02-02-81 agendat
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CITY OF RICHFIELD, MINNESOTA
Office of City Manager
Council Letter No. 35
Agenda February 2, 1981
The Honorable Mayor
and
Members of the City Council
City . of Richf field
Council Members:.
Subject: Lyndale Garden Fruit and Vegetable
Market, Inc. Developer`s Agreement
On January 26, 1981, the HRA met with the city council to
hear a presentation for the reconstruction of the Lyndale Gar-
den Center. At their meeting on February 2, 1981, the HRA will
be presented with a developer's agreement for the project.
The agreement will delineate the responsibilities of both
the developer and the HRA. The primary role of the HRA will be
to provide additional land area to the developer by purchasing
the Adams property. During the week of January 19, 1981, an
offer based on appraisal data was made to purchase the property
and was subsequently rejected. It now appears that purchase of
the property through eminent domain may be necessary. On Febru-
ary 17, 1981, the HRA may be requested to authorize the initiation
of eminent domain and quick-take proceedings against this property
to provide it to the developer by late summer. The developer's
agreement will contain provisions for funding the purchase of
this acquisition.
Additional land area will be provided the developer by the
sale of two small triangular parcels owned by the city. They
contain approximately 11,250 and 1,842 square feet respectively
and are located near Richfield Lake on the southern edge of the
Garden Center property, and is land which now supports a growth
of trees and grasses.
There will be other major subject matters in the developer's
agreement. The developer must provide evidence to the HRA of a
commitment to finance the development through a tax exempt mort-
gage, and a schedule for completion of construction. The devel-
oper will also be required to provide a performance security re-
lated to construction completion. However, when tax exempt finan-
ing is utilized, a separate performance guarantee between the
HRA and the developer is of less significance because the lender
who provides the mortgage for the project must be reasonably
assured that the project will be completed and also requires
the developer to maintain insurance on the improvements during
. ~ ~ Council Letter No. 35 -2- February 2, 1981
and after construction. Because of this concern by the lender
in having the project completed and protected, the chances of
failure are considerably reduced.
On Monday evening, February 2, 1981, the HRA will be pre-
sented with a developer's agreement. The specific terms and
conditions will be reviewed at that time.
respectfully-submitted,
~o I
_ Karl Nollenberger
City Manager
KN/eja
cc: Community Development Director
Administrative Services Director