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03/04/2013 - City Council Finance CommitteeFINANCE COMMITTEE MEETING MONDAY, MARCH 4, 2013 1:00 P.M. CONFERENCE ROOM 2A &B AGENDA I. AGENDA ADOPTION II. CEDAR GROVE PRELIMINARY DEVELOPMENT AGREEMENT - PRATT- CASSIDY TURLEY MARKETING PLAN I L� III. CEDAR GROVE FINANCING - TIF DISTRICT MODIFICATION BUDGET IV. CEDAR GROVE FINANCING - CDBG ALLOCATION UPDATE V. CENTRAL AREA UPDATE - CSM INTEREST IN PUBLIC FINANCING ASSISTANCE OPTION VI. OTHER BUSINESS �C_) • FUNDING SOURCE FOR CAPONI PROPERTY VII. ADJOURNMENT Agenda Information Memo Finance Committee Meeting March 4, 2013 II. CEDAR GROVE PRELIMINARY DEVELOPMENT AGREEMENT - PRATT- CASSIDY TURLEY MARKETING PLAN DIRECTION TO BE CONSIDERED: To make a recommendation to the EDA regarding the extension of the Preliminary Development Agreement between the EDA and Pratt Development relative to the Cedar Grove Redevelopment District. FACTS: • In March, 2011, after Doran Companies withdrew from the Doran -Pratt master developer partnership for the Cedar Grove Redevelopment District, the EDA entered into an Amended Preliminary Development Agreement with Pratt Development, under which Pratt entered into a listing agreement with Cassidy Turley to market the EDA -owned property in the Cedar Grove core area and one parcel south of Cedar Grove Parkway. The agreement with Pratt also is essentially a listing agreement with compensation occurring as broker fee at the time of any sale of property in which the team was involved. The term of the agreement was subsequently extended from March 2012 to March 2013. • At its meeting of January 15, 2013, the EDA authorized the preparation of an additional one year extension of the Preliminary Development Agreement between the EDA and Pratt Development under the same terms. At its meeting of February 5, 2013, approval of the agreement extension was pulled for discussion and questions were raised about the currency and effectiveness of the information regarding the Cedar Grove Redevelopment on the Cassidy Turley website, because the information an EDA member found in a web search did not mention the Paragon project, and the search found that no reference to the Cedar Grove Project was on the Pratt website. It was also suggested that the EDA should be updated on the marketing and prospecting activities of the team and that it would the EDA should receive an updated marketing plan from the team for the area in light of the approval of the Paragon project. • The matter was referred to the Finance Committee for further review in anticipation of the matter being returned to the EDA at its meeting of March 19, 2013 for further consideration. It was suggested that a condition of any extension be more frequent updates to the EDA on progress in the marketing of properties and a formal update to the EDA at a meeting in August or September of 2013 to determine whether to further extend the agreement or consider proposals for master developer services in 2014. • At its meeting of February 6, 2013, the Finance Committee briefly discussed the EDA action and directed staff to work with the developer team to get responses to the issues raised, to get updates and corrections as appropriate and to have the team prepare the requested marketing plan for review by the Committee at a meeting preceding the EDA meeting on March 19tH The Committee also asked the City Attorney to advise as to the possibility of modifying the listing agreement in certain ways to address the concerns that had been raised. The City Attorney will be present at the Committee meeting to discuss options in that regard. • Since that time, staff has communicated the concerns and worked with the developers to provide the information requested. Mr. Pratt and Mr. McCaffrey will be present at the Committee meeting to present the marketing plan and respond to questions as appropriate. Since the Committee meeting, they have provided the following specific information: • The document that had been located in the initial web search was the original listing document for the entire 65 acre core area and the Cassidy Turley site does have updated information regarding the project on their website. Unfortunately, the updated information was not as easily accessed by search engines. The company is taking steps to make it easier for parties doing web searches to locate the updated pages. To date, Mr. Pratt and Mr. McCaffrey have focused on the property information being located on the Cassidy Turley site, since they have the formal listing of the property. Staff has asked Mr. Pratt to set up a link from his company sites to the Cassidy Turley site to facilitate direct connections to the information for people searching from that direction. • Staff has modified the City's Cedar Grove website to provide a direct connection to the most recent information on the Cassidy Turley site. Mr. McCaffrey noted that standard practice in the industry is to not modify an offering until a sale has closed. Staff clarified that the unique situation here is that the EDA as owner would want clarification of how the availability of the property has changed to take advantage of the level of approval Paragon had achieved. Cassidy Turley apologized for not posting the Paragon information more promptly and has modified the information on its site accordingly. • The developers restated the importance of maintaining a level of confidentiality of contact information in providing updates to their clients. The developers have provided detailed summaries of activity to the staff redevelopment group in the past and it has not been retained in City files so it does not become public information. To maintain confidentiality, the developers can either report information about numbers of meetings and contacts in generalities to the full EDA and/or it may be appropriate for them to provide the detailed summaries to the Finance Committee on behalf of the EDA. • Staff has also continued its participation in the Cedar Avenue Bus Rapid Transit Oriented Development Study, being coordinated through Dakota County in partnership with the Cities along the corridor. Over the next six months, one of the outcomes of that study will be a third party analysis of potential prospect uses for the stations along the corridor, including the Cedar Grove Station. That information will be useful in assisting the City and the master developer in targeting uses and users for the outlots, as well as providing market based data as support. • Mr. Pratt and Mr. McCaffrey will be present at the Committee meeting to overview marketing activity to date and the materials in enclosed. ATTACHMENTS: • Amended Preliminary Development Agreement on pages rS through q • Excerpt of Minutes of February 5, 2013, EDA meeting enclosed on page • Cassidy Turley email summarizing recent activities on page I, • Cassidy Turley summary of marketing activity to date noted in email to be distributed at Committee meeting. • Marketing Plan enclosed without page number. AMENDED AND RESTATED PRELIMINARY REDEVELOPMENT AGREEMENT THIS AMENDED AND RESTATED PRELlMrNr Y EVELOPMENT AGREEMENT ( "Agreement ") is made this ALday of 2011, by and between the Eagan Economic Development Authority, a Minnesota municipal corporation (hereinafter the "EDA "); the City of Eagan, Minnesota municipal corporation (the EDA and the City of Eagan are hereinafter collectively referred to as the "City "); and Pratt Development, Inc., a Minnesota corporation (hereinafter referred to as "Redeveloper "). (The City and Redeveloper are hereinafter collectively referred to as the "Parties. ") WHEREAS, Doran Pratt Development, LLC and the City entered into that certain Preliminary Redevelopment Agreement dated August 21, 2007 and the First Amendment dated August 18, 2008 pertaining to the redevelopment of the Cedar Grove Redevelopment District (collectively referred to as the "Development Agreements "); and WHEREAS, the Development Agreements have expired and Redeveloper has requested that the City retain it to serve as the Master Developer for the core area of the Cedar Grove Redevelopment District (the "Redevelopment Property") as generally depicted on Exhibit "A;" and WHEREAS, Kelly Doran has indicated that he has terminated his relationship with Doran Pratt Development, LLC and Leonard Pratt, through his company, proposes to continue the redevelopment of the Cedar Grove Redevelopment District and serve as the Redeveloper; and WHEREAS, in order to pursue the redevelopment, the Redeveloper has requested that the City engage various consultants to assist in the redevelopment; and WHEREAS, the City is willing to engage such consultants and retain the Redeveloper as the Master Developer for the core area all upon the terms and conditions contained herein. NOW, THEREFORE, in consideration of the mutual covenants and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties as follows: 1. REDEVELOPMENT PROPERTY. The properties proposed to be redeveloped are the properties depicted on Exhibit. "A," with the exception of the properties identified as Exception Parcels 1 and 2 (the "Site "). The Parties agree that the Site may be enlarged to include other lands at the mutual agreement of the Parties. 2. UNDERTAKING AND EXCLUSIVE RIGHTS. In consideration of the time, effort and expenses to be incurred by the City and Redeveloper in pursuing the undertakings set forth herein, the City hereby agrees that for the term of this Agreement it will not: (i) provide or enter into an agreement for provision of financial assistance to any third party in connection with any proposed development within the Site; and (ii) condemn or agree to proceed with the condemnation of any property within the Site to assist or facilitate development within such area by a third party. Said exclusive rights shall continue, unless earlier terminated, as provided for herein, until March 16, 2012, or until such later date as the Parties may mutually agree. 3. THE PROJECT. The Project will consist of the redevelopment of the site and may include residential, mixed use and retail as shown on the Concept Plan attached hereto as Exhibit "B." Building designs will be consistent with the design standards adopted by the City as may be modified from time to time. 4. DEVELOPER OBLIGATIONS. a. Solicitation of Outside Brokers. Redeveloper has indicated it will use a regional or national real estate consultant for procuring other regional or national developers. Redeveloper shall be responsible for any and all costs or fees incurred by any outside consultant and shall indemnify and hold the City harmless from any and all claims that may be asserted by any outside consultant or any other third party. Within 30 days after execution of this Agreement, Redeveloper shall provide a detailed summary outlining the efforts and their respective roles in the drafting and implementation of the Project, including the respective roles of Len Pratt and representatives of Cassidy Turley. b. Development Updates. Redeveloper shall provide monthly updates to the City concerning the status of any ongoing redevelopment activity for the Project. A representative of the Redeveloper shall attend bi- monthly meetings of the Eagan Economic Development Authority to provide updates of the status of any redevelopment activity for the Project. A representative of the regional or national real estate consultant must also attend at least one EDA meeting to discuss the status of any redevelopment activity. C. Presentation of Proposed Development /Developer. Redeveloper shall use its best efforts to solicit outside development for the Project. Prior to presenting any development proposal to the City and City Staff, Redeveloper must prequalify any prospective developer. Origination of Developer. If the prospective developer originates with Redeveloper, it must advise City Staff of the contact and expectations regarding the timing of the qualification process. tr: ii. Prequalification of Proposed Developer. Redeveloper will conduct all necessary due diligence to "qualify" the proposed developer, including the developer's financial capacity and background on prior developments. Redeveloper will obtain a pro forma for the proposed project from the developer which will be provided to the City's Consultants. iii. Analysis for Public Assistance. The City is not presently making any commitment whatsoever to provide a specific type, level or amount of public assistance that may be available for the site, the Redeveloper' or any other developer. However, upon submission of a development proposal and pro forma identified above, the City will work with the Redeveloper to determine if public assistance is.available to the Project. Redeveloper shall provide an escrow in a minimum amount of $5,000.00 to allow for the City's consultants to review the proposed development pro forma. The City intends to retain the services of Faegre & Benson, LLP, Ehlers and Associates, Inc. and Severson, Sheldon, Dougherty & Molenda, P.A., as well as other persons (collectively referred to as the "Consultants "). Consultants are being retained to assist with legal matters pertaining to the Project and an analysis of the pro forma. The City will reimburse itself from the deposit for all costs and expenses incurred by the City's Consultants. 5. POSSIBLE SALE OF CITY PROPERTY. In the event that the City determines that the development proposal may be feasible, the City will prepare a purchase agreement through the City Attorney's office. The purchase agreement will be in a form acceptable to the City and the actual developer will be identified as the "Buyer" under the agreement. The purchase agreement will be in a form consistent with the previously approved Master Purchase Agreement, which is attached hereto as Exhibit "C," including all contingencies contained therein. The City makes no commitment that it will sell any portion of the site to the Redeveloper or any other party. POSSIBLE RECOVERY OF COMMISSION. The Redeveloper is hereby granted permission to list the Property on the Multiple Listing Service and it shall be the responsibility of Redeveloper to coordinate such listing with the City. Redeveloper acknowledges that due to the multiple properties located at the Site, that it may not be possible to accomplish the listing. The City acknowledges that in the event of a sale of city property, it will pay a total commission of 10% to Redeveloper (Redeveloper may allocate among other brokers), Said commission is earned only upon a successful closing. The City reserves the right to reject all offers. 7. ACCESS TO CITY PROPERTY. Redeveloper and its agents and representatives shall, during the term of this Agreement, have reasonable access to the portions of the Site owned by the City that are not occupied by any tenant ( "City Property") and the right to enter upon the City Property for the purpose of investigating the City Property, including inspecting, surveying, engineering, test boring, performance of environmental tests and such other work as Redeveloper shall consider appropriate and shall have the further right to make such feasibility studies and analyses of the City Property as it deems appropriate.. Prior to entry upon any portion of the City Property for the purpose of commencing any such testing or studies of the' City Property, Redeveloper shall procure and maintain general public liability insurance containing customary limits. Redeveloper agrees to restore any material damage done to the City Property by anyone acting in Redeveloper's behalf in conducting the activities described in this Section, Redeveloper agrees to indemnify and hold the City harmless from and against all loss, cost, liability and expense including attorneys' fees suffered by the City as a result of Redeveloper's activities or the exercise of entry rights by Redeveloper, its agents and representatives. 8. SIGNAGE PLAN. Contemporaneously with the execution of this Agreement, Redeveloper shall provide a signage plan, which must be reviewed and approved by the City. All signs must comply with City Code and trailers must comply with any requirements or conditions employed by the City's Building Inspector. To the extent that any proposed signs do not comply with City Code, specific deviations from the City Code must require prior approval of the City Council of the City. 9. TERMINATION. This Agreement may be terminated prior to its expiration by the City as to all or a portion of the Redevelopment Property upon the giving of written notice to the Redeveloper that the Redeveloper is not diligently pursuing the redevelopment of the portions of the Redevelopment Property, The Redeveloper shall have a reasonable time, but in no event less than 30 days to effect a cure of such default, or to demonstrate that it is diligently pursuing such cure. 10. LEGISLATIVE JUDGMENT. The Redeveloper understands that many of the actions which may be necessary for the Project and may be contemplated by a Master Development Agreement involve matters of the discretion by the City Council of the City, and in some instances, its legislative judgment. Such actions may only be made following established procedures, and the City cannot and does not agree, in advance, to any specific decision in such matters. RAI i 11. NOTICES. All communications shall be directed to the Redeveloper at: Pratt Development, Inc. Attn: Leonard W. Pratt 3500 Willow Lake Boulevard, Suite 100 Vadnais Heights, MN 55110 All communications shall be directed to the City at: Eagan Economic Development Authority Attn: Thomas L. Hedges, Executive Director 3830 Pilot Knob Road Eagan, MN 55122 -1810 And City of Eagan City Hall Attn: Jon Hohenstein, Community Development Director 3830 Pilot Knob Road Eagan, MN 55122 -1810 IN TESTIMONY WHEREOF, the Parties hereto have set their hands as of the date and year first above written. EAGAN ECONOMIC DEVELOPMENT AUTHORITY, a, Minnesota municipal corporation nn� By: V Mike Maguire Its: President By: Thomas L. Hedges Its: Executive Director x MINUTES OF A MEETING OF THE EAGAN ECONOMIC DEVELOPMENT AUTHORITY Eagan, Minnesota February 5, 2013 A meeting of the Eagan Economic Development Authority was held on Tuesday, February 5, 2013 at the Eagan Municipal Center. Present were President Maguire, Commissioner Bakken, Commissioner Fields, Commissioner Hansen and Commissioner Tilley. Also present were Executive Director Hedges, Community Development Director Hohenstein and City Attorney Dougherty. CALL TO ODER President Maguire called the Economic Development Authority meeting to order. ADOPT AGENDA Commissioner Tilley moved, Commissioner Hansen seconded a motion to approve the agenda as presented. Aye: 5 Nay:0 CONSENT AGENDA Councilmember Fields pulled Item 2. Approve extension of preliminary redevelopment agreement with Pratt Development for the Cedar Grove Redevelopment District for separate action. Commissioner Bakken moved, Commissioner Tilley seconded a motion to approve the Consent Agenda as amended. Aye: 5 Nay: 0 It is recommended to approve the minutes of January 15, 2013 EDA meeting as presented. Item pulled for separate action. Community Development Director Hohenstein gave a staff report with additional history on Item 2. Commissioner Fields indicated she had visited the Cassidy Turley and Pratt Development websites and said they lacked current information regarding the Paragon project as part of the Cedar Grove Redevelopment. Fields suggested the Council see a Sales and Marketing Plan at a future council meeting with an update in August 2013 to see how the marketing is going. It was noted that the Council Finance Committee reviews financial aspects of the Cedar Grove project and that they could review the concerns and suggestions at an upcoming meeting. After further discussion, President Maguire moved, Commissioner Fields seconded a motion to it was continue Consent Item 2. to the March 19, 2013 Economic Development Commission meeting with direction to staff to ask developers Pratt and Cassidy Turley to submit a Sales and Marketing Plan to be reviewed at time. Aye: 5 Nay: 0 There was no Old Business. OLD BUSINESS Ib -,1L� Jon Hohenstein From: McCaffrey, James < James .McCaffrey @cassidyturley.com> Sent: Tuesday, February 26, 2013 10:55 AM To: Jon Hohenstein Cc: Len Pratt (lenpratt @pratthomes.com) Subject: FW: Report Attachments: Cedar Grove Report Marketing Summary.pdf Jon; attached please find a summary Marketing Report of activity that we have engaged in the past several months. This will show our marketing efforts and contacts since mid -2012 thru February of 2013. A NEW MARKETING PLAN going forward will follow later this week before our meeting next Monday. This information will address any questions about pursuits of developers or users for the various outlots and where our concentrations have been. You will see that continued marketing penetration has been to attract hospitality, multifamily and retail developers to the Cedar Grove outlots. The efforts of the marketing team have generated 50 face to face meetings with prospects in addition to the 20 city staff and EDA meetings attended. This update reflects the changes made to the Cassidy Turley web site to address the Paragon development. Once again, this data was not put forth on the web site earlier as our policy is not to make specific development plans /concepts public on line until a closing has occurred. This protocol is customary due to concerns by the developer, the architect, tenants and others over confidentiality, competitive advantage, copyright and disclosure concerns about accurate representation of plans and schematics prior to EDA approval. That approval was granted in late November of 2012. We will be more aggressive going forward with representation of developing activity while still maintaining the proper degree of discretionary disclosure. can assure you that Len and I have been providing the entirety of Paragons plans, updated site concept plans with outlots reflected, and have been putting forth these materials in electronic and printed format to developers and users for the past several months on a confidential one to one basis. look forward to our continuing discussions and thank you for your support. James M. McCaffrey, CCIM Senior Vice President, Principal Cassidy Turley 1400 IDS Center 80 South 8th Street Minneapolis, MN 55402 T 612- 347 -9355 James. McCaffrey @cassidyturley.com www.cassidyturley.com My Website Follow Cassidy Turley© Cassidy Turley i cam se"te If you need to send me a file larger than 5MB please use this link This e -mail and attachments (if any) is intended only for the addressee(s) and is subject to copyright. This email contains information which may be confidential or privileged. If you are not the intended recipient please advise the sender by return email, do not use or disclose the contents and delete the message and any attachments from your system. Unless specifically stated, this email does not constitute formal advice or commitment by the sender or Cassidy Turley. Agenda Information Memo Finance Committee meeting Monday, March 4, 2013 III. CEDAR GROVE FINANCING — TIF DISTRICT BUDGET MODIFICATION DIRECTION TO BE CONSIDERED: To make a recommendation on the proposed modification to the original Cedar Grove TIF district budget and direct it to a future City Council meeting for approval. FACTS: • The original TIF district budget from 10 years ago is the budget of record today; the original budget of course did not contemplate construction of a parking ramp. • The process for modifying the budget to reflect the Paragon project and other known changes is reflected in Ehlers' Schedule of Events. The public hearing for the budget modification is scheduled for April 2. • With historical information and input from staff, Ehlers has drafted a revised budget. The budget reflects the addition of the parking structure at $14,775,000 (net of Paragon's contribution), interest on the parking ramp bonds of $4,400,000, and additional interest on interfund borrowing of $9,900,000. • Public Works Director Matthys is analyzing whether additional costs are expected to be incurred related to the Other Qualifying Improvements listed. He will have preliminary estimates at the Finance Committee meeting. Additional improvement costs may be incorporated into the final budget modification if that is the direction of the Committee. • To balance the revised budget under the assumption of no special legislation extending the term of the TIF district, an EDA contribution from sources other than tax increment is required. The City hopes to obtain special legislation at some point to extend the district and fund the projected gap. If special legislation is not obtained, the City may be able to use tax abatement at the conclusion of the TIF district term to generate additional dedicated revenue to cover the gap. • Staff from Ehlers will be available at the Finance Committee meeting to expand on the budget and answer questions. ATTACHMENTS: • Schedule of Events related to the budget modification is on pages 13 through A- • The proposed budget modification detail will be distributed at the meeting. I a SCHEDULE OF EVENTS EAGAN ECONOMIC DEVELOPMENT AUTHORITY AND THE EAGAN CITY COUNCIL FOR THE MODIFICATION OF TAX INCREMENT FINANCING DISTRICT NO, I LOCATED IN THE CEDAR GROVE REDEVELOPMENT PROJECT AREA (a redevelopment district) January 30, 2013 February 6, 2013 Finance Committee meets to discuss potential Modification of TIF District No. 1. February 19, 2013 FDA requests that the City Council call for a public hearing. February 25, 2013 Project information, property identification numbers, and maps sent to Ehlers and Associates for drafting documentation. March 5, 2013 City Council calls for public hearing on the Modification of Tax Increment Financing District No. 1. N/A Project information submitted to the County Board for review of county road impacts (at least 45 days prior to public hearing). *The County Board, by law, has 45 days to review the TIF Plans to determine if any county roads will be impacted by the development. Because the City staff believes that the proposed tax increment financing districts will not require unplanned county road improvements, the TIF Plans will not be forwarded to the County Board 45 days prior to the public hearing. Please be aware that the County Board could claim that tax increment should be used 'for county roads, even after the public hearing. March 6, 2013 Letter received by County Commissioner giving notice of Modification of Tax Increment Financing District No. l (at least 30 days prior to publication of public hearing notice). [Ehlers will e -mail and-mall on March 6, 2013]. March 15, 2013 Fiscal /economic implications received by School Board Clerk and County Auditor (at least 30 days prior to public hearing). [Ehlers will fax and mail on or before March 15, 2013] March 26, 2013 Planning Commission meets at 6:30 p.m, and reviews Modification to determine if it is in compliance with City's Comprehensive Plan, Apri 12, 2013 EDA considers the Modification. [Ehlers will send EDA packet information via email on or before March 26, 2013] 13 SCHEDULE OF EVENTS - PAGE TWO EAGAN ECONOMIC DEVELOPMENT AUTHORITY AND THE EAGAN CITY COUNCIL FOR THE MODIFICATION OF TAX INCREMENT FINANCING DISTRICT NO. 1 LOCATED IN THE CEDAR GROVE REDEVELOPMENT PROJECT AREA (a redevelopment district) April 5, 2013 Date of publication of hearing notice and map for the Modification of the Tax Increment Financing Plan for Tax Increment Financing District No. 1 (at least 10 days but not more than 30 days prior to hearing). [Sun Thisweek publication deadline April 2, 2013 — Ehlers will submit notice and map to newspaper via email at or before noon] May 7, 2013 City Council holds public hearing at 6;30 p.m. on the Modification of the Tax Increment Financing Plan for Tax Increment Financing District No. I and adopts the resolution approving the Modification. [Council packet information sent by April 30, 2013.] May 7, 2013 , 2013 12013 Week of May 20, 2013 Week of May 20, 2013 June 4, 2013 June 28, 2013 July 2, 2013 Council calls for the sale of General Obligation TIF Bonds. City authorizes Ehlers to request certification of the Modification. Ehlers requests certification of the Modification with County and State. Distribute Official Statement for G.O, TIF Bonds. Conference call with Rating Agency, City Council meets to award sale of G.O. TIF Bonds. Estimated closing date for G.O. TIF Bonds. Deadline for Legislative extension of the 5 -year Rule. o .HL;b LF9ARITS IN F UIRIC t'I M.ACV.f T; Agenda Information Memo Finance Committee Meeting March 4, 2013 IV. CEDAR GROVE FINANCING — CDBG ALLOCATION UPDATE DIRECTION TO BE CONSIDERED: To consider a recommendation to the City Council the reallocation of a portion of the City's CDBG balance for costs related to the CDA's Riverview Ridge Townhomes project. FACTS: At its meeting of February 6, 2013, the Finance Committee reviewed the deal points for a prospective development by Dominium to construct a 55+ apartment project at Cedar Grove. One of the proposed financing sources for that project was an allocation of the City's Community Development Block Grant fund balance to underwrite the purchase of the land. The amount proposed is the combination of program revenue and a portion of the unused allocations from prior CDBG years, totaling $221,200. This amount needs to be expended no later than May 1, 2013 to avoid being withdrawn for local use by HUD. • The Committee determined that the TIF generation that would come from the Dominium project did not justify the level of subsidy required to proceed. The Committee indicated it would be open to a proposal that offered more for the land and required less in the way of fee waivers. That response has been shared with Dominium and the company has indicated it does not intend to proceed at this time. Given that response and the timeliness of expenditure matter, staff contacted CDA staff about alternative uses of the funds. The CDA indicated that the MnDOT review of the access requirements from Hwy 13 to the Riverview Ridge project has resulted in turn lane and intersection improvement costs greater than they had anticipated in the project pro forma. The CDA is exploring other funds at its disposal to make up the difference, but if the City were to reallocate the balance from its original uses to the Riverview Ridge project, it would close the gap, provide support for an Eagan based project and would avoid a loss of the funds for the community. • One issue will be the timing of the consideration of this alternative and consideration of the development application by the Council. It is expected that the Met Council review of the Comprehensive Plan Amendment will be completed soon and the development proposal will be back before the Council in April. ATTACHMENTS: None 15 Agenda Information Memo Finance Committee Meeting March 4, 2013 V. CENTRAL AREA UPDATE — CSM INTEREST IN PUBLIC FINANCING ASSISTANCE OPTION DIRECTION TO BE CONSIDERED: Update only — no direction is requested. FACTS: At its meeting of February 6, 2013, the Finance Committee was given an update on the progress toward the presentation of the Central Commons Area Small Area Study by HKG. As a part of that update, it was noted that a number of the concepts the consultant had prepared included structured parking, more substantial pedestrian features or greater building verticality than CSM, the owner of the former Lockheed Martin property, has suggested could be implemented in a redevelopment that was entirely privately financed. The Committee was not asked to take action, but was advised that a question to be anticipated at Workshop meeting at which the study was presented would be whether the Council would be open to considering public financing assistance for the project, if it would facilitate one or more of its desired policies or features in a redevelopment. In response to the question at the workshop, the Council indicated an openness to the option, depending on what it would bring to the project. • Since that time, staff has compiled its notes of the input from the Workshop and met with representatives of CSM to discuss their understanding of the Council responses and next steps regarding their approach to the property. As a part of the conversation, the representatives expressed interest in taking initial steps to determine whether a tax increment financing district could be established for the property. • Both staff and the developer made clear that this interest does not amount to a commitment by either parry, but it is an expression of interest in exploring what might be brought to the project if some level of assistance were available. Staff will overview what exploring this possibility may require moving forward. ATTACHMENTS: • Staff notes from City Council Workshop enclosed on pages /7- through / - _ • Additional information will be reviewed at the Committee meeting. I (J Notes from Eagan City Council Workshop City Staff List February 12, 2013 • Is there a Council preference for a development of the site that focuses on a single use — such as office, retail, residential or other — or a combination of uses? General — Prefer mixed use —later comments acknowledge that not all use elements are equally supportable. Attracted to mixed use, but also attracted to pedestrian scale layouts. Integrating roadway (East -West) through the site & different scale buildings on the north side of the site could be different uses. With whatever the uses, pedestrian and bicycle trail connections to Central Park & Argosy important. CF: More of a mix would be good; not willing to state percentages. MT: Agrees, pedestrian friendly important. MM: Likes mixed use but leans more toward pedestrian scale regardless of mix. • Are there certain policies within the Central Commons Special Area Plan that the City Council prioritizes higher than others? General — Avoid "sea of asphalt ", parking areas broken up. Buildings can break up parking fields. Like the idea of walkability, human scale, want greenway to gravitate to. How can you screen parking? We have enough strip malls. This needs to be unique. Give high attention to human scale. CF: No sea of asphalt. MM: Screen parking with buildings and break the parking fields up. MT: Walkability is important given proximity to transit; no sea of parking. CF: Varying building heights will help make the site interesting. MM: Argosy /Central Park access area treatment equally as important as YD/PK Road. Site should communicate with Eagan Transit Station in some fashion but probably least likely to draw pedestrians from YD/PK Road. • Is there a Council priority placed on human scale policies in the Special Area Plan, including pedestrian orientation, transit integration, public gathering spaces or other features to a redevelopment of the area? See above • What are the Council's expectations regarding the form of the buildings and improvements within the area? All single story versus an integration of single and multi -story buildings? General — Prefer mix. Expect diversity of height. Tendency to think of site perspective from YD/PK Road but development needs to relate to north and west sides too. Is there a way to relate development visually to the transit station and complement it vertically? IOC • Is there a Council expectation as to the maximum size /footprint of individual buildings? Is that expectation the same for both single story and multi -story buildings? General — Rely on market to define what is needed. Understand challenge of two -story retail but want to connect buildings to the rest of the community. Comfortable with the need for one large anchor, but not comfortable with more than one building of that scale. MM: Concerned with two large anchor buildings creating a wall and diminishing the human scale. This was clarified to not be the case. • What are the Council's expectations as to a maximum or preferred percentage of any particular use? General — Like aspects of the urban village concepts. Some interest in some additional residential, perhaps on the north side of the site between retail and Central Park. Some residential /senior housing could complement the medical office use. MM: I do toy with some residential, particularly on the north side. MT: Agrees, particularly for seniors or first -time buyers that would take advantage of the retail, possible medical and ECC. • What are the Council's expectations regarding the inclusion of one or more public streets (such as an east -west collector) within the development to define development areas and create streetscapes? General — Street breaks the site up and brings down the scale — optional as to whether it's public or private. MM: Open to developer's call on public v. private street provided it integrates the site. MT: Likes the street adding a break in the site. What are the Council's expectations regarding the visibility of service and loading areas from major roadways? General — Need to be screened appropriately. Hard site to deal with, street frontage on all sides. Side - loading or wing walls could be utilized, understood that would add cost. CF: With appropriate screening, loading areas can be towards the street. MM: What am I missing? There are streets on all four sides of this site. Appropriate screening should be required. • What are the City Council's expectations as to structured or underground parking as means of achieving development priorities such as higher densities or greater walkability? Is that expectation the same if public financing assistance were necessary to achieve it? iM General — In favor of structure or underground parking in order to reduce sea of asphalt. Open to considering public assistance depending on what it would bring to the project. Is there an opportunity to interact with the transit station's structured parking? MT: Yes, to avoid a sea of asphalt. MM: Not a lot of pedestrian action between Eagan Station and the LM site; wondered if transit circulation could be enhanced. Open to public assistance depending on the benefit to the City for doing so. All CC members stated an openness to have the general discussion. • Are there additional policies that arise out of the discussion that should be applied to an intensification or redevelopment of the area? If so, what would they be? General — Restated need for it to be different than typical suburban. Site development should relate to ECC & Central Park. Understand it needs to be market supportable to be successful. MT: Would like something different than what we have. Would prefer a mix of attractions like Centennial Lakes. Would like to see the addition of little things to draw people in from ECC. All CC members acknowledged the need to have a successful development. 19 Agenda Information Memo Finance Committee Meeting March 4, 2013 VI. OTHER BUSINESS - FUNDING SOURCE FOR CAPONI PROPERTY ACTION TO BE CONSIDERED: To provide direction to staff regarding funding source for purchase of Caponi land. Options to consider: • Park Systems Development and Renewal & Replacement (PSDR &R) Fund • Balance designated for Open Space within the Community Investment Fund • Unrestricted balance in the Community Investment Fund FACTS: • The Caponi Art Park has a total of 57.12 acres; 30 acres are currently owned by the City but managed by the Caponi Art Park, the middle 17.9 acres has a conservation easement in place that prohibits future development of the land but a mortgage is owed on the fee title of this parcel, and the final 9.22 acres with the house and studio does not have a conservation easement but a mortgage is owed on this land. • At its meeting of January 15, 2013, the City Council approved a Purchase Agreement with the Caponi Art Park Board to purchase 27.12 acres of land operating as the Caponi Art Park for the amount of $800,000 with a proposed closing date of December 31, 2014 or sooner. • At its meeting of January 15, 2013, the City Council approved a Joint Powers Agreement with Dakota County to share funding of the Caponi land. Dakota County agreed to provide $400,000 for the purchase to be matched equally by the City of Eagan. The intention of the Joint Powers Agreement is for the City of Eagan to acquire fee title of the final portion of the Caponi Art Park and convey a permanent conservation easement for this property with a proposed closing date of December 31, 2014 or sooner. • The Caponi Art Park Board has indicated that they may wish to complete the land sale sooner than December 31, 2014. • Funding for the City's portion of the purchase was proposed by staff to come from the PSDR &R Fund. Council referred the discussion of funding source for the City's contribution to the Finance Committee. • The current available balance in the PSDR &R Fund is about $1.3 million. In 2013, $425,000 in tax levy and an unknown amount of park dedication fees will flow into the PSDR &R Fund. • In the Community Investment Fund, $58,750 of the original $60,000 designated in 2007 for Open Space is available. • The undesignated balance in the Community Investment Fund is about $1.3 million. ATTACHMENTS: None Cassidy Commercial Turley Real Estate Services 2013 Marketing Plan Cedar Grove Redevelopment Sites Eagan, Minnesota March 1, 2013 Presented to Jon Hohenstein Community Development Director City of Eagan Len Pratt Master Developer Presented by James M. McCaffrey, CCIM 612.347.9355 The information contained herein is confidential information provided by Cassidy Turley for the exclusive use of Cassidy Turley and the City of Eagan. Distribution to third parties is strictly prohibited. Cassidy Commercial Turley Real Estate Services Property Analysis Cedar Grove Redevelopment Concept Plan +^ ' ,4 _ -_ Keystone • / ' Senior, East End • , 4Qa 4 8 acres / � Lincoln Jensen s '�� ♦ - •,.`�Q'. cedar -le Bowl •• - • ClIe n� r* as a rte �/�,. outlot e 2.11 acres ♦• - / / w QacKC9 w'd °sue r 9 � • l� v :i ?:i E P f J`e`t , 0 a cr°' ♦ ` F \oQ / JI Or f Q Nicola Ridge ILennar Outlot A 4th and SM Additions 4 04 acres G f r Transit o Station Parkway Triangle 44 acres Legend o :eo '° Cedar Grove Site Plan Feet Paragon Outlets and Surrounding Area RedevelopmentTIFArea OFuture Development Area N cassidyturley.com Cassidy Turley Real Estate Commercial Services Property Analysis Aerial — East End cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Salient Facts — East End Property Name: Cedar Grove Mixed Use Redevelopment — East End i Address: Eagan, MN 55122 County: Dakota PIDs: 10- 16720 -01 -010 10- 01900 -04 -060 10- 09100- 04-050 10- 16901 -01 -020 Property Type: Land — Commercial Development Site Lot Size: 4.8 acres Zoning: Cedar Grove District Real Estate Taxes (2012): Exempt Traffic Counts: Survey: Phase I: Topography: Asking Price Range: AUAR: Highest and Best Uses: Highway 77 (Cedar Ave) — 76,000 vpd Highway 13 — 22,500 vpd Cedar Grove Boulevard —1,500 vpd Cedar Grove Parkway —1,800 vpd Available Eagan EDA will deliver a clean site Level $12.00 - $15.00 per square foot On web site • Hospitality Use- preferable multi -story — limited or full food and beverage operations • National Restaurants- casual dining with liquor • National Franchise Restaurants —fine dining with liquor • Local casual or fine dining with liquor • Retail shops and Paragon shopper convenience type uses — coffee, lunch -type dining • No fast food • No convenience gas cassidyturley.com Cassidy ial Turley RCoeal m Estamercte Services Property Analysis Salient Facts — East End Proposed Uses: Contacts to make or follow -up with on a systematic basis: This prominent entrance location has the greatest visibility of all the sites by far. Our focus to date has been to attract either hospitality developer's interest or casual to fine dining national franchise restaurants that would prefer or even demand this type of exposure, visibility and prominence at the entrance to this high traffic Paragon development. There has been casual interest from a hospitality user and a retail developer with a single story concept plan. The most desired type development on this entrance corner has been higher density of uses and height. Finding the right combination of commercial, retail restaurant uses that accomplish this outcome will take the creativity of a retail developer that has either control of the right tenant mix or can adequately generate the best tenant mix from a concept plan they would create. Adobo Grill Amerigo Restaurant Andy's Frozen Custard Anytime Fitenss Au Bon Pain Baja Fresh Mexican Grill Baja Sol Tortilla Grill Baskin Robbins Bath & Body Works Ben & Jerry's Benihana Big Bowl Brothers Bar & Grill Buca di Beppo Buffalo Wild Wings California Cafe California Pizza Kitchen Caribou Coffee Carrabbas Italian Grill Champps Americana Chili's Bar & Grill Chipotle Christopher & Banks Cold Stone Creamery Cosi County Kitchen Cupini's Fresh Pasta & Panini Daily Grill /The Grill on the Alley Domino's Pizza Don Pablo's Dunn Brothers Coffee Einstein Bros Bagels Fado Irish Pub & Restaurant Famous Dave's Fantastic Sams Fleming's Prime Steakhouse & Wine Bar Fuddruckers Garbanzo Mediterranean Grill Granite City Food & Brewery Ground Round Houlihan's International House of Pancakes — IHOP Joe's American Bar & Grill Kona Grill Krispy Kreme Donuts Leeann Chin Logan's Roadhouse Longhorn Steakhouse Love from Minnesota Marie Callender's Restaurant & Bakery Melting Pot Morton's Steakhouse Nascar Sports Grille Noodles & Company Old Chicago Old Spaghetti Factory Olive Garden Original Pancake House Outback Steakhouse P.F. Chang's China Bistro Panchero's Mexican Grill Panera Bread Bakery /Cafe Pei Wei Asian Diner Perkins Restaurant & Bakery Piccadilly Cafeteria Pittsburgh Blue Qdoba Mexican Grill Red Lobster Redstone Rock Bottom Restaurants Romano's Macaroni Grill Rosa Mexicano Ruby Tuesday Sawatdee Thai Restaurant Smashburger Ted's Montana Grill TFI Fridays The Cheesecake Factory Toby Keith's I Love This Bar & Grill cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Salient Facts — East End Tucci Benucch Wolfgang Puck Pizzeria Twin City Grill Cucina Waffle House Wood Ranch BBQ & Grill cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Aerial — Outlot B cassidyturley.com Cassidy rcial Turley Real EstatCommee Services Property Analysis Salient Facts — Outlot B Property Name: Cedar Grove Mixed Use Redevelopment — Outlot B - Ramp East Address: Eagan, MN 55122 County: I Dakota 10- 16850 -01 -060 10- 16850 -01 -122 10- 16850 -01 -082 PIDs: 10- 16850 -01 -050 10- 16850 -01 -123 10- 16850 -01 -081 10- 16850 -01 -040 10- 16850 -01 -111 10- 01900 -06 -073 (partial) 10- 16850 -01 -031 10- 16850 -01 -090 Property Type: Land — Commercial Development Site Lot Size: 2.74 acres i Zoning: Cedar Grove District Real Estate Taxes (2012): Exempt • Highway 77 (Cedar Ave) — 76,000 vpd Traffic Counts: i Highway 13 — 22,500 vpd Cedar Grove Boulevard — 1,500 vpd • Cedar Grove Parkway — 1,800 vpd - - i Survey: Available Phase I: Eagan EDA will deliver a clean site Topography: I Level topography Asking Price Range: $8.00 - $10.00 per square foot AUAR: Highest and Best Uses: On web site • Hospitality use- preferable multi -story — limited food and beverage operations Entertainments venues • Sporting goods • Outfitters • Local restaurants - casual dining, fast fresh types stores; i.e., Chipotle, Noodles • Retail shops and Paragon shopper convenience type uses —coffee, lunch -type dining cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Salient Facts — Outlot B Proposed Uses: This location has good line of site visibility as one enters from the east end destined for the Paragon Center. Our focus to date has been to attract either hospitality developer interest or casual dining franchise restaurants that see a market opportunity to capitalize from Paragon traffic. Of all the developers and users that have viewed this opportunity to date, the consensus lean toward a medium sized retail box user that would have an appeal to the "non outlet" shopper members of the family visiting this area. Ideally the user that desires this location would be able to utilize, in some capacity, the structured parking ramp that will be available to complement their needs and thereby limit the number of surface parking spaces that might otherwise be required to meet their customer demand. Sporting goods suppliers, entertainment venues have been explored to date and will be approached again. This site has more flexibility in the types of uses that work in this location, including hospitality. As with the East End, finding the right combination of retail developer who has a primary tenant in control to drive development or can develop and present a concept plan that meets their needs and those of the EDA for this location. Contacts to make or follow -up with on a systematic basis: AMC Theatres Academy Sports & Outdoors Anytime Fitness Ashley Furniture B &B Theatres Bass Pro Shops Bassett Furniture Cabala's Champs Sports Chuck & Don's Pet Food Outlet Cinemark USA Consolidated Theatres Cort Furniture Crate and Barrel Dick's Sporting Goods Dickinson Theatres Edwards Theatres Equinox Fitness Ethan Allen Furniture Brands Pier One Imports Furniture Outlets USA Red Wing Shoe Gander Mountain Company Regal Cinemas Goddard School REI Golf Galaxy Room & Board Golf USA, Inc. Samsonite Golfsmith Scheels Guitar Center Slumberland Hibbett Sports Snap Fitness Hickory Farms Sports Authority Hobby Lobby Sun & Ski Sports HOM Furniture Trader Joes IMAX UFC Gym IHOP United Artists Theatres Kerasotes ShowPlace Walgreens Theatres Worldwide Sportsman LA Fitness Midwest Hospitality Liberty Fitness Minnesota Hospitality Lifestyle Family Fitness CSM Lifetime Fitness Thaarldson Lodging cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Salient Facts — Outlot B Fitness 19 Torgerson - Willmar Raymond Management Wooleys Fairview Suites Ted Leines Steve Sherf Mann Theaters American Hotels, TMI Hospitality Radisson Hotels First Hospitality — Chicago - Hilton Garden Inn (CBD) Weis has relationship Company Raymond Management, WI Carlson Inn and Suites Brutger Co Lowell Lankford AmericlNN cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Aerial — Future Development 1.8 Acre Site cassidyturley.com Cassidy commercial Turley Real Estate Services Property Analysis Salient Facts — Future Development 1.8 Acre Site Property Name: Cedar Grove Mixed Use Redevelopment — Future Development 1.8 Acre Site Address: Eagan, MN 55122 Dakota County: PIDs: 10- 01900 -06 -051 (partial) Property Type: Land — Commercial Development Site Lot Size: 1.8 acres Zoning: Cedar Grove District Exempt Real Estate Taxes (2012): • Highway 77 (Cedar Ave) — 76,000 vpd • Highway 13 — 22,500 vpd Traffic Counts: . Cedar Grove Boulevard — 1,500 vpd • Cedar Grove Parkway —1,800 vpd Survey: Available Phase I: Eagan EDA will deliver a clean site Topography: i Grade drop from the Parkway to the north Asking Price Range: $8.00 - $10.00 per square foot AUAR: On web site Highest and Best Uses: • Hospitality Use - preferable multi -story — limited or full service food and beverage operations , Local casual restaurant concept, family or fine dining with liquor Proposed Uses: This location will have less visibility as shoppers enter the area and to date our focus has been on hospitality developers and hotel flags that can maximize density and height. The expectation is that concepts can be developed to utilize the structured parking facility and thereby require less land area. There has been interest from two hospitality developers with different flags considering this site for some time at our suggestion. A decision has been made to work exclusively with one of the developers in the design of their facility in conjunction with the ramp cassidyturley.com Cassidy Commrcial Turley Real Estaete Services Property Analysis Salient Facts — Future Development 1.8 Acre Site Contacts to make or follow -up with on a systematic basis: design. That developer is well down the road with a flag user and proformas analysis. Continuing contacts to be made with Hospitality developers: Midwest Hospitality Minnesota Hospitality CSM Thaarldson Lodging Company Torgerson - Willmar Raymond Management Wooleys Fairview Suites Ted Leines Steve Sherf Lowell Lankford Accor Hilton Hotels Corp. Westmont Hospitality Group Host Hotels & Resorts Inc. Starwood Hotels & Resorts Worldwide Inc. LQ Management LLC FelCor Lodging Trust Sunstone Hotel Investors Inc. Intercontinental Hotels Group John Q. Hammons Hotels & Resorts LLC Equity Inns Inc. American Hotels , TMI Hospitality Raymond Management, WI Brutger Co St Cloud Radisson Hotels Carlson Inn and Suites AmericlNN First Hospitality — Chicago - Hilton Garden Inn (CBD) Weis has relationship Lodgian Inc. American Property Management Corp. Capital Hotel Management LLC White Lodging Services Corp. Innkeepers USA Trust LaSalle Hotel Properties Winston Hotels Inc. Loews Hotels Tishman Realty Corp. Jameson Inns Winegardner & Hammons Inc. Boykin Lodging Co. cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Aerial — Outlot A cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Salient Facts — Outlot A E 'roperty Name: Cedar Grove Mixed Use Redevelopment — Outlot A — West Transit Site kddress: Eagan, MN 55122 ,ounty: Dakota 10- 01900 -08 -100 10- 01900 -08 -050 10- 01900 -08 -010 10- 01900 -08 -040 'IDS: 10- 01900 -08 -080 10- 01900 -08 -030 10- 01900 -08 -070 10- 01900 -08 -020 5roperty Type: Land — Commercial Development Site _ot Size: 4.04 acres t ?oning: Cedar Grove District Real Estate Taxes (2012): Exempt • Highway 77 (Cedar Ave) — 76,000 vpd Highway 13 — 22,500 vpd Traffic Counts: • Cedar Grove Boulevard — 1,500 vpd • Cedar Grove Parkway — 1,800 vpd Survey: Phase I: Topography: Asking Price Range: AUAR: Available Eagan EDA will deliver a clean site Level $7.00 - $9.00 per square foot On web site • Residential Multifamily- market Rate apartments • Hospitality Use - preferable multi -story — limited food and beverage operations Highest and Best Uses: . Local casual, fast fresh and family restaurants. • Retail shops and Paragon shopper convenience type uses — coffee, lunch -type dining cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Salient Facts — Outlot A Proposed Uses Contacts to make or follow -up with on a systematic basis: This location has the least visibility of all the outlots for shoppers that enter Cedar Grove. It does have the distinct advantage of being adjacent to the Bus Rapid Transit Station that now functions as the hub of transit to the Mall of America and points beyond. As the station capacity grows the convenience factor will expand for residents that live or work in this area or employees that work at the Paragon Center. Our focus to date has been to attract residential apartment developers that can meet this need for new and amenity rich rental housing that will attract new millennia - type renters to the area. An alternative use could be retail that will serve the needs of local residents and serve the BRT Station commuters' needs for commercial convenience services. Again, finding the right combination of residential commercial or retail uses that will accomplish this outcome will take the creativity of a developer that has either control of the right tenant mix or can adequately generate the best tenant mix from a mixed -use residential /retail concept plan they would create. Contacts to make and follow -up with on a systematic basis: Stuart Companies Bader Development Trammell Crow Sand Companies Dunbar Development United Properties TE Miller Company Doran Company Opus Ryan Company Greco Development LeCessee Development Sherman Associates Richdale Development Bigos Management Goldmark Develoment Klodt Development Excelsior Group Alatus Cornerstone Development Stonebridge Guns bury Development Magellan Carlston Group Highland Management Olympic La -Nel Financial cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Aerial — Parkway Triangle cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Salient Facts — Parkway Triangle Property Name: - I Cedar Grove Mixed Use Redevelopment — Parkway Triangle Residential Site Address: County: PIDs: Eagan, MN 55122 Dakota 10- 13520 -00 -010 10- 13520 -01 -010 10- 13520 -00 -020 10- 01900 -12 -020 Property Type: Land — Commercial Development Site Lot Size: 4.4 acres Zoning: Cedar Grove District Real Estate Taxes (2012): Exempt Traffic Counts: • Highway 77 (Cedar Ave) — 76,000 vpd • Highway 13 — 22,500 vpd • Cedar Grove Boulevard — 1,500 vpd • Cedar Grove Parkway —1,800 vpd Survey: Phase I: Topography: Available Eagan EDA will deliver a clean site Level Asking Price Range: AUAR: $12,500 - $15,000 per unit On web site Highest and Best Uses: • Residential market rate apartments • Senior independent • Senior assisted care • For sale townhomes • Senior co -op Proposed Uses: I This prominent location south of the Paragon Development and south of the Parkway had been considered for senior housing for some time. This site has a residential feel and enjoys elevation cassidyturley.com Cassidy Commercial Turley Real Estate Services Property Analysis Salient Facts — Parkway Triangle above the other sites which can lend itself to prime views of the river valley from higher elevations while still offering the amenity of a nature area with the park adjacent. Our focus to date has been to attract senior developers and now market rate developers as well. There has been interest from a senior independent developer for some time in this site. Contacts to make or Market rate and Senior Developers: follow -up with on a systematic basis: Presbyterian Homes Doran Company j Ebenezer Opus I La -Nel Ryan Company j Senior Hosing Perspectives Greco Development KA LeCessee development I Silvercrest Sherman Associates I Ecumen Bigos Management Aeon Goldmark Development United Properties Klodt Development Dunbar Development Excelsior Group Sherman Associates Alatus Cornerstone Development Shelter Corp Stonebridge Walker Methodist Guns bury Dev Episcopal Homes Magellan i ! Good Samaritan Society Carlston Group Volunteers of America Highland Management Greco Olympic Stuart Companies La -Nel Financial Bader Development Dunbar Development Trammell Crow United Properties Sand Companies TE Miller Company cassidyturley.com Cassidy Commercial Turley Real Estate Services Marketing Strategy Our marketing strategy is based on three principles: 1. 30 — 90 —120 Day Plan — Focused and fast to market; reintroducing prospects to the property 2. Intentional Prospecting - Strategically pursue our prospective developers and users 3. Create Awareness -- Create awareness in the brokerage and business community First 30 Days • Within 30 days all hard copy and updated electronic marketing collateral will be revised and refreshed • List the property on MNCAR; add a property website link and access to site plans /outlots • Create targeted call list of local prospects to understand interest and feedback on the impression of the property; call reports will be sent on a monthly basis • Attend staff meetings • Generate target list and begin intentional prospecting 90 Days • Send marketing collateral to targeted prospects — developers and specific users • Call through targeted prospect list 120 Days • Review all activity interest and follow -ups Intentional Prospecting Our approach to prospecting users is tactical and intentional; we strive to show the development community what opportunities are here with Paragon now a reality. We achieve this by periodic mailings of our quarterly market report and property announcement mailings. Cedar Grove has many features that benefit specific users; it is our job to find those users. The Intentional Prospecting itinerary: • Identify target prospect list • Begin communication via phone calls, mailers and electronic format • A continuous communication plan will bring awareness to Cedar Grove During a prospecting campaign, we will target specific restaurants, retail developers, multifamily developers, assisted care developers and hospitality developers. Awareness Positive awareness for Cedar Grove in the brokerage and business community is imperative for success. Our approach will generate overall awareness and excitement about the property, target the most promising users of the property and continually stay in front of the commercial brokerage community. Cassidy Commercial Turley Real Estate Services Marketing Strategy Reintroduce and Create Overall Awareness • Signage: We will reinstall an appropriate amount of "For Sale" signs strategically placed on the outlot properties announcing the availability. Budget Responsibility: Cassidy Turley Timing: 2 weeks • Property Brochure — For Sale: Cassidy Turley will develop and print a two page, four -color brochure for use in direct marketing to prospective tenants and brokers. Budget Responsibility: Cassidy Turley Timing: 2 weeks • Offering Package — For Sale: Cassidy Turley will redevelop a "Confidential Investment Offering Package" for use in providing information to prospective buyers. This typically includes an executive summary, property description, market overview, and any due diligence that can be provided by the seller for review by potential investors, along with instructions for submitting offers if applicable. Budget Responsibility: Cassidy Turley Timing: 3 weeks • Multiple Listing Service — We will register the site with the Minnesota Commercial Association of Realtors (MNCAR) and LoopNet. These services provide broker members with information describing the salient features of the property. In addition, public access to property information through LoopNet will be available through the Cassidy Turley website. Budget Responsibility: Cassidy Turley Timing: 1 week Property Website: — Cassidy Turley has developed a website specific to this property. This website creates value to the property and ownership by providing additional exposure and also provides a platform for potential developers to easily download the property details. Details included on the website would be: a full version of the Offering Memorandum, complete survey details, and zoning information and most recent concept plans including Paragon information. Any additional updated information will be posted to the site as it becomes available. Budget Responsibility: Cassidy Turley Timing: 2 weeks • Electronic Brochure: Cassidy Turley will develop an electronic brochure for the property that highlights all significant features of the sites. The E- Brochure will be used to send information to prospective buyers and brokers. It will include highlights of the area, a link to the property website, and contact information. Budget Responsibility: Cassidy Turley Timing: 3 weeks • Solicitation of Cassidy Turley Client Base — Our computerized database of all existing Cassidy Turley clients will be utilized. These accounts will be contacted and made aware of the purchase opportunity available. In addition to the local Cassidy Turley resources, the entire retail and hospitality brokerage teams from Cassidy Turley will be utilized to make national and global contacts to appropriate decision - makers. Cassidy Commercial Turley Real Estate Services Marketing Strategy • Solicitation of Brokerage Community — Cassidy Turley enjoys an excellent reputation of ingenuity and integrity within the brokerage community and works to further cultivate that relationship. Constant and consistent exposure of the property to the development community will be achieved through personal contacts, mailings and broadcast e- mails. • Strategic Evaluation — At certain intervals of the marketing effort, Cassidy Turley will evaluate the marketing approaches that have been utilized. Responses to each program will be studied in order to implement revised tactics into our marketing program as the sales process progresses. If Cassidy Turley feels a situation necessitates a change, we will, with the approval of ownership, make adjustments to keep the effort on track. Cassidy Commercial Turley Real Estate Services Marketing Strategy Prospect Marketing During the time the offering memorandum is being updated, we will actively promote this opportunity and further explore all buyers of this product type to ensure we develop a comprehensive buyer list. The property size, quality, and location will enable us to position each property as a highly desirable site. In order to validate this theme, the marketing team will develop and use the following approach during the course of the marketing program. • Quality aerial photographs along with detailed custom graphics carefully designed to illustrate the properties strategic location within the South Metro suburbs. • Perform comprehensive up -front due diligence with the help of ownership that will alleviate questions up front. Direct Mailing: Large postcards will be produced and sent out to our developer database. The pieces will have an aerial of the site, a site map showing its location and bullet point highlighting specific information about the project. Budget Responsibility: Cassidy Turley Timing: 3 mailers (first 6 mos.) Brokerage Marketing • Broker Alerts: On a monthly basis, we will e-mail pertinent property information to the brokerage community to ensure that the brokerage community will not lose sight of the property and the opportunity that exists at the project. Budget Responsibility: None Timing: Continuous Owner Contact and Reporting • Marketing Progress Reporting: Clear and consistent communication by Cassidy Turley will be completed. We will provide a marketing progress update on a frequent basis, utilizing a format to identify all prospects contacted with specific data on each prospect's situation, or action plan, as well as all correspondence sent. Prospect Activity Updates: In addition to frequent conversations and feedback, we will provide written prospect activity reports catered to whatever time period is desirable. Review and Strategy Evaluation Marketing Progress Evaluation: We will conduct on -going reviews regarding marketing progress being made, proposals generated, etc., ensuring that our strategy remains fresh and competitive. After the first ninety days of our marketing efforts, we will evaluate the marketing approach being utilized. Reasons for success or failure of a certain program will be studied in order to implement revised tactics into our marketing program. If Cassidy Turley feels a situation necessitates a change, we will, with the approval, make adjustments as needed to keep the effort on track. Your Cassidy Turley Team Cassidy Turley is a national team of dedicated commercial real estate professionals, delivering superior results for our clients for more than 100 years. Our team of professionals is dedicated to consistently delivering solutions that produce superior results and champion your business goals. We believe in face -to -face relationships and that hands -on problem solving is fundamental. As dedicated advocates for our clients, we are passionate about their long -term success and deliver integrated, tailored solutions in Capital Markets, Corporate Services, Project Leasing, Project and Development Services, Property Management, and Tenant Representation. We also provide a range of specialty services including Sustainability Consulting and Distressed Asset Services as well as industry- focused practice groups. With Cassidy Turley, you can pursue your real estate plans more confidently. Cassidy Turley established its local base by merging with Towle Real Estate (founded in 1909), one of the best names in the Twin Cities commercial real estate. Our long term knowledge and in -depth experience provided by local staff, coupled with the strength of Cassidy Turley, provides our clients with excellent service and tremendous resources. Our Vision and Core Values Fundamental to our success are our core values — our cornerstone principles. These principles reflect what is most important to us as a firm and are the foundation of our company's culture. Our vision is to be a world -class provider of fully integrated commercial real estate services. Supported by outstanding resources, our talented people meet client needs with responsiveness, adaptability, excellent execution and unwavering commitment to our clients' success. Our core values are: Cassidy Commercial Turley Real Estate Services Exceptional Results for Our Clients We do whatever it takes, wherever it takes us. Dedication to Our Communities We don't just work in our communities, we belong to them. Growth for Our Company We grow to get better, not just bigger. Energizing Workplace for Our Associates Our people are more than assets; they are Cassidy Turley. Our goal is to provide superior service to each and every client. Our platform and service offerings are designed to meet the wide ranging needs of our customers, along with the flexibility to provide customer solutions. Service Lines Investor Services From finance and investment sales, to leasing and management services, our deep connections in the institutional and private sectors help you seize opportunities and maximize returns. • Capital Markets • Distressed Asset Services • Landlord Representation • Owner Occupier Sales • Project Management and Development Services • Property Management Occupier Services Cassidy Turley has a proven track record of analyzing your space needs and executing efficient and value -added strategies to meet them. • Corporate Services • Owner Occupier Sales • Project Management and Development Services • Tenant Representation Practice Groups Our practice groups are comprised of professionals with deep expertise unique to particular property types and within specific industries Food and Beverage Facilities • Healthcare • Higher Education • Hospitality • Law Firm • Life Sciences • Multifamily • Not - for - Profit • Retail Specialty Services Fully integrated into our core service offerings, Cassidy Turley has specialized capabilities to meet the evolving needs of our investor and occupier clients. Auction Services • Financial Advisory Services • Location Advisory and Incentives • Sustainability Consulting • Valuation and Advisory Services Cassidy Turley Key Statistics Cassidy Turley is a leading commercial real estate services provider with more than 60 offices nationwide. The company represents a wide range of clients —from small businesses to Fortune 500 companies, from local non - profits to major institutions. Cassidy Turley enhances its global service delivery outside of North America through a partnership with GVA, giving clients access to commercial real estate professionals across the globe. 2011 Transactions $22 billion in Transactions (gross volume, not revenue) • Office: $13.5 billion • Industrial: $3.5 billion • Retail: $2.5 billion • Multi- Family: $.4 billion • Land: $0.5 billion • Other: $1.6 billion $10.3 billion' in Capital Markets Transactions (gross volume) • Sales: $8.8 billion • Finance: $1.5 billion *Included in the total transaction volume of $22 billion 17,000 Lease transactions closed 1,900 Sale transactions closed Management Portfolio 455 million sq ft management portfolio on behalf of institutional, corporate and private clients cassidyturley.com Cassidy Commercial Turley Real Estate Services Leasing Portfolio 400 million sq ft project leasing portfolio Corporate Services • $57 million average savings delivered for clients over the past 2 years • 28,000 client locations served • 6,000 transactions completed in 2011 United States Locations Associates • More than 3,500 professionals • More than 900 brokers Industry Rankings Brokerage: • #1 in San Francisco, St. Louis, Indianapolis, Phoenix • #2 in Cincinnati, Nashville, Silicon Valley • #3 in San Diego, Denver, Sacramento, North Bay /Marin County (Source: American City Business Journals and other local business journals) Property Management: • #1 in Indianapolis, Nashville, St. Louis • #3 in Washington, DC (Source: American City Business Journals and other local business journals) cassidyturley.com Cassidy Commercial Turley Real Estate Services James M. McCaffrey, CCIM Principal, Senior Vice President 1400 IDS Center, 80 South 8th Street I Minneapolis, MN 55402 T 612.347.9355 F 612.347.9389 James .McCaffrey@cassidyturley.com I cassidyturley.com Capital Markets - Investment Sales Experience James McCaffrey joined Cassidy Turley in 1982 after spending six years as a vice president with the Eberhardt Cos., where he originated residential and commercial mortgage loans. Today, Jim is a member of the Investment Services Group (ISG) and is a Cassidy Turley shareholder. He has been recognized as the Cassidy Turley Salesperson of the Year for Minneapolis -St. Paul in 1998, 2001, 2003, 2004, and 2005. Since entering the commercial real estate industry, Jim has specialized in Investment and Owner /Occupier Sales and Land Acquisition and Disposition. He has sold more than 6,000 apartment units in the Minneapolis and St. Paul marketplace, valued in excess of $200 million. He also has sold more than two million square feet of office, industrial and retail properties valued in excess of more than $105 million. Jim has been involved in land transactions totaling 510 acres, valued at more than $53 million. Areas of Specialization Investment Sales, Owner /Occupier Sales, Multifamily, Land Acquisition and Disposition Clients Served • Billy Graham Evangelistic Association • Cornerstone Realty Advisors • Doran Company • Inland America REIT • Intercontinental • International Multifoods Corp • Kennedy Associates • Opus Development • Prudential • St. Paul Port Authority Major Transactions • Riverview at Upper Landing Apartments, $43.5 million • Century Court Apartments, $38.5 million • Uptown City Apartments, $30.2 million • 1300 Harmon Place, 213,000 sq ft, $11.2 million • City Center Professional Building, 48,000 sq ft, $9.3 million Education Northwestern University, Graduate work in Mortgage Banking Regis College, Bachelor's Degree Awards and Recognition Cassidy Turley President's Club, 2010 • Super Valu Inc. • University of St. Thomas • US Bank • Village Green • 8200 Normandale, 82,000 sq ft, $7.2 million • MTS Land in Eden Prairie, 28 acres, $5.7 million • Jostens Land in Bloomington, 33 acres, $2.5 million • Minneapolis CBD Apartment site, $3.7 million • University of Minnesota student housing site, $2.5 million Professional Affiliations Certified Commercial Investment Member (CCIM), Past President of Minnesota /South Dakota chapter NAIOP Commercial Real Estate Development Association Minnesota Commercial Association of Real Estate Urban Land Institute (ULI) Minnesota Multi- Housing Association (MHA) Greater Minneapolis Area Association of Realtors, Past Board Member