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HomeMy WebLinkAbout2019-07 EDARCommissioner Graves introduced the following resolution and moved its adoption: EDA RESOLUTION NO. 2019-07 RESOLUTION APPROVING A PRELIMINARY DEVELOPMENT AGREEMENT WITH BRADY REAL ESTATE DEVELOPMENT, INC WHEREAS, the Economic Development Authority of Brooklyn Center, Minnesota (the "Authority") has received a proposal from Brady Real Estate Development, Inc, a Minnesota Corporation (the "Developer") regarding the development of land owned by the Authority at 1601 James Circle ("Authority Property"), for the creation of a three-story, 81,000 square foot office building, and associated parking, and public infrastructure improvements including utilities, roadway adjustments and storm water ponding, which proposal contemplates the Authority's conveyance of the Authority Property to the Developer; and WHEREAS, the Authority's Board of Commissioners has reviewed the Developer's development concept and has caused to be prepared a Preliminary Development Agreement to allow the Developer to negotiate the purchase of the Authority Property, conduct due diligence, and gain approval from the City for land use approvals and a public subsidy application; and NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority of Brooklyn Center,, Minnesota (the "Board), as follows: 1. The EDA hereby approves the Preliminary Development Agreement substantially in accordance with the terms set forth in the form presented to the Board, together with any related documents necessary in connection therewith (collectively, the "Preliminary Development Documents") and hereby authorizes the President and Executive Director to negotiate the final terms thereof and, in their discretion and at such time as they may deem appropriate, to execute the Preliminary Development Documents on behalf of the Authority, and to carry out, on behalf of the Authority, the Authority's obligations thereunder. 2. The approval hereby given to the Preliminary Development Documents includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the Authority and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the Authority. The execution of any instrument by the appropriate officers of the Authority herein authorized shall conclusive evidence of the approval of such document in accordance with the terms hereof. In the event of absence or disability of the officers, any of the documents authorized by this Resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by such other officer or officers of the Board as, in the opinion of the City Attorney, may act in their behalf. 3. Upon execution and delivery of the Preliminary Development Documents, the officers and employees of the Authority are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the Authority to implement the Preliminary Development Documents. Resolution No. 2019-07 4. The Board hereby determines that the execution and performance of the Preliminary Development Documents will help realize the public purposes of the Act. 18, 2019 Date Mayor ATTEST:��� City Clerk The motion for the adoption of the foregoing resolution was duly seconded by commissioner Ryan and upon vote being taken thereon, the following voted in favor thereof: Butler, Elliott, Graves, Ryan and the following voted against the same: None whereupon said resolution was declared duly passed and adopted. PRELIMINARY DEVELOPMENT AGREEMENT THIS PRELIMINARY DEVELOPMENT AGREEMENT ("Agreement") is made and entered into this 8th day of April, 2019, by and between the Economic Development Authority of Brooklyn Center, Minnesota (the "Authority") with its principal office at 6301 Shingle Creek Parkway, Brooklyn Center, Minnesota 55430, and Brady Real Estate Development, Inc, a Minnesota Corporation (the "Developer") with its principal office at West End Tower, 1600 Utica Ave S, Suite 900, Attn: Mike Brady St Louis Park, MN 55416. The Authority and the Developer may hereinafter be referred to individually as a "party" and collectively as the "parties." WHEREAS, the Authority is the owner of certain real property described in Exhibit A (the "Authority Property") located in the City of Brooklyn Center, Minnesota (the "City"); and WHEREAS, the Developer has presented to the Authority a concept for the development of the Authority's Property that may be acquired by the Developer for the creation of a three- story, 81,000 gross square foot office building, and associated parking, and public infrastructure improvements including utilities, roadway adjustments and storm water ponding (the "Development"), which proposal contemplates the Authority's conveyance of the Authority Property to the Developer. WHEREAS, the Authority's Board of Commissioners has reviewed the Developer's development concept and desires to enter into this Preliminary Development Agreement to allow the Developer time to negotiate the purchase of the Authority Property, conduct due diligence, and gain land use approvals from the City; and WHEREAS, the Authority and Developer intend to proceed with the Development if. (i) a satisfactory agreement can be reached regarding the purchase price to be paid by the Developer for the Authority Property; (ii) satisfactory financing for the Development can be secured; and (iii) the City approves a land use application by the Developer, allowing the Development to proceed. NOW, THEREFORE, in consideration of the foregoing, the Authority and the Developer hereby agree as follows: Section 1. Preliminary Nature of Agreement. The Authority and Developer agree that this Agreement is intended to be preliminary in nature. Before the Authority and Developer can make a decision on whether to proceed with the implementation of the Development, it will be necessary to consider information relative to the land, uses, design, economics and other aspects of the Development. The purpose of this Agreement is to allow the Developer an opportunity to assemble such necessary information, to refine the above referenced development concept, to negotiate with the Authority concerning the execution of a purchase agreement (the "Contract"), and which, if executed, will set forth the rights and responsibilities of the Authority and the Developer with respect to the Development. 1 During the term of this Agreement, the Authority agrees that it will not: (i) discuss the terms of the Development with a third party without the prior written consent of Developer, except to the extent required by the Minnesota Government Data Practices Act (Minnesota Statutes, Chapter 13) or other law; or (ii) enter into or negotiate a similar agreement or any other proposals with any party other than the Developer to develop the Authority Property. Section 2. Present Intent of Parties. The parties intend this Agreement to document their present understanding and commitments and, further, that if the following conditions are fulfilled to the mutual satisfaction of the Authority and Developer the parties will proceed in an attempt to formulate a mutually satisfactory Purchase Agreement for the Authority Property: (a) the Developer demonstrates the feasibility of the Development as refined pursuant to this Agreement; (b) the completion of all undertakings required by this Agreement in a satisfactory and timely manner; (c) the satisfaction of such other conditions as are determined to be appropriate by either party; and (d) the Development is generally consistent with the proposed concept submitted to the Authority's Board of Commissioners on March 25, 2019. The Contracts (together with any other agreements entered into between the parties hereto contemporaneously therewith) when executed will supersede all understandings and obligations of the parties hereunder. Section 3. Development Design. The Developer's concept for the Development on the Development Property is preliminary in nature and must be refined before implementation. The concept as proposed involves the creation of a three-story, 81,000 square foot office building with related parking and public infiastructure improvements including utilities, roadway adjustments and storm water ponding. Section 4. Developer Undertakings. During the term of this Agreement the Developer shall do the following: (a) Continue to refine its site and building plans for the Development. (b) Continue to refine its business plan and program of the interior space, operation model for a business tech center, and partnerships with neighboring properties. (b) Undertake preliminary engineering, soil testing/borings and geotechnical analysis of the Development Property. For this purpose, the Developer and its contractors shall have the right to enter upon the Authority Property at reasonable times and after notice to the Authority. The Developer shall indemnify, defend and hold the Authority harmless from and against any claims or damage, of whatsoever nature, 2 arising out of the entry onto the Authority Property and shall repair any damage caused to the Authority Property. This obligation shall survive termination of the Agreement. (c) Submit to the Authority a proposed schedule for the undertaking of the Development including timing of the closing and commencement and completion of construction activities. (d) Using title information and a survey provided by the Authority, update evidence of title to the Authority Property and provide to the Authority any objections to title. (e) Seek to secure a commitment for financing sufficient for construction of the public infrastructure improvements. (f) Obtain enviromnental reports and studies provided by the Authority and such other studies and testing deemed necessary, to determine the acceptability of the environmental condition of the Authority Property. (g) Prepare, submit application, and receive all necessary City land use approvals related to the development of the Authority Property. (h) Make all required presentations to the City Council of the City, the Authority's Board of Commissioners and the City Planning Commission in connection with seeking approvals for the Development. All of the information described above shall be prepared or collected at the sole expense of the Developer. The Developer shall have no obligation to provide the Authority or City any reports, tests, analyses or any other due diligence it has prepared internally or obtained from any third party except as specifically provided herein. Section 5. Authority Undertakings. During the term of this Agreement, the Authority will undertake the following: (a) Coordinate any necessary meetings with the Authority, City Council, Planning Commission and the community. (b) Assist in identifying public improvements necessary to be constructed or relocated in connection with the Development including, but not limited to, utilities, roadway changes and storm water ponding. (c) Identify construction, permit, application, utility and any other fees and the amount of such fees that the Developer may be expected to pay in connection with the Development. (d) Identify the approval process and timeframes for development approvals that may be expected for the Development. 91 (e) Provide to the Developer any title information and any third party reports the Authority has on hand regarding the Authority Property. (f) Provide to the Developer any surveys and environmental reports related to the Authority Property that are in the possession of the Authority. The Authority will, at the Developer's expense, cooperate with the Developer in pursuing any federal or State environmental approvals, permits, program enrollments or determinations requested by the Developer with respect to the Authority Property. (g) Coordinate with the Developer in pursuing any grants that may assist with environmental analysis, brownfield remediation, gap financing, and/or others that may be identified that would assist the Development. (h) Notwithstanding any provisions or understanding to the contrary, neither the City nor the Authority will exercise its condemnation powers to acquire any additional property or other real property in connection with the Development. Section 6. Contingencies. The parties acknowledge and agree that proceeding with the Development is subject to a number of contingencies including, but not limited to, the following: (a) The acquisition of all or part of the Authority Property by direct purchase, on such terms and conditions as are acceptable to both parties. (b) The acceptance by the Developer of its environmental and geotechnical assessments and all other environmental and wetland reports and surveys certified to the Developer and its lender, deemed necessary by the Authority and the Developer for all of the property to be encompassed by the Development, which reports and surveys must be satisfactory to the Authority and the Developer. (c) The Authority and the Developer having obtained all necessary approvals for the Development from all appropriate governmental authorities including, but not limited to, any necessary watershed district approvals. (d) The Developer having obtained such land use approvals from the City as is necessary to allow the Development to move forward. (e) Title to the Authority Property having been found acceptable to the Developer in its sole discretion. (f) The Developer having conducted such soils, well, engineering, hazardous waste, environmental and other testing as it determines necessary. (g) The Developer having obtained financing for, at a minimum, the public infrastructure improvements acceptable to Developer and satisfactory to the Authority. 0 Section 7. Negotiation of Contracts. During the term of this Agreement, the Authority and the Developer shall proceed with the negotiation of Contracts relative to the Development. The decision to enter into the Contracts shall be in the sole discretion of each of the parties. The parties agree that this Agreement is not intended to bind the parties to enter into any future agreement for the sale and acquisition of the Property, but is merely intended to set forth the parties' intent to proceed with the process of negotiating an agreement for the sale of the Property development of the property. If the Developer determines during the term of this Agreement that undertaking the Development is not financially feasible, it will promptly notify the Authority of such determination in writing and the parties will terminate this Agreement. Section 8. Effect of Approvals. No approval given by the Authority hereunder or in connection herewith shall be deemed to constitute an approval of the Development for any purpose other than as stated herein and the process outlined in this Agreement shall not be deemed to supersede any concept review, conditional use permit, vacation, subdivision, or other zoning or planning approval process of the Authority or the City relative to the development of real estate. Section 9. Payment of Costs. Both Parties are aware of and acknowledge that contingencies and unknowns presently exist, any one or more of which could make the Development cost prohibitive, and that both parties are expending sums of money and time with full knowledge of the risks involved and that neither party shall be liable for any of the other party's expenses in any event, except (i) as otherwise provided pursuant to a separate agreement between the parties, (ii) in connection with an application for a Public Subsidy, or (iii) pursuant to required fees or costs related to applications made to the City or under City Code. Section 10. Modifications. This Agreement may be modified and the term hereof may be extended only through written amendments hereto signed by both of the parties to this Agreement. Section 11. Exclusive Rights. In consideration of the time, effort and expenses to be incurred by Developer in pursuing the undertakings set forth herein, the Authority hereby agrees that for the term of this Agreement it will not provide or enter into an agreement with any third party in connection with any proposed development of the Authority Property. During such period the Developer shall have the exclusive right to work with the Authority in establishing definitive Contracts for the Development Property. Said exclusive rights shall continue, unless earlier terminated as provided herein, for the period described within Section 12 of this Agreement. Section 12. Term and Termination. This Agreement shall be effective as of the date first written above and shall continue for one year until April 8, 2020, unless terminated earlier in accordance with Section 7. If for any reason the Contracts have not been entered into by the parties by such date, or any mutually approved extension thereof, this Agreement shall be null and void and neither party shall have any liability or obligations to the other, except as provided in Section 9 regarding Authority costs incurred prior to the termination of this Agreement. 5 Section 13. Severability. If any portion of this Agreement is held invalid by a court of competent jurisdiction, such decision shall not affect the validity of any remaining portion of this Agreement. Section 14. Notices. Notice, demand, or other communication from one party to the other shall be deemed effective if sent by certified mail, postage prepaid, return receipt requested or delivered personally to a party at its address in the first paragraph of this Agreement, or at such other address as such party may designate in writing to the other party. IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf and the Developer has caused this Agreement to be duly executed in its name and behalf on or as of the date first above written ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER, MINNESOTA Its P sident BC Its Executive Directo Brady Real Estate Development, Inc. Its President/CEO rol EXHIBIT A Legal Description of the Authority Property Lot 2, Block 1, Richardson Park 3rd Addition, according to the recorded plat thereof, and situate in Hennepin County, Minnesota. 546682v2 TJG BR305-1