03-18-96 agendaCITY OF RICHFIELD, MINNESOTA
MONDAY, MARCH 18, 1996
REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING
COUNCIL CHAMBERS
7:00 P.M.
AGENDA
CALL TO ORDER
APPROVAL OF MINUTES OF REGULAR HRA MEETING OF FEBRUARY 20, 1996
1. OPPORTUNITY FOR CITIZENS TO ADDRESS THE HRA ON ITEMS NOT ON
THE AGENDA
l
2. CONSIDERATION OF FIRST AMENDMENT TO CONTRACT FOR PRIVATE
REDEVELOPMENT; MERIDIAN CROSSINGS, TOLD DEVELOPMENT
COMPANY
HRA LETTER NO. 13
3. CONSIDERATION OF AGREEMENTS RELATED TO MERIDIAN CROSSINGS;
TOLD DEVELOPMENT- COMPANY
HRA LETTER NO. 14
4. PRESENTATION OF INTRODUCTORY STUDY RESULTS REGARDING JOINT
USE FACILITY FOR RICHFIELD AMERICAN LEGION POST AND RICHFIELD
VFW POST BY CONNOISSEUR RESTAURANT MANAGEMENT, INC.
HRA LETTER NO. 15
5. EXECUTIVE DIRECTOR REPORT
6. 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 Administrative
Services Director at 861-9702.
~-'t-u.~~/ a.va i I ab I-~ ~ ~ C ~ D~
.~ f~~~~)
• HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No. 15
Agenda March 18, 1996
Issue Statement:
Presentation of introductory study results regarding joint use facility for Richfield
American Legion Post and Richfield VFW Post by Connoisseur Restaurant
Management, Inc. (CRM).
Background:
In December 1995 the HRA retained the services of CRM to determine the feasibility of
the American Legion and VFW jointly using a single facility. They would operate a club
and banquet facilities jointly and each post separately.
Attached is a copy of the first phase of the report known as the introductory study which
relates to the probable financial viability of a facility, Pages two and three contain the
executive summary. The study concludes that a point club would be viable if it were
designed to contemporary standards and operated on the basis of a sound business
plan.
Recommended Motion:
Discuss the presentation made by Mr. Jim Domoracki, President. of CRM, regarding the
introductory study results regarding the joint facility for the American Legion and VFW.
Basis of Recommendation:
1. The HRA retained the services of CRM to determine. the feasibility of a jointly used
facility.
2. It would be appropriate to hear a verbal presentation of the report and ask
questions regarding the conclusion.
3. The working group of American Legion and VFW officials recently reviewed the
report and concurred with virtually all of its findings.
Alternative Recommendation:
1. Refuse to hear the report.
2. Delay presentation of the report.
Discussion/Decision- Mode:
With completion of the introductory feasibility phase, CRM has undertaken the initiation
of the advanced feasibility phase. This phase will include interviews of existing active
and inactive members, collection of data from surrounding restaurants and specific
information needed to identify a site. This phase will cost approximately $12,000 and
will be completed in about 60 days.
Respectful ubmitted,
James rosser
Executive Director
JDP:cak
HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No. 14
Agenda March 18, 1996
Issue Statement:
Consideration of agreements related to Meridian Crossings; TOLD Development
Company.
Background:
At the February meeting, the HRA reviewed a status report on several items which are
pre-conditions to closing. The attached documents are being proposed to implement
the pre-conditions which need to be carried forward.
The letter dated March 19, 1996 (attached) lists all the items which need to be carried
forward and some which require a separate document (attached as Exhibits A, B and
C). The letters in parenthesis below relate to the points in the March 19, 1996 letter.
Paragraph (a) and points 1. and 2. relates to the wetlands, utility relocation and traffic
signalization the costs of which will be specially assessed. Exhibit A is the Petition and
Waiver Agreement whereby TOLD would .request that assessment. Initially the
assessment would be spread against Parcel I. Parcel II would be included when
construction proceeds. If the assessments are not paid the HRA may deduct payments
a' from the tax increment. (The attachments identified. in the Petition and Waiver
Agreement are not yet available).
Paragraph (b) and points 1. and 2. relate to the entry and exit points of the site. The
Release-and Waiver (Exhibit B) is to be signed by TOLD. TOLD agrees to not claim
damages from MNDOT or the City should it become necessary for the frontage road
access point to be relocated.
Paragraph (c) and points 1., 2. and 3. provides for the construction of the interior site
traffic circulation system. Exhibit C is the Declaration of Covenants, Conditions,
Restrictions and Maintenance Agreement For A Private Road. This declaration makes
it possible for the City to repair and maintain this roadway system and assess the
related costs against the property. This would only be implemented if TOLD was
negligent in this regard.
In paragraph (d) points 1. and 2. TOLD is agreeing to "protect and preserve" the mature
trees on the site.
Paragraph (e) indicates that TOLD agrees to incorporate into their site the trees located
on the northeast edge of the site (previously the area was identified as an outlot and
would have been owned by the HRA).
Paragraph (f) indicates that TOLD fins the site to be environmentally acceptable.
Some residual soil from the Total Petroleum site must be removed by the HRA. When
the asphalt was installed last fall on the Total Petroleum site to create a parking surface
the top soil was scraped away and dumped on the Cloverleaf site. Even though the so
is clean it is "foreign" from the perspective of a Phase I environmental report sign off.
Paragraph (g) indicates that sewer utility, relocation work will be specially assessed in
accordance with Exhibit A. The cost of telephone and electrical relocation work will be
"front ended" by TOLD and reimbursed through TIF.
it
Paragraph (h) discusses project progress review. (The Contract For Private
Development calls for commencement of Phase I construction no later than 30 days
after closing. Phase II construction is to begin no later than November 4, 1998 or one
year following completion of Phase I whichever is later).
Recommended Motion:
Approve the attached letter dated March 19, 1996 as well as the Exhibits A, B and C
attached.
Basis of Recommendation:
1. The Contract For Private Redevelopment identifies the above items are pre-
closing conditions..
2. The attachments including the March 19, 1996 letter and Exhibits A-C are to
provide a means for concluding the pre-conditions.
3. These items have been negotiated with TOLD.
Alternative Recommendation:
1. Delay consideration.
2. Refuse to act.
Discussion/Decision Mode:
To proceed with marketing TOLD needs these items to be concluded.
Respectfully submitted,
James rosser
Executive Director
JDP:cak
.J
Community Development
6700 Portland Avenue • Richfield, Minnesota 55423-2599
City Manager Mayor Council
James D. Prosser Martin Kirsch Don Priebe Michael Sandahl
Susan Rosenberg Russ Susag
March 19, 1996
Mr. Ralph O. Robinson, Chairman
TOLD Development Company
Wedgwood Commerce Centre
6900 Wedgwood Road, Suite 100
Maple Grove, MN 55311
Subject: Meridian Crossings -City of Richfield
Dear Ralph:
The Contract for Private Redevelopment between the Richfield HRA and Meridian
Properties ("TOLD") required that the parties come to agreement on a number of
specified issues within 90 days of the Contract's execution by all the parties.
Because we were close to agreement on those various issues, but not quite there, the
deadline was extended to April 15, 1996.
This letter is intended to serve as a memorandum of understanding regarding the
agreement which TOLD and the HRA have now reached concerning the matters discussed
below. If this letter fully, completely and accurately reflects your understanding, please
indicate that by executing this letter at the space provided for you below, and returning a
signed copy to me.
For the sake of clarity, 1 will outline our understandings as they relate to the various
paragraphs of Section 3.2.
(a) the portion of the wetland locate d on the Phase 11 Property which the HRA_ is
willing and leg~(y entitled to fill, the allocation of the costs of such activity and the
method for financing such costs, and whether, in the reasonable jsdgment of the
Redevelop, the Phase 11 Prosy, i ncluding the wetland area to be filled, is of
sufficient area and configuration to s upnort the ~ronosed Phase 11 Minimum
Imnrovements.
•
The Urban Hometown
Telephone (612) 861-9760 • Fax (612) 861-8974
General City Matters: 861-9700
An Equal Opportunity Employer
Mr. Ralph O. Robinson, Chairman
March 19, 1996
Page 2
1. The HRA has determined that, subject only to obtaining approval from the City
of Richfield, it is legally entitled to fill the entire wetland located on the Phase II Property.
We understand that the request for City approval is in process, and should be obtained
prior to Closing. TOLD has informed the HRA that sufficient area and configuration exists
on the Phase II Property to Support the Phase 11 Minimum Improvements; and that
hopefully, sufficient area also exists to preserve a portion of the wetland.
2. The costs and expenses which are involved in the. filling of the wetland are to be
the responsibility of TOLD. The HRA and TOLD anticipate that the wetland work along
with part of the utility relocation and the traffic signalization projects will be performed by
the City as an assessable public improvement project. This understanding is contained in
detail in the attached petition and waiver agreement ("Exhibit A").
Exhibit A will be put in final form and submitted to the City Council in time to be
considered prior to the Closing. In the event that TOLD, or a successor, fails to make the
special assessment payments, the HRA will be entitled to apply any payments due under
the Limited Revenue Note for Phase I, or any amount due TOLD upon the repurchase of
the Phase II Property, necessary to cover any non-payment and secure any future payment..
(b) the location of any entry and exit noints from and to the Redevelo m n
Property and adjacent nublic roadways, together with any sienalization for such
entry and exit points and the allocation of the cost and the method for financing th,~
cost of such si~alizaiton.
1. The TOLD Site Plan submittals which are in the process of review by the City
staff depict the various proposed entry and exit points and are acceptable to the HRA.
Issues relating to the south access point on the Frontage Road are addressed in the Release
and Waiver Agreement ("Exhibit B") which will be executed as a part of the Closing.
2. The design work for the signalization and related intersection work is in process
and will be finalized. along with Exhibit A; which also provides that TOLD pay the entire
cost of that improvement. The right of the HRA to utilize alternate sources to cover
and/or secure any non-payment would be the same as described above with reference to
paragraph (a).
(c) The Incation.~yout and design of any interior traffic circulation systems for the
phases and the timing and constnaction of the same.
Mr. Ralph O. Robinson, Chairman
March 19, 1996
Page 3
1. The TOLD Site Plan submittals which are currently under consideration by the
City .adequately show the features required by this paragraph.
2. The interior traffic circulator system serving both phases is to be constructed by
TOLD along with the construction of the Phase 1 Minimum Improvements. No Certificate
of Completion is to be issued for Phase 1 until the system is substantially completed.
3. At Closing, the TOLD will execute and deliver Exhibit C to the City.
(d) the landscapLe plan for the two phases and the timing and installation of the
same.
1. The TOLD Site Plan submittals which are currently being considered by the City
adequately describes the landscape plan and its installation.
2. TOLD is agreeing to utilize its best efforts to protect and preserve the mature
trees located on the Redevelopment Property. TOLD will work with the City's- forestry
staff during construction to protect trees from constnaction activities. Thereafter, TOLD
will avoid, whenever possible, the removal of mature trees from its property, and will,
whenever possible replace mature trees which are removed.
(e) whether either of the separate parcels of land lying to the northeast and
northwest of the Redevelopment Property would be included in the transaction and
added to the legal description of the Redevelopment Property..
1. The parcel lying to the northeast will be included in Phase II. The plat which is
being processed by the City makes that incorporation. We may decide to amend the
Contract to utilize the legal descriptions which are contained in the plat. The northwest
parcel will not be incorporated into the Redevelopment Property. These activities do not
change the purchase price of the Redevelopment Property.
(f) the condition of the Redevelopment Property with respect to environmental
contaminations and pollutions and the obligations and responsibilities of the ap roes
with respect to remediation; if any.
1. TOLD has conducted its environmental review of the Redevelopment Property
and accepts the same in its present condition (except as to #2 below). TOLD agrees to
release the HRA, its officers, agents and employees from any claims or causes of action
Mr. Ralph O. Robinson, Chairman
March 19, 1996
Page 4
occasioned by or arising out of the presence of environmental contamination or pollution
on or under the Redevelopment Property except as to those which the HRA either placed
or knowingly permitted to be placed thereon.
2. Prior to Closing the HRA will remove from the Redevelopment Property the
foreign soil which was placed thereon following removal from a location known as the Total
Petroleum Site. The removal will be conducted in compliance with all laws and regulations;
and at the sole cost and expense of the HRA. The HRA will supply TOLD with any
documentation reasonably necessary to establish the proper removal of the foreign soil, and
payment of the full cost for the removal
(g) the nat~~re, location and cost of removal or relocation of any utilities currently
located on the Redevelopment Property which are required to be removed and
relocated due to construction of the Minimum Improvements and the allocation .and
financing of the cost of such activities.
• 1. The sewer work will be done in accordance with the agreement contained in
Exhibit A.
2. The telephone and electric work will be done by the utilities providing that
service.. The initial cost will be paid by TOLD and reimbursed through payments under the
Phase. I Note. The Note for Phase I will be increased by the cost of such work which is
estimated to be $20,000.
(h) ~h~process bkwhich the HRA may review and evaluate the Redeveloper's
progress during the periods described in Section 3.4 and 4.5A: and the actions
available to the HRA if it determines that the Redeveloper is not proceeding wi h
due diligence during such erp iods.
1. During the periods described in the two referenced sections, the HRA and
TOLD will meet at intervals established by the HRA to review the progress of TOLD in
accomplishing the activities required to commence construction of the Minimum
Improvements. TOLD agrees that it will utilize its best efforts and do those things which
are generally recognized in the trade as appropriate in accomplishing those objectives.
2. We believe that the agreements between the HRA and TOLD contain sufficient
incentives to motivate TOLD to utilize its best efforts to construct both phases.
Mr. Ralph O. Robinson, Chairman
March 19, 1996
Page 5
Ralph, on the basis of the foregoing, 1 am happy to state on behalf of the HRA that the
preconditions contained in Section 3.2 of the Contract have been satisfactorily resolved as
above described.
Much remains to be done, but 1 am satisfied that the working relationship which TOLD and
the HRA have established will serve us well as we move forward.
Respectfully yours,
James D. Prosser
Executive Director
JDP:js
The undersigned, on behalf of TOLD has read this letter and the attached agreements and
agrees that they do fully and completely reflect the understandings of TOLD with respect
to the matters which they contain.
[H:CdAdmin:L-Robins]
Exhibit A
PETITION AND WAIVER AGREEMENT ("Property")
THIS AGREEMENT made this day of 1996 by and
between MERIDIAN PROPERTIES REAL ESTATE DEVELOPMENT L.L.C., a
Minnesota limited liability .company d/b/a TOLD DEVELOPMENT COMPANY
(hereinafter "TOLD"), THE HOUSING AND REDEVELOPMENT AUTHORITY IN
AND FOR THE CITY OF RICHFIELD, a Minnesota public body corporate
and politic (hereinafter "HRA") (the HRA and TOLD are herein
referred to collectively as "Petitioners") and THE CITY OF
RICHFIELD, a Minnesota municipal corporation (hereinafter "City").
WITNESSETH:
WHEREAS, the HRA is the owner of that certain tract and parcel
of land which is legally described as Lots 2 and 3, Cloverleaf
Addition; and
WHEREAS, the HRA and TOLD have entered into a document
entitled Contract for Private Redevelopment _("Contract") calling
for the sale by the HRA to .TOLD of the Property and for the
redevelopment of the Property in phases; all as is fully set forth
in the .Contract; and
WHEREAS., it is the desire of the Petitioners that the City
undertake certain assessable improvements ("Improvements").which
are required in furtherance of the redevelopment project envisioned
in the Contract through a city project ("Improvement Project"); and
WHEREAS, .the Petitioners wish the City to undertake the
Improvement Project without notice of hearing or hearing on the
Improvement Project, and without notice of hearing or hearing on
the special assessments levied to finance the Improvement Project
and to levy 100 percent of the cost of the Improvement Project
against the Property as hereinafter provided; and
WHEREAS, the City is willing to construct the Improvement
Project in accordance with the request by the Petitioners and
without, such notices or hearings, provided the assurances and
covenants hereinafter stated are made by the Petitioners to ensure
that the City will have valid and collectable special assessments
as they relate to the Property to finance the cost of the
Improvement Project; and
WHEREAS, were it not for the assurances and covenants
hereinafter contained, the City would not construct the Improvement
Project without such notices and hearings and is doing so solely at
the behest, and for the benefit of the Petitioners.
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RC125-66
NOW, THEREFORE, on the basis of the mutual covenants and
agreements hereinafter provided, it is hereby agreed by and between
the parties hereto as follows:
1. The Petitioners hereby petition for the undertaking of
the Improvement Project consisting generally of the elements
contained in the attached Exhibit A ("Improvement Plan").
2. Petitioners represent and warrant that the HRA is
currently the owner of l00 percent of-the Property; and that on
sale to TOLD, TOLD will become. the owner of 100 percent of the
Property, and that Petitioners have the full legal power and
authority to encumber the Property as herein provided, and that as
of the date hereof, the HRA has fee simple absolute title in the
Property which is not subject to any liens, interests or
encumbrances, except as listed on the attached Exhibit B
("Encumbrances").
3. The Petitioners request that 100 percent of the. cost of
the Improvement Project be assessed against the Property as
follows:
a) 100$ of the cost is to be assessed against Lot 3 and
collected together with taxes from Lot ~3 until the year in
which a building permit is issued to TOLD for construction of
the Lot 2 minimum improvements as described in the Contract.
• The assessment. (including the principal balance and accrued
interest) will then be reallocated between Lot 3 and Lot 2 as
requested by TOLD and consistent with standard city assessment
practices.
4. TOLD for itself and the HRA for itself waives notice of
hearing and hearing pursuant to Minn. Stat. $ 429.031, on the
Improvement Project, and the notice of hearing and hearing on the
special assessments levied to finance the Improvement Project
pursuant to Minn. Stat. S 429.061 and .specifically requests that
the .Improvement Project be undertaken and special assessments
levied against the Property therefor without hearings.
5. TOLD for itself and the HRA for itself waives the right
to appeal the levy of special assessments in accordance with this
Agreement pursuant to Minn. Stat. ~ 429.081, car reapportionment
thereof upon land division pursuant to Minn. Stat. ~ 429.071, Subd.
3, or otherwise; and further specifically agrees with respect to
such special assessments against the Subject Property or
reapportionment that:
a)
which the
the HRA;
b)
the Prope;
be in an
Any requirements of Minn. Stat. Chapter 429 with
City does not comply are hereby waived by TOLD and
The increase in fair market value of Lot 3 and of
rty as a whole resulting from the Improvements will
amount at least equal to the total cost of the
JHD101073
RC125-66 2
Improvement Project, aid that such increase in fair market
value is a special benefit to the Property;
c) Assessment of 100 percent of the cost of the
Improvement Project against the Property as outlined above is
reasonable, fair and equitable and there. are not other
properties against which such costs should be assessed; and
d) TOLD. for itself and the HRA for itself specifically.
waives notice and the right to appeal reapportionment of such
special assessments upon land division pursuant to Minn. Stat.
5429.071, Subd. 3.
6. The Petitioners understand that it is the intention of
the~City to provide for the payment of such special assessments in
ten annual installments commencing in 1997; and bearing interest at
that rate of 8.5$.
7. The covenants, waivers and agreements contained in this
Agreement shall bind the successors and assigns of the Petitioners
and shill run with the Property and bind all successors in interest
thereof. It is the intent of the parties hereto that this
Agreement be in a form which is recordable among the land records
of Hennepin County, Minnesota and they. agree to make any changes to
this Agreement which may be necessary to effect the recording and
filing of this Agreement against the title of the Property.
8. This Agreement shall terminate upon the final payment of
all special. assessments levied against the Subject Property
regarding the Improvement Property and the City shall execute and
deliver such documents, in recordable form, as are necessary to
extinguish the rights hereunder.
9. Notwithstanding any other provisions herein to the
contrary, .the City may not enter into the. contracts for the
Improvement Projectuntil the Petitioners have each been given 15
days to review and object to the costs thereof.
10. The City will let no contract for the Improvement Project
if such objection is made until and .unless such objection is
subsequently withdrawn.
11. Absent the written consent of both TOLD and HRA, no part
of the Improvement Project described in Exhibit A can be removed in
awarding the contracts.
i
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RC125-66 3
•
•
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD,
MINNESOTA
By:
Its Executive Director
By:
.Its Commission Chairperson
MERIDIAN PROPERTIES REAL ESTATE LLC
By:
Its
By:
Its
CITY OF RICHFIELD, MINNESOTA
By:
Its
By.
Its
ACKNOWLEDGEMENT
•
IN WITNESS WHEREOF, the parties have set their hands the day
and year first above writ en.
STATE~OF MINNESOTA )
SS.
COUNTY OF )
The foregoing instrument was acknowledged before me this
day of , 199.6, by and
respectively, the Executive Director and
Commission Chairperson of-the Housing and Redevelopment Authority
in and for the City of Richfield, a Minnesota public body corporate
and politic, on behalf of the Authority.
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AC125-66
Notary Public
4
STATE OF MINNESOTA )
SS.
COUNTY OF )
The foregoing instrument was acknowledged before me this
day of , 1996, by and
,respectively, the
and of Meridian Properties Real Estate LLC,
a Minnesota limited liability company.
Notary Public
STATE OF MINNESOTA )
SS.
COUNTY OF )
The foregoing instrument was acknowledged before me this
day of 1996, by , and
respectively, the and
of the City of Richfield, Minnesota, a
Minnesota municipal corporation.
Notary Public
This_Instrument Was Drafted By:
KENNEDY & GRAVEN, CHARTERED (JBD)
470 Pillsbury Center
Minneapolis, Minnesota 55402
612-337-9300
JBD101073
RC125-66 5
Exhibit B
RELEASE AND WAIVER
I. RECITALS
1. The undersigned is the owner of a tract of land legally described- in the
attached Exhibit A ("Property") .
2 . The Property is abutted on the south and west by a dedicated roadway
running between Lyndale Avenue on the east and Interstate Highway 35W on the west
which is generally referred to as the North Frontage Road ("Road") .
3. The Minnesota Department of Transportation ("MN/DOT") has under
review various options for the redesign of 35W and various adjacent roads including
the Road . Certain of the optional designs would call for. the removal of the Road and
the resulting impact on the ingress and egress to and from the Property along its
southerly boundary. The undersigned does understand however, that ingress and
egress locations will be made available to replace. the lost ingress and egress,
although not likely at the same. location.
4 . MN /DOT is requiring, in anticipation of future activities to be
undertaken on .the Road that the undersigned waive and release any claim which it
may have caused by the loss of access to the Road.
II. WAIVER AND RELEASE
On the basis of the foregoing, and on the payment of one. dollar and other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the undersigned, for itself, its tenants and its successors and
assigns to .the Property hereby waives and releases the Minnesota Department of
Transportation, the State of Minnesota, together with any other government agency
or authority having jurisdiction over the Road or Interstate Highway 35W, the City
of Richfield the Richfield Housing and Redevelopment Authority and their respective
officers, agents and employees from any claim, or cause of action, of whatever
JBD101708
RC125-66 1
nature known or unknown, occasioned by or arising out of the temporary and
• permanent removal of access and ingress and egress to and from the Road.
MERIDIAN PROPERTIES REAL ESTATE
DEVELOPMENT L.L.C
By
Its
By
Its
ACKNOWLEDGIIVIII~TT
On the day of 1996, and
• personally known to me .appeared before me and
acknowledged that they were the and ,
respectively of MERIDIAN PROPERTIES REAL ESTATE DEVELOPMENT L.L. C, a
Minnesota limited liability corporation and that they have executed the foregoing
investment on behalf of the Corporation.
Notary
•
JBD101908
- RC1Z5-66 Q,
Exhibit C
• DECLARATION OF COVENANTS, CONDITIONS, RESTRICTIONS
AND MAINTENANCE AGREEMENT-FOR A PRIVATE ROAD
THIS DECLARATION is made on the date hereinafter set forth by
the between Meridian Properties Real Estate Development L.L.C., a
Minnesota limited liability company d/b/a TOLD Development Company
("Owner") and the City of Richfield ("City")..
WITNESSETH:
WHEREAS, Owner is the .owner of certain land located in
Richfield, hereinafter called the Property, which land is described
on Exhibit A, attached hereto and made a part hereof by reference;
and
WHEREAS, the Owner wishes to develop the Property and provide
access thereto by means of a privately-owned and maintained road
which will not be accepted by the City for maintenance.
NOW THEREFORE, the Owner hereby declares that the Property
shall be held, sold and conveyed subject to the following
easements, conditions, agreements and restrictions which are for
• the purpose of providing ingress and egress to the Property, and
which shall run with the .land described as the Property, and which
shall be binding on all parties having. any right, title or interest
in the land so described, or any part thereof, their heirs,
successors and assigns, and which shall .inure to the .benefit of
.each owner thereof and to the City.
ARTICLE I: DEFINITIONS
Section 1.1. City. The City of Richfield, a municipal
corporation under the laws of the State of Minnesota.
Section 1.2. Owner. Means Meridian Properties Real Estate
Development L.L.C., a Minnesota limited liabi?.ity company d/b/a
TOLD Development Company and. any successor in ownership to either
Lot 2 or Lot 3, Block 3, Cloverleaf Addition or both.
Section 1.3. Private Road. The grade, base, surface,
ditches, culverts and other elements and appurtenances which create
a driving surface upon the Road Easement which is suitable for
vehicular traffic.
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RC125-66
• Section 1.4. Lot. Lot 2 or 3, Block 3, Cloverleaf Addition.
Section 1.5. Road Easement. The right-of-way .over Lot 3,
Block 3, Cloverleaf Addition for the purpose of .ingress and egress
and which is legally described as set forth in Exhibit A, attached
hereto and made apart hereof by reference.
ARTICLE II: PROPERTY RIGHTS
.Section 2.1. Owner's Easement Rights. Every owner of either
Lot shall have an easement for ingress and egress in and to the
Road Easement. Said easement shall be appu=tenant to and shall
pass with the title to each Lot.
Section 2.2 Delegation of Use.. An owner may delegate the
said right to use the Road Easement to tenants, guests and
invitees.
ARTICLE III:
COVENANTS FOR CONSTRUCTION, RECONSTRUCTION, MAINTENANCE
AND REPAIR
Section 3.1. Construction and Repair. The Owner hereby
agrees to construct, reconstruct, maintain and repair a Private
Road on the Road .Easement and acknowledge that the City has no
obligation to construct, reconstruct, maintain and repair a Private
Road, and that the City does not intend to acquire or open said
Private Road as a public roadway.
Section 3.2. Payment of Costs. The Owner hereby assumes and
agrees to pay the cost of construction, of the Private Road -and
hereby assumes and agrees to pay an equal share of the
.reconstruction, maintenance and repair of the Private Road. Such
construction, reconstruction, maintenance and repair shall meet
JHD101136
RC125-66 2
minimum standards set forth in the specifications for private roads
approved by the City .and as required by the ordinances of the City.
Section 3.3. Lien and Obligation for Assessments. The Owner
hereby covenants and agree to pay assessments established with
respect to each Lot, together with interest, court costs, and
reasonable attorneys' fees required for collection thereof, which
assessment shall be a charge on that Lot and shall be a continuing
lien upon that Lot. Each assessment, as described above, shall
also be the personal obligation of the Owner of the Lot when the
assessment falls due. The personal obligation for delinquent.
assessments shall not pass to an Owner's successor in title .unless
expressly assumed by such successor. Such assessments shall be for
the .exclusive purpose of the reconstruction, maintenance and repair
of the Private Road.
Section 3.4. Payment Costs. Each Owner's share of such
assessments shall be due and payable 30 days after notice thereof
from the person or entity rendering an account for the costs of
such construction, reconstruction, maintenance and repair. The
assessment shall bear interest at the rate of 8~ per annum from the
due date to the date of payment. Any Owner may bring an action on
behalf of himself or herself and all other non-defaulting Owners to
collect a defaulting Owner's assessment which has not been paid
when due, and shall be entitled to recover reasonable attorneys'
fees together with all necessary costs and disbursements incurred.
in connection therewith.
Section 3.5. Approval of Plans. The plans, specifications
and the awarding of contracts for the construction, reconstruction,
JHD101136 3
AC125-66
maintenance and repair of the Private Road shall be approved in
writing by the ,City. No Owner may be except from the assessment by
waiving the use or enjoyment of the Private Road or by abandonment
of the Lots.
ARTICLE IV: RIGHTS OF THE CITY
Section 4.1. Right of Repair. The covenants, conditions and
restrictions of this Declaration shall inure to the benefit of the
City. In the event that the Owners fail to reconstruct,
maintenance and repair the Private Road; in accordance-with the
.City's standards, it is agreed by the Owner that the City may, at
its discretion and option, undertake the reconstruction,
maintenance and repair of the Private Road but that any such action
taken by the City will not result in the establishment of a public
• roadway. The Owners further covenant and agree that the costs
incurred by the City under this Section 4.1 shall be divided among
and paid by the Owners in accordance with the formula set out in
Section 3.2., 3.3. and 3.4. of the preceding Article III. In the
event that any Owner shall default in such payment, .the City may,
at its option, assess the costs against the appropriate Commercial
Lot, and certify said assessment to the county auditor and collect
the same in a single payment as in the case of special assessments
for public improvements.
Section 4.2. Conveyance of Easements. The Owner hereby
conveys an easement for ingress, egress, reconstruction,
maintenance and repair over the Road Easement to the City for
response to police calls, fire calls, rescue and other emergency
calls, inspections, animal control, street maintenance and repair,
JBD101136
RC125-66 4
construction and reconstruction, snow removal, provisions for
adequate surface drainage, sanitary sewer, form sewer, water mains,
and other utilities, weed control, dutch elm control, installation
of cable television, or other public services deemed necessary by
the City. The cost of any such work. performed pursuant to this
Section 4.2. shall be assessed against the Lots pursuant to Section
4.1. of this Article.. The City is not required to perform any of
the work outlined in this Article IV but reserves to itself the
option to do so.
ARTICLE V: MISCELLANEOUS PROVISIONS
Section 5.1. Restrictions on Use. No Owner shall obstruct
or interfere with the right or privilege of any other Owner to use
the Private Road or Road Easement nor shall any Owner .alter.,
construct, remove or obstruct .the Private Road or Road Easement.
Upon any violation of this Section 5.1, any Owner shall have the
right to restore the Private Road or Road Easement to its prior
condition and cause the cost thereof to be assessed against the
Owner violating this Section 5.1. The costs, including reasonable
attorneys' fees, incurred by any Owner in protecting his or her
vested rights by an action law or in equity against another Owner
shall be recoverable in said action.
Section 5.2. Subordination of the Lien to Mortgages. The
lien of .any assessment provided for herein except for the
assessments provided for in Sections 4.1. and 4.2. shall be
subordinate to the lien of any first mortgage against any Lot.
Section 5.3. Duration. The covenants, conditions and
restrictions of this Declaration shall run with the land and shall
JHD101136
RC125-66 5
be binding on all persons claiming, ownership thereunder. The
covenants, conditions and restrictions of this Declaration shall
not be deemed to be merely nominal and of no actual and substantial
benefit to the party or parties to whom or in whose favor they run
unless the City shall so consent in writing.
IN WITNESS WHEREOF, the parties hereto have executed this
Declaration on the day and year indicated below.
•
•
JBD101136 6
RC125-66
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Gq aC71~N i aICC / ~:.ti rC;t~' EXHIBIT A
~ TG1L0 DIEYFLO~'MENT
a^ ease.^er' .^.'i°• Lr C'.Cr J^'i C: ASS .!rr i^..." ~ __. .. _ ^ __ -
AJD:?'ON, acc_,~;~iy t^ ^e -ecrorc .'a: .-..,._~ -e^-A, ^ ~__ " -- -
yieg ~or;~er y ~' a •^e ;esc-ice^, a "C^'^"9r.. ^; ... ."'@ :.+; :-- ..
SC'C ~^t ?: '.^ence ~eQr~^ C(i ^.!~rEEc ?? ^' •PS ?E ?C: :S'•_:5:. _.' ..
point ~ sc;~ nortr ' ne -` _,. ? .. .. Oerg .^e :~ =~- -- - _ ; ~ _
Oe 85G!!000; :^arie 85'er ^ ..•S'^.~'.e _ ~~- . G^~ae• --~ _ _ _ - -- - -
Caws CO~C_':@ `0 ~'8 Cr.n ^;;,-~ C 'OC~.S ^~ __ `° _ - .
!.^.4 degrees 4l^. '^ ~ _:85 C. 58~C.^GS .'.:°v^. .. _. eF`ve ^t... - _ ~ 2
,^^r!;;te5 +e SEGO^CS ['~S', ,"•^C6 ^Or' _CS•6' y .. .. 5:_ ~2 _ _.- _
• do^g ,. gar-:an~e^t ~.. :o _. _~Je .,, .^e - _ __ - _
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5QC~3 NOr;^. _~ OEy'!ES 7r? .:QS ~1: SeCYCS .^.5' .~,a^ •~ ~. ~ - _
33 min •tes ~; seco^a _.._ . ^o-;~@.^.~ s•~ a _.. .e. _ .. s'= -_ _ . .
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1
HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No. 13
Agenda March 18, 1996
Issue Statement:
Consideration of the first amendment to Contract for Private Redevelopment; Meridian
Crossings, TOLD Development Company.
Background:
On October 9, 1995 the HRA approved the Contract for Private Redevelopment with
Meridian Properties Real. Estate Development L.L.C. d/b/a TOLD Development
Company. At the same time,-two limited revenue tax increment notes were approved; a
Phase I note in the amount of $5,600,000 and a Phase II note in the amount of
$6,600,000. Interest was at 8.5%.
At the February HRA meeting Ralph Robinson, President of TOLD, indicated that the
proposed plans for Meridian Crossings had been modified to be more responsive to the
market. That is one of the two buildings could be six to eight stories and the taller.
building eight to ten stories. (This is the basis on which the Planning Commission
recently completed their review of the project and approved it).
The proposed first amendment changes the minimum values of the improvements to
reflect the potential of an eight and ten story building and also modified the amount of
each note. The Phase I and II Note "present" values would be $7,644.695 and
$8,494,593 respectively plus 8 1/2% interest. This is the amount of tax increment to be
paid through .year 2011. Since this is a "pay as you go" project the tax increment is
paid out only if the annual taxes on the development are paid. (See the attached first
amendment).
Also attached is an updated "But/For" analysis of Meridian Crossings prepared by
Publicorp, financial consultant to the HRA. The cover letter sets forth the four primary
elements of the proforma which Publicorp examined. Both Sid Inman of Publicorp and
Ralph Robinson of TOLD will be in attendance at the HRA meeting.
Recommended Motion:
Approve the first amendment to Contract for Private Redevelopment.
Basis of Recommendation:
1. The Contract approved by the HRA in October 1995 commits the HRA and TOLD
to the utilization of tax increment financing (Article VII).
2. With an increase in the potential size of the project it is appropriate to increase the
size of the notes based on the "But/For" analysis.
•
3. The Meridian Crossings proposal is being processed on the basis of two buildings
with a maximum of eight and ten stories each.
Alternative Recommendation:
1. Delay consideration of the amendment.
2. Refuse to accept the amendment.
Discussion/Decision Mode:
Approval of these items-will continue to evidence support of the project and keep it
viable in the market place.
Respectfully submitted,
Jame .Prosser
Executive Director
JDP:cak
•
FIRST AMENDMII~iT TO
CONTRACT FOR PRIVATE
REDEVELOPMIIJT
(TOLD)
THIS AMENDMENT, .made and entered into as of .the day of
1996 by and between MERIDIAN PROPERTIES REAL ESTATE
DEVELOPMENT L.L.C., a Minnesota limited liability company d/b/a TOLD
DEVELOPMENT COMPANY ("Redeveloper") and THE HOUSING AND
REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD,
MINNESOTA, a Minnesota public body corporate and. politic ("HRA") .
WITNESSETH:
WHEREAS, the HRA and Redeveloper did on 1`'tt execute and
deliver that certain document entitled Contract for ~~Prvate Y~.edevelopment
("Contract") ; and
WHEREAS, such contract is currently in full force and effect according to its
terms; and
WHEREAS, subsequent to the .execution and delivery of the Contract the
Concept. Plans have been revised and indicate a market value .greater than previously
determined;
WHEREAS, the resulting increase in Tax Increment is now available to
reimburse the Redeveloper under the Notes .
NOW THEREFORE, based upon the mutual covenants and undertakings
hereinafter contained, the parties agree as follows:
1. Section 4.4 of the Contract is hereby amended to read as follows
Section 4.4 . Concept Plans . The HRA hereby approves the Concept Plans for
Phase I which have been submitted by the Redeveloper as they relate to the following
matters
(a) marketing plans;
(b) tenant mix projections;
(c) anticipated dates for commencement and completion of the Minimum
Improvements ;
(d) general site, plan; and
(e) showing the Phase I Minimum Improvements in reasonable detail.
The parties anticipate that the Minimum Improvements and the :land will, upon
completion, have a market value of approximately $/~ ix Prior to
Commencement of Construction of the Phase II Minimum Improvements, the
Redeveloper shall obtain the approval of the HRA for the Phase II Concept Plan. No
approval by the HRA shall relieve the Redeveloper of the obligation to comply with
JBD101559
RC125-66
the terms of this Agreement, the terms of the Redevelopment Plan, applicable
federal, state and local laws, ordinances, rules and regulations, or to construct the
Improvements . The HRA reserves the unrestricted right to reject the Concept Plans
for Phase II, or for amendments to the Concept Plans for either phase, if in its sole
discretion the HRA determines that the above referenced conditions have not been
met. Such Concept Plans shall, in any event, be deemed approved unless rejected
in writing by the HRA, in whole or in part.. Such rejection shall .set forth in detail
the reasons therefor, and shall be made within twenty (20) days after the date of
their receipt by the HRA . If the HRA rejects .the Concept Plans or an amendment in
whole or in part, the Redeveloper shall submit new or corrected Concept Plans within
twenty (20) days after written notification to the Redeveloper of the rejection . The
provisions of this Section relating to approval, rejection, and resubmission of
corrected Concept Plans shall continue to apply until the Concept Plans have been
approved by the HRA.
If the Redeveloper desires to make any material change in the Concept Plans
after their approval by the HRA, the Redeveloper shall submit the proposed change
to the HRA for its approval. If .the Concept Plans, as modified by the proposed
change, conform to the requirements of this Section with respect to such previously
approved Concept Plans, the HRA shall approve the proposed change and notify the
Redeveloper in writing of its approval. Such change in the Concept Plans shall, in
any event, be deemed approved by the HRA unless rejected, in whole or in part, by
written notice by the HRA to the Redeveloper, setting forth in detail the reasons
therefor. Such rejection shall be made within twenty (20) days after receipt of the
notice of such change .
Final construction plans and. specifications -shall be reviewed by the City
Building Official in connection with issuance of building permits . No building permit
may be issued if the final construction plans and specifications materially depart from
the approval Concept Plans .
2. Section 4.5B of the Contract is hereby amended to read as follows:
Section 4.5B . Preconditions to Phase II Construction Commencement . Phase.
II construction may not commence until all of the following preconditions have
occurred:
a) all necessary zoning approvals for Phase II have been obtained.
b) the HRA has reviewed and approved the evidence of financing for
construction of the Phase II Minimum Improvements .
c) the HRA has reviewed the construction contracts for the Phase II
Minimum Improvements .
d) the HRA has reviewed and approved the Concept Plan for the Phase II
Minimum Improvements; which Concept Plan indicates a minimum market
value. for. Phase II of at least $/~ 22, 508, 628 .
e) all other preconditions to the commencement of the Phase II Minimum
Improvements contained in this Agreement or in any agreement
referenced in Section 3.2 have been satisfied or waived .
JBD101559
RC125-66 2
Upon the Commencement of Construction for Phase II, the escrow established
pursuant to Section 3.5 togeth~~ with accrued interest shall be released to the HRA .
3. Page D-1 of Exhibit D is hereby amended to read as follows:
EXHIBIT D
$~a<~!
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR' THE CITY OF RICHFIELD
LIMITED REVENUE TAX INCREMENT NOTE
(PHASE I)
The Housing and Redevelopment Authority in and for the City of Richfield (the
"Authority") , hereby acknowledges itself to be indebted and, for value received,
promises to pay to the order of Meridian Properties Real Estate Development L . L . C . ,
a Minnesota limited liability company, d/b/a TOLD Development Company .(the
"Owner") , .solely from the source, to the extent and in the manner.,; hereinafter
' al rinei al amount of this Note, being -`!t<~~~' .
provided ...the origin : P .::::.. P..;:::::; : <:<;;:>;> ..
:..: . ~::~nd~d:~<`<:<;`3;g~ Dollars ($"~~f~:,~~t) (the
« ::.:.::.:::::::.::y:::::::.:::.:.::,::, :.::::::::::::........::............................... .
"Principal Amounts') , together with interest thereon accrued from the date of this
Note, at the rate of interest. of eight and one half percent (8.5$) per annum (the
"Stated Rate") , in the amount and on the dates (the "Scheduled Payment Dates") set
forth on the Payment Schedule attached as Schedule A hereto and in the. amounts
stated thereon (the "Scheduled Payments"). Interest accruing from A
...:..:::...
~!~~5, shall be added to :principal on asemi-annual basis on each August 1 ~ and
February 1 until A t' > 18.
Any payments on this Note shall be applied first to accrued interest and then
to the Principal Amount in respect of which such payment is made .
-Each payment on this Note is payable in any coin or currency of the United
States of America which on the date of such payment is legal tender for public and
private debts and shall be made by check or draft made payable to the Owner and
mailed to the Owner at it postal address within the United States which shall be
designated from time to time by the Owner.
The Note is a special and limited obligation and not a general obligation of the
Authority, which has been issued by the Authority to aid in financing a "project,"
as defined in Minnesota Statutes, ~ 469.174, of the Authority within and for the
benefit of its Interstate-Lyndale-Nicollet Redevelopment Project Area and Tax
Increment Financing District ("District") .
THE NOTE IS NOT A DEBT OF THE AUTHORITY, THE CITY OF RICHFIELD,
OR THE STATE OF MINNESOTA (THE "STATE") , AND NEITHER THE AUTHORITY,
THE CITY OF RICHFIELD, THE STATE NOR ANY POLITICAL SUBDIVISION
THEREOF SHALL BE LIABLE ON THE NOTE, NOR SHALL THE NOTE BE PAYABLE
JHD101559 3
RC125-66
OUT OF ANY FUNDS OR PROPERTIES OTHER THAN AVAILABLE TAX INCREMENT,
• AS DEFINED BELOW.
The Scheduled Payment of this Note due on any Scheduled Payment Date is
payable solely from and only to the extent that the Authority shall have received as
4. By amending page E-1 of Exhibit E to read as follows:
EXHIBIT E
$8~~'3
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD
LIMITED REVENUE TAX INCREMENT NOTE
(PHASE II)
The Housing and Redevelopment Authority in and for the City of Richfield (the
rrAuthority") , .hereby acknowledges itself to be indebted and, for value received,
promises to pay to the order of Meridian Properties Real Estate Development L.L.C..
• a Minnesota limited. liability company, d/b/a TOLD Development Company (the
"Owner") , solely from the source, to the extent and in the manner. hereinafter
' al amount of this Note bein Via""' . t~±~~ i€?~~'
rovided the original...princip ......::..:.::::::::::::.::::::::::.::::::::::::::::::::::.;:.;::::.;:«.;:~::::.;:.;:.;:.;:;:.;g :::::~:........;..:.;::;::::..:;...::...;..::.;...
::..::. ... -:::.::::.>::>::.:; .... :.::.:<:> . ~~a<:::I~d~ :. d>:::~'i~~::.:<:>::~ Dollars (s;4~~;~5~~;)
..
(the principal Amount ), together wrath interest thereon accrued from the date o
this Note, at the rate of interest of eight and-one half percent (8.5$) per annum (the
"Stated Rate"), in the amount and on the dates (the "Scheduled Payment Dates") set
forth on the Payment Schedule attached as Schedule A hereto and in the :amounts
stated thereon (the "Scheduled Payments") . Interest accruing from:: /~::
~99~i, shall be added to_~rincipal on asemi-annual basis on each Augu[s~ ~ and
'e~rry;~ until ~'~~r~:;:.~.:::X~!~~.
Any payments on this Note shall be applied first to accrued interest and then
to the Principal Amount in respect of which such payment is made .
.Each payment on this Note is payable in any coin or currency of the United
States of America which on the date of such payment is legal tender for public and
private debts and shall be made by check or draft made payable to the Owner and
mailed. to the Owner at it postal address within the United States which shall be
designated from time to time by the Owner.
The Note is a special and limited obligation and not a general obligation of the
Authority, which has been issued by the Authority to aid in financing a "project,"
as defined in Minnesota Statutes, ~ 469.174, of the Authority within and for the
benefit of its Interstate-Lyndale-Nicollet Redevelopment Project Area and Tax
Increment Financing District ("District") .
JBD101559 4
RC125-66
THE NOTE IS NOT A DEBT OF THE AUTHORITY, THE CITY OF RICHFIELD,
OR THE STATE OF MINNESOTA (THE "STATE") , AND NEITHER THE AUTHORITY,
THE CITY OF RICHFIELD, THE STATE NOR ANY POLITICAL SUBDIVISION
THEREOF SHALL BE LIABLE ON THE NOTE, NOR SHALL THE NOTE BE PAYABLE
OUT OF ANY FUNDS OR PROPERTIES OTHER THAN AVAILABLE TAX INCREMENT,
AS DEFINED BELOW.
The Scheduled Payment of this Note due on any Scheduled Payment Date is
payable solely from and only to the extent that the Authority shall have received as
5 . By amend~n~ page: ~-~€' of E~hibit,;,1J to read as foJ;low~.,'
'~ See attaeh~d
•
IN WITNESS WHEREOF, the parties hereto have set their hands and seals as
of the day and year first above written.
THE HOUSING AND REDEVELOPMENT
AUTHORITY OF THE CITY OF
RICHFIELD, MINNESOTA
By
Its
By
Its
MERIDIAN PROPERTIES REAL
ESTATE DEVELOPMENT L . L . C .
By
Its
JBD101559
RC125-66 5
STATE OF MINNESOTA )
SS
COUNTY OF )
The foregoing instrument was acknowledged before me this day of
1995, by and the
Chairperson and Executive Director of The Housing and. Redevelopment Authority
in and. for the City of Richfield, Minnesota.
STATE OF MINNESOTA ).
SS
COUNTY OF )
Notary Public
The foregoing instrument was acknowledged before me this day of
1995, by ,its of Meridian
Properties Real Estate Development L . L . C . a Minnesota limited liability company,
d/b/a TOLD Development Company.
• Notary Public
•
JHD101559 6
RC125-66
•
.,
JHD101559
RC125-66
.......................................
.......................................
.......................................
.......................................
~'C'7'.
•
JHD101559
RC125-66
E-4
~'1EiR {~~ ~9b 17C~~,~t'I'~ tHLLKJ O~ nJJVLlr1ItJ
~ MEMORANDUIVi
?O; Bruce Palmborg -City of Richfield
FROM: Sid Inman - EhlersJPublicorp Inc.
DATE: March 5,1996
RE: Updated Btrt/lror Aaatysis for the TOLD Prnject
Per your request, we have reviewed the updated request for assistance ficom the TOLD Company for the office
project located on the Cloverleaf site.
We requested and received tm updated development profotma from the developer-and used them as the basis Of
our review. Also we attempted to review other similar projects for comparison. Since there are few of these
projects being built, our comparisons were primarily based on smaller office projects.
In general the request for increascd tax increment was based on increased cost due to the increased size of the
building. WIWe all the cost and revenues shifted upward, they did so in proportion with the previous analysis.
In nwiewing the profoxrrta we focused on four elements:
1. While the total cost of the project increased, the sq. ft. cost elements remained about the same.
~ 142 per sq. ft. for total costs and S 11 S per sq. ft. for construction.
i 2. The mortgage amount is sti1175°~ of the total cost.
3. The developer will be required to provide equity of 25g'o or $14,712,000 for the project. They are
assuming that a return oncosts of at least l0% will be required to attract this amount of equity.
4. Assuming that the City would provide no assistance, the project would still require an average rert of
over 516.00 per sq. ft to provide a IO% return. The developer's market studies (provided to the City}
have shown that the average rent that can be charged and remain competitive is 513.00 per sq. ft. Using
$13.00 per sq. ft. leaves an overall financing gap that is covered using the tax increment.
As with our last report, we believe that the information provided by the developer is conservative, and there is
a possibility that they could over time achieve higher rents thus higher returns. We also believe that the office
market, while rationing, is still speculative, and the developer could see lower returns as well_ You have
attempted to aecautt for the future by providing your assistance using the Pay-As-You-Go method which exposes
the City to minimal financial risks.
Please let me know if you have additional questions or comments.
front ilia deck oj•
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AtMicorp IaclEhlus want ssoriaks. h~
29S®1Yarwrst Centt~
46 SaMtb Serehtl4 Stn~et
~lliw+reapalis, MN SS402
(61?) 339-8291
FAX• {6IZj 339-®8S~!
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19HK F~J 70 roc • ,7 r rrl tnLLr~.7 c+. n=~=,v~,ln i ~~
F 1..E ivo . ~ use ~ 1Z : c>8 ! f) : t t~_I) DEVEI.OPl1ENT 612 420 7574
PAGE 2
Maridiaa G'~ossings fiichfield
But For AncYlysis - $osed on 1 ggg lneome
March 5, 1996
PtscYSa 1: 8-stones, 183,842 F~table Sgtuare Foot
Phase II: IO-stones, 230,290 Rentable Sgetore l:'evt
Witham Tmc Inereeruecit With Tax Ystcrement
saut~ess oaa use sources Sources and use sources
L~md I. I00.000 1,100,000
FS-virar~rrserttalJ$oil Testing 100,0ot) 100,000
Soil Corzection/Gradirig 400,000 400,000
t3ea! Estate Takes 100,000 100,000
Totci Iand Coeds 1.700,000 1,70o,aoo
1 Phase I Building l2,a50,000 12.850.000
phase I pborking Ramp 3,850.000 3,850,000
Phase I Landscaping 192,000 192,000
I Phatio I Terto~st Improvements 3,7S0,000 3.750,000
Phase Il Building !6,062,500 16,062,500
Phase IJ Parking Ramp 4,812.500 4,8!2,500
phaso II LartdacccPing 240.000 240,000
Phase Il Tencsnt Lmprovelnents 4,687,500 4.6$7,500
t:,onstructiont~ontiYigency~39o 2,393,335 1,393,335
Total Cansiructioa Costs 47,837,835 47,837,835
Architecture/Iriterior/Eng. 1,312,500 1,312,500
InspectionslAp~o~xsle 237,500 237,500
l,oggl. Acccwnting, Title ~ 235,000 235,000
Lasing FeeelMarketir-g 2,150,000 2,150,000
Oaerhead 468,750 468,750
Construction Interest 2,250A00 2,250,000
Lease Up Deficit 1,187,500 I, 187,500
Loom Placetaant Fees !.200,000 1,200,000
Soft Cast Cos3tir3ger~cy @346 ~ 271,238 271,238
Total Soft Costs 9,312.48$ 9,3IZ,l88
Total Pralect Cost 58,850,323 58,850,323
Mortgage i?596 LTt~ 44,197,742 44,137, 7~l2
Equity 14,712,581 14,712,561
SUT LRG.399 Page t
11...E IYO. C.~. G Vd~V`J ~.yb 1~ ~ jll (~ J~lry iV L~+a.A"7 7CJYT - ~12 µCV ~7, 7Q r- . ~• c.~
PAGE 3
Meridian t'rossinge Richffeld
$ut For Analysis -Based on 1999 rncome
NQan;]u 5. 1996
Phcsa I: 8-stories, 183,842 Rentable Squaw Feet
p}taae II: 10-stories. 230,290 E~Cntabis Square Feet
Without Tax Incral'nent With Tas Increment
SocarCe¢ and Use Sources Sources aatd Ure Sources
Phase I Income 2,389,946 2,389,946
' f~hase A Incorsss 2,993,770 2,993,770
' Less Vacoxicy @ 796 -376.$60 -376,86a
Less F~cpenses cn Vacant Spare
CAM {3.2815F~ -95,085 -95,085
Taxes {4.50/SF~ -130,452 -130.452
tnsuersnce (.11JSF) -3,189 -3,189
Mcc~agAerant Fees (.79/SF? -22,901 -22.901
Nwt Ol~r+ctting Income 4,755,229 4,755,229
. TIF Be:,etit tt~V of 1999 estimate? 1,a19.159
MorGgctge Payectesnt -4,937.060 -4,937.060
20~~
9.50% interestrate
Prinrip~sl from Page i
Net Irscoate -181,831 1.237,328
Retum on Equity -1.24% 8.4196
Aetusu an Cost 8.08916 10.4996
BUT•LRG.398 Pepe 2