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HomeMy WebLinkAbout2016-027 EDAR Commissioner Lin Myszkowski introduced the following resolution and moved its adoption: EDA RESOLUTION NO. 2016-27 RESOLUTION AUTHORIZING A 60 DAY EXCLUSIVE NEGOTIATING PERIOD WITH CGG HOLDINGS REGARDING THE DEVELOPMENT OF 32 ACRES WITHIN THE OPPORTUNITY SITE WHEREAS, on April 27, 2015, the City Council adopted Resolution No. 2015- 74, A Resolution Adopting the 2016 Strategic Priorities and 2016-2018 Strategic Plan, which included Strategic Priorities for Resident Economic Stability, Targeted Redevelopment, Enhanced Community Image, Inclusive Community Engagement, Strengthened and Empowered Youth, and Key Infrastructure Investments; and WHEREAS, the Strategic Priorities for Targeted Redevelopment provided for redeveloping properties to the highest value and best use to accomplish the City's goals regarding housing, job creation, and growth of the City's tax base. Additionally, the City will appropriately prepare sites and provide the necessary supporting infrastructure investments to guide redevelopment of publicly-and-privately owned properties; and WHEREAS, the Strategic Plan for Targeted Redevelopment includes the following Strategic Targets and Initiatives: 1. Completion of Senior Assisted Living Development(Cars with Heart Site) by 2017; 2. Completion of Phase I Mixed Use Residential (Opportunity Site) for 10-15 acres with 250 units; 3. Completion of Phase II (Shingle Creek Crossing Development) through working with the developer on strategies using market analysis and incentives; and WHEREAS, on September 14, 2015, the City Council/EDA Work Session included a discussion on a preliminary development agreement (Contract for Exclusive Negotiations with Sand Development LLC) for the development of a market rate apartment and commercial Planned Unit Development within the southern portion of the Opportunity Site; and WHEREAS, on October 12, 2015, the EDA adopted Resolution No. 2015-22, a resolution which authorized the EDA to enter into a Preliminary Development Agreement with Sand Development which set out certain responsibilities related to the preliminary plans, determined the feasibility for redeveloping the Opportunity Site, and authorized the hiring of an engineering consultant (Solution Blue) to conduct the work to be performed by the EDA under the Preliminary Development Agreement; and EDA RESOLUTION NO. 2016-27 WHEREAS, on January 25, 2016, the City Council/EDA Work Session included a review of the Conceptual Master Plan illustrating the conceptual development of the southern 32 acres of the Opportunity Site (Lot 2, Block 2, Brookdale Square, and Lot 1, Block 1, Brookdale Square 2"d Addition) for the phased development of: seven apartment buildings, comprising a total of 746 market rate apartment units; a two-acre commons area with pool and activity building; a 50,000 square foot performing arts center with structure parking providing 160 stalls; and public and private utility and street improvements to serve the development; and WHEREAS, the consensus of the City Council/EDA was that the Conceptual Master Plan provided by Sand Development and Solution Blue met the City's vision for the redevelopment of its 32 acres within the southern portion of the Opportunity Site and satisfactorily addressed the provisions of the Preliminary Development Agreement necessary to proceed with the preparation of a Final Development Agreement; and WHEREAS, on February 8, 2016, the EDA adopted RESOLUTION NO. 2016- 06, which authorized the preparation of a Final Development Agreement with Sand Development to include the following: 1. Duration of the contract. 2. Terms and price of the land acquisition costs. 3. Plans and schedule of site preparation improvements to be completed by the EDA. 4. Plans and schedule for the public improvements to be completed by the EDA. 5. Schedule for the conveyance of buildable lots and the Redeveloper's schedule for construction of the private improvements and residential portion of the planned unit development. 6. Affordability requirements. 7. City review and approval rights (environmental assessment worksheet, residential planned unit development(PUD)platting, and site plans). 8. Other financial assistance that may be required to complete the improvements; and WHEREAS, during the preparation of a Final Development Agreement the following issues and fiscal challenges resulted in a determination that the project, as designed, was not feasible: EDA RESOLUTION NO. 2016-27 1. The developer was unable to secure financing for the first phase of two apartment buildings comprising 308 units. 2. The public infrastructure costs were estimated at approximately $6.9 million which exceeded the Tax Increment projected for the first phase development. 3. The developer's proforma required up-front TIF assistance of$5 Million through the EDA sales of a G.O. TIF Bond vs. a Pay-As-You-Go Note. WHEREAS, the EDA did not enter into a Final Development Agreement with Sand Development and, since the term of the Preliminary Development Agreement had expired, the EDA was once again open to seek new development proposals for the Opportunity Site from other Developers; and WHEREAS, the EDA retained the engineering consultant services of Loucks & Associates to re-evaluate the storm water management options for the Opportunity Site and review the estimated development costs for public infrastructure which provided an alternative layout and design for storm water management with projected public infrastructure costs in the range of$2.3 Million and have discussions on the City Council's strategic goals and visions for redevelopment within the Opportunity Site; and WHEREAS, Devan George, Partner, CGG Holdings, has expressed an interest in working with the City on the planned residential development of market rate apartment units within the Opportunity Site; and WHEREAS, on November 28, 2016, the City Council/EDA reviewed a conceptual development plan submitted by CGG Holdings which illustrated the following development on the 32 acres within the Opportunity Site owned by the EDA: 1. 425-475 market rate apartment units with 425-575 underground parking stalls and 230 surface parking stalls; 2. 200 senior apartment units with 200 underground parking stalls and 80 surface parking stalls; 3. 60 townhomes with terraced courtyards and 120 underground parking stalls; 4. 37,000 square foot Community Arts Center and 6,000 square foot retail building (restaurant/brew house)with 290 surface parking stalls; and i EDA RESOLUTION NO. 2016-27 5. Green areas for community park/event spaces, common areas, dog park, and a perimeter green area &trail with connections to the Regional Trail System; and WHEREAS, the consensus of the Council Members was that the conceptual development plans were consistent with their vision for the redevelopment of the Opportunity Site. NOW, THEREFORE, BE IT RESOLVED, by the Economic Development Authority of Brooklyn Center, Minnesota as follows: 1. That the EDA agrees to provide CGG Holdings a 60-day exclusive negotiating period to negotiate a working partnership with the City of Brooklyn Center for the redevelopment of the southern 32 acres within the Opportunity Site (Lot 2, Block 2, Brookdale Square and Lot 1, Block 1, Brookdale Square 2"a Addition) that would include the first phase construction of 200 apartment units in 2017 and the use of a Pay-As-You- Go Note as the fiscal tool to bridge any financial gap for the private improvements. 2. This Exclusive Negotiating Period is in effect through February 13, 2017 and the EDA may enter into negotiations with any other developer after that date if the EDA has not acted by resolution during the Exclusive Negotiating Period enter into, at least preliminarily, a development agreement with CGG Holdings on its development plan for the Opportunity Site from CGG Holdings. December 12, 2016 Date President The motion for the adoption of the foregoing resolution was duly seconded by Commissioner Dan Ryan and upon vote being taken thereon,the following voted in favor thereof: Tim Willson, April Graves, Kris Lawrence-Anderson, Lin Myszkowski, Dan Ryan and the following voted against the same: whereupon said resolution was declared duly passed and adopted.