Originally constructed between 1971-1973, Riverside Plaza consists of 1,303 rental units. Sherman Associates acquired the property in 1988 and at that time performed the first substantial rehab of the complex utilizing low-income housing tax credits and a HUD-insured mortgage as the primary sources of financing. In January of 2011, Sherman Associates closed on one of the largest tax credit rehabilitation projects in the nation’s history and began a $132 million, two- year refinance and renovation of this iconic property. In the process, Riverside Plaza was placed on the National Register of Historic Places less than 40 years after it was initially constructed. The historic designation was in part due to the concepts and design brought forward by world renowned architect Ralph Rapson. During the construction period, the building remained occupied, conducting a temporary relocation that is unmatched in size and complexity. The rehabilitation, completed in November of 2012, focused on substantial upgrades to the mechanical and electrical systems, along with exterior and site work that returned the Riverside Plaza complex to its original 1970s appearance. COMPANY PROFILE: Development Experience Project Details • Historic Acquisition and Rehabilitation • 134 Affordable Apartments • 6,700 Square Feet Retail - Ground Floor • Project Value: $33.3 Million • Financing: State and Federal Low Income Housing Tax Credits, State and Federal Historic Tax Credits, HUD Insured Mortgage, MHDC TCAP Soft Loan, Kansas City CDBG Loan Role: Developer, General Partner, Property Manager Completed: December 2010 Awards and Recognition: • 2011 Capstone Award by Kansas City Business Journal • 2011 T. Timothy Anderson Award for Best Historic Rehab involving LIHTC - Finalist Kansas City, Missouri The former Dierks Building, a 17-story, steel frame, brick-clad office building in the heart of downtown Kansas City, sat vacant for a decade. Through the help of City, State and Federal funds, this project now houses 134 families offering them rental opportunities that are integral to Kansas City’s efforts towards downtown revitalization. Re-christened Grand Boulevard Lofts, this project represents Sherman Associates’ first move into the Kansas City housing market. Opening to fanfare from city officials, the community has gained tremendous support from community organizations such as The Urban Core Group. The building is listed on the National Register of Historic Places and contains two first floor and sub-level commercial spaces which are being marketed to top-rate national and local retailers. GRAND BOULEVARD LOFTS COMPANY PROFILE: Development Experience Project Details • Historic Acquisition and Rehabilitation • 28 Affordable Apartments - Floors 4-5 • 42 Market-rate Apartments - Floors 6-8 • 102 Condominiums - Floors 9-17 • 20,000 Square Feet Retail - Ground Floor • Project Value: $81 Million • Financing: City of St. Louis, Federal Low Income Housing Tax Credits, New Markets Tax Credits, Federal Historic Tax Credits, Missouri State Historic Tax Credits, Missouri State LIHTC, Brownfield Redevelopment Credits Role: Developer, General Partner, Property Manager Completed: December 2008 Awards and Recognition: • 2008 Development of the Year St. Louis, Missouri The Syndicate Trust Building is a prominent historic property located at the intersection of 10th and Olive Streets in the heart of downtown St. Louis. Originally built in 1907, the 16-story building is comprised of approximately 450,000 square feet and was previously used for office and retail space. The building was placed on the National Register of Historic Places because of its notable architecture. Retail has returned to the Syndicate Trust Building with top-rate national and local retailers located in the street level space. Loft condominiums, located on floors 9 through 16, and rental apartments, located on floors 4 through 8, provide residents with the convenience, features and amenities associated with urban living. THE SYNDICATE COMPANY PROFILE: Development Experience Project Details • New Construction • 155-Room Hotel • 64 Condominiums • 4,000 Square Feet of Retail in the aloft • 7,800 Square Feet of Retail in the Zenith • Project Value: $61 Million • Financing: New Market Tax Credits, Environmental Grant Role: Developer, Owner, Sales Broker Completed: August / November 2008 Awards and Recognition: • 2008 Finalist in Hospitality Development/ Redevelopment by Minneapolis/St. Paul Business Journal • 2010 Honor Award for Excellence in Concrete Design & Construction Minneapolis, Minnesota In 2008, Sherman Associates opened the new 155- room aloft Hotel along Washington Avenue South in downtown Minneapolis. Part of Starwood Hotels, aloft has five stories with guest rooms on 2 through 5. The ground level includes approximately 4,000 square feet of retail space and the hotel’s common areas. Adjacent to the project is the Zenith Condominiums. Located in the prestigious Mill District, the project provides an opportunity for contemporary living in a dynamic downtown neighborhood. Just steps from the exciting new Guthrie Theater, and a few blocks from the heart of downtown, the Zenith offers dramatic views of the Minneapolis skyline and the Mississippi River. With shops, river trails and light rail service all within walking distance, this project provides high-end housing in the downtown market. ALOFT HOTEL & ZENITH CONDOMINIUMS COMPANY PROFILE: Development Experience Project Details • Historic Acquisition and Rehabilitation • 150 Affordable Senior Apartments • 147 Guest Rooms and Suites Hotel • 33 Condominiums • Project Value: $55 Million • Financing: Federal Historic Tax Credits, Federal Low Income Housing Tax Credits, Minnesota Housing Finance Agency Soft Debt, Section 8, New Market Tax Credits, Tax Increment Financing Role: Developer, General Partner, Owner, Property Manager Completed: Summer 2007 Duluth, Minnesota In 2006, Sherman Associates acquired and rehabilitated the historic Greysolon Plaza building in downtown Duluth, Minnesota. Built in 1910 as the Hotel Duluth, Greysolon Plaza’s guests have included several former US presidents. The building was converted to affordable senior housing in the 1990s. As part of its redevelopment plan, Sherman Associates has rehabilitated and preserved this affordable senior housing. Across the street, Sherman Associates constructed a new building that includes the Sheraton Duluth Hotel which is connected to the historic ballroom of the Greysolon Plaza by skyway. Five floors of luxury condominiums have been constructed on top of the six-story, full-service hotel. The renovation and construction of the two buildings are part of a multi-project redevelopment of the historic “Old Downtown” area of Duluth. GREYSOLON PLAZA | SHERATON HOTEL | 311 SUPERIOR COMPANY PROFILE: Development Experience Project Details • Historic Rehabilitation and Mixed-Use Conversion • 41 Market-rate Apartments • 178 Affordable Apartments • 88 Condominiums • Project Value: $77 Million • Financing: Federal Low Income Housing Tax Credits, US Bank first mortgage (Housing Revenue Bonds), Minnesota Housing Finance Agency, City of Minneapolis, Hennepin County,Tax Increment, Metropolitan Council Role: Co-Developer, General Partner, Property Manager Completed: December 2005 Awards and Recognition: • 2010 Property Excellence Award by Minnesota Multi Housing Association • 2009 Best of the Decade by Minneapolis/St. Paul Business Journal • 2007 Affordable Housing Finance Magazine: Best Historic Rehabilitation • 2006 National Trust/HUD Secretary’s Award for Excellence in Historic Preservation • 2005 Best in American Living by Professional Builder Magazine • 2004 Best in Real Estate: Best Overall by Minneapolis/St. Paul Business Journal Minneapolis, MN In 2004, a collaboration between developers Sherman Associates and Ryan Companies transformed the mammoth 1.2 million square-foot historic Sears, Roebuck building in South Minneapolis into a mixed- use masterpiece featuring 88 loft and penthouse condo units, 219 rental units (including affordable units), the headquarters of Allina Health Systems and a global food market. The Global Market features a variety of small businesses started by local entrepreneurs. Midtown Exchange was designed, developed and financed in record time spanning only six months initial inception to the beginning of construction. Sherman Associates took the lead on the development of the condominiums and apartments at Midtown Exchange, which remains one of Sherman Associates’ most celebrated projects earning continued awards and recognition from both local and national sources. MIDTOWN EXCHANGE | CHICAGO LOFTS COMPANY PROFILE: Development Experience Project Details • 65 Market-Rate Apartments • 44 Affordable Apartments • 32 Condominiums • Project Value: $15 Million • Financing: HUD, Fannie Mae, City of Des Moines, Polk County Housing Trust Fund, Neighborhood Finance Corporation, Federal Low Income Housing Tax Credits, Tax Abatement Role: Developer, General Partner, Property Manager Completed: September 2004 Des Moines, Iowa Completed in 2004, Vine Street Lofts and its sister condominium project, Water Street Brownstones, were the first significant new construction residential projects in Des Moines in over 20 years. Located on a prime site overlooking the Des Moines River, the parcel had been a surface parking lot for decades. Selected through a competitive request for proposal process, Sherman Associates and partner Lander Urban Development introduced a model that was untried in Des Moines high-end home ownership opportunities; market-rate rental units and affordable rental units on the same block sharing the same underground parking system. The project is a resounding success and is considered the project that jump-started the downtown housing market. VINE STREET | WATER STREET COMPANY PROFILE: Development Experience Project Details • Retail Space: Approximately 14,000 sq ft • Dakota on the Park / 38 Units - For Sale Housing • Essex on the Park / 38 units - For Sale Housing • Sibley Park Apartments / 113 Units - Rental Housing • Sibley Court Apartments / 121 Units - Rental Housing • 9th Street Lofts / 49 Units - For Sale Housing • Printer’s Row / 48 units - For Sale Housing • Lyons Court/60 units - Senior Rent • Total Project value: $96.2 million Role: Developer, Property Manager, General Partner Completed: 2001 through 2006 Awards and Recognition: • 2001 Best in Real Estate by Minneapolis/St. Paul Business Journal Saint Paul, Minnesota Wacouta Commons is a multi-phase redevelopment of the previously blighted industrial space in downtown St. Paul. The area was redeveloped to include mixed- income rental and ownership housing along with ground level retail space. The multi-faceted project fully revitalized the entire northeast quadrant of downtown Saint Paul and remains an essential housing component to the city’s continued redevelopment. WACOUTA COMMONS COMPANY PROFILE: Development Experience Project Details • New Construction • 4,500 Square Feet Retail - Ground Floor • 50 Affordable Apartments • Project Value: $10.5 Million • Financing: Federal Low Income Housing Tax Credits, Tax Credit Assistance Program, HUD Insured Mortgage, City of Denver HOME Funds, State of Colorado HOME Funds. Role: Developer, General Partner, Property Manager Completed: February 2012 Denver, Colorado Sherman Associates brought its expertise in urban redevelopment to Denver with the Phoenix on the Fax project. Located southeast of City Park along Colfax Avenue, and midway between downtown Denver and the employment centers in the Fitzsimmons redevelopment area, it represents the first new construction development in an area of Denver quoted to have an “infamous” past. Phoenix on the Fax has garnered the support of The Fax Partnership, Denver City Council, Denver Office of Economic Development, State of Colorado, HUD, Colorado Housing Finance Agency, and local investor RBC Capital Markets. The new construction project features 50 affordable rental units and 4,500 square feet of retail space. Completed in February of 2012, Phoenix on the Fax had tremendous interest from renters and leased up very quickly. PHOENIX ON THE FAX COMPANY PROFILE: Development Experience Project Details • Historic Rehabilitation • 96 Affordable Apartments • 15,522 Sq. Ft. Commercial Space • Project Value: $11.0 Million • Financing: Iowa Finance Authority Mortgage, Federal Low Income Housing Tax Credits, State Historic Tax Credits, City of Cedar Rapids, EZ Tax Credit Equity, IFA 1602 Funds Role: Developer, General Partner, Property Manager Completed: October, 2010 Cedar Rapids, Iowa The historic Hotel Roosevelt is a 12-story masonry building located in downtown Cedar Rapids. After sustaining damage from the Flood of 2008, the adaptive reuse converted the hotel into 96 apartment units with income restricted units at 60% AMI and market-rate units. The second floor houses project amenities that include a large community room, a fully- equipped fitness center, a laundry room and a business center equipped with computers for resident use. The first floor contains over 15,000 SF of commercial space, and the remaining space in the basement was converted into additional, secure resident storage lockers. The historic designation of the building dictated the exterior restoration of the brickwork, the refurbishing of the windows, and the revitalization of the interior corridors and doors. After 12 months of construction, the Hotel Roosevelt now provides four studio, 59 one-bedroom and 33 two-bedroom units with upgraded amenities, including new flooring and fixtures, central heat and air conditioning, and a secure intercom entry system. THE ROOSEVELT COMPANY PROFILE: Development Experience Project Details • Historic Rehabilitation • 90 Affordable Units • 12,105 Sq. Ft. Commercial • Project Value: $15.3 Million • Financing: FNMA Mortgage, Federal Low Income Housing Tax Credits, Federal Historic Tax Credits, State Historic Tax Credits, EZ Tax Credit Equity, EZ Sales Tax Rebate Role: Developer, General Partner, Property Manager Completed: August, 2012 Waterloo, Iowa The Russell Lamson Apartments is an eight-story masonry and concrete building originally constructed in 1914. In that same year, an edition of the Hotel Bulletin refered to the Hotel Russell Lamson as “one of the most complete, up-to-date and modern hotels to be found anywhere on the American continent. It bears a very favorable comparison with the best to be seen in any of the largest cities.” The building has been on the National Register of Historic Places since 1988. Before the renovation began, the building had been previously converted into 75 apartment units on floors 3 though 8, with commercial space on the first and second floors. To minimize the relocation of existing residents, construction was completed in two stages. This allowed approximately half of the current residents as well as all the commercial tenants on the street level to remain in the building during the renovation. The newly renovated building contains 90 affordable housing apartments. The layouts consist mainly of studio and one- bedrooms, with a few two- and three-bedroom units. Within the units, the historic windows were refurbished, kitchens were replaced and bathrooms were upgraded. A new exercise facility was built in addition to a laundry facility. During the renovation, forgotten architectural pieces like the magnificent windows in the lobby were also rediscovered and restored. The end result provided high- demand affordable housing while revitalizing a Waterloo icon. THE RUSSELL LAMSON COMPANY PROFILE: Development Experience Project Details • Historic Rehabilitation • 66 Affordable Units • 5,345 Sq. Ft. Commercial • Project Value: $17.1 • Financing: Iowa Finance Authority Mortgage, State Historic Tax Credits, Federal Historic Tax Credits, Federal Low Income Housing Tax Credits, Other Funding Sources Role: Developer, General Partner, Property Manager Completed: October, 2010 Des Moines, Iowa As a historic landmark in downtown Des Moines, this six-story structure was transformed into 66 affordable apartments and approximately 7,000 square feet of retail space. The building boasts a large 1,500 SF community room and is accompanied by a computer learning center, a fitness center and an on-site leasing office on the main level. Bike storage and surface parking is also available at the site. The units provide historic details coupled with modern finishes. Original windows were restored and provide wonderful views of downtown and the surrounding area. In addition to the historical details of the apartments, residents enjoy unit upgrades that include in-unit washer and dryers, dishwashers and sink garbage disposal systems. RUMELY LOFTS COMPANY PROFILE: Development Experience Project Details • New Construction • 102 Affordable Units • 11 Market-Rate Units • Project Value: $21.0 Million • Financing: HUD Insured 1st Mortgage, Federal Low Income Housing Tax Credits, IDED - EZ Tax Credits and Sales Tax Credits, IFA 1602 Funds, CIty of Des Moines, Other Sources Role: Developer, General Partner, Property Manager Completed: December, 2010 Des Moines, Iowa Located in downtown Des Moines, Metro Lofts is a four-story new construction development with a total of 111 apartment units. The building offers an amenity package including a large community room, fully- equipped exercise room, a computer learning center, underground parking, secure entry, and an on-site leasing office and manager. The apartment units have modern, durable finishes. Residents enjoy central air conditioning, in-unit washers and dryers, high-speed internet connection, energy-conserving fixtures, and an additional interior storage closet. Select units have walk-in closets, patios or balconies. With downtown Des Moines right outside its front door, Metro Lofts offers quality affordable housing in a convenient location. METRO LOFTS COMPANY PROFILE: Development Experience Project Details • New Construction • 180 Rental Apartments • 10,000 SqFt Commercial / Retail Space • 36 Market-Rate Apartments • 144 Affordable Apartments • Project Value: $28.3 Million • Financing: US Bank Construction Loan, Mass Mutual 1st Mortgage, Low Income Housing Tax Credits, MHFA Challenge Fund, Family Housing Fund, Affordable Housing Trust Fund, Minneapolis CPED Deferred Loan, Hennepin County Affordable Housing Investment Funds, Met Council Livable Communities Demonstration Funds, Role: Developer, General Partner, Property Manager Anticipated Completion: November, 2013 Minneapolis, Minnesota Longfellow Station is a 180-unit transit-oriented development located along the Hiawatha Light Rail Line in Minneapolis. Located within the mill district of the Longfellow Neighborhood, Longfellow Station will appeal to families and single adults that rely on public transportation to connect them to employment and educational opportunities. It is conveniently located a few miles south of downtown Minneapolis with easy access to major job centers such as Downtown Minneapolis, Mall of America, The University of Minnesota, Fairview-Riverside Medical Campus, and the Minneapolis/St. Paul International Airport. The development of the Central Corridor Light Rail Line will give additional benefit to the residents of Longfellow Station when completed. Emphasis in the design process has been placed on unit and common area amenities in order to compete with market-rate product in the area. Units feature open layouts, dishwasher, in-unit washer & dryer, a built-in office niche, and fiber optic wiring. Common area amenities include a community room, coffee area, business center, fitness room, theatre room, bike repair area, bike storage, heated underground parking, a dog run, and tot-lot. LONGFELLOW STATION Project Currently Under Construction COMPANY PROFILE: Development Experience Project Details • 3-Story New Construction • 60 Apartments, 2 Retail Spaces • 54 Affordable Units (40% & 60% AMI) • 6 Market-Rate Units • 3,100 SqFt Commercial • Project Value: • Financing: Iowa Finance Authority Mortgage, Low Income Housing Tax Credits, EZ Tax Credit Equity, EZ Sales Tax Rebate, City of Davenport NSP Funds Role: Developer, General Partner, Property Manager Anticipated Completion: July 2013 Davenport, Iowa Harrison Lofts is a new construction development of mixed-use housing and retail located on the 14th block of Harrison Street in Davenport, Iowa. On the street level, there are two retail spaces positioned along each of the 14th and 15th street corners. Residential parking is located behind the building, and retail customers will utilize the ample street parking on 14th and 15th Street. The community room has a large area for tenants to gather or watch television, and also provides workstations complete with computer and internet access. In addition to the community room there is a fully-equipped exercise room and a laundry facility. The building will also have an on-site leasing office and is fully-equipped with a 24/7 monitored security system. The 60 apartment units consist of efficiency, one- bedroom and two-bedroom layouts. As a mixed- income building providing affordable housing, the project targets single individuals and families. The units feature high quality interior finishes and amenities such as high ceilings, oversized windows, in-unit washer and dryers, energy efficient fixtures and appliances, and additional tenant storage. HARRISON LOFTS Project Currently Under Construction COMPANY PROFILE: Public Profile Public Profile Sherman Associates The following pages highlight some of Sherman Associates’ recent awards and press coverage. More can be found at www.sherman-associates.com/media-center. Ma r ch 20 11, Vo lum e I I, Issu e I II Pub lis he d b y No vo gra dac & Co mp an y L LP New s, Analy sis and Co mmenta ry O n Af f or dable Ho usin g, C ommun i t y Dev e l opme n t and Re new able E n er gy Tax Cred i t s con t i nued on page 2 Rive rside Plaz a A part men t s’ colo r ful exte ri o r repr e- s ents a c olorful past. The apa rtment c omple x was t h e fr st pha se of a U.S. D epa rtme nt of Hou sing a nd Ur- ba n De velo p men t (H UD) revitaliz ation p ro gr am kno wn as Ne w To wn-In To wn, w h i ch p l anne d t o cre ate a 12,00 0-unit mixe d-inc ome “uto p ian v i l l age” i n Minne apolis, Mi n n.’s C eda r-Rive r side ne i ghborho o d. It w as als o the f ctio n al hom e of M ar y Tyle r Moo re’s chara cte r in late r s ea son s of The Ma ry Tyle r Mo or e Sh ow. Yet, w i t h i n a fe w ye ar s of its 1973 co mple t i on, the de velo pme n t had f allen on ha rd t i m es. HU D ha d sc r appe d t h e New To wn pla n. The d eve lopment faced w ate r shuto f fs, ren t str i ke s a n d mor t gag e de f aults. In 1988, Sh er m an A ssoc i ate s a nd othe rs us ed the nasc ent lo w- inc ome h ous i n g tax credit (LIH T C) prog ra m to a cquire t h e dev elo p ment. Twen t y-t h re e ye ar s l ate r, River sid e P l aza is poised fo r a com eba ck. She rm a n Ass o ciat es will us e a n al- loc atio n of LIH T Cs, a long with state and f ede ra l his t or i c ta x cre d i t s (H T Cs), tax-exempt bo n d s (TEBs), a H UD loa n and othe r pub l ic a n d p r i v ate f n anc i n g to c o mple t e a $13 2 mil- lion m ake ove r of the 1,303-u n i t dev elo p m ent. A Storied His t or y Arc h i t ec t Ralph R apson d esigne d Rive r side Pla za, origina l l y ca l led Ce d ar Squa re West, in the Br u t alis t sty l e, w hic h was popula r f ro m the 1950 s th rou g h the mid-197 0s. S i n ce a cquir- ing the 11 buildin g s, She rm a n A ss oc i ates ha s im p ro ved t h e building s, in cr ea sing the numbe r o f ele v ators i n t h e 12- t o 40-story highris es a nd i n sta l l i ng l if e s afety fe atur es, such as s p r i n k l ers. At p re sent, Riv er sid e Pla za h ous es more t h an 4,400 p eople i n m i xed-i n com e units; the d evelopm ent has 66 9 proj ec t-b as ed S ec t i o n 8 u n i t s a nd 63 4 m a r k et ra t e units. Many r es i dents o f t he m arke t r ate u n it s als o recei ve h ous i ng c hoic e v ouc h er s. T he cam p u s i n clude s a K-8 charter s cho ol, groc ery store and t ena n t r es our ce c ente r t hat p ro vide s social s ervic es to m o r e t h an 40 0 i n d i vidua l s ea ch mo n t h. M any te n ants atte n d the adj ac ent Unive rsity o f M i nnesota or ha v e recentl y arr i ve d f ro m Som alia. A Garga n t uan Tas k A ccording t o Geo rg e Sherma n, p rincipa l and founder of Developer Begins Makeover of Largest Affordable Housing Development in Minnesota By Jennifer Do c kery, Assignment Edito r, Novogradac & Company LL P Pho to: C o urtesy of Sher m a n A s s o ci a t e s Riv ersid e Pla z a A pa r t men t s, o r i gin all y ca lle d C ed a r Sq ua r e We s t, w as bui l t in th e 19 7 0s as p art of t he U.S. D ep artm e nt of Ho usin g an d U r ban D ev e l op ment’s Ne w To w n-In To w n i n itia tiv e. Preservation Today Creating the Future from the Past PA GE 1 0 Déjà Vu in Minneapolis PA GE 2 2011’s Premier LIHTC Developments P A GE 19 Sleuthing the Market Study P A GE 32 TaxCreditAdvisorJ une 201 1 | Vo lum e XXII I N o. 6 Ten Fifty B S an Di ego, C ali f. D eve lo p er: Aff i rme d H o usi ng G r ou p C a t ego r y Wi n ner,2 01 1 E ds o n Ex c e l len c e Awa rd s (se e p. 1 9) P U BLI S HE D I N A S SO C IAT ION W ITH TH E NATIONA L HOU S ING & RE HA BI L ITA T ION AS S O CI AT I O N VO L.12 4, NO. 84 FIN ANC E-C OMM ERCE.C OMFRIDAY| APRI L 2 9, 201 1 Rehabbing Riverside — ‘Ellis Island’ of city B Y M ARK A ND E RSO N Sta f f W r ite r T h e $13 2.4 million re n o vation of the Riv er side Pla za ho us- ing co m p l ex in M i n n eapoli s’ Wes t Ba n k st arted in Febr u ary, b u t own e r Ge orge S her m an h ost- ed a p arty a nd gr ound- bre a king on Wednes d ay — g iving guest s a glimpse of o ne of the re gion’s biggest h ousi n g inve st m ent s and o n e of its mos t d i s- ti n ctive com m unities. “This is the city’s El l is Isl and,” sa i d Mi ke Ch ris tensen, exec u ti ve dire ct o r of the M i n n e a p o l i s Co m m u n i ty P l anning and Eco n omic De velopment a gency. C h ris te n sen he l ped lead a t our on Wednesday, but he i s aw are t h at t h e ho u sing compl ex’s Wes t Bank neigh bor hood ha s long been Minnea p olis’ gatew ay for i m m i- grant s. T he mo st rec ent arriv als ar e mo stly fro m east ern Afr i ca. Abou t 80 p ercent of Ri verside Plaza’s 4,400 residen ts are from S omalia, Ethiopia and Er i tr ea, said F re d da S cobey, exe cutive di rect or of the River side Plaz a Tena nt s Associ at ion. T h e 3 8-ye ar-o ld Rive rs ide Pl aza is big, a f act t hat has a n noyed m any of its ne igh- bor s. But its sca le als o has e nable d i t to deliv er a ma j or p ortio n of the T win Citie s’ affordabl e hou sing supp l y. Mor e than half i ts 1,30 3 apa rtmen ts are S ectio n 8 units, and 8 5 percent ar e desig- nated as affor d able fo r househo l ds ea rn- ing 60 pe rcent or le ss of the medi an me tro inco me. That m ake s River side Pla za the biggest affo rda ble ho u sing campus in the M idwe st and the b igge st sin gle mo rtga ge in t h e U.S. H o u sing a n d Urban De velopment dep artme n t’s ho usin g p ort- f olio, said Sh erm an, p reside n t of Sherman A ss ocia tes, whi ch has owned Rive rs ide f or 23 years. It’s a city within a city, but tha t city needs a big re n ova ti on. About h alf the $132.4 mill i on co st will go t o ref inanc e its mort gage, while more tha n $6 5 mil l ion will be s p ent o n m a j or r ehabs: rep l a cing $132.4M Total pr oj ec t co st 14 S ou rce s of e qui t y and debt RI VE RS ID E R EDO Mike C hr istens en, left, d i r ector of Minne a polis’ Comm u n it y Pl a nning Eco n o m ic De vel o p m ent a gency, a nd Ge o rg e She rma n, pres ident o f Sherman Ass o ciate s, expl a in some of the r enov a t i ons at Riv er side Plaz a whi l e a co u p le o f res i d ents wa l k b y. (Staff p hot o: Bi l l Klo tz) RIVER SIDE TO PA GE 2 COMPANY PROFILE: Public Profile Awards and Recognition 2012 Best In Real Estate - Multifamily Development or Redevelopment: Riverside Plaza 2012 Minnesota Public Health Achievement Award: Sherman Associates 2012 Property Excellence Award - Senior Housing: Blaine Town Square Senior Apartments 2012 Property Excellence Award - Affordable Housing 101+Units: Midtown Exchange 2011 Lifetime Achievement Award - Minneapolis/St. Paul Business Journal: George Sherman 2011 Capstone Award - Multifamily: Grand Boulevard Lofts 2011 T. Timothy Anderson Award for Best Historic Rehab Involving LIHTC Finalist: Grand Boulevard Lofts 2011 Honorable Mention for Historic Rehabilitation: Grand Boulevard Lofts 2010 Property Excellence Award - Affordable Housing 101+Units: Midtown Exchange 2009 Best of the Decade by Minneapolis/St. Paul Business Journal: Midtown Exchange and The Chicago Lofts 2008 Development of the Year: Syndicate Trust Building, St. Louis 2007 Affordable Housing Finance Magazine: Best Historic Rehabilitation: Midtown Exchange and The Chicago Lofts 2006 National Trust/HUD Secretary’s Award for Excellence in Historic Preservation: Midtown Exchange and The Chicago Lofts 2006 Project of the Year: Adaptive Reuse by Multifamily Executive Magazine: Midtown Exchange and The Chicago Lofts 2005 Best in American Living by Professional Builder Magazine: Midtown Exchange and The Chicago Lofts 2005 Trillium Award by Builders Association of the Twin Cities: Midtown Exchange and The Chicago Lofts 2004 Best in Real Estate: Best Overall by Minneapolis/St. Paul Business Journal: Midtown Exchange and The Chicago Lofts 2003 Best in Real Estate by Minneapolis/St. Paul Business Journal: Falcon Heights Town Square 2002 Best in Real Estate by Minneapolis/St. Paul Business Journal: Burnsville Heart of the City 2001 Best in Real Estate by Minneapolis/St. Paul Business Journal: Wacouta Commons COMPANY PROFILE: Public Profile aging and in need of rehabilitation. “We had known for a period of time that the property’s mechanical systems had to be replaced,” says Sherman. “The plumbing, both in domestic and hot water systems, had failed to the point of having routine emergencies and shutoffs and flooding of the buildings, because the pipes had deteriorated.” Tenants often wait for 25 min- utes to get hot water, letting the water run and driving up the property’s water bills. Sherman planned to seek fresh housing credits for a new acquisition/rehab transaction. But the timing was off. “About the time we started to put a game plan together for the rehab of the project and the re-syndica- tion,” he recalls, “the market for credits evaporated.” In addition, the massive size and scale of the development made it even tougher to win an allocation of 9% hous- ing credits and to secure tax credit equity. “But that did- n’t stop us,” Sherman notes. After considering but ruling out an application for 9% housing tax credits, Sherman Associates pursued tax-exempt financing, which brings 4% credits. The U.S. Department of Housing and Urban Development (HUD) agreed to provide a new FHA-insured mortgage, and the city,state, and others committed to provide $15 mil- lion in gap financing. The new HUD Section 221(d)(4) loan, nearly $50 million and funded by bond proceeds, has a 42-year term and fixed interest rate of 5.895%. But even with all these funds, Sherman still came up short. “That still left us with a thirty to forty million dollar gap. So we took the unusual step of looking at whether a 35-year-old building could be declared historic.” It’s rare for a building less than 50 years ago to be certified as historic by the National Park Service. But Sherman Associates succeeded after just six months, and Riverside Plaza was listed on the National Register of Historic Places in December 2010. Constructed during 1971-73, Riverside Plaza was designed by well-known local architect Ralph Rapson, As he oversees his biggest project ever, Minneapolis developer George Sherman is liv- ing out one of Yogi Berra’s old lines – It’s déjà vu all over again. “Our first experience with low-income housing tax credits was on this same project – Riverside Plaza – in 1988. We acquired it through a negotiated sale from HUD, which had foreclosed on it. And we did a bond transaction using four percent credits. We got a whop- ping 50 cents per credit dollar [in equity], paid over a couple years” This time around, Sherman’s outfit, Sherman Associates, is re-syndicating and redeveloping the mas- sive housing project – 1,303 units in 11 buildings occu- pying four city blocks – using various tax credits and other resources. “Hopefully we’ll be done by October 2012,” says Sherman. The $132 million project will involve more than $60 million in renovations to the complex, which has about 4,500 residents, including a number of college students. Work includes replacing the plumbing, mechanical, and electrical systems; sealing the exterior of the buildings; installing new windows and doors; refurbishing all of the apartments and common areas; and other improvements. Nearly 90% of the apartments will be LIHTC units; the rest market-rate. Of the 1,303 units, 669 will contin- ue to receive project-based Section 8 rent subsidies. After completion, the projected initial monthly gross rents for the LIHTC units will range from $545 for effi- ciencies up to $1,295 for three-bedroom apartments. Market-rate rents will range from $795 for one-bed- rooms up to $1,595 for four-bedrooms. The improvements could cut the development’s annual utility costs – now nearly $3 million, or 28% of annual operating expenses – by $500,000 to $1 million. As with other pre-1990 LIHTC transactions, Riverside Plaza wasn’t subject to a 30-year extended use commit- ment, but rather just a 15-year compliance period. After the compliance period expired, in the 2000s, Sherman Associates continued to operate the complex as afford- able rental housing. But by now, the development was Low-Income Housing Tax Credit www.housingonline.com June 2011 |Tax Credit Advisor 3 Riverside,continued on page 4 The Second Time Around Historic Minneapolis Housing Complex Under Redevelopment With Fresh Tax Credits George Sherman Preservation Today Creating the Future from the Past PAG E 1 0 Déjà Vu in M i n n e a p o l i s P A G E 2 2 0 1 1’s P remie r LIHTC Development s P A G E 19 Sleut h i n g the Market S tudy P A G E 32 TaxCreditAdvisorJ u n e 2011 | Vol u me X XI II N o. 6 Te n F i f ty B San D i e g o, C a l i f. De v e l o p e r: A ff ir m e d Ho u s i n g G r oup C a t eg o r y Wi nn e r,2 0 1 1 E d so n Ex c el l e n ce A w a r d s (s e e p. 1 9) P UB LI S H E D I N AS S O C IA TIO N W I T H T H E N AT I ON A L H OU SIN G & R E H AB I L I TA T I O N A SS O CI A T I O N COMPANY PROFILE: Public Profile Low-Income Housing Tax Credit 4 Tax Credit Advisor |June 2011 www.housingonline.com and reflects modernism and brutalist architectural styles. The buildings range from two to 39 stories, and are 70% concrete/30% glass with colored glass panels. Also significant is that Riverside Plaza (originally Cedar Square West) is one of only two projects (the other is Roosevelt Island in New York City) built and funded under HUD’s “New Town, In Town” initiative. Under legislation enacted in 1968 and expanded in 1970, the U.S. government provided funding to encourage the development of four types of “new communities” across the U.S. The “New Town, In Town” communities, one of these, were to be very large self-contained mixed-use rental communities or “urban villages” with tenants of low to high incomes. “This was just to be the first phase of a 10,000-unit project,” says Sherman. “They only built the first 1,300 units before both the funding stopped and the financial model stopped working.” Underwritten for the larger, ultimate size, Riverside Plaza struggled financially from the start and HUD foreclosed on its mortgage in 1987. AEGON USA Realty Advisors LLC purchased the federal housing and historic tax credits, placing the investment in a proprietary fund for investor Google and providing nearly $44 million in equity.The developer elected to receive about $14 million in cash from the state in lieu of claiming the state historic credits. The city of Minneapolis issued $69.9 million in tax- exempt bonds, of which nearly $50 million funded the HUD mortgage, and provided nearly $2 million in afford- able housing trust fund monies. Other sources of soft funds included the Minnesota Housing Finance Agency (two loans), the Family Housing Fund, and the Greater Metropolitan Housing Corporation. Tom Streitz, of the City of Minneapolis Department of Community Planning and Economic Development, praises the Riverside Plaza renovation project and says it is needed, estimating the local affordable rental housing vacancy rate at around 1%. “It’s absolutely fantastic; it’s some- thing that needed to happen.” He noted, “The city’s investment and the other investment that’s going into this building is a huge state- ment about what we see as the future of this neighbor- hood being a transit hub, being a place where afford- Riverside,continued from page 3 able housing and market-rate housing meet, and an important architectural symbol and an important symbol to the immigrant community of Minneapolis. There’s a lot of value embodied in those buildings.” Riverside Plaza and the surrounding neighborhood are home to many East African immigrants. The neigh- borhood already has a station on one existing light rail line, and a second light rail line will be coming through in the near future. Riverside Plaza– Source and Uses Summary SOURCES Tax-Exempt Bond Proceeds / HUD 221(d)(4) . . . . . . .$49.950,000 Mortgage - City of Minneapolis, AFL-CIO Housing Investment Trust 4% Low-Income Housing Tax Credit Equity . . . . . . . .$29,106,635 -AEGON USA Realty Advisors LLC Federal Historic Tax Credit Equity . . . . . . . . . . . . . . . .$14,767,244 -AEGON USA Realty Advisors LLC State Historic Tax Credit Equity . . . . . . . . . . . . . . .$14,126,603.04 MHFA - PARIF Loan . . . . . . . . . . . . . . . . . . . . . . . . . .$7,016,350.00 MHFA - EHDC Loan . . . . . . . . . . . . . . . . . . . . . . . . . .$5,083,650.00 Family Housing Fund Loan . . . . . . . . . . . . . . . . . . . . . .$200,000.00 CPED - AHTF Loan . . . . . . . . . . . . . . . . . . . . . . . . . . .$1,900,000.00 Met Council - LHIA Loan . . . . . . . . . . . . . . . . . . . . . . .$575,000.00 GMHC Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$1,300,000.00 Seller Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$2,000,000.00 Rebates (Xcel/CenterPoint) . . . . . . . . . . . . . . . . . . . . .$400,000.00 Cash Flow from Operations for Development . . . .$2,962,909.48 Deferred Developer Fee . . . . . . . . . . . . . . . . . . . . . . . . .$3,000,000 Total Sources . . . . . . . . . . . . . . . . . . . . . . . . . .$132,388,393 USES Acquisition Cost.........................................................$41,300,000.00 Construction + Construction Contingency.............$65,030,914.00 Architectural/Engineering/Legal Fees.......................$2,640,000.00 Construction Interest...................................................$4,300,000.00 Other General Development/Financine Fees..........$3,728,479.00 Relocation.....................................................................$2,250,000.00 Reserves........................................................................$5,139,000.00 Total Development Cost...................................$132,388,393 MHFA – Minnesota Housing Finance Agency CPED – City of Minneapolis Department of Community Planning and Economic Development PARIF - Preservation Affordable Rental Investment Fund EDHC - Economic Development and Housing Challenge Program AHTF - Affordable Housing Trust Fund GMHC – Greater Metropolitan Housing Corporation LHIA- Metropolitan Council Local Housing Incentives Account - Metropolitan Livable Communities Act Tom Streitz TCA COMPANY PROFILE: Public Profile COMPANY PROFILE: Public Profile COMPANY PROFILE: Public Profile March 2011, Volume II, Issue III Published by Novogradac & Company LLP News, Analysis and Commentary On Affordable Housing, Community Development and Renewable Energy Tax Credits continued on page 2 Riverside Plaza Apartments’ colorful exterior repre- sents a colorful past. The apartment complex was the frst phase of a U.S. Department of Housing and Ur- ban Development (HUD) revitalization program known as New Town-In Town, which planned to create a 12,000-unit mixed-income “utopian village” in Minneapolis, Minn.’s Cedar-Riverside neighborhood. It was also the fctional home of Mary Tyler Moore’s character in later seasons of The Mary Tyler Moore Show. Yet, within a few years of its 1973 completion, the development had fallen on hard times. HUD had scrapped the New Town plan. The development faced water shutoffs, rent strikes and mortgage defaults. In 1988, Sherman Associates and others used the nascent low- income housing tax credit (LIHTC) program to acquire the development. Twenty-three years later, Riverside Plaza is poised for a comeback. Sherman Associates will use an al- location of LIHTCs, along with state and federal historic tax credits (HTCs), tax-exempt bonds (TEBs), a HUD loan and other public and private fnancing to complete a $132 mil- lion makeover of the 1,303-unit development. A Storied History Architect Ralph Rapson designed Riverside Plaza, originally called Cedar Square West, in the Brutalist style, which was popular from the 1950s through the mid-1970s. Since acquir- ing the 11 buildings, Sherman Associates has improved the buildings, increasing the number of elevators in the 12- to 40-story highrises and installing life safety features, such as sprinklers. At present, Riverside Plaza houses more than 4,400 people in mixed-income units; the development has 669 project-based Section 8 units and 634 market rate units. Many residents of the market rate units also receive housing choice vouchers. The campus includes a K-8 charter school, grocery store and tenant resource center that provides social services to more than 400 individuals each month. Many tenants attend the adjacent University of Minnesota or have recently arrived from Somalia. A Gargantuan Task According to George Sherman, principal and founder of Developer Begins Makeover of Largest Affordable Housing Development in Minnesota By Jennifer Dockery, Assignment Editor, Novogradac & Company LLP Photo: Courtesy of Sherman Associates Riverside Plaza Apartments, originally called Cedar Square West, was built in the 1970s as part of the U.S. Department of Housing and Urban Development’s New Town-In Town initiative. COMPANY PROFILE: Public Profile continued from page 1 Sherman Associates, putting together fnancing for Riverside’s redevelopment was a gargantuan task; its size prevented Sher- man Associates from applying for 9 percent LIHTCs and to reno- vate its 1,303 units, the developer would have needed double the state’s annual 9 percent credit allowance. Riverside also has the most units of any property under a single HUD mortgage to date. “Its greatest challenge has always been its size. It doesn’t ft into any square or round hole,” said Sherman. Sherman Associates worked with HUD, the state housing fnance agency, the city of Minneapolis and others to obtain funding for the $132 million redevelopment. The city awarded 4 percent LI- HTCs and TEBs to the property. AEGON USA Realty Advisors LLC (AEGON) provided $29 million in LIHTC equity and AFL- CIO Housing Investment Trust (HIT) invested in the TEBs, which were used to secure a nearly $50 million HUD-guaranteed frst mortgage. Funding also came from the Minnesota Housing Fi- nance Agency’s (MHFA’s) Economic Development and Housing Challenge program − approximately $7 million; MHFA’s Preser- vation Affordable Rental Investment Fund program, − approxi- mately $5 million; City of Minneapolis affordable housing trust fund − $1.9 million; Greater Metropolitan Housing Corporation − $1.3 million; Metropolitan Council’s Local Housing Incentive Ac- count program − $575,000; and Family Housing Fund − $200,000. The remaining capital came from a $3 million deferred developer fee, $2 million in seller equity, nearly $3 million in cash fow-oper- ations for the development and $400,000 in energy rebates. “The key for us … was getting HUD involved early in the scope of the rehab,” said Ken Dayton, executive vice president of Oak Grove Capital, the HUD mortgage underwriter/lender. “From the city’s perspective, this project was about enhancing Novogradac Journal of Tax Credits Editorial Board PUBLISHER Michael J. Novogradac, CPA MANAGING EDITOR Alex Ruiz EDITOR Jane Bowar Zastrow TECHNICAL EDITORS Robert S. Thesman, CPA James R. Kroger, CPA Owen P. Gray, CPA Thomas Boccia, CPA Daniel J. Smith, CPA ASSIGNMENT EDITOR Jennifer Dockery STAFF WRITER Jennifer Hill CONTRIBUTING WRITERS Thomas Boccia, CPA Jing Chen, CPA Brandi Day Brad Elphick, CPA G. Tyler Gibbs, CPA James R. Kroger, CPA Peter Lawrence John Leith-Tetrault Forrest Milder Lindsay Sutton Annette Stevenson, CPA Amanda Talbot, HCCP John M. Tess Stephen B. Tracy, CPA PRODUCTION Jesse Barredo James Matuszak Novogradac Journal of Tax Credits Information Address all correspondence and editorial submissions to: Alex Ruiz/ 415.356.8088 Address inquiries regarding advertising opportunities to: Emil Bagalso / 415.356.8037 Editorial material in this publication is for informational purposes only and should not be construed otherwise. Advice and interpretation regarding the low-income housing tax credit or any other material covered in this publication can only be obtained from your tax advisor. © Novogradac & Company LLP 2011 All rights reserved. ISSN 2152-646X Reproduction of this publication in whole or in part in any form without written permission from the publisher is prohibited by law. continued on page 3 Rendering: Courtesy of Sherman Associates www.novoco.com  March 2011 2 NOVOGRADAC JOURNAL OF TAX CREDITS COMPANY PROFILE: Public Profile continued from page 2Novogradac Journal of Tax Credits Advisory Board LOW-INCOME HOUSING TAX CREDITS Bud Clarke BOSTON FINANCIAL INVESTMENT MANAGEMENT Jana Cohen Barbe SNR DENTON Tom Dixon BOSTON CAPITAL Valerie White STANDA RD & POOR’S CORPORATION Rick Edson HOUSING CAPITAL ADVISORS INC. Richard Gerwitz CITI COMMUNITY CAPITAL Rochelle Lento DYKEMA GOSSE TT PLLC John Lisella U.S. BANCORP COMMUNITY DE V. CORP. Phillip Melton GRANDBRIDGE REAL ESTATE CAPITAL Thomas Morton P IL LSBURY WINTHROP SHAW PITT MAN LL P Stephen Ryan COX, CAS TLE & NICHOLSON LL P Arnold Schuster SNR DENTON Rob Wasserman U.S. BANC ORP COMMUNIT Y DE V. CORP. PROPERTY COMPLIANCE Rose Guerrero CALIFORNI A TAX CREDIT ALLOCATION COMMITT EE Sharon Jackman SI G SERVICES LLC Michael Kotin K AY KAY REALT Y Michael Snowdon MCA HOUSING PART NERS Gianna Solari SOLARI ENTERPRISES Ruth Theobald Probst THEOP RO COMPLIANC E & CONSULT. INC. Kimberly Taylor HOUSING DEVELOPMENT CENTER HOUSING AND URBAN DEVELOPMENT Sheldon Schreiberg P EPPER HA MILTON LL P Monica Sussman NI XON PEABODY LL P NEW MARKETS TAX CREDITS Frank Altman COMMUNITY REINVESTMENT FUND Bruce Bonjour PERKINS COIE LLC Neil Kimmelfeld LANE POWELL Marc Hirshman U.S. BANC ORP COMMUNIT Y DE V. CORP. Scott Lindquist SNR DENTON Ruth Sparrow FUTURES UNLIMITED LAW PC Herb Stevens NI XON PEABODY LL P Mary Tingerthal HOUSING PARTNERSHIP NETWORK Tom Tracy HUNTER CHASE & COMPAN Y Joseph Wesolowski ENTERPRISE COMMUNITY INVESTMENT INC. HISTORIC TAX CREDITS Don Holm FA RRIS BOBANGO BRANAN PLC John Leith-Tetrault NATION AL TRUST COMM. INVESTMENT CORP. Bill MacRostie MACROSTIE HISTORIC ADVISORS LLC Donna Rodney BRYAN CAVE LL P John Tess HERITAGE CONSULTING GROUP RENEWABLE ENERGY TAX CREDITS Ed Feo USRG RENEWABLE FINANCE Michael Hall BORREGO SOLAR SYSTEMS Jim Howard DUDLEY VENTURES Forrest Milder NI XON PEABODY LL P Darren Van’t Hof U.S. BANC ORP COMMUNIT Y DE V. CORP.continued on page 4 the quality of life for the residents,” said Matt Goldstein, senior project coordinator for Minneapolis’s community planning and economic development’s multifamily housing development divi- sion. “The project is consistent with the city’s goals and policies. It earned the most points of any project that requested money in the 2010 round.” He said Riverside Plaza received the points because it is a mixed-income development, preserves existing units, has a longer than required affordability period and because “every public dollar leverages signifcant private investment.” Sherman also agreed to hire 90 workers from the surrounding community. The redevelopment of Riverside Plaza also fts into a larger im- provement plan for the Cedar-Riverside neighborhood. The Min- neapolis Public Housing Authority renovated units at The Cedars in 2010 and the city is building two light rail transit stations on the site’s perimeter. After securing the LIHTC and bond allocation, Sherman Associ- ates sought out a tax credit syndicator or investor that would be able to invest nearly $34 million in LIHTCs. “It’s complex, but it’s an important project for the city. AEGON has the ability to take projects of a size that other syndicators may not be able to accom- modate,” said Anne Simpson, director in AEGON’s Community Investments Group. AEGON combined Riverside Plaza’s LIHTCs and HTCs into an equity fund that includes Google Inc. as an investor. The National Park Service (NPS) added the 38-year-old Riverside Plaza to the National Register of Historic Places on December 28, 2010. The NPS agreed with Sherman Associates assessment that, as one of the few remaining New Town-In Town developments, the Rapson-designed complex is signifcant to the country’s his- torical record. The National Register designation qualifed Riv- erside Plaza for federal and state HTCs. “That’s helped raise $28 million in additional equity,” Sherman said. AEGON provided nearly $15 million in equity for the federal HTCs through the same fund that provided the LIHTC equity. Riverside Plaza is also one of the frst properties to receive credits through the Minnesota Historic Structure & Community Rein- vestment Tax Credit program. The state Legislature created the program last year to encourage redevelopment. Under the pro- gram, Riverside is eligible for a 20 percent tax credit that Sherman plans to return the state for a grant equal to 90 percent of its value, or about $14.1 million. “We were struggling with gaps in the proj- ect …. The state historic credit was absolutely critical. It really got the gap completed and got the project closed,” Sherman said. Financing for Riverside Plaza closed on January 6 and construc- tion began on February 1. Workers will replace the domestic water, sanitary sewer systems and mechanical systems, as well as individual unit remodels. Sherman Associates plans to reno- www.novoco.com  March 2011 3 NOVOGRADAC JOURNAL OF TAX CREDITS COMPANY PROFILE: Public Profile continued from page 3 vate between 60 and 100 units each month. During the renovations, residents will move into furnished “hotel” units at the property. Sherman anticipated that the reno- vations would be completed by December 2012. This article frst appeared in the March 2011 issue of the Novogradac Journal of Tax Credits. © Novogradac & Company LLP 2011 - All Rights Reserved Notice pursuant to IRS regulations: Any U.S. federal tax advice contained in this article is not intended to be used, and cannot be used, by any taxpayer for the purpose of avoiding penalties under the Internal Revenue Code; nor is any such advice intended to be used to support the promotion or marketing of a transaction. Any advice expressed in this article is limited to the federal tax issues addressed in it. Additional issues may exist outside the limited scope of any advice provided – any such advice does not consider or provide a conclusion with respect to any additional issues. Taxpayers contemplating undertaking a transaction should seek advice based on their particular circumstances. This editorial material is for informational purposes only and should not be construed otherwise. Advice and interpretation re- garding property compliance or any other material covered in this article can only be obtained from your tax advisor. For further information visit www.novoco.com. www.novoco.com  March 2011 4 NOVOGRADAC JOURNAL OF TAX CREDITS COMPANY PROFILE: Public Profile VOL.124, NO. 84 FINANCE-COMMERCE.COM FRIDAY| APRIL 29, 2011 Rehabbing Riverside — ‘Ellis Island’ of city BY MARK ANDERSON Staff Writer The $132.4 million renovation of the Riverside Plaza hous- ing complex in Minneapolis’ West Bank started in February, but owner George Sherman host- ed a party and ground- breaking on Wednesday — giving guests a glimpse of one of the region’s biggest housing investments and one of its most dis- tinctive communities. “This is the city’s Ellis Island,” said Mike Christensen, executive director of the M i n n e a p o l i s Community Planning and Economic Development agency. Christensen helped lead a tour on Wednesday, but he is aware that the housing complex’s West Bank neighborhood has long been Minneapolis’ gateway for immi- grants. The most recent arrivals are mostly from eastern Africa. About 80 percent of Riverside Plaza’s 4,400 residents are from Somalia, Ethiopia and Eritrea, said Fredda Scobey, executive director of the Riverside Plaza Tenants Association. The 38-year-old Riverside Plaza is big, a fact that has annoyed many of its neigh- bors. But its scale also has enabled it to deliver a major portion of the Twin Cities’ affordable housing supply. More than half its 1,303 apartments are Section 8 units, and 85 percent are desig- nated as affordable for households earn- ing 60 percent or less of the median metro income. That makes Riverside Plaza the biggest affordable housing campus in the Midwest and the biggest single mortgage in the U.S. Housing and Urban Development department’s housing port- folio, said Sherman, president of Sherman Associates, which has owned Riverside for 23 years. It’s a city within a city, but that city needs a big renovation. About half the $132.4 million cost will go to refinance its mortgage, while more than $65 million will be spent on major rehabs: replacing $132.4M Total project cost 14 Sources of equity and debt RIVERSIDE REDO Mike Christensen, left, director of Minneapolis’ Community Planning Economic Development agency, and George Sherman, president of Sherman Associates, explain some of the renovations at Riverside Plaza while a couple of residents walk by. (Staff photo: Bill Klotz) RIVERSIDE TO PAGE 2 COMPANY PROFILE: Public Profile plumbing, heating and cooling, and eleva- tor systems, and fixing wear and tear throughout the campus’ interior and exte- rior public spaces. Sherman acknowledges those fixes have been needed for years. “The system was designed poorly when it was built, and it’s been deteriorating for a long time,” he said. “You can crumble the pipes in your hand.” The result is a 30-minute wait for hot water in the morning, residents say, and buildings that are cold in the winter and hot in the summer. The renovations will end those prob- lems while offering hundreds of jobs. Sherman said the plumbing reconstruc- tion will keep 100 plumbers working steadily over the next two years, and city documents say the project will provide another 200 construction jobs. The utility fixes will also make the proj- ect much “greener.” Sherman said the reductions in water usage and more effi- cient heating and cooling will produce $1 million in annual water and energy sav- ings. The blueprints include new plazas on the border of the campus, which will bet- ter link it to the rest of its Cedar Riverside neighborhood and make it part of a new pedestrian and bicycle path connecting the West Bank’s Hiawatha and Central Corridor LRT stations. Riverside Plaza is an enormous housing community, and the capital stack that is financing its renovation matches the scale. The $132.4 million project includes 14 sources of equity and debt, ranging from the developer’s contribution, state and city funds, to the founders of Google and a union trust fund. Sherman said his team spent five years trying to assemble the package, knowing that the deterioration was making it urgent to get the project under way. At the heart of the financing challenge was the decision to keep the project affordable. That decision limited the pro- ject’s income and its investor pool. It made Riverside eligible for low-income housing tax credits — but that source took a beat- ing during the recession. Proceeds dropped from 90 cents or more for a $1 tax credit five years ago to as low 60 cents by Riverside Large complex provides big portion of affordable housing supply George Sherman (center) says workers are renovating 60 apartments each month. Residents in those units live in temporary housing on the campus for that month. (Staff photo: Bill Klotz) COMPANY PROFILE: Public Profile 2009 and 2010. Sherman kept searching. “It was like a Rubik’s Cube — we just kept turning the pieces hoping to find ways for the colors to line up,” he said. The pieces finally lined up in early 2010 thanks to the project’s architect, the late Ralph Rapson. Sherman and historic adviser Charlene Roise put together a suc- cessful case for historic designation based on the contributions of the renowned local architect — unlocking state and federal historic tax credits that contributed $29 million in equity. The low-income housing tax credits also strengthened when they went to mar- ket by late 2010. Investors paid close to 84 cents for the credits, Sherman said. That strength came in part from the project’s size, said Angela Christy, an attorney and tax credit specialist with Faegre & Benson who advised Sherman. “An investor looks at this and says I can invest in 13 projects with 100 units, or I can invest in one project,” she said. “They’re going to decide that this is a lot easier to monitor.” Meanwhile, Riverside’s latest residents stand out in their commitment to educa- tion and to self-reliance. “This is an upwardly mobile population,” said Christiansen of CPED. “They’re looking for opportunities to build their lives here, and the city wants to help do that.” The renovation budget commits $150,000 annually for the next 30 years to the tenants association, aimed in part to meet new learning challenges, and anoth- er $15,000 a year to create a new Safety Center on the campus. The campus includes the Minneapolis School District’s busiest adult education classes, with more than 500 people study- ing languages or computer courses each week. Riverside also has a successful charter school that will double in size from its current 150 students when new space is created in the renovation. Sherman said that 120 residents are attending the Minneapolis Community Technical College now and hundreds more are attending the University of Minnesota and other nearby colleges. “Part of Riverside’s appeal is that it’s so close to higher education,” he said. The 38-year-old Riverside Plaza, on the West Bank of Minneapolis, was designed by the architect Ralph Rapson. Riverside has 1,303 units, 85 percent of which are designated as affordable housing. (File photo: Bill Klotz) Reprinted with permission of Finance & Commerce Inc. ©2011 COMPANY PROFILE: Public Profile 233 Park Avenue South, Suite 201 • Minneapolis, MN 55415 Phone: (612) 332-3000 • Fax: (612) 332-8119 www.sherman-associates.com Shherman A Attac Associates chment A s Develop A.2 pment Hiighlights Red Cedar Poin developmen t t Loca ation of Deevelopmennt Highligh ts Heritage Blaine T Falcon H e Park Town Square Heights Town n Square Red Cedar Poin developmen t t Her Sherm Camp devel Thom The b enviro innov that s attent T e H T S S S R ritage Park man Associates pus located in opment named mas T. Feeney M buildings were onment; utilize vative storm w served the spe tion was given Thomas T. Fee enhanced assist Heritage Park Type: N A Size: 48 50 Schedule: A Sources: H R Role: C k Senior Ca s partnered wi North Minnea d Thomas T. 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Housing. Providers of M ience in all ar gree in Hosp Cedar Poin developmen cal and ision. Was an d profitable food service institutions, racts, and the ars in the last Minnesota. reas of food itality t t n t Arc Attac chitect Re chment B elevant Ex B.1 xperiencee Red Cedar Poin developmen t t Previous Work 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Similar Project Experience (Senior) Description: The idea of a senior living community at this location was embraced by the city and is a key component to what Apple Valley calls the Central Village: a walkable, multifaceted, nearly 30-acre redevelopment in the heart of Apple Valley. The design team felt a particular obligation to create a welcoming, vibrant environment full of unique amenities where residents feel at home throughout the community. The permanent residents and their regular visitors frequent the neighborhood restaurants, stores and recreational areas. Awards & Recognitions: -Winner, 2010 Best in Real Estate – Senior Living Category, Twin Cities Business Journal Experience in: • HUD financed CCRC project • Senior Apartments • Environmental Sensitivity Address: 1670 Legacy Parkway E, Maplewood, MN 55109 Construction Cost: $18.2 million Square Footage: 171,500 square feet Timeline: Design - 2.5 months Construction - 12 months Completion Date: September 2010 Client: Ecumen - Contact: Julie Murray - Phone: (651) 766-4340 - E-mail: juliemurray@ecumen. org KWA Project Team Members: Link Wilson, Collin Kaas, Enrico Williams, Kim Behrens Units: 134 total Site Features: • Nature Trails to adjacent wetland • Outdoor Courtyards • Memory Care Garden Residential Features: • Fireplace Lounge & Coffee Bar • Public and Private Dining Theater • Fitness Room, Salon, & Spa • Creative Arts Room • Library • Chapel The Seasons at Apple Valley Apple Valley, MN Description: Kaas Wilson collaborated with Sherman Associates to create this green workforce housing on a brownfield site. Located on a bus line and near schools and a library, this four-story building was designed to provide homes for families with modest incomes. A mix of two and three bedroom units were designed with the needs of parents with children in mind. An on-site playground and proximity to the local library also make it attractive to young families. Methodology: Several strategies were employed to maximize the use of the site and to keep the development affordable. A nearby utility right-of-way became a storm water infiltration pond. Native species were selected for the landscaping, minimizing irrigation demands. Both the structure and floor plans were carefully designed for high efficiency at minimal cost. Meeting the Green Communities Criteria had the added benefit of lower utility costs for renters. Parking was located under the building to create room for a children’s playground. Together these strategies make family housing affordable, sustainable, and attractive for a market segment that is currently under-served. Experience in: • MHFA Tax Credit • Affordable Rental Housing • Green Communities Criteria Address: 8735 Portland Avenue S., Bloomington, MN 55420 Construction Cost: $6.3 million Square Footage: 87,600 square feet Timeline: Design - 3 months Construction - 10.5 months Completion Date: July 2009 Client: Sherman Associates - Contact: Tony Kuechle - Phone: (612) 332-3000 - E-mail: tkuechle@sherman- associates.com KWA Project Team Members: Collin Kaas, Enrico Williams Link Wilson Units: 50 units Features: • Individual Storage Units • Community Room • Tot Lot • Connections to the Existing Neighborhood • 1:1 Underground Parking Garage Previous Work 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Similar Project Experience (Multi-family) The Crossings at Valley View Bloomington, MN Previous Work 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Similar Project Experience (Senior) *UHDW5RRP 5HIU H VKPHQW %DU 7K HD W H U &UHDWLYH $U W V 0HPRU\&DUH &RPPXQLW\0DLQ(QWUDQFH 6D O R Q 6SD )L W Q HVV &HQWHU $PEHU &O X E 5RR P 0HPRU\ &DU H *DUGHQ *DUD J H (QWU\ 3 RUWH &R FKqU H $FRUQ 0DUN H W /REE\$G P L QLVWU DW L RQ $XWXPQ /H DY H V 5HV WD X UDQW +DUYHV W 5 RRP &KHI¶V.LWFKHQ F\3DUNZD\ Description: Financed with the HUD (Housing and Urban Development) 232 financing program, this senior housing facility is located in the northern suburbs of the Twin Cities, adjacent to the Maplewood Mall and St. John’s Hospital. The 130,000 square-foot community will have 150 apartments on four levels, comprised of 120 one- and two-bedroom independent living and assisted living apartments. A memory care neighborhood will have 15 apartments, as will an enhanced care neighborhood. Amenities include ala carte services based on the needs and desires of each resident, a community movie theater, fitness center, arts studio, restaurant, private dining room, café, and more. Awards & Recognitions: Winner of the 2010 Best in Real Estate Awards for the Minneapolis/St. Paul Business Journal Experience in: • HUD financed CCRC project • Senior Living • Environmental Sensitivitiy Address: 1670 Legacy Parkway E, Maplewood, MN 55109 Construction Cost: $18.2 million Square Footage: 212,000 square feet Timeline: Design - 2 months Construction - 12 months Completion Date: September 2010 Client: Ecumen - Contact: Julie Murray - Phone: (651) 766-4340 - E-mail: juliemurray@ecumen.org KWA Project Team Members: Link Wilson, Enrico Williams, Kim Behrens Units: 150 total Site Features: • Nature Trails to adjacent wetland • Outdoor Courtyards • Memory Care Garden Residential Features: • Fireplace Lounge & Coffee Bar • Public and Private Dining Theater • Fitness Room, Salon, & Spa • Creative Arts Room • Library • Chapel The Seasons at Maplewood Maplewood, MN Previous Work 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Similar Project Experience (Senior) Description: Senior citizens will be served in this 93-unit catered living residence which is part of an already constructed condominium and town home development. The architecture, site lighting and landscaping of the new catered living residence blends in with the overall campus. The interiors are of a craftsman style with emphasis on lighting, day lighting, way finding and ease of use. A full range of meal services, including ala carte options, will be available to all residents to aid in the aging in place process. Methodology: From the beginning this project was a search for the proper use on the site. The process was collaboration with the existing neighbors living on the campus and the city at large to reach a reasonable solution on a very tight site. The grounds where designed to allow for a planned access to a city trail system that connects several regional parks, but at the same time increase the amount of existing resident parking both on grade and under the proposed building. Awards & Recognitions: 2010 Best in Real Estate Award finalist for the Minneapolis/St. Paul Business Journal Experience in: • HUD financed CCRC project • LEED Certification • Senior Living Address: 2301 Village Lane Bloomington, MN 55431 Construction Cost: $14 million Square Footage: 134,250 square feet Timeline: Design - 2.5 months Construction - 12 months Completion Date: April 2010 Client: Greco Development, LLC - Contact: Brent Rogers - Phone: (612) 630-2542 - E-mail: brogers@grecollc.com KWA Project Team Members: Collin Kaas, Kim Behrens, Ryan Dupuis Units: 93 total Residential Features: • Commercial Kitchen • Residential & Private Dining Rooms • Community Room • Beauty Salon & Spa with Massage Therapy • Fitness Center • Movie Theater • Digital Recreation Space • Library & Parlor Nine Mile Creek Bloomington, MN Previous Work 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Similar Project Experience (Senior) Inver Glen Senior Living Inver Grove Heights, MN Description: This recently completed 102-unit LEED-registered project serves independent seniors as well as those requiring assistance in daily living or memory care. A full range of meal services, including ala carte options are available to all residents. To create an inter-generational environment, an on-site preschool for nearby families and the neighboring church has been incorporated into the building and is connected to the church with a walking trail. Methodology: The building’s form and its site design reflect a project conceived for and shaped by its context. Three stories tall and in the Craftsman style, the building wraps around the crest of a hill to provide commanding views of the adjoining green space. A neighboring church provided the opportunity to create a shared vehicular entrance and parking area which also serves the preschool. Among the strategies employed to achieve LEED certification, all storm water will remain on-site and flow into the pond rather than going directly into municipal storm drains connected to local waterways. Other site improvements to maximize water infiltration will include water- permeable paving, landscaped retention bio-swales, and infiltration basins. Experience in: • HUD-financed CCRC project • LEED Certification • Market-Rate Rental Housing Address: 7260 South Robert Trail Inver Grove Heights, MN 55077 Construction Cost: $13 Million Square Footage: 128,800 square feet Timeline: Design - 3 months Construction - 12 months Completion Date: October 2009 Client: Southview Senior Living Communities - Contact: Lance Lemieux - Phone: (651) 454-4801 - E-mail: lancel@ southviewcommunities.com KWA Project Team Members: Collin Kaas, Ryan DuPuis Site Features: • LEED certification • Walking trails connecting to the neighborhood • Landscaped retention bio- swales Residential Features: • Inter-generational Preschool • Commercial Kitchen • Residential & Private Dining Rooms • Beauty Salon • Fitness Center • Library & Parlor Previous Work 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Cutting Edge Project (Multi-family) Description: Oaks Station Place is a mixed use development to be located at the 46th Street Station on the Hiawatha Line. The project consists of a single building with 104 rental apartments and approximately 9,000 square feet of first floor retail space. The inspiration for the look and feel of Oaks Station Place comes from Forest Hills Gardens, an iconic transit oriented community built almost one hundred years ago in Queens, New York on the Long Island Railroad. Forest Hills Gardens has been a model of smart transit oriented development. The classic architecture, brick exteriors, gable roofs and building skyway evoke the style and grace of an earlier era. Methodology: Because there could only be one entrance for the piece of land occupied by Oaks Station Place and the 46th Street Bus and Light Rail station, the team needed to determine how the two properties would interact. The solution was to create one building that spanned over the site entrance and was connected below grade via underground parking. Oaks Station Place is a leading example of how to implement smart transit-oriented development. Awards & Recognitions: 2012 Best in Real Estate Award finalist for the Minneapolis/St. Paul Business Journal Experience in: • Market-Rate Rental Housing Address: 3550 East 46th Street Minneapolis, MN 55406 Construction Cost: $15.5 million Square Footage: 170,000 square feet Estimated Timeline: Design - 4 months Construction - 13 months Completion Date: September 2012 Client: Oaks Station Place, LLC - Contact: Norm Bjornnes - Phone: (612) 879-1804 - E-mail: NBjornnes@ mulliganbjornnes.com KWA Project Team Members: Collin Kaas, James Schloemer Units: 104 total Residential Features: • Community Room • Theater • Fitness Room • Attached Retail • Outdoor patio with entertainment and grilling area • Proximity to Light Rail Station and Bus Lines Oaks Station Place Minneapolis, MN Previous Work 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Tight Budget Project (Multi-family) Description: Trail’s Edge apartments in Waconia, MN is the first of two phases that aims to bring higher-density apartment housing onto two parcels of land that had remained undeveloped for some time. Set within an up-and-coming area of Waconia where working-age adults are the primary demographic, Trail’s Edge apartments features an underground parking garage ratio of 1 stall per unit, and features a healthy mix of studios, one-, two- and three bedroom apartments. All units, regardless of size, are complete with a full kitchen and island, 1 bath per bedroom, in-unit washers and dryers, and in-house storage closets. Budget constraints demanded that construction remain as simple as possible. With suspended balconies and a strategic use of materials in selective locations to help to put a modern spin on a traditional look, Trail’s Edge becomes a place that any person would be proud to call their home. Methodology: When our client approached us with the challenge of putting together a full set of drawings for a cutting edge multi-family housing project under the constraints of an extremely tight budget and an even tighter schedule, we relied on our experience in multifamily housing and years of working efficiently as a team to not only meet, but exceed our client’s expectations in a timely and efficient manner. Experience in: • Livable Communities Act (LCA) Grant funding, application materials and submission • Market-Rate Rental Housing Address: 885 and 905 Airport Road Waconia, MN 55387 Estimated Construction Cost: $8.9 million Square Footage: 113,710 gross square feet Estimated Timeline: Design - 2 months Construction - 11 months Estimated Completion Date: October 2013 Client: Carver County CDA - Contact: Frank Dunbar - Phone: (763) 377-7090 - E-mail: frank@dundev.com KWA Project Team Members: Link Wilson, Collin Kaas, Enrico Williams, Ryan Dupuis Units: 76 total Residential Features: • 2-story Entry Lobby & Mail • Community Room with Kitchen • Fitness Center • Theater • Digital Recreation Space • Entry Plaza with Bicycle Racks • Connection to existing Bus Routes • Outdoor Patio • Tot Lot Carver County Workforce Housing Waconia, MN Previous Work 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Similar Multi-Family Work Kaas Wilson Architects has worked closely with both the U.S. Department of Housing and Urban Development (HUD) and other Agencies on numerous multi-family housing developments. Publicly funded projects often have additional design standards that they must meet to ensure that the dollars used to fund these projects are wisely invested. We are familiar with these standards, and understand the implications they have on the design of all aspects of a project. Towerlight Apartments (Senior) Saint Louis Park, MN • HUD i nanced, UFAS compliant • Recipient of Hennepin County Transit-Oriented Development Grant • Redeveloped brown i eld site • TIF i nancing 324 1st Street (Market Rate Apartments) Minneapolis, MN • Downtown, Warehouse District • HUD i nancing in process Village Commons Workforce Multi-Family Housing (MHFA) Savage, MN • Fully meets MHFA Design Guidelines • Livable Communities Grant (Met Council) • Scott County HRA funding Grain Belt Terrace (Market Rate Apartments) Minneapolis, MN • HUD Financing in process • Winner of City Competition for best design development and construction team Background 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Project Design & Management Team Kaas Wilson Architects was launched in January 2007, but it started much earlier. Collin Kaas and Link Wilson became formidable a team while working together at Miller Hanson Partners. There, they and many of their current staff collaborated on many landmark projects such as Gramercy of Edina; Groveland Condominiums; Olin Crossings Condominiums and Mystic Falls Lodge in Gatlinburg, Tennessee. They realized quite early on that their personal styles worked well together, and clients found their teamwork unparalleled in terms of creativity, cost-effectiveness and focus. Today, they bring their excellent collaboration and integrity in housing design to Kaas Wilson Architects. KWA believes that an architect’s role is much more than simply drawing plans and elevations; it is to take a client’s ideas and deliver their message to a variety of audiences. These audiences include finance agencies and builders, who are an integral part of making a client’s dream reality. By proactively establishing good working relationships with neighborhoods, planners, and city board members, we can preemptively address concerns. We also understand that issues will always arise, so we pride ourselves on our ability to quickly employ problem solving skills in order to find solutions that work for everyone and avoid costly delays. Utilizing these skills, Kaas Wilson Architects has been involved in some of the most successful housing developments in the Twin Cities. Our strength is our people, and we have attracted not only the brightest architects and designers in the field, but professionals who are skilled at communication and collaboration. Our casual studio-like office environment is designed to facilitate better teamwork and idea sharing. Kaas Wilson Architects doesn’t just meet expectations - we exceed them. The team shown on the following pages have been a part of Multi-Family and Senior/ Supportive Housing projects their entire careers. Enrico, Kim, Collin and Link have worked together a combined 28 years. As well, our long-term strategic partners on the multi-family housing projects, showcased in this proposal, have been with us since the 1980’s. We know and understand this part of the metro area, with Collin Kaas a Richfield resident. We know that we will bring a unique knowledge to the Cedar Point Housing Development that no other Architects and their consulting groups can bring. Location: Minneapolis, MN Year Established: 2007 Legal Status: LLC Ownership: Link Wilson, Collin Kaas Stai ng: Architectural 12 Administration 2 (LEED AP 4) Total in firm 14 Background 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Kaas Wilson Architects Position in Firm: Principal Education: • Master of Architecture, University of Minnesota • Post-Graduate studies in architecture, Kings College of London, UK • B.S. Architecture, University of Nebraska Experience: 26 years Registrations: Architect licensed in MN, AZ, FL, IA, SD, TX; LEED AP Professional Memberships: • American Institute of Architects • US Green Building Council • Construction Specification Institute Volunteer Organizations: Minneapolis Stevens Square Community Executive Board member and co-chair of the Development Committee Link Wilson, AIA, LEED AP Team Leader, Principal in Charge BIO: Although he has managed projects in more than 20 states, Link Wilson is best known throughout the Minnesota design community, having spent the last 26 years working in and around the Twin Cities. Link’s experience managing design teams for large, multifaceted projects bridges the gap between owners’ dreams and contractors’ practical applications in the field, and delivers projects on time and on budget. Link’s passion for creating warm and inviting living environments is based in the belief that everyone deserves to feel at home. From affordable apartments to luxury condominiums, he integrates principles of sustainable design with cutting-edge trends to create healthy and spacious environments that integrate seamlessly into a greater community. As the design team leader, Link’s role continues to grow beyond that of the traditional architect. Link’s familiarity with funding and financing procedures as well as the process of municipal entitlements assure projects progress smoothly. Because of this, Link is frequently sought after by both non-profit and for-profit organizations to help guide their endeavors. RELEVANT PROJECTS: Seasons at Apple Valley, Apple Valley, MN Seasons at Maplewood, Maplewood, MN North Star Apartments, Big Lake, MN Village Commons Apartment and Townhomes, Savage MN Crossings at Valley View Family Apartments, Bloomington, MN Grain Belt Apartments, Minneapolis, MN 324 North 1st Street Apartments, Minneapolis, MN Rayette Apartments, Saint Paul, MN Waconia CDA housing, Waconia, MN Inver Glen and All Seasons Preschool, Inver Grove Heights, MN Towerlight, Senior Living and Wellness Center, St. Louis Park, MN Nine Mile Creek, Bloomington, MN MN Veterans Home Campus, Bldg. 4 Renovation, Minneapolis, MN Bierman Place Student Housing and Wellness Center Rehab., University of Minnesota The Shores Senior Living, Maplewood, MN Oaks Station Place, Minneapolis, MN AWARDS AND RECOGNITIONS: • Minneapolis/St. Paul Business Journal runner up for Oak Station Place. • Minneapolis/St. Paul Business Journal Best in Real Estate Award: Seasons at Maplewood; Client: Ecumen • Minneapolis/St. Paul Business Journal Best in Real Estate i nalist: Nine Mile Creek Catered Living; Client: Greco Development • Senior Design Magazine Merit Award: Village at Woodlands, Brighton, MI; Client: Trinity Health • National Easter Seals Easy Access Design Award: Sonoma Group Home; Client: Accessible Space • Minneapolis/St. Paul Business Journal Best In Real Estate Award: Gramercy of Edina; Client: Cooperative Communities • Minneapolis/St. Paul Business Journal Best In Real Estate i nalist: The Groveland; Client: Steven Scott Development Background 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Kaas Wilson Architects Position in Firm: Principal Education: • University of Oregon – Master of Architecture • University of Minnesota – B.S., Architecture, Design minor Experience: 11 years Registrations: LEED AP Professional Memberships: • American Institute of Architects • U.S. Green Building Council Collin Kaas, Assoc. AIA, LEED AP Project Manager BIO: Collin’s professional experience has focused on multi-family housing facilities for people of all ages and abilities. His understanding of both housing markets and the complexities of a project’s cost structure ensure his projects have both the overall schematic design and the user-focused interior design required for success. His strong project management skills, consistent and timely responsiveness to owners and contractors, and diligent on-site supervision help transform those designs into built reality. He has designed, managed, and been a team member on numerous senior housing facilities and “all ages” residential projects. RELEVANT PROJECTS: Seasons at Apple Valley, Apple Valley, MN Seasons at Maplewood, Maplewood, MN North Star Apartments, Big Lake, MN Village Commons Apartment and Townhomes, Savage MN Crossings at Valley View Family Apartments, Bloomington, MN Grain Belt Apartments, Minneapolis, MN 324 North 1st Street Apartments, Minneapolis, MN Rayette Apartments, Saint Paul, MN Waconia CDA housing, Waconia, MN Inver Glen and All Seasons Preschool, Inver Grove Heights, MN Towerlight, Senior Living and Wellness Center, St. Louis Park, MN Nine Mile Creek, Bloomington, MN MN Veterans Home Campus, Bldg. 4 Renovation, Minneapolis, MN Bierman Place Student Housing and Wellness Center Rehab., University of Minnesota The Shores Senior Living, Maplewood, MN Oaks Station Place, Minneapolis, MN AWARDS AND RECOGNITIONS: • Minneapolis/St. Paul Business Journal Young Entrepreneur Award • AIA Minneapolis Merit Award: Heritage Commons; Client: MPHA • Minneapolis/St. Paul Business Journal Best In Real Estate Award, Heritage Commons; Client: Minneapolis Public Housing Auth. • Minneapolis/St. Paul Business Journal Best In Real Estate Award: Gramercy of Edina; Client: Cooperative Communities • Minneapolis/St. Paul Business Journal Best In Real Estate Finalist: The Groveland; Client: Steven Scott Development Background 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Kaas Wilson Architects Position in Firm: Designer Education: • University of Minnesota – Master of Architecture • University of Minnesota – B.A., Architecture, Studio Arts Minor Experience: 12 years Position in Firm: Project Manager Education: • University of Minnesota – Master of Architecture • University of Minnesota – B.S., Architecture Experience: 8 years Enrico Williams Design Manager BIO: Enrico’s architectural career began in 2000 working with both Link and Collin, designing multi-family facilities that respond to the unique and specialized requirements of residents. Over the years, Enrico has found success in creating innovative design solutions by thinking outside the box, managing complex projects by keeping lines of communication strong, and addressing all concerns of the entire design team, whether they are clients, contractors, consultants, or building officials. The results are projects that are a successful integration of building systems, materials, and program that are aesthetically pleasing and pragmatic, while staying on-schedule and on-budget. RELEVANT PROJECTS: Grain Belt Terraces, Minneapolis, MN Tarnhill Clubhouse and Apartments campus rehabilitation, Bloomington, MN Summit Hill Assisted Living renovation, Saint Paul, MN Rayette Lofts, Saint Paul, MN Northern Star Apartments, Big Lake, MN Seasons at Apple Valley, Apple Valley, MN Seasons at Maplewood, Maplewood, MN Nine Mile Creek Catered Living, Bloomington, MN Trail’s Edge Apartments, Waconia, MN Creek’s Run Townhome, Chaska, MN Benilde High School Campus Planning, St. Louis Park, MN Vernon Terrace, Edina, MN Kim Behrens Project Captain, Team Manager BIO: As a skilled project manager of projects as large as 39 million dollars, Kim has a depth of experience with multi-family housing design and construction as well as experience working with stakeholders from cities to agencies to help move a project forward. Prior to joining Kaas Wilson Architects, Kim worked at RSP Architects, was an architectural model builder for Feyereisen Studios, and spent three years at HTG Architects working on a variety of project types. She brings a background in multi-family housing, commercial and financial design. Her experience has taught her the importance of detailing, how to forecast client needs an`d how to design flexibility for the future. Kim will work closely with project stakeholders to ensure their vision exceeds even their own expectations. RELEVANT PROJECTS: Parkside Village Apartments, Apple Valley, MN TowerLight, Saint Louis Park, MN Riverside Terrace Renovation, Thief River Falls, MN Park Manor Senior Apartments Renovation, Detroit Lakes, MN The Shores Senior Living, Maplewood, MN Vernon Terrace, Edina, MN Holtkötter International, Dallas, TX Nine Mile Creek, Bloomington, MN Seasons of Apple Valley, Apple Valley, MN Seasons of Maplewood, Maplewood, MN MN Vets Home - Building 4, Minneapolis, MN MetaBank, Des Moines, IA Telco Federal Credit Union, Rapid City, SD* Star Choice Credit Union, Bloomington, MN* *work completed at previous i rm Design 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Attributes: What Sets Us Apart Natural Surveillance 1. Transparent vestibules at building entrances 2. Landscape designs created to provide surveillance, especially in proximity to designated points of entry and opportunistic points of entry 3. Lighting placed along pathways and other pedestrian-use areas at proper heights for lighting the faces of the people in the space 4. Streets designed to increase pedestrian and bicycle traffic Natural Access Control 5. A single, clearly identifiable, point of entry 6. Front yards with waist level fencing along residential property lines to control access, and encourage surveillance 1234 56 Natural Territorial Reinforcement 7. Activities scheduled in common areas to increase proper use, attracting more people, and increasing the perception that these areas are controlled 7 Towns and communities are not developed at once, but are rather created and rei ned through piecemeal growth and individual acts. Often development is guided by an overall master plan and/or planning and zoning ordinances, but it is the overall ef ect of all development – in the context of the whole – that dei nes the character of a neighborhood, community, town, or region. Residents choosing to move to a locale instantly become a part of that community, and the role an individual plays can be guided by the surrounding context. Principles of defensible space and crime prevention through environmental design are inherent in each of our housing projects, as a way of reinforcing the long-term success of a project and supporting stability within the community. Our buildings are contextually sensitive to the surrounding site and neighborhood. For example, the main entry is a single point of access and is well lit at night. We believe spaces, inside and outside, should be simultaneously safe and inviting. Simple, concise design strategies can address many safety concerns from the outset; nurturing warm, vibrant communities through thoughtful design choices. Design Principles Implementation 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Attributes Relationships and Expectations KWA takes pride in being accessible and responsive to our clients as well as the regulatory officials and contractors we work with. We listen carefully to our clients so that we may respond appropriately. We work hard at establishing and maintaining relationships. Don’t just take our word for it though; see what our clients have to say: “Kaas Wilson’s expertise in affordable housing really showed with Crossings at Valley View – the efficient design required no value engineering. They also approached the application of the Green Communities criteria to the project from a cost-effective view point. Their focus on cost control allowed us to add more brick to the exterior than we initially thought the budget would allow. The resulting project has real market appeal – it exceeded our lease-up expectations.” –Ryan Sailer, Vice President of Development, Sherman Associates Kaas Wilson’s experience with a wide range of multi-family projects has taught us what works and what doesn’t. We are constantly evaluating materials and systems in order to bring the greatest life-cycle value for the dollars invested in a project. Creativity + Experience = Improved Quality and Cost Savings During the design process for the remodel of the Centennial Ballroom, KWA seized the opportunity to reuse the wood slat paneling that lined the walls of the existing ballroom, and reinvent the use of this material as a large acoustic panel screen on the ceiling, saving the owner $50,000 in material costs. In addition to this, when structural studies showed that there was no way to make the roof rigid enough to resist the deflection of the motorized operable partition that the owner wanted, Kaas Wilson found a manual operable partition that is easily moved and is in use at several large convention centers. The switch from motorized to manual operable partitions saved the project $80,000. Kaas Wilson kept a keen eye on the owner’s maintenance and operating costs for our affordable housing project, Crossings at Valley View. Knowing that this project was geared for families and that kids especially have a tendency to spill, KWA sought out a durable but affordable carpet tile that could be spot-replaced as necessary. Occupancy sensors were installed in the hallways, public areas, and garage to save lighting energy costs when these spaces are not in use. With our past five housing projects, none of them have seen change orders for anything but unforeseen site conditions and owner upgrades. Sustainable Design If one were to ask a room full of people what “sustainability” means, they will most likely come up with a variety of answers. Sustainability means many things, but it ultimately comes down to providing stewardship and conservation of our natural and built environment. For the proposed property this can mean optimizing the site to ensure that storm water is captured and infiltrated on site, using native species in the landscaping, careful consideration of site lighting, minimizing impervious surfaces, and minimizing the amount of land disturbed during construction. From a building stand point, one can look to a well insulated and detailed building envelope, occupancy sensors in public spaces, use of environmentally preferable products, and the selection of HVAC systems that are not only energy efficient but help provide good indoor air quality. We recommend a whole systems approach to optimize the effects of these design decisions. What sets us a apart is that we have completed LEED Certified projects, Green Communities Criteria projects and Minnesota B3 projects without jamming concepts down our clients throats. Implementation 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com Attributes Problem Solving and Working Relationships While working on the renovation of Building 4 for use as an Adult Daycare for the Minnesota Veterans Home, we came to a crossroads regarding the historic doors and trims in the building and authorities having jurisdiction over the project. The State Historic Preservation Office was requiring that all the historic trims and doors be salvaged, refinished and reinstalled with the renovation work, and the State Health Department, which will license the facility, was requiring that all the existing doors and trims be taken out as they were coated in lead paint and the Health Department felt that this condition, even if the wood were refinished, posed a health risk to the population of vulnerable adults that would occupy the building when the program opened. KWA worked with all parties involved to come to a resolution to offer the existing doors and trims to an architectural salvage company and replace all trims and doors with new that matched in kind. Through all of this, construction was not delayed. While our Nine Mile Creek project was under construction, the management team for the building decided that they needed more office space. KWA was able to catch this early, work with the contractor to move some walls around, and create more offices, all at no additional cost to the project. References 2104 4th Avenue South, Suite B, Minneapolis, MN 55404 \ 612.879.6000 \ www.kaaswilson.com References DEVELOPERS Ryan Sailer Partner Everwood Development Phone: (612) 508-4627 Email: Ryan@everwoodcompany.com Frank Dunbar President Dunbar Development Phone: (612) 599-90992 Email: Frank@DunDev.com CONTRACTORS Marv Kotek President Frerichs Construction Phone: (612) 363-7378 Email: marv@frerichsconstruction.com Mike Benedict Vice President Frana Companies Phone: (612) 965-9801 Email: mike@frana.com OWNER/OPERATORS Julie Murray Vice President of Development Ecumen Phone: (651) 766-4340 Email: juliemurray@ecumen.org Barb Halverson President Steven Scott Management Phone: (952) 292-6181 Email: bhalverson@steven-scott.com FINANCIAL Tim Nichols President Nichols Financial Phone: (952) 895-5200 Email: tnichols@nicholsfinancial.com CITY PLANNER Maggie Dykes, AICP Associate City Planner City of Apple Valley Phone: (952) 953-2569 Email: MMilton@ci.apple-valley.mn.us BUILDING OFFICIAL Greg Brady Commercial Building Inspector City of Apple Valley Phone: (952) 953-2581 Email: gbrady@ci.apple-valley.mn.us Landscap Attac pe Archite chment B ect Relev B.2 vant Experience Red Cedar Poin developmen t t Educ Bogg Camp Carle Minn East Camp India and E J.W. and L Mast Iowa Rese Jorda Koch Kyoto Japan Nara & Sit Scien St. Pa Minn State Farib Unive Arch Plann Chan Halls desig cation/Institut gy Creek Gang p, Master Pla eton College, nesota, w/ He Carolina Univ pus Master P ana University Environmenta Riley Children Library, Cance ter Plan, India State Univer arch Complex Zone Mas an Elementar hi Institute of o University K n Institute for e Design, Nar nce Museum aul Area Voca nesota e of Minnesot bault, Minnes ersity of Minn Arts Distr Arts Distr Carlson Sc College of itecture Site Earth Scie ning, Minnesot nhassen, Minn Pioneer R River Ben , Parking Super Com West Ban gn B tion g Camp, A Ho n and Design Seeley G. 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E ter, Minnesot netonka Inc. C nesota Site Evalu thwestern Be arec Corpora Paul Companie , Minnesota rry Corporatio dquarters and Master P e Farm Mutu onal and Cor er Value Store rie, Minnesot tage Compan nesota ls Fargo Hom neapolis, Min ernment wn’s Valley Ci tral Square Co nesota riet Bishop Pla nesota nepin County nesota nesota Valley Interpretive C nesota Zoolog sissippi Headw sissippi, Minn onal Defense ter and Librar hester River G Training Cent ing Planning, Min entre, Kingdo nergy Techno ta Corporate He uation and M ell Market Stre ate Headquart es, Inc. Corpo on Semicondu d Laboratory lan and Site P al Automobil porate Office es, Inc. Corpo ta ies Southwes e Mortgage C nnesota ity Park, Brow ommunity Ce ayground, Ha y Juvenile Just y National Wi Center, Bloom gical Garden, waters Recrea nesota e University A ry, Fort McNa Gardens, Roch Red ter and Precli nneapolis, Mi om Establishm ology Center, eadquarters, aster Plan eet, St. Paul, ters, Jeddah, orate Headqu uctor Division Facility, Eaga Plans e Insurance C es orate Headqu st Crossing, Ed Campus Mast wn’s Valley, M enter, South S arriet Island, S tice Center, M ldlife Refuge mington, Min , Apple Valley ation Master Academic Ope air, Washingto hester, Minne Cedar Poin developmen nical Studies innesota ment, Riyadh, Brooklyn Chanhassen, Minnesota Saudi Arabia uarters, St. n an,MN Company arters, Eden den Prairie, ter Plan, Minnesota St. Paul, St. Paul, Minneapolis, Education nesota y, Minnesota Plan, Upper erations on, D.C. esota t t , St. A Minn St. Cl Wino Wino Com Cent Dow Holid Hyatt Milw Penin desig Golf Prair Quar MN Radis Radis Sacra Seou Kore Two Indus ADC Mast MTC MTS Head 3M C Minn Publi Elon Elon Hube Plaza Lawr Nort Quad nthony Falls I nesota loud Public Li ona County H ona, Minneso mercial/Deve er Square Off ntown Mall, S day Inn Intern t Regency Ho waukee Depot nsula Papaga gn, Guanacast Four Seas course, Marin ie Stone Ente rry Highlands sson Hotel, Ly sson Metrodo amento Mall, ul Ski Resort, H a Appletree Sq strial Corporate He ter Plan, Eden Overhaul Fac Systems Corp dquarters/Ma Chemolite, Sit nesota ic Assembly College Athle College, Nort ert H. Humph a Design, Min rence Joel Vet h Carolina d City Civic Ce Interpretive P brary, St. Clo istorical Socie ota eloper fice Plaza, Kn Sioux Falls, So national, Bloo otel, Flint, Mic t Master Plan yo Resort, ma te, Costa Rica son’s Resort, A na, ertainment Ce Residential C ynchburg, Vir ome Hotel, M Sacramento, Hyosan Devel uare, Bloomi eadquarters/ n Prairie, Min cility, St. Paul poration Corp anufacturing, te Studies, Ca etic Campus, th Carolina rey Metrodo neapolis, MN terans Coliseu enter Site Plan Plan, Minneap ud, Minnesot ety Interpreti oxville, Tenne outh Dakota omington, Min chigan , Minneapolis aster plannin a Arnold Palme enter plannin Community, S rginia Minneapolis, M , California lopment Com ngton, Minne Manufacturin nesota , Minnesota porate Eden Prairie, ampus Plannin and Football me, Site Plan N um, Winston nning, Moline polis, ta ive Center, essee nnesota s, Minnesota g and site er Signature g, Elgin, IL St Paul Park, Minnesota mpany, Seoul, esota ng Facility , Minnesota ng, Hastings, Stadium, ning Studies, Salem, e, Illinois Sant St Cl MN Univ Publ “Dar Exca III, 1 “Site at Ni “Rec Coau Awa ASLA Ame Fello Bogg Hono Cent Minn Mer Land Dow Beau East Mer Arch Harr Minn Mer Jame India Mer Heal Koch Awa May Citat MAS May Desi ta Clara Conve oud State Un versal Studios ications rk Age and By avations at Ni 983 e Environs an ichoria in Sou constructing a uthor, Minne rds and Hono A Fellowship erican Society ow under the gy Creek Gang or Award, MA tral Square Co nesota it Award, Min dscape Archit w Chemical Co utification Aw Texas Medic it Award, MA hitects/Mode riet Bishop Pla nesota it Award, MA es W. Riley H ana it Award, MA lthcare hi University o rd of Excellen yo Clinic, Jacks tion, AIA/Mod SLA yo Clinic, Scot gn Award, Ar ention Cente niversity Foot s Japan Maste yzantine Occu choria in Sou d Techniques uthwest Gree a Bronze Age sota Messeni ors y of Landscap category of D g Camp, Cass ASLA ommunity Ce nnesota Chap ects (MASLA) ompany, Midl ward, City of M cal Center, Ath ASLA and Citat rn Healthcare ayground, Ha ASLA ospital for Ch ASLA and Desi of Technology nce, MASLA sonville, Flori dern Healthc tsdale, Arizon rizona Desert Red r, Santa Clara ball Stadium, er Planning, O upation,” Coa thwest Greec s,” Coauthor, ece, Volume I, Regional Env ian Expeditio e Architects i Design Works sia, Florida enter, South S pter American ) land, Michiga Midland, Mich hens, Texas tion, America e arriet Island, S hildren, Indian ign Award, AI y, Kochi, Japa ida are and Hono na Botanical Ga Cedar Poin developmen a, California , St Cloud, Osaka, Japan author, ce, Volume Excavations , 1978 vironment,” n, 1972 nducted as s St. Paul, n Society of an higan an Institute of St. Paul, napolis, IA/Modern an or Award, arden t t f Minn and I Hono Minn Paul, First Nara Awar Penin Reso Meri Gran “Res Cham nesota Valley Interpretive C or Award, MS nesota WWII , MN Place Institute of S rd of Excellen nsula Papaga rt Communit t Award, MAS d Prize, Cont ponsible Dev mber of Comm National Wil Center, Bloom SAIA Veteran’s Me Science and T nce, MASLA yo, Master Pl y, Guanacast SLA ribution to th elopment”, C merce dlife Refuge E mington, Minn emorial Comp Technology, N lan for a Wor e, Costa Rica he Communit Costa Rican‐A Education nesota petition, St Nara Japan ld Class y Awards for merican Roch Roch Mer Hono St. P Minn Mer Sper Minn Mer Well Minn Best Jour hester Peace hester, Minne it Award, MA or Award, AC Paul Companie nesota it Award, MA rry Univac Sem nesota it Award, MA ls Fargo Hom neapolis, Min t in Real Estat nal Plaza, Maste esota ASLA CEC es Corporate ASLA miconductor ASLA e Mortgage W nnesota te, Overall Wi Red r Plan and Sit Headquarter Headquarter West Building inner, Twin C Cedar Poin developmen te Design, rs, St. Paul, rs, Eagan, g, ities Business t t s Conssultant D Attac ennis O’D chment B Donnell R B.3 Relevant Experienc Red ce Cedar Poin developmen t t P ROPERTY E XPERIENCE WALKER METHODIST 2000-2012 Hazel Ridge Maplewood, MN Highview Hills Lakeville, MN River Pointe Moorhead, MN Summit Pointe Cedar Rapids, IA Walker Methodist Edina Edina, MN Walker Methodist Kenzie St. Anthony, MN Walker Methodist Lyndale Minneapolis, MN Walker Methodist Plaza Anoka, MN Walker Methodist River Anoka, MN Walker Place Minneapolis, MN Walker Methodist Tree Tops Anoka, MN Westwood Ridge West St. Paul, MN THE GOODMAN GROUP 1999-2000 The Commons on Marice Eagan, MN The Inn on Westport Sioux Falls, SD Healthy at Home (home health care agency) Sioux Falls, SD The Peaks Flagstaff, AZ Miramont Pointe Clackamas, OR Terracina Grand Naples, FL BROOKDALE LIVING COMMUNITIES 1997-1998 Brendenwood Voorhees, NJ Chatfield West Hartford, CT The Gables at Brighton Brighton, NY The Gables at Farmington Farmington, CT The Island of Lake Travis Austin, TX Edina Park Plaza Edina, MN ACTIVELIFE MANAGEMENT CORP. 1986-1997 Barkley Place Ft. Meyers, FL The Benchmark Hoffman Estates, IL Edina Park Plaza Edina, MN Hawthorn Lakes of Lake County Vernon Hills, IL La Vida Del Mar San Diego, CA The Kenwood Minneapolis, MN The Oak Park Arms Oak Park, IL The Spring of East Mesa Mesa, AZ The Springs of El Cajon El Cajon, CA The Springs of Escondido Escondido, CA Spring Ridge at Charbonneau Portland, OR CCON SE NC ECT CEPT TION TUA N C AL C PLA Red AN Cedar Poin developmen N t t CO Ove Sherm Each amen follow    Ove The prog frame sills, selec comm publi neigh creat betw comp and t Com The cons   ONCEPT erview man Associat of the three nities will be o wing describe  Phase I w market an Care in th  Phase II w Together choices to Assisted L  Phase III w identifying balance of erall Design primary inten ram uses inte e constructio brick and sto ction of these munity, the n c green space hborhood. Pu te destination ween the resid plete, will cre the rest of th mpatibility w proposed dev iderations inc  Phases I a down from  The prima minimizing TUAL P tes and its dev phases conte of high-quality es each of the ill feature 120 nalysis indicat he Richfield m will include 66 with Phase I, o residents. F Living and Me will contain ap g a medical-of f the site. n ntion for the o erspersed thr on that utilize one, premium materials wi eighboring pa es will preser ublic trails an ns that encou dents of this a eate a courtya e site, with a with Surrou velopment is clude: and II will only m the intense ary ingress/eg g traffic on lo PLAN velopment te emplated are y and build up e three phase 0 units of Ass tes a strong d market. Pleas 6 units of 55+ , Sherman As From no-to-lo emory Care). pproximately ffice type use overall design roughout the a consistent cement fiber ll create a ha arkway, and t rve existing co d extensive la rage travel by area and their ard frame aro proposed art nding Resid designed to i y be three sto e commercial gress for all th ocal streets; eam envision a in response t pon the othe s; please see sisted Living, emand for th e see Section Senior Living sociates wou ow service ne 6,600 square er that will be n of this area site. The res palette of ma r board siding rmonious ble he adjacent g onnections to andscaping, an y foot throug r neighbors. ound the gree t feature set a dential & Co interact with ories and Pha uses to the e hree phases i an ambitious to market co r landmark de Attachments Independent his housing typ n F (Market L g with rents a uld foresee bo eeds in Phase e feet of office complimenta is to create t sidential porti aterials that w g, panel, and t end of colors green-space. o the site and nd locations o ghout the site The propose en-space that at the epicen ommercial A and support ase III will only east and mod s proposed to three phase nditions and evelopments s C.1 and C.2 Living and Me pe, with a par etter) for add affordable to oth phases as e II, to higher e/retail space ary to the sen the consisten ions of this ca will include ro trim, and 30-y and textures Placement of d address futu of public ame , while creati ed residential will serve to ter. Area existing, adja y be one stor derate density o be off of th development demand. The within the C for proposed emory Care. rticularly acut ditional detail households w providing a c service need e. Sherman A nior housing t feel of a cam ampus will co ock-faced CM year dimensio that comple f the new con ure connectio enities such as ng opportuni buildings for connect bot acent land use ry, representi y single family he to-be-cons Red t for the Ceda e design, con City of Richfie d elevations a Sherman As te shortage o l. with moderat continuum of ds in Phase I ( Associates ant that will be b mpus for the onsist of three MU with deco onal asphalt s ment the sur nstruction an ons to the gre s art or wate ities for inter Phases I & II, h buildings to es. Specific de ing an approp y homes to th structed Richf Cedar Poin developmen ar Point area struction and ld. The and site plan: ssociates’ of Memory te incomes. f housing Independent, ticipates built on the variety of e-story wood rative stone shingles. The rounding d proposed eater r features wi raction , when o each other esign priate step- he west; field Parkway t t . d d ll ,    Addit prop overf Com The speci      Con The site i site. The Ceda  Pedestrian Avenue. on local, r  Phase II m pedestrian  Lastly, the Internatio tionally, Sher osed develop flow parking mmunity De proposed dev ific features t  Design, m Architect Point dev  The devel building e  As previo developm activity.  The devel provide a Associate making fe  The devel lighting, ap adhesives Minnesota from the formity to Z proposed dev s MR-3, whic Sherman Ass proposed hig ar Point area. n paths are p This will mak residential str may include w n and residen e developmen onal Airport. rman Associat pment on a nu for church ev evelopment velopment w hat will advan materials and c s have built th elopment pro lopment will xteriors and, ously-mention ment transition lopment will desired ame s would antic atures; lopment will ppliances and ; and resident a Housing’s G development Zoning Req velopment w h provides fo sociates’ prop gh density, mix roposed to c ke the develop reets; walk-up/townh ntial feel; nt team is exp Special atten tes has engag umber of item vents. Please Design Gui ill build on ot nce the HRA’ construction heir reputatio oposal will co be rich with p potentially, i ned, the devel nal between t contain two l nity to comm cipate collabo feature a num d construction t orientation Green Comm t’s close prox uirements ill include a h or a minimum posal exceeds xed-use natu ontinue the e pment more home style en perienced in d ntion is given t ed the neighb ms, including see Section idelines ther successfu s goal of cont quality will be ons upon dev ontinue this tr pedestrian-sc ndividual wal lopment will i the neighbori large green sp munity membe orating with H mber of susta n; durable fini programs. S unities standa ximity to servi igh-density of m of 24 units p s this minimu re of Sherma existing paths permeable to ntrances on th developing pr to design and boring Mt. Ca sharing facilit F (Letter of S ul projects re tinuing to fos e of high qual veloping high- rend; caled features k-up/townho include two p ng residentia pace areas th ers and future HRA to enhan inable design ishes, recycle Sherman Asso ards. Additio ices, employm f housing and per acre, resu um with 185 p an Associates’ s found in the o pedestrians he 16th Avenu rojects near n d construction alvary Luthera ties, programm Support) for a ecently undert ster high-qual lity. Sherman quality, susta s, including m ome entrances pedestrian pa l/commercial at will be acc e residents of nce this space and construc ed materials a ociates would onally, the fut ment and tran d a mixed use ulting in a min proposed unit ’ proposal adv e adjacent sho but continue ue side, giving noise generat n features tha an Church ab ming for inter additional det taken in the C ity developm n Associates a inable develo oderate build s off of 16th A aths that will c uses but also cessible to the f the develop e with public a ction features and low VOC d likely build t ture residents nsit opportun e component. nimum of 149 ts and 6,500 vances of the Red opping center e to limit vehi g the propert tors, such as M at will mitigat bout partnerin rgenerational tail. City. The fol ent projects and Kaas-Wil opments and t ding heights, a Avenue; cross the site o permeable t e public. The pment. Sherm art and other s, including en paints, carpe the developm s of the site w nities. Current zon 9 units for this square feet o e HRA’s goals Cedar Poin developmen r to 16th icular traffic ty a more MSP te this issue. ng on the l activities and lowing are in the City: lson the Cedar attractive e, making the to pedestrian ese spaces wi man r place- nergy-efficien ets and ment to will benefit ning for the s 6.2 acre of office/retail s for the t t d n ll t . UN Pha The f the In Bedr hous for a Pha The f Phase types Pha Phase dema senio NIT CO ase I: 120 U following tab ndependent/A room units. S eholds move dditional deta ase II: 66 U following tab e I, this devel s will accomm ase III: 6,50 e III is curren and. This size or-focused ho OUNT & Units Assist le illustrates t Assisted Livin Sherman Asso from single f ail. U In M G Units 55+ S le illustrates t opment inclu modate house U O O Tw T 00 square f ntly estimated e of developm ousing contem & SQUA ted Living the unit mix a ng component ociates’ marke family homes Unit Type ndependent/A One B One B Two B Total Memory Care Studio One B Total Grand Total enior Livin the unit mix a udes a numbe eholds that de Unit Type One Bedroom One Bedroom wo Bedroom otal feet Office/ d to be approx ment would b mplated for th ARE FOO and average s t of this deve et analysis ha but still desir Assisted Living Bedroom Bedroom + D Bedroom o Bedroom ng and average s r of One Bed esire a larger m m + Den m /Retail ximately 6,50 be sufficient to he balance of OTAGE square footag lopment cont s indicated a re a larger ho Num g 38 Den 8 34 80 32 8 40 120 square footag droom + Den housing spac Num 39 14 13 66 00 square feet o house and o the site. S ges for the va tains a numbe market for la ousing space. mber Ave 750 900 1,01 875 535 750 575 775 ges for the va n and Two Be ce and enhanc mber Ave 750 900 1,01 835 t in size. The office medica rious unit typ er of One Be arger units in Please see S erage S.F. 5 rious unit typ edroom apart ce the market erage S.F. 5 e final size wil al-type user co Red pes in Phase I edroom + De the Richfield ection F (Mar pes in Phase I tments. Thes tability of the ll be subject t omplimentary Cedar Poin developmen . Note that n and Two d area, as rket Letter) I. Similar to se larger unit e property. to market y to the t t UN Sherm will m the d All th mech prog orien Addit Mt. C partn and c Luthe The f Pha The a build comm salon and l In-un    Whe in mi that c NIT & B man Associat make the dev desirability of hree phases w hanical system ram. Addition ntation progra tionally, all th Calvary Luthe nering with da community m eran Church following sum ase I: 120 U attractive des ing itself will munity ameni n; card room, oved ones. nit amenities w  Independe services a heating/co  Assisted L meal plan  Memory C programm outdoor g en building an ind. Our expe cater to the s BUILDIN tes’ proposal elopment an the existing C will benefit fro ms; durable fin nally, building ams. hree phases w eran Church. aycares/schoo members. Plea and Sherman mmarizes the Units Assist sign of the bu feature three ities will be av movie theate will depend u ent Living: O available every ooling; Living: choice with up to th Care: Studio ming and med gardens. assisted care erience has p specific needs NG FEA for the redev attractive and Cedar Point a om a host of nishes, recycl g security syst will benefit fro For Phase I s ols and provid ase see Sectio n Associates a unit and build ted Living uilding offers h e stories and vailable, inclu er and intern upon the unit One-bedroom y two weeks; e of any Indep hree meals pe and One-bed dical care; thre e building, it is rovided us th s of these res ATURES velopment of d desirable pl area and Rich green buildin ed materials tems will be i om a partners specifically, Sh ding intergene on F (Letter o are considerin ding features high-grade co an undergrou ding library; w et lounge; act type; three s , One-bedroo one daily me pendent Livin er day; and em droom privat ee meals per s crucial to ke he knowledge sidents. S Cedar Point lace to live, w hfield as a who g features, in and low VOC ncorporated ship Sherman herman Asso erational activ of Support) fo ng. for each of th onstruction m und parking g wellness, ther tivities progra ervice levels om + Den an eal provided; g apartment; mergency res te apartments day; houseke eep the resid e and expertis features high work and visit ole. ncluding energ C paints, carp and the mult Associates a ociates and its vities is extre or additional he three phas materials and g garage. To ma rapy and fitne amming; outd for househol nd Two-bedro in-unit laund individually t sponse on-sit s with a home eeping; intera ents’ varying se to make sp h-quality desig t. These sam gy-efficient lig pets and adhe tifamily phase anticipates for s developmen emely positive detail on the ses. generous amo ake residents ess center; da door patio; an lds with differ oom layouts a ry equipment tailored healt e 24 hours pe e-like, comfor active kitchen physical, men pecial amenity Red gn and constr e features wi ghting, applian esives; and a r s will provide rming with th nt team have f e for both ho partnership ounts of gree s feel at home ay spa, barber nd guest suite ring needs: available; hou t; individually- h care service er day; rtable setting ; and secure, ntal and emot y and materia Cedar Poin developmen ruction that ll enhance nces and recycling e resident he neighboring found that ousing tenants Mt. Calvary en space. The e, extensive r shop and es for visitors usekeeping -controlled e plan and g; specialized private tional needs al selections t t g s e Pha As w bedro     In-un     Pha The e balan and i ase II: 66 U with the first p oom, One-be  Heated, u  Secured a  Commun  Extensive nit amenities w  Quality, m  Individual  In-unit lau  Potentially ase III: 6,60 exact feature nce of the site nclude appro Units 55+ S phase, Phase I edroom + De underground access; ity and fitness green space. will include th market-rate le ly-controlled undry equipm y walk-up ent 00 square f es of Phase III e. Phase III w opriate parkin enior Livin II will feature en and Two-b parking; s rooms; . he following: evel finishes; heating and a ment; trances for se feet Office/ are to be det will be of simil g facilities for ng high-quality c bedroom layo air conditioni elect units. /Retail termined and ar high-qualit r the tenants. construction outs. Building ng; d will be comp ty constructio and design e g amenities w plimentary to on and design lements. Thi will include: o the senior h n elements as Red s phase will o housing propo the previous Cedar Poin developmen offer One- osed for the s two phases t t AF The f and d T As d prog The incom To th deve For t prop rent/ insuf may such FFORDA following tab discussion of Number of A Units (%) Number of M Rate Units (% Total Numbe Units escribed in t gram requirem majority of h me restrictio he extent fea elopments pr the proposed perties. The /service stru fficient for th be feasible t a strategy w ABILITY le illustrates t affordability i Affordable Market %) er of the Financial ments, apart households t ons are show 1 Bedr 1 Bedr 2 Bedr asible, Sherm rovide a broa d redevelopm costs of pro cture infeasi he service lev o integrate a will increase t Y MATR the affordabil is not applicab Ph 120 Units A 0 120 section (Sec tment rents a that will rent wn below: room room + Den room man Associat ader choice o ment, howev oviding requir ble; current vels that will a number of the complex RIX ity for each o ble. hase I: Assisted Liv 0 (0%) 0 (100%) 120 ction E), Phas and tenant in t at this prop Rent Li $927 $927 $1,11 es desires to of housing op ver, we are p red services government be provided market rate ity of financi of the two ho ving 66 U se II will be f ncomes will b perty will hav mit 7 (sin 7 (sin 1 (sin o develop mix ptions and al roposing dis in Assisted L -support pro d at this deve units into th ng and poten ousing develop Phase I nits 55+ Se 66 (100% 0 (0%) 66 financed with be restricted ve one or tw Income $34,620 – ngle – double $34,620 – ngle – double $34,620 – ngle – double xed-income low the prop stinct market Living develo ograms for A elopment. D he Phase II (5 ntially drive t pment phases II: nior Living %) ) h Housing Ta d to 60% Are wo members; Limit $39,540 e occupancy) $39,540 e occupancy) $39,540 e occupancy) housing com perty to targ t rate and aff opments mak Assisted Livin Depending on 55+ Senior ) the need for Red s. Phase III is Tot 66 (3 120 (6 186 ax Credits. A ea Median Inc the current ) ) ) mmunities. S get a broade fordable hou ke an afforda ng communit n market con developmen r additional g Cedar Poin developmen s Retail/Office tal 5%) 65%) 6 As per come (AMI). rent and uch r market. sing ble ies are nditions, it nt. However gap financing. t t e r, Attac Concept chment C tual Eleva C.1 ations Red Cedar Poin developmen t t Richfield, MN - Building Entry of South Building facing Northwest n.t.s 5/23/2013 Richfield, MN - Greenspace Rendering of View facing East n.t.s 5/23/2013 Attac Propo chment C sed Site P C.2 Plan Red Cedar Poin developmen t t Richfield, MN - Proposed Site Plan n.t.s 5/23/2013 Richfield Parkway 3-story Senior Living: 120 units (total) Commercial - 6600 sf 3-Story Senior Living: 66 units Taft Park 16th Avenue South PPRO SE OJE ECT ECT TION T T N D IME D ELIN Red NE Cedar Poin developmen t t Pro The f woul Pleas     HRA of De Site A Site P Finan Due Finan Cons Cons Com oject Ti following tab ld envision th se note the fo  All three willingnes  Phase I w strong tod occupancy  Phase II is to apply fo apply for. senior ho Hennepin Met Coun Minnesota  Phase III’s hence we A Selection eveloper Assembly/ Preparation ncing Diligence ncing Closing/ struction Star struction mpletion imeline le describes t at the three ollowing regar phases’ timin s of current o ould commen day, Sherman y before othe s dependent u or. The follo The timing o using. Source County AHI ncil LCDA/LH a Housing RF s full value and are proposin 120 Uni Septembe January / rt the anticipate phases would rding the anti g are directly owners to se nce as soon a n Associates w er potentially upon applicati owing are the of this phase F/TOD HIA FP d potential w ng to develop Phase I: its Assisted June 2013 er 2013 – Ap y 2014 – May May 2014 May 2015 d timeline for d occur in suc cipated timel y correlated t ll; as possible. W would look to competitive ion/award dat anticipated a is less sensitiv A will be demons p it last. Living 6 pril 2014 S y 2014 r each of the ccession. ine: to the time re While the dem o begin const properties ca tes for deferr application/aw ve because th Applications February 20 April 2014 June 2014 strated when Pha 66 Units 55+ June September 20 February 20 Apr Apr three develo equired to ass mand for Seni ruction and h ame to fruitio red loan/gap ward dates for he market is e s Due 014 4 4 the first two ase II: + Senior Liv e 2013 013 – April 20 14 – April 20 ril 2015 ril 2016 opment phase semble the si ior Assisted L have the prop on; resources Sh r sources She expected to r Aw o phases are c ving 6 014 Sept 015 Ju Red es. Sherman A te, including t Living within t perty available erman Assoc erman Associ remain deep wards Anno May 2014 November 2 October 20 complete and Phase ,600 SF Ret June 20 tember 2013 ly 2015 – Oc October June 20 Cedar Poin developmen Associates the the market is e for ciates intends ates would for affordable ounced 4 2014 014 d occupied, III: tail/Office 013 – April 2014 tober 2015 2015 016 t t s e 4 IN S FI NFO ECT NA OR TIO ANC MA N E CIA ATIO E AL ON Red N Cedar Poin developmen t t FIN The f Land Cons Soft C Total First Equity HTC TIF GAP Total Phas Phase expe see a deve requ reque show Chall othe Phas Phase gap/d credi bond Hous defra for th numb Minn awar for a NANCIA following tab Acquisition struction Costs Uses Mortgage y/Def. Fees Equity * Sources se I: 120 U e I will be con erienced deve attached for a lopment team irements, we esting the HR wn above repr lenges and St r phases. se II: 66 Un e II will be fin deferred loan it-enhanced b ds for the pro sing. As with ay developme he project. In ber of funder nesota Housin rds are shown dditional disc AL le illustrates t Phas 120 Units As $1,344,000 $15,990,000 $4,570,000 $21,904,000 $17,523,200 $1,439,100 -- $1,250,000 $1,691, 700 $21,904,000 Units Assiste nventionally/b elopment team an initial comm m and the Ric do anticipate RA create TIF resents our e rategies,” bel nits 55+ Sen nanced by a co resources. T by HUD. “4% oject. These c h Phase I, Sher ent costs and n order to fill rs, including th ng (Consolida n in the Sectio cussion on ou the anticipate se I: ssisted Living (80%) (7%) (6%) (7%) ed Living bank-financed m, we anticipa mitment lette chfield market e a funding ga F Housing Dis estimate of th ow, for addit nior Living ombination o Tax exempt b %” housing tax credits differ rman Associa fill funding ga l the remainin he Met Coun ated RFP). Th on D (Timelin ur strategy for ed developme Ph 66 Units 55 $1,008,000 $6,760,000 $3,442,000 $11,210,000 $4,556,530 $577,541 $2,565,967 $750,000 $2,759,962 $11,210,000 d. Due to the ate such a pro er from Brem t. Due to cos ap for this pro strict to defra e TIF potenti tional discussi of tax exempt bonds may be x credits will from compet ates would an aps. The $750 ng funding gap cil (LCDA an he anticipated ne). Please se r closing the f ent sources an ase II: + Senior Living 0 (41% (5% (23% (7% (24% 0 e strong dema oject will be f mer Bank, illus sts inherent i oposal. In ord ay developme ial for the pro ion on our st t bonds, hous e issued by th be “automat titively award nticipate requ 0,000 shown p, we would a nd/or LHIA), H d timing for e ee “Discussio funding gap fo nd uses for e g Ph 6,600 SF $336,000 $865,000 $175,000 $1,376,000 %) $1,100,800 %) $275,200 %) -- %) -- %) -- $1,376,000 *See and for this h favorably view strating their n redevelopm der to the fill ent costs and oject. Please trategy for clo ing tax credit he HRA or an tically” be gen ded “9%” hou esting the HR above repres anticipate ma Hennepin Co ach of these on of Financin or this and th ach phase. ase III: Office/Retail 0 0 (80%) (20%) 0 discussion bel housing type i wed by our le interest in th ment along w l the gap, we fill the fundin see “Discuss osing the fund ts, developer nother issuer nerated by the using tax cred RA create a T sents our est aking deferred ounty (AHIF a funding sourc ng Challenges he other phas Red T $2,688,000 $23,615,000 $8,187,000 $34,490,000 $23,180,530 $2,291,841 $2,565,967 $2,000,000 $4,451,662 $34,490,000 low for how th in the City, al ending partne he developme ith the site as would anticip ng gap. The $ sion of Financ ding gap for t equity, TIF a and will be li e issuance of dits allocated TIF Housing D timate of the d loan reques and/or TOD) ces’ applicatio and Strategie ses. Cedar Poin developmen Total 0 0 0 (67% (7% (7% (6% (13% 0 his will be filled long with the ers. Please ent type, the ssembly pate $1,250,000 cing his and the nd other kely be tax exempt by Minnesota District to TIF potential sts to a and ons and es,” below, t t %) %) %) %) %) d. a Phas Phase deter Asso antic the s Disc The c deve costs parce requ gap in In or that strate Site Sherm Sherm ultim to Sh The deve   A sim Bloo assign assem se III: 6,60 e III of the de rmined; the d ociates has suc ipated that th site is demons cussion of F costs of assem lopment. Bas s of $2,688,00 els prior to co irements for n collaboratio  Applying partnerin the HRA  Review p Associat  Conside rder to overc provides for egies. Severa Assembly O man Associat man Associat mately be assig herman Assoc HRA acquirin lopment beca  Reduce ho exempt an  Reduce ri developer milar strategy mington HRA ned the agree mbled and pre 00 square fe evelopment w development ccessfully dev his third phas strated. Financing C mbling and pr sed upon acq 00 for the par onstruction s the developm on with the H g for Met Cou ng with other A would likely project design es and Kaas-W r creative str ome the chal an economica al options are Option 1, H tes proposes tes will offer r gned to the H ciates. ng and owning ause it will: olding costs f nd the HRA c sk: carrying r. was successf A, the develop ements to the epared site to eet Office/R will be conven could be a bu veloped nume e would take Challenges reparing the v uisition and r rcels not yet start and to d ments, particu HRA; ideas inc uncil funds for r cities on this y make such a n for value en Wilson can e ategies for sit lenge of asse ally feasible p e described be HRA Acquire to negotiate relocation be HRA and it wo g the propert for the develo can maintain t multiple parc fully used at t per for this p e HRA; the H o the develop Retail ntionally/bank uild-to-suit fo erous other m better shape s and Strat various parce relocation cos acquired by t emolish the e ularly for Phas clude: r site assemb s kind of stra a request com ngineering item ngage the HR te assembly: s mbling the va project, Sherm elow for cons es Propertie purchase agr enefits compa ould acquire t ties in the int opments: und the parcels w cels for an ind the Penn-Ame property nego HRA then acq per at fair ma k-financed. Th r an owner-o mixed-use dev e after Phases egies ls for develop sts provided the HRA. Ad existing struc se II. Sherma ly: Sherman tegy. The loc mpetitive for M ms: with a pr RA on design see below for arious parcels man Associate sideration. es and Conv eements with rable to thos the propertie erim the prop der HRA own with the other determinate a erican Redeve otiated agreem uired the par rket value. he ultimate st occupant or c velopments s s I and II were pment repres by the HRA, dditional costs ctures. These an Associates Associates ha cation, densit Met Council f riority on qua and construc r additional d s and preparin es would like veys Fee Sim h the owners se offered by es, prepare th perties is imp nership, the p rs it already o amount of tim elopment in B ments to purc rcels, demolis tructure of th could be lease such as propo e completed a sent extraord we would an s would be in e costs are dr will creative as successfull ty, mix of inco funds; ality and desig ction conside detail. ng them for d to work with mple to Dev of the remai the HRA. Th hem for devel portant to the properties wo owns; me presents a Bloomington. chase the disp shed existing Red his phase is ye ed to a tenant osed at Cedar and the full-p dinary costs fo nticipate total ncurred to ma riving the gap ly work to fil y partnered a omes and inv gn maintained rations; development h the HRA on veloper ining lots not he agreement lopment and e feasibility of ould potentia high-risk for . According t parate parcel properties an Cedar Poin developmen et to be t. Sherman r Point. It is potential for or the acquisition aintain the financing l the financing and is volvement of d, Sherman in manner n creative yet acquired ts would convey them f the ally be tax- the to staff at the s and nd sold the t t g . e Site As w parce Asso Unde woul finan prese lease Pleas deve may Assembly O with Option 1 els needed fo ociates’ purch er this option ld be long-ter cial benefit to ent value if m e payments via se note that in lopments’ pro include it bei Option 2, H , Sherman As r the develop ase agreemen n, the propert rm and result o the develop mortgaged by t a bonds or so n addition to ospective len ng long-term HRA Acquire ssociates wou pment. Reloc nts and take t ty would be c t in annual pay pments would the developm ome other inv the HRA’s an ders and inve (50-99 years es Propertie uld work dire cation would title the land. conveyed to S yments from d be realized i ment. Depend vestment veh nd Sherman A estors would s), non-cancel es and Conv ctly with the be offered. T Sherman Asso the developm if the lease pa ding on the va hicle to recou Associates’ re have addition llable and sub veys via Gro sellers to neg The HRA wo ociates via a G ments to the ayments paid alue of lease up a portion o equirements f nal requireme bordinate to m round Lease gotiate purch ould ultimately Ground Lease HRA, rather from operati payments, th of its costs. for the Grou ents as to its mortgage deb Red e to Develop hase agreeme y be assigned e. The Grou than a one-ti ions were les e HRA may m nd Lease stru structure. R bt and investo Cedar Poin developmen per nts on the Sherman nd Lease ime sale. The ss than its monetize the ucture, the Requirements or equity. t t e D A DO S AD OCU ECT DDIT UME TIO TIO ENT N F ONA TAT F AL TIO Red ON Cedar Poin developmen t t Lettter of Sup Attac pport – M chment Mt. Calvar F.1 ry Lutheraan Churc Red ch Cedar Poin developmen t t Lette Attac er of Inte chment rest – Br F.2 remer Bannk Red Cedar Poin developmen t t Attac Richfield chment Market L F.3 Letter Red Cedar Poin developmen t t Viewpoint Consulting Group, Inc. / 9104 Barrington Terrace / Brooklyn Park, MN 55443 P. 763-273-4303 / www.viewpointconsult.com May 23, 2013 Mr. Brad Goering Sherman Associates 233 Park Avenue South Minneapolis, MN 55415 RE: Summary of Initial Demand Assessment for Independent, Assisted Living, and Memory Care Housing in Richfield, Minnesota Dear Brad: This letter provides a summary of the findings from an initial demand assessment that Viewpoint Consulting Group, Inc. conducted for senior housing with services on a redevelopment parcel in Richfield. The location for the proposed senior housing is the Cedar Point Redevelopment at 66th Street and 17th Avenue. The purpose of the initial assessment was to broadly assess the depth of demand for market rate senior housing in the local area to determine if potential exists to support a new development. Included in the initial assessment were specific demand calculations for three service-levels: congregate independent (“independent”), assisted living, and memory care housing. Potential demand was calculated based on analysis of the income/asset-qualified target market for market rate senior housing and the supply of competitive senior housing units serving the primary market area. The ability of the proposed development to capture unmet demand in the market area was also estimated in the assessment. Summary of Findings The primary market area (“PMA”) for senior housing on the redevelopment site was defined as Richfield and two zip codes comprising Minneapolis roughly south and east of 46th Street and Penn Avenue – 55417 and 55419. The PMA had a total population of 86,083 in 2010, of which 10,678 were over age 65 and 5,352 were over age 75. As of 2012, the senior population (age 65+) in the PMA is projected to have grown to 10,678 and by 2017 it is projected to reach 12,381. As the PMA’s senior population grows, so too will demand for senior housing. Summary of Initial Demand Assessment for Senior Housing in Richfield, MN Viewpoint Consulting Group, Inc. Page 2 May 23, 2013 Richfield currently contains three senior housing properties offering services that would be competitive with the proposed development. They are Village Shores, The Pines, and Mainstreet Village, which combine for 403 units. There are also several other senior properties just outside the PMA in Edina, Minneapolis, and Bloomington that would be partially competitive due to draw area overlap. Including a portion of these nearby developments, we identified a total competitive supply of 386 independent units, 208 assisted living units, and 51 memory care units serving the PMA. While there are no pending competitive developments in the PMA, the competitive supply of senior housing will increase as new developments near the PMA are under construction or proposed. These include one development under construction in Minneapolis (The Waters on 50th), two proposed developments in Edina (6500 France and Continental Gardens) and one proposed development in Bloomington (Portland Commons). The initial demand calculations for market rate senior housing on the subject Site in Richfield are summarized in the table below. Total unmet demand in the PMA for the three service-levels was projected for 512 market rate units in 2012, but declining slightly due to competition from new developments that will be coming on-line near the PMA in Edina and Minneapolis. The estimated portion of PMA demand that can be captured by the Site is estimated at 35%. In 2017, this equates to demand for 57 independent units, 60 assisted living units, and 49 memory care units, for a total of 165 units. This is market rate (or “private pay”) and does not include additional demand that would come from lower-income seniors utilizing the Elderly Waiver program. Summary of Initial Demand Calculations, Richfield PMA, 2012 to 2017 Total Unmet Demand PMA Competitive PMA on Subject Demand Supply Demand Site Independent Living 561 367 195 68 Assisted Living 379 197 182 64 Memory Care 185 49 136 48 Total 1,125 613 512 179 Independent Living 543 380 162 57 Assisted Living 407 237 170 60 Memory Care 207 68 139 49 Total 1,158 686 472 165 Source: Viewpoint Consulting Group, Inc. 2012 2017 Summary of Initial Demand Assessment for Senior Housing in Richfield, MN Viewpoint Consulting Group, Inc. Page 3 May 23, 2013 To be conservative, we would recommend a building on the Site with only about 85% of the 2017 potential as summarized in the table (or about 140 units). A building with 140 units would need to capture about 30% of unmet demand in the PMA to reach full occupancy (and only 12% of total PMA demand). As noted in initial demand assessment, the purpose of the assessment was to broadly assess the depth of demand for senior housing in the local area to determine if potential exists to support a new development. Thus, the findings are preliminary and should be viewed in that light. A full market feasibility study would more closely examine factors such as the desirability of the subject site and the performance of competitive buildings, both of which may impact demand. Please call me with any questions or if I can be of further assistance. Sincerely, Viewpoint Consulting Group, Inc. Jay Thompson President