04-09-79 agendaHOUSING AND REDEVELOPMENT AUTHORITY
Office of Executive Director:
HRA Letter No. 16
Agenda. April 9; ~~979
~-~-e~ ~, s - o
Housing and Redevelopment
Authority Commissioners
City of Richfield
Commissioners c
Subject: P,ecommendation Relating to Developer for
New Home Program
The developer is to construct either five three-bedroom houses
or four three-bedroom houses and one house accessible to the- Handi-
capped. A developer must also receive a Section 8 rent assistance
set-aside from .the Minnesota Housing Finance Agency or the U.S. De-
partment of Housing .and Urban Development, so that the. homes may be
rented to large,.. low to moderate income families who qualify for rent
assistance. The developer would own and manage the units.
On February 12~, 1979, the Housing and Redevelopment Authority
authorized the staff to xequest proposals from interested devel-
opers to construct five single family homes on scattered lots
throughout the city. The lots to be used in this program will be
properties with substandard (garage) houses purchased by the HRA
with bonus Community Development Block Grant funds. The houses
will be demolished and the cleared lots would be sold to a de-
veloper.
The HRA sent out 98 "request for development'proposals and
received 13 requests for a proposal packet.. Of these, 4 developers
submitted a proposal. to the HRA. The following developers submitted
proposals:
1. Robert Bartz and Mark Harm, 1382 Cherry Hill Road,
Mendota Heights, 55118
2. Minnesota/Dakota Housing Corporation, Suite 502,
Midwest Plaza Buil~3~na~ Minneapolis; 55402.
3. Richard Blevins and James Freitas, 7532 Washburn
Avenue, Richfield, 55423
4. David Ames and Robert Dippen, 502.9 Morgan Avenue
South, Minneapolis 55419.
Each of the four proposals ..has been reviewed by the New Home.
r' Committee using the following set of established criteria:
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HRA Letter No. 16 -2- April 9,-1979
the proposed purchase price of the land; the square feet of living..
area to be provided in the homes; suitability of the proposed homes
to the neighborhood,. especially. in terms of exterior finish; the
development costs and financial feasibility of the project; the
developers qualifications; the construction schedule; and the de-
velopers proposed property management procedures. A comparison
of the four development proposals as reviewed by these criteria
is-attached..
Staff Recommendation
David Ames and Robert Dippen are proposing to purchase the
-lots for $2,500 each, to constructor each lot a split level house
.with-three bedrooms and habitable living space on the lower level
that could be finished at a future date. The total finished living
area, including the lower level, would be 1,064 square feet. This
was the largest house proposed by any of-the four developers. Since
the proposed houses are of a split level design, and most of the lots
which might be used for this program have a 50-foot frontage, this.
proposal will meet all zoning requirements. The developers will
not decide on the exact type and style. of exterior finish and trim
• until the actual sites. are selected, so_that the exterior finish on
each of the houses will.conform with those of neighboring properties.
The -total development cost of this.. proposal is $ 249 , 012 , s~his is less
than the other three proposals., making it the most feasible project
.financially..
.David Ames. and Robert Dipper are both experienced in housing.
David Ames has completed financial feasibility studies for many
residential developments. Robert Dipper, who would be responsible
for the construction of the houses, has been involved in real estate
for 12 years as a xealtor and contractor. These developers propose
to manage the completed ,homes themselves.
Approval of this recommendation by the HRA will enable the
developer to finalize the application to the Minnesota Housing
Finance Agency or the U. S.-Department of Housing and Urban Develop-
ment. However, this developer selection will be contingent upon
the ?.~^t sale. T?^° °'~^t resale price to the developers of the lots
cannot be established until the lots have been purchased by the ~-i
and the Section 8 Rent Assistance Payments have been set aside for
the developer. Once the resale price and. rent assistance payments
are established, it will be necessary for the HRA to hold a public
.hearing on resale of the lots. The developer must also propose a
purchase price for .the lots at the public hearing.
It -is the recommendation of the New Home Committee,. in which I
r
..
HRA Letter No. 16 -3- April 9, 1979
concur, that David Ames and Robert Dippen be authorized to submit
a final application to the Minnesota Housing Finance Agency or
the U. S. Department of Housing and Urban Development.. It is also.
recommended that the HRA authorize the Executive Director to nego-
tiate a developer's agreement with David Ames and Robert Dippen.
The developer`s agreement will-not be executed until the developer
is designated as the successful purchaser for the lots..
Respectfully submitted,
J ce L. Wilde
Acting Executive Director
JLW/eja
ec: Planning & Redevelopment Director
Public Works Director
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urchase Square Total
rice Feet of Exterior Development Financial Developeres Construction Pr
veloper e; Lots Dwelling Finish Zoning Cost Feasibility Qualifications Schedule
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-_ ___ _ Ma
vid Arnes & _
Financial __ _
_
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pert Dippen x,500 1164 sq. siding meets $249,012 Feasibility -experience with) Construction to
(includes require- complete MHFA and HUD I starts 11/79 ma
rec room) ments feasible -financier feasible de
-12 years in
36' x 24' real estate
nnesota/ Financial -experience + Construction ma
kota• Feasibility with MHFA & ~ starts 11/79 rna
using -0- 1100 sq.' wood meets $276,718 complete HUD i feasible hi
rporation require- feasible -established pa
35' x 41' ments planning & ! ba
architecture ~
: firms
:
~hard Blevins -------- ------- __ ___ _.--- - __ _ _ _ _
Financial . _ _ _
_ .... _ ___ _ f . ---
partner has Construction
ma
J $9,500 1008 sq.' masonite 2' into $291,277. Feasibility 2 years I starts 5/79 de
nes Freitas siding sideyard incomplete building infeasible
42' x 24' not feasible -no experience
------- --- - -- with MHFA/HI1D
- ------- -- - -- -
------
_
bert Bartz ~ woodsman Financial p
-no ex errence ~ Construction ma
rk Harm $;,500 1120 sq.' siding meets $335>125 Feasibility with MHFA or ~ starts 30 de
with cedar require- incomplete .HUD days after
40' x 28' trim ments not feasible -experience ~ MHFA
in rental I approval
feasible
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