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HomeMy WebLinkAbout1987 03-31 EBFAt b i; MEMORANDUM r TO: Earle Brown Farm Committee FROM: Brad Hoffman, HRA Coordinates-' DATE: March 31, 1987 f~f SUBJECT: RFP Proposal Brooklyn Center is now approaching decision time about the future uses of the Earle Brown Farm. From the point of time that the HRA first began serious efforts to acquire the Farm to the present, the Farm committee has given consideration to a variety of uses that included; a farmers market, restaurants, bed and breakfast, country furniture, office space, senior centers, country western music hall, museums and others. The scope of uses has been narrowed to a trade show center (multiuse) facility and support uses. A market analysis was done relative to the use of the buildings as a senior center. From that study we learned that we need to select a target market and concentrate on -it, i.e. don't try the shotgun approach. It was also learned that the Earle Brown Farm and its location were well known. Knowledge of the location of the Farm is a significant marketing plus. A number of objectives were established by the Farm committee. First and foremost, was the preservation of the Farm. The underlying objective for the involvement of Brooklyn Center has been the restoration and preservation of a significant part of the City's history. Second, the development of the Farm should be as self-supporting as possible. Efforts to develop the Farm should minimize the fiscal impact upon the City. Third, the buildings should be public or quasi-public in nature. It is important that the public be able to appreciate this part of Brooklyn Center's past. Fourth, any development on the site should be influenced by the traffic capacity's limitations of the area. Numbers of cars or trips to and from the site as well as the time of such trips are significant in the determination of use. Finally, consideration should be given to social uses including day care, senior centers and so forth. The committee directed the staff to give serious consideration to a convention/trade show center. The Hippodrome at 13,500 square feet plus an additional 7,500 square feet in the attached stable provides us with an opportunity to attract many of the smaller trade shows. Competition from comparable sized facilities is somewhat limited. In Minnesota, there are eight (8) facilities listed in the "Trade Show Convention Guide". Within the metro area four (4) facilities are of similar size. In December 1986, it was decided that an attempt should be made to solicit proposals (RFP's) from private developers for the restoration and management of the Farm. We requested development concepts allowing any potential developer the latitude to use the buildings in an economically prudent manner. The HRA would provide financial assistance (to be negotiated) to assure the financial probability of the development. In essence, we allowed developers the opportunity to "write their own ticket" while retaining the right to accept or reject the proposal. A total of 27 different entities requested -2- proposal specifications. Those requesting the RFP's were developers, architects, and finance people. Only one (1) proposal was received. Our attempt to solicit the RFP's did provide us with a barometer of the private sector's view of the Farm. It is a small and difficult project to undertake. Mr. Jim Ryan of Ryan Construction informed us that it was too small and was not the type of project they do. Greg Watson of AHW was and is still interested in doing the actual work, but did not want to be in an ownership position. The architects I discussed the proposal with were unable to find developers who were interested. In short, the cost was prohibitive in relationship to doing other projects and the project was too small to be economically feasible. The one proposal received came from Al Beisner. Mr. Beisner proposes to build a trade show/multipurpose facility with office space supporting the rest. The HRA would finance the project and he would manage the construction and the facility upon completion. At some point, there would be a negotiated division of profits (assuming there are any) between the HRA and Mr. Beisner. Enclosed you will find a copy of Mr. Beisner's proposal. On page 7 he provides an income analysis for the Farm. With the exception of the hippodrome base rent, rents seem to be within the range to be anticipated. Documenting rent for the hippodrome is much more difficult. A base rent of $0.20 per square foot is very competitive on the trade show market place. The St. Paul Radisson and the Radisson South charge $0.35 per square foot. The Hyatt Hotel charges $0.03 per square foot. However, the hotels which will be our major competition will all negotiate the fee because their interest is in renting the rooms. I have discussed a similar proposal with Mr. Steve Anderson, manager of the Ramada, who indicated that we could come to an agreement with the hotels to pay for the space so that they might rent rooms. The trade show industry is large and growing. There are over 9,000 trade shows (not conventions) annually, generating in excess of $7 billion in convention hall rentals. In Minnesota there are several hundred such shows that would be potential users of our facilities. There are many shows on the market not listed with the Convention and Trade Show Guide. In my memo dated June 6, 1986 to the Farm committee, I estimated annual maintenance costs at $211,000. Adding other operating costs, administration and staffing for a convention center along with promotional monies, Mr. Beisner estimated the total cost at $350.000. Debt service is not considered in these figures. (We will discuss debt services at our meeting.) The Beisner revenue estimate is $763,100 annually. Assuming a 27 percent reduction in the number of days booked for trade shows, our revenue projection would be closer to $620,000. These numbers assume our ability to successfully promote and lease our facility for trade shows. At this time, the Minneapolis Convention Center will be down for three (3) years. Also, the Prom Ballroom is closed providing us with an opportunity to fill a niche in the market. Other uses such as dinners, dances, entertainment promotions, exercise -3- classes, and so forth serve as potential revenue sources. Brede, Inc., a trade show supplier, has indicated that from their experience our size, 100- 150 booths, show is the fastest growing part of the market. ' The proposal from Mr. Beisner leaves the HRA with several choices. The HRA can reject the proposal outright and pursue the development ourselves and solicit a management team for the Farm. The HRA could accept the proposal and commence negotiations on a development and management agreement. Finally, the HRA could pursue a management agreement with Mr. Beisner and proceed with the development (restoration) ourselves. There are obvious advantages and disadvantages to each. If we accept the proposal, the restoration and management will be handled by Mr. Beisner, subject to our contractual agreement. He would be better suited to move quickly and economically as well as relieve the HRA of the burden of managing the site. However, the redevelopment and management of the site not covered by contract would be at the discretion of Mr. Beisner. Also the perception that our facility functions to serve Mr. Beisner's, whether true or not, will 1 be made. If we do the project ourselves, the HRA would retain total control both in restoration and management. With the control comes the problems of staffing, time and procedures of a governmental agency. If we split the restoration from the management, we retain more control over the restoration and have only a management agreement for running the Farm. The advantage, we still retain a greater degree of control while removing the HRA from the day to day operations of both the restoration and management of the Farm. We seem to have zeroed in on a use for the buildings that appears to have the potential to be self-supporting. It would be a definite boom to local hotels ' and provide Brooklyn Center with a rather attractive asset for community functions. The bottom line is that the City is ultimately responsible for the fiscal integrity of any development of the Farm. At this point, we need to ' determine the short- and long-term role of the HRA relative to the restoration and management of the Farm. Also, we must determine how we want to proceed with the restoration of the Farm. REQUEST FOR PROPOSALS Mr. Greg Watson AHW 1295 Bandana Boulevard Suite 335 St. Paul, MN 55108 Mr. Jim Ryan Ryan Construction 700 International Center 500 2nd Avenue South Minneapolis, MN 55402 Mr. Al Beisner 6100 Summit Drive Brooklyn Center, MN 55430 Mr. Janis Blumental Blumentals Architecture, Inc. 6100 Summit Drive Brooklyn Center, MN 55430 Mr. Dick Krier Derick corporation 11095 Viking Drive Suite 360 Eden Prairie, MN 55344 Mr. and Mrs. Tim Pearson Village Peddler 7909 Mississippi Lane Brooklyn Park, MN 55444 Mr. John R. Buzek AEC Engineers and Designers 511 Eleventh Avenue South Minneapolis, MN 55415 Mr. Dennis Batty Architects & Associates 1 6860 Shingle Creek Parkway Brooklyn Center, MN 55430 Mr. Frank L. Reese, A.I.A. Israelson, Reese, Ellingson & Assoc., Inc. 11000 West 78th Street Suite 220 Eden Prairie, MN 55344 Mailed 1-87 REQUEST FOR PROPOSALS Mr. Cornelia Einsweiler Marketing Director Armstrong, Torseth, Skold and Rydeen, Inc. 4901 Olson Memorial Highway Minneapolis, MN 55422 ' Mr. Arthur H. Dickey, A.I.A. Arthur Dickey Architects, Inc. 4930 France Avenue South Minneapolis, MN 55410 Ms. Jenny Adams 1 Director of Marketing The Adams Group, Inc. 118 East 26th Street Minneapolis, MN 55404 Mr. Dennis A. Houck Vice President Lincoln Capital Corporation 7205 Ohms Lane Edina, MN 55435 Mr. David Maroney 801 Washington Street Northfield, MN 55057 Mr. Dick Smith Johnson & Smith Architects ' 219 North 2nd Street Minneapolis, MN 55401 ' Mr. George Begin 13600 Rockford Road Plymouth, MN 55441 Mr. Mike Podawiltz P.O. Box 1361 5t. Cloud, MN 56301 Mr. Dick Gilyard Lindberg Pierce Inc. Architects 600 1st Avenue North, Suite 600 Minneapolis, MNd 55403 AEC Engineers and Designers 511 Eleventh Avenue South Minneapolis, MN 55415 Attn: Rudy Mr. Nick Sperides Kingman Dillon Corporation 240 Portland Minneapolis, MN 55415 Mailed 1-87 REQUEST FOR PROPOSALS Mr. Rick Martin Winfield Development Co. ' 3300 Edinborough Way Edina, MN 55435 Mr. Mike Rivard 6490 Excelsior Boulevard Suite E-8 Minneapolis, MN 55426 Mr. Bill Gernes Olmsted Historical Society Box 6411 Rochester, MN 55903 Mr. Lee Schafer MN Real Estate Journal 7701 York Avenue South Edina, MN 55435 Mr. Dave Nelson Uhde-Nelson Inc. Const. 3825 85th Avenue North Brooklyn Park, MN 55443 Mr. Richard Kleinbaum Gleeson Architects 2402 University Avenue Suite 203 St. Paul, MN 55114 Mr. Tim Trimble 2001 Killebrew Drive Bloomington, MN 55420 Mr. John Rohrman Design Partnership 124 North 1st Avenue Minneapolis, MN 55401 Mailed 1-87 a r c t)ro%vR- COMM0116 March 4 1987 i Mr. Brad Hoffman HRA, City of Brooklyn Center 6301 Shingle Creek Parkway Brooklyn Center, MN 55430 Dear Brad: This has been one of the most difficult proposals to prepare and is viewed equally as the biggest challenge of my real estate career. It also contains some uncertainty, but.nothing that cannot be negotiated out. I ask that after you review this proposal, that time be made available for an oral presentation. There are so many variables and/or variations of each proposed facet of redevelopment that as much as a 351/10' cost/income variance is possible. However to minimize this situation, safeguards can be built in. Over the years, many, many development proposals for the property have surfaced, all have failed. Learning from past experiences and keeping within City parameters, this proposal is: - Convert H Barn and D Barn into office space - Build a greenhouse-style connecting link between the H and 0 Barns to function as entry and service space. - Convert the Horse Barn into: a' a. Community-related office space b. Restaurant or meeting room ' c. Catering kitchen d. Office/retail space - Add 4,481 sf of space to the Hippodrome and convert it into a multi- purpose room, functioning as a community center, exhibition hall, banquet facility, dance hall, senior citizen center. - Move the "cook's shed" to the south property line and convert it to a seniors' wood shop. i 6100 ~ ummtt Dnvc ~Lcrth yrrurarr aarrrrrr' 5r(_x-,k1vrt Cctkt'. jMinnC&k L 55430 Phoac (all) %-0329 Mr. Brad Hoffman March 4, 1987 Page 2 The green space or mall will be preserved and restored to its original state ' as much as possible. Costs, income and debt structure in the proposal are preliminary and conserva- tive, but have a great deal of flexibility. Management of the entire complex will be under one control, with the appropriate consultants and operators. Presently, the following companies have made firm proposals to participate in this project and be part of the team. Blumentals - Architectural Services Bor-Son Construction Companies - General Construction Monarch Foods - Kitchen/Dining Consultants ' Best, Inc. - Catering and Restaurant Services All of the above have committed to work on the project as proposed. Best and Blumentals will also lease substantial space. Best would bring a full- time catering manager and sales staff to the project. Brad, I can/would bring any of the representatives to any future meetings. Thanks for your consideration. Sincerely, L. A. Beisner ' LAB: sI Enclosures TABLE OF CONTENTS Paqe No. 1. BUILDING USES 1, 2, & 3 II. BUILDING AREA SUMMARY 4 III. COSTS -Definitions 5 IV. BUILDING COST SUMMARIES 6 V. INCOME SUMMARY 7 VI. ANNUAL BUILDING OPERATING BUDGET 8 VII. ECONOMIC ANALYSIS 9 VIII. SUMMARY/CONCLUSIONS 10 IX. PROPOSAL 11 I. BUILDING USES: ' The entire redevelopment area, as outlined in the attached Exhibit A, Site Plan, will be rehabilitated in accordance with the McDonald and Mack Historic Preservation Guidelines. The redevelopment proposal parallels the stated uses for the property. It also reflects an attempt to redevelop the property to its highest and best use economically, while providing a quasi-public use for the property. The general use for the property is to develop it into a combination of general office space, office space designated specifically for or to community services, a catering kitchen, possibly a specialty restaurant and a multi-purpose space that will function as a community center, senior citizen center, exhibit hall, banquet space, attraction center, etc. In addition to the rehab of the existing buildings, we are proposing the construction of three new structures: a connecting building between the existing H & E Barns, a breakout area with lavatories, storage rooms, etc. built along the east wall of the Hippodrome and a connecting building between the relocated "Cook's Shed" and the existing Earle Brown Office Building. The "Cook's Shed" will be relocated to the southern portion of the site and be converted to a workshop. r The overall development will incorporate as many different uses and functions into the complex as possible. The goal will be to have a complex that is capable of having several completely different functions performed simul- taneously without interfering with each other and/or having all of the space function as one complete and single entity. Barns/Buildings H & E: These buildings will be converted to general purpose office space. Each building could provide space for multi-tenant or single-tenant users. Each building will be remodeled to finished "shell" construction conditions. A connecting building will be constructed between the two Barns. This Building will function as a main entry. It will probably be a two-story, 1 open atrium design. This entry building will also provide restrooms, storage and utility rooms for Barns/Buildings H & E. The H & E Barns will accommodate either a single-user or multi-tenant users. Exhibit B & C, attached hereto, depicts elevations and functional floor uses. These Barns/Buildings can be developed into very good quality office space suitable for any small to medium sized business. There is potential to develop either building into small multi-tenant offices and provide a central secretarial and answering service. Initially there are no plans to connect these two buildings to the Main Barn/Building or the D Barn to the west. We have a preliminary agreement to lease approximately 330 of the proposed office space. 1 Main Barn/Building: This redevelopment structure is a demonstration of the complex and delicate integration of various uses. The Building will have community service- related office space, a catering kitchen and either a specialty-type restau- rant or a large ancillary meeting room, service hall area and additional general purpose offices.. The north wing of this Building will be remodeled into office space, following the same general physical outline of the existing barn stalls. Final design is not yet determined, but existing bars, stalls and brick will be coordinated into the final product. The individual offices will be approximately 12' x 15' (as existing stalls). The space will be specifically marketed to community service organizations, such as Chamber of Commerce, Convention Bureau, catering office, etc. Four specific inquiries for the office space have been obtained. The south wing will be improved with a full catering kitchen, related storage, service offices related to the senior citizens and possibly a kitchen designed ' to service the specialty restaurant. The catering kitchen is designed to serve any/all requirements of the adjacent exhibit hall/banquet facility and al.so provide for off-premises catering service. A preliminary kitchen design (Exhibit E) with accompanying costs have been obtained. A written preliminary agreement with one of the Twin Cities' largest food service companies has been obtained. The agreement specifically is for off-premises service, but a proposal for an on-site catering is in process. This company also has limited interest in the restaurant area of the Barn. Several organizations have also expressed interest in providing senior-related services in general office space in a condo-style rental arrangement. The center wing of the Barn will function as the main entrance to this Building. Besides the main entry and vestibule area, this wing will provide the storage area and lavatories for the entire building. The dominate part of this wing is the two-story 1,400 square foot clear span area. This space could function either as restaurant seating area or additional meeting/banquet space. This space opens nicely onto the "green space" and its natural two-story area would ' serve either proposed use well. Five restaurant operators have reviewed this area and site as a potential location, but to date, all have declined for the present to become involved. Several restaurant and managerial options have been considered, the most popular or realistic include: - breakfast and lunch only - eggs - omelettes specialty - New York-style deli - home style breakfast and lunch, run by seniors in a cooperative - bakery-deli with take-out ' It is difficult to commit on the use of this space now because, although an operator is not close to being committed, this area does have great potential as a restaurant. Development may have to proceed without a commitment to 1 help prove up traffic and pedestrian count to entice the restauranteur. -2- r 1 EXHIBITS AND ATTACHMENTS Exhibit A Site Plan Exhibit B H & E Barns Exhibit C Floor Plans Exhibit D Horse Barn Exhibit E Catering Kitchen - Layouts & Costs Attachments: General Contractor Qualifications Cater's Qualifications Food Service Consultant Qualifications Hippodrome: The Hippodrome provides the greatest opportunity for a very diverse management and utilization challange. We propose that the structure be expanded by the addition of 4,481 square feet of service/breakout space. By building outside of the existing structure, we can preserve what is probably the largest "clear span" space outside of a sports facility in the Upper MIdwest. This multi-purpose space will be used for: ' - banquets (up to 1,200 people) - exhibition hall (90 10'x10' booths) - dance hall - concert hall - meeting space (1,700 people) - senior center - community center All and many more of these uses are possible with the proposed additional construction and relocation of the "Cook's Shed". A single management entity can coordinate public activities (Boy Scout breakfasts, Earle Brown Days) and senior activities (aerobics , lectures, pot luck suppers), and public events (sports show, Lions' convention, computer shows). The ability to be able to offer these varied activities truly offers everyone an opportunity to be part of the total Earle Brown Farm. The introduction of a folding door separating the main area provide opportunities for two unrelated activities simultaneously. Redevelopment could include extensive investment to provide for superior acoustics, adequate electricity for computer shows, portable dance floors and furniture and fixtures to adequately accommodate all the potential uses. -3- k 1 1 1 1 1 1 1 r II. BUILDING AREA SUMMARY: AREAS (in square feet) Areas Gross Net Barn H 4,858 4,858 Annex 500 Barn E 4,858 4,858 Barn T (Horse Barn): North Wing 2,239 1,500 South Wing 2,184 1,520 West Wing 2,120 1,600 Hippodrome 13,525 13,525 Annex 4,481 Total 36,742 27,861 -4- III. COSTS: There are many variables that comprise the total costs of any project of a single purpose nature. These variables are increased in a mixed-use project and is compounded even further in a rehabilitation and further still in a historical restoration. Final plans and specifications have not been developed for the project, thus specific pricing is not available. Concept plans with several variables and qualifications have been discussed with the architect and a general contractor to obtain cost parameters. Restoration cost guidelines have been studied. Consultants have been questioned. Without many hours of expert analysis and study, nothing more than a guideline can be established and even that guide- line must be qualified. However, cost parameters must be established to measure the economic feasibility of the proposed redevelopment. With those guidelines stated, the following cost estimate summaries will also provide for measurable variations for use and quality of interior finishes. Definitions: Hard Costs: All costs directly attributable to construction/ redevelopment including utilities, site improve- ments, bricks and mortar, etc. Soft Costs: All costs that are attributable to the construction of the project but not considered hard costs, such as: appraisals, architect fees, legal, survey, interest, leasing fees, management fees, etc. ' Tenant Improvements: All interior improvements or finishing. Furniture, Fixtures & Equipment (FF&E): All property (generally moveable) not considered to be part of the building, i.e. tables, chairs, plates. ~ s IV. BUILDING COST SUMMARIES: Barn H: Hard Costs: 4,858 sf at $40 Soft Costs: 4,858 sf at $18 Tenant Improvements: 4,858 sf at $15 rounded to Barn E: Hard Costs: 4,858 sf at $40 Soft Costs 4,858 sf at $18 Tenant Improvements: 4,858 sf at $15 rounded to Annex: Hard Costs: 500 sf at $80 . Total $ 194,320 87 , 444 72,870 $ 355,000 $ 194,320 87,444 72,870 $ 355,000 $ 40,000 $ 750,000 Barn T (Main Horse Barn): Hard Costs: 6,770 sf at $68 $ 460,360 Soft Costs: 6,770 sf at $20 135,400 T.I. North Wing: 2,239 sf at $18 40,300 T.I. South Wing: 2,184 sf at $60 131,040 T.I. West Wing: 2,120 sf at $15 (A)scenario 31,800 [2,120 sf at $20 (B)scenario] [42,400] FF&E South Wing: Kitchen (catering) 70,000 FF&E West Wing: 150 seats at $225 (A)scen. - 33,750 '150 seats at $350 (B)scen.] (52,500] ;Kitchen (restaurant)(B)] [63,0001 $ 902,650 (A) or 995,000] (B) Hippodrome: Hard Costs: 13,525 sf at $95 $ 1,284,875 Soft Costs: 13,525 sf at $20 270,500 Tenant Improvements: FF&E: 11000,000 $ 2,555,000 Annex: Hard Costs: 4,481 sf at $80 $ 358,480 Soft Costs: 4,481 sf at $20 89,620 Tenant Improvements: FF&E: rounded to $ 448,000 Miscellaneous Costs: Site Utilities: $ 322,000 Cook's Shed Relocation: 50,000 Landscaping: 75,000 Site Improvements: 125,000 $ 572,000 Total: Say $ 5,230,000 (A) or 5,322,000] (B) -6- V. INCOME SUMMARY: Incomes derived from the various uses are estimates on best efforts methods. The rental schedule for the office space, however, is very conservative and achievable. The rents quoted for the restaurant and catering kitchen reflect negotiations with Best, Inc. In addition to base rent, Best, Inc. will pay 6% of sales for all catering delivered off-site and 12% for on-site catering. The incomes/rents are Gross Rents. Barn H: Office Space Barn E: Office Space Barn T: North Wing: Office South Wing: Office 4,858 sf at $11.50 4,858 sf at $11.50 1,500 sf at $11.50 520 sf at $12.00 Kitchen (catering) $ 55,900 $ 55,900 $ 17,300 $ 6,200 $ 21,800 against 6% of Sales West Wing: Hippodrome: Base Rent Catering Restaurant: 1,700 sf at $10 13,525 sf at $.20 psf per day x 200 days or $2,700 per event $400,000 Sales x 12% $ 17,000 against 6% of Sales $ 541,000 $ 48,000 -7- V1. ANNUAL BUILDING OPERATING BUDGET Taxes ($2.00 psf) $ 72,000 Insurance 24,000 Utilities 72,000 Heat & Air Conditioning $45,000 Electricity 24,000 Water-Sewer 3,000 Snow Removel 4,000 Lawn 3,000 Replacement & Repairs 15,000 Equipment Replacement & Reserve 15,000 (additional reserves must be considered for FF&E if a convention center and restaurant are built into the project) Management 45,000 Administration 50,000 Travel & Expenses 10,000 Maintenance 30,000 Miscellaneous 10,000 Total Operating Expenses: $ 350,000 Proposed Debt Service - 8J%, 30 years at $5,500,000: 507,650 I. - Annual Budget: $ 857,650 -8- 1 N 1 f 1 1 1 y y K y M y y y q ~r VII. ECONOMIC ANALYSIS: ANALYSIS Annual Budget: $ 857,650 Annual Income: $ 763,100 Deficit: ( $ 94,550 ) Additional Income: Percentage rent in restaurant, 6% of all net sales using scenario B - add $ 11,000 Increase catering sales in Hippodrome - Example: $1,000,000 sales at 12% = $120,000 Versus $48,000 in pro forma - add $ 72,000 Increase Hippodrome rates to $.25 psf or Increase days by 25%-or Increase base rent $600 per event - add $ 135,000 Charge for use of chairs, dance floor, FF&E, etc. - add $ 20,000 Potential Adds Cost Savings: Restaurant operator will probably aid in purchase of FF&E. - save $ 30,000 $1,000,000 FF&E in Hippodrome may be cut to $500,000. This translates into an annual savings of $ 46,000 Potential Savings Potential swing of $ 314,000 From deficit of $94,550 to Net Income $219,450 -9- $ 238,000 $ 76,000 VIII. SUMMARY/CONCLUSIONS The redevelopment proposed appears to be reasonably feasible economically. The proposal is compatible with the historic restoration and redevelopment guidelines. The use of public exhibit hall space can compatibly be integrated with senior citizen use and scheduling by having one coordinating entity. Additional time is necessary to firm up commitments on costs, restaurant operators and convention/business. Present Status: - A food service operator (caterer) and potential restauranteur is in place. Final negotiations have not been concluded, but we are in agreement in principle. - The catering company has agreed to have a full-time manager on site to assist in banquet sales. - The catering company will operate catering business for off-site service. - A kitchen and banquet supply consultant is in place. - The office space is approximately 30% pre-committed, assuming reasonable terms can be negotiated. - Two general contractors with extensive restoration experience are being considered. One has expressed interest via a formal presenta- y tion. y h r' _10- IX. PROPOSAL: We propose that we be appointed Developer of Record. During the next six months, the following activities will occur: - Firm up costs - Solidify office leases or letter of intent Solidify kitchen leases and restaurant letter of intent - Complete working drawings - Obtain preliminary approval of appropriate historical society - Provide operations organization chart - Try to reduce costs or increase income to provide 1.1 to 1 coverage - Confirm selection of general contractor - Provide time table proposing start late summer of 1987 - City to commit to provide financing as outlined: a. City to provide full non-recourse loan to include reserves, etc. b. Until break even occurs, all budgets will be reviewed and approved jointly between City,(HRA) and Developer. c. The lowest interest rate loan obtainable will be provided. d. As consideration, Developer will agree to a participating loan, whereby City receives a percentage of net proceeds. y y -11- q