4.0. SR 06-23-2003MEMORANDUM
Item ~ 4
TO:
FROM:
DATE:
Mayor & City Council
Catherine Mehelich, Director of Economic Development///~//
June 23, 2003
SUBJECT: Downtown Revitalization Project- MetroPlains Presentation
Attachments
· Downtown Revitalization Project Goals and Redevelopment Process
· Downtown Revitalization Project Planning & History
· Draft HRA June 5, 2003 Meeting Minutes
· MetroPlains Preliminary Time Table
Back~round
The HRA has been working with MetroPlains Development for the past 6-months to refine
redevelopment options for the downtown. The attached Project Goals, Redevelopment
Process, and Planning & History summarize the activities of the HRA. At its special June
meeting, the HRA heard a presentation from MetroPlains Development regarding concept
options. The attached draft HRA minutes reflect the HRA's discussion. The HRA directed
MetroPlains to proceed by taking the design concept for the Jackson Block and Bluff Block
to a public open house for feedback. The open house was held June 18th from 6 - 8:00 p.m.
at Lion's Park Center.
Redevelopment Concept Plans
The presentation by MetroPlains Development will include: · project activities to date
· review of the original project goals established by the HRA,
· review of design concepts, market analysis and financial feasibility
· review proposed project timetable
The City Council will not be expected to make a final decision on the project plans or
financial arrangements. However, the Council will be requested to identify issues that need
to be addressed as part of a final development agreement.
As part of the proposed timing, MetroPlains anticipates submitting a financing request to the
MN Housing Finance Agency by July 24th. As part of the submission, some general
consensus issues, as outlined in the attached Preliminary Time Table, will need to be reached
with details to follow over the next 3 to 4 months.
Downtown Revitalization Project
Project Goal & Objectives
Purpose: For more than 30 years, various studies and proposals have examined the need to redevelop
Elk River's downtown business district. Investment in the downtown has stagnated and area businesses and
residents alike are concerned about the need to revitalize downtown and attract people there.
Neighborhoods age, and change will occur whether or not the City intervenes. Controlling that change
through revitalization and redevelopment will ensure that the types of changes that occur in downtown Elk
River are the ones people want - those that will keep our community vital and flourishing.
Primary Goal: To assure the long-term viability of downtown by making a connection to the rest of the
community and by utilizing the riverfront location. Redevelopment will enhance downtown Elk River's role
as a residential, retail and commercial area and also revitalize investment in the downtown business district.
Development Objectives: · Mixed use (residential/retail/service)
· Consideration of the historic context study results
· Strengthen connection to the community
· Traditional downtown design elements
· Brick, stucco, stone materials with visual breaks in the building design
Increased residential density
· Pedestrian orientation
· Increase exposure to the riverfront
· Recognize those buildings that have potential for rehabilitation
· Replace market/economic obsolete buildings
· Multiple types of housing products (i.e. townhomes, senior rental coops, market rate apartments)
Pover
Downtown Revitalization Project
Redevelopment Process
The phases of Redevelopment Process include:
Phase I - Need Identification
The HRA has identified the Core Central Business District as the focus area for redevelopment. The
primary goal is to assure the long-term viability of downtown by making a connection to the rest of the
community and by utilizing the riverfront location. A communications strategy is developed to keep the
public informed of the project and to provide opportunities for public comment.
Phase II - Concept Development
Various design concepts have been developed which incorporates consistent themes from the previous 30
years of planning, current design objectives, and input from the development community. The design
concepts identify desired outcomes, potential redevelopment uses and design ideas, and designates potential
areas for redevelopment.
Phase III - Concept Refinement
In this phase the concept is tested for market and financial feasibility with the help of developers and market
specialists. The redevelopment concept is then refined, based on the £mancial and market analysis. This
phase includes an oppommity for the public to provide comments on the alternative design concepts.
Phase IV - Request for Proposals/Developer Selection
The City will be contacting qualified developers to discuss the redevelopment concept. Developers'
experience and financial capabilities are assessed. One or more developers are selected for further analysis
of the redevelopment feasibility. The City reviews general plans, including uses, design concepts, densities
and financial feasibility with developers.
Phase V - Development Agreement
Most of the planning is completed and a developer has been selected, but the project is still months from
construction. A pre-development agreement is negotiated with one or more developer, providing a period
of exclusive fight for development. During this period the developer must refine plans and assess market
feasibility. In the development agreement, the developer secures a lease commitment and financing for the
project, completes land use and other regulatory issues. The development agreement occurs when the
developer completes contingencies and initiates land acquisition and building design.
Phase VI - Construction
All development agreements are final, acquisition has begun and even some initial demolition of existing
properties has occurred.
City of Elk River
Downtown Revitalization Project
Planning & Project History
1970
1982
1986
1988
Elk River Central Business District Report (Nason, Wehrman, ICa'fight &
Chapman Inc., Mpls) is developed and provides general guidelines for physical
appearance, movement patterns, and development potentials of the CBD
for years 1970-1990.
· Unify existing and new buildings for distinct unique character
· Remove traffic conflicts (eg overpass between North & South Hwy 10)
· Provide adequate parking (eg parking ramp)
· Utilize natural setting of Mississippi River (eg restaurant)
Elk River Downtown Redevelopment Plan (Zack Johnson & Associates Inc.)
establishes a long-range guide for evaluating physical improvements, developing
zoning policies, establish priorities in capital improvements and identifying
redevelopment opportunities.
· Rehab buildings that City finds architecturally & historically significant (eg
establish design standards)
· Concentrate retail/office south of Hwy 10
· Concentrate sen~ice business north of Hwy 10
· Concentrate high-density residential west of Lowell
· Priority Redevelopment Areas:
- Town Square - for retail/office space and municipal parking
- King & Main - for office space
- Star News buildings to cinema building - for 2-story retail/office
The City and Chamber work with the Governor's Design Team to develop an
overall plan for the CBD. The river is stressed as an amenity to focus on.
· Promote downtown as "unique historic river town"
· Link with open space & trail system
· Utili~.e river with restaurant/hotel/community center
· Consider parking ramp for heavy traffic areas
The Central Business District Redevelopment Project results in a theme for CDB
fixtures, trees, and sidewalks in the downtown area. The project is paid for via
assessments and City, HRA, and Utility funds.
Downtown Revitalization Project
Planning and Project History
Page 2 of 6
Elk River Riverwalk Project (Brauer & Associates Ltd, Eden Prairie) creates
riverwalk design and financial feasibility for new building proposed for Hardware
store site.
Create more retail/service traffic via restaurant
· Generate interest in Mississippi River via boardwalk trail
· Develop design standards
1989
Following the purchase of the Hardware store site, the EDA improves the site for
use as public green space. In 2000, the EDA turns the property over the City for
parkland.
1990
Riprap is installed along the riverbank in the CBD for erosion control in 1990 and
again in 1995. The project is funded by a grant from the Sherburne County Soil and
Water Conservation District and matched by the City and HRA.
The EDA and Dr. Tony Jarmoluk redevelop the NE corner of Main St. and Lowell
Ave as a new dental clinic.
1992 The city demolishes the old creamery building and then assists
The chamber in 1994 in relocating their building to the site.
Parking lot at Jackson Square is improved by the HRA. In 1993 the city purchases the
BNRR parking lots for CBD patrons and the HRA improves one of the lots in 1994.
In 1995, improvements are made to the parking lot behind Kemper Drug.
1994
A Riverwalk Corridor Committee is formed to spearhead riverwalk effort. A
Riverwalk Plan (Hoisington-Koegler Group Inc.) is developed for the CBD, and is
envisioned for the beginning of a trail system along the river.
· Interpretive walk/bike trail depicting early transportation history of region
1996 The city applies for an ISTEA grant to fund the Riverwalk Project, but the application
is rejected. Phasing of the project is considered but no action is taken.
1997
HRA acquires the King and Main site and removes the existing structures. The
proposal to immediately redevelop the site with a 12,000 commercial building falls
though. A number of other concepts for the site are later proposed, but none
materialize.
1998
The HRA hires Theresa Washburn to lay the foundation for developing a downtown
plan master plan. Ms. Washburn submits the Central Business District Action Plan in
January of 1999. Implementation of the Action Plan begins but participation levels
from citizens drop.
a. Public Improvement Goals: plan to ut'~ize river, art center, pedestrian pathway,
beautification plan
Downtown Revitalization Project
Planning and Project History
Page 3 of 6
b. Private Improvement Goals: sign ordinance, facade improvements to highlight
historic character, interior standards, new construction to compliment historic
character
c. Activities & Events Goals: Heritage Festival, develop winter festival, develop
mural event
d. Business Activity Goal: complete market analysis
1999 The EDA, Council, and HRA review the Strategic Plan for Economic Development
and lower downtown's priority.
2000
Summer
King and Main is sold to the First National Bank of Elk River, which plans to
construct an office building on the site. Downtown is listed as a top priority at
Operation ER's October meeting.
Fall
HRA authorizes staff to complete Downtown Redevelopment Plan to identify priority
redevelopment skes and guide desired development. Plan to include inventory of
properties, conditions, vision and implementation.
2001
March
HRA directs staff to research details of two Main Street properties for sale (ECM
Publishers)
April
HRA considers information on property sale and directs staff to work with private
developers for redevelopment proposals for the site/area. Staff sends listing agent a
list of developers speciali?.ing in retail/office mixed use developments.
Staff receives interest in redevelopment from property owner, Nadeau's, and interest
from two developers: Kraus-Anderson/Best & Hempel and Marly
Glines/Dynamics Design.
May
Joint work session between HRA, Planning Commission & River's Edge Assoc.
Staff presents results of market analysis, and assessment of building condition &
historic significance for discussion of redevelopment opportunities.
Staff request preliminary development concepts from two interested developers for
review and discussion by HRA. Riverfront property owners notified of developer
interest.
HRA authorizes the completion of new paver brick sidewalks in the CBD in
conjunction with Municipal Utilities electric line relocation project. New trash
receptacles, trees, and flowerpots added to beautify downtown.
Downtown Revitalization Project
Hanning and Project History
Page 4 of 6
June Joint work session with HRA, Planning Commission & River's Edge Assoc. Priority
projects and design principles ranked. Group identifies the redevelopment of ECM
Publisher/Riverfront property as a priority project.
HRA considers presentation of development concept by Best & Hempel.
HRA provides feedback and requests additional information on development
concept including:
· Sufficient parking
· Amount of housing
· Sufficient land area for proposed project
· Finandal feasibility
HRA directs staff to work with developer to present financial feasibility and proposal
for HRA assistance.
July
Heritage Preservation Commission (HPC) recommends completion of historic
context study prior to HRA action on development proposal for downtown Elk
River.
August
AMCON Construction requests information on any redevelopment oppommities.
HRA directs staff to request development proposals from broader group of
developers. HRA authorizes completion of historic context study for year 2001,
completion early 2002. Redevelopment work session with Ehlers & Assoc.
scheduled for Sept. HRA meeting.
September HRA works with Ehlers & Associates to facilitate Downtown Revitalization
Project.
October
HRA develops problem statement, identifies core CBD as focus area. HRA
develops primary goal: To assure the long-term viability of downtown by making a
connection to the rest of the community and utilizing the riverfront location.
December HRA reviews preliminary design concepts and discusses development strategies.
2002
February
1~ edkion Downtown Revitalization Q & A Newsletter distributed via Elk River Star
News insert and at Open House.
HRA revisits design objectives, concepts, and development strategies. An Open
House was held to gather public input. Comment forms were gathered from the
public.
I~larch Staff mailed 98 Requests for Proposals to prospective developers.
Downtown Revitalization Project
Planning and Project History
Page 5 of 6
April
2nd edition Downtown Revitalization Q & A Newsletter distributed via Elk River
Star News insert.
Pre-proposal meeting was held to provide additional details to developers wishing to
submit proposals.
May
Five developers submitted concept proposals for a downtown revitalization project.
Staff conducted reference checks, site visits, and preliminary interviews as part of the
initial proposal evaluation process. Ehlers & Associates provided Tax Increment
Financing projections of each concept proposal.
Carole Zellie of Landscape Research presented the HRA with the Historic Context
Study of the CBD.
June
HRA selected MetroPlains, TOLD, and Best & Hempel to interview and scheduled
and open house for public review and comment.
July
Open House is held to gather public input on development concepts of three finalist
developers. HRA & City Council completes interview of the three finalist
developers.
August
HRA selects MetroPlains for which to enter into a Preliminary Redevelopment
Agreement. City Council ratifies the HRA's selection of MetroPlains.
September HRA reviews draft of 3rd edition project Q& A newsletter.
Request for Proposals sent to engineering firms for completion of property TIF
redevelopment eligibility assessment services.
October
3rd edition Downtown Revitalization Q & A newsletter distributed via Elk River Star
News insert.
HRA approves Preliminary Redevelopment Agreement with MetroPlains.
HRA and City Council consensus that the HRA will be the lead agency on the
redevelopment project.
November
MetroPlains selects JLG Architects for the Elk River project. MetroPlains selects
Ken Brooks of KJB Real Estate Services as the broker to contact property owners
who may be part of development concept area. City mails letter notifying property
owners of possible contact from broker.
HRA authorizes S.E.H. to complete property TIF redevelopment eligibility
assessment services for proposed project area.
December Regular HRA meeting cancelled due to lack of pressing agenda items.
Downtown Revitalization Project
Planning and Project History
Page 6 of 6
2003
January
February
March
April
May
June
June
The HRA held a joint meeting with the Heritage Preservation Commission regarding
recommendations of local historic significance in the downtown area. While the
HPC noted many of the buildings in the downtown are may have local historic
significance, the HRA directed the developer, MetroPlains, to proceed with the
original proposal area. The I-IRA further directed the developer to explore the
feasibility of renovation and reuse of the former Cinema Building and Dick's Main
Tap prior to including as part of the redevelopment project. MetroPlains has
indicated that the two buildings are not presently being considered in the proposed
project areas. The HRA approves a policy on interfund loans for a downtown TIF
district.
Staff provided update to HRA on the project communications and status of the tax
increment financing eligibility assessment activities.
MetroPlains requests the HRA's consideration of a 6-month extension on the
preliminary redevelopment agreement timeframe. HRA reviews draft of new
downtown district zoning standards. HRA requests revisions and a second review.
HRA approves 6-month extension of preliminary redevelopment agreement
timeframe. HRA calls special meeting for June to hear MetroPlains' presentation on
redevelopment plan options.
4th edition of Downtown Revitalb_ation Q&A Newsletter distributed via Elk River
Star News insert. HRA considers proposal from property owner for the purchase
641 Main Street. HRA consensus to not purchase 641 Main Street at this time.
MetroPlains Development presents design concept options at the HRA Special
Meeting. HRA directs MetroPlains to proceed in taking the design concept for
Jackson Block and Bluff Block to a public open house for feedback.
Public Open House held at Lion's Park Center, 6 - 8:00 p.m. Comment forms
provided for staff to collect feedback to compile and share with the HRA and
Council.
SPECIAL MEETING OF THE ELK RIVER
HOUSING AND REDEVELOPMENT AUTHORITY
HELD AT THE ELK RIVER CITY HALL
THURSDAY, JUNE 5, 2003
Members Present:
Staff Present:
Chair Toth, Commissioners Thompson, Lieser, Motin and Wilson
Executive Director Cathy Mehelich, Economic Development Assistant
Heidi Hall, City Administrator Pat Klaers, and Director of Planning
Michele McPherson
Call Meeting To Order
Pursuant to due call and notice thereof, the special meeting of the Elk River Housing and
Redevelopment Authority was called to order at 5:00 p.m. by Chair Toth.
Draft Comprehensive Plan Review
Director of Planning Michele McPherson provided an overview of the Draft Comprehensive
Plan and asked that the HRA provide comments which will be forwarded to the
Comprehensive Plan Update consultant Rusty Fifield, Hoisington Koegler Group, Inc.
(HKGi).
Discussion occurred regarding the reasoning for an Urban Reserve area along the eastern
boundary of Elk River. Ms. McPherson explained the following reasons why the
Comprehensive Plan Update Task Force decided to designate the area as an Urban Reserve:
· City staff is working to analyze the capacity of the waste water treatment plant.
· An Urban Reserve area would allow a cost effective approach to the potential
extension of city services to the area.
· The Task Force may wish to reserve plant capacity for commercial and industrial
development.
· City services are less likely to be extended to a Rural Residential area, which is the
current land use of the eastern boundary of Elk River.
Commissioner Motin expressed concern that Urban Reserve areas could eventually be
rezoned to accommodate leapfrog development. Ms. McPherson stated that if a rezoning
request were to happen, city staff should remind policy makers the importance of following
the Comprehensive Plan. City Administrator Pat Kflaers added that the waste water
treatment plant capacity would also need to be evaluated before a rezoning would occur.
Commissioner Thompson arrived at 5: ! 4p.m.
There was discussion regarding Mixed Use, a new land use included in the Draft Plan.
Ms. McPherson explained that Mulvaney Point and Elk River Station are designated as
Mixed Use in the Draft Plan. HRA members noted the Draft Land Use Map does not
include Elk River Station as Mixed Use. Ms. McPherson stated that the correction would be
made to the map.
Special HRA Minutes
June 5, 2003
Commissioner Motin provided the following comments to Ms. McPherson:
Page 2 ~
· The Urban Reserve Area north of County Road 12 should be left Rural
Residential
· The Historic Contexts Study should be referenced but not used to guide City
Council actions
· There is a need for more Highway Business between 165th and 171st along Hxvy
10
· The north side of Main Street/north side of 5th Street should be Highway
Business
· Urban Residential should act as a buffer between High Density and Rural
Residential areas
· It makes sense to have strip malls incorporated into neighborhoods as long as
the market has been tested
Commissioner Wilson mentioned that he was pleased to see that housing is a large component of the
Draft Plan.
Commissioner Lieser inquired of the rules for incorporating affordable housing into TIF Districts.
Catherine Mehelich explained that a certain percentage of affordable housing must be added to a
project based on low to moderate household income guidelines as established by the TIF statute.
Ms. McPherson mentioned that the HRA will receive and be able to independently review the second
and third drafts of the Comprehensive Plan before it is approved.
Commissioner Toth requested that the Regular HRA Meeting scheduled for June 23rd be rescheduled
as a Special HRA Meeting on June 30th due to his inability to attend the June 23rd meeting.
COMMISSIONER WILSON MOVED TO CALL A SPECIAL MEETING OF THE HRA
FOR JUNE 30TM CONTINGENT UPON SPACE AVAILABILITY AT LIONS PARK
CENTER. COMMISSIONER THOMPSON SECONDED THE MOTION. THE
MOTION CARRIED 5-0.
3. Downtown Revitalization Project: Presentation by MetroPlains Development
Jim Prosser of Ehlers & Assodates explained that the main challenge faced by MetroPlains
since August of 2002 has been high land costs, which has caused £mancial feasibility issues,
thus project delays. Mr. Prosser added that MetroPlains is further along in the process of
refining concepts than many cities have been at this stage.
Mr. Prosser proceeded to provide the HRA with the next steps of the project:
· HRA to consider a concept to present to the public
· Staff Project Team to brainstorm options to close the financial gap
· HRA and MetroPlains to decide upon Final Development Agreement terms
Vern Hanson of MetroPlains, Lonnie Laffen of JLG Architects, and Jim Prosser provided
the HRA with a presentation which included an overview of the City's project goals, a
presentation of redevelopment concepts, and an overview of the £mancial and market
feasibility issues regarding the project.
Special HRA Minutes
June 5, 2003
Mr. Hanson's presentation of the redevelopment concepts included the Bluff Block,
Brick Block, and the Jackson Block. Mr. Hanson explained the proposed development for
each location:
Bluff Block · 10,000 SF commercial on f~rst floor along Main St.
· 52 unites of for-sale housing
· 70-80 below grading parking stalls for housing and commercial residents
· 3-4 stories
· Connection to city's rivenvalk development
Brick Block · 6,000 SF of commercial
· 52 units of rental housing
· 66 below grade and 54 surface parking stalls
· Optional 75 below grade public parking
· 3 stories
Jackson Block · 10,000 SF commercial on first floor along Jackson St. and at the comer of Jackson
and Main
· 32 units of rental housing
· Up to 66 below grade parking units for housing and commercial, 18 surface units,
and 9 additional on-street parking spaces
· 3 stories
Following the presentation, Chair Toth mentioned that prior to the presentation he had been
strongly opposed to the redevelopment of the Jackson Block area but that he now
understood why the area is appropriate for redevelopment.
Chair Toth asked MetroPlains if they would be responsible to develop the park area next to
the Cinema Building. Mr. Hanson stated that MetroPlains would develop a walking path to
the rear of their redevelopment area but that the City would be responsible to extend the
walking path beyond that area in addition to the park.
The HRA posed several questions regarding the management of pedestrian traffic, the
transition of existing businesses, parking issues, and visibility issues for the brick block if the
Jackson Block area is developed.
It was stated that existing business owners have expressed concerns for lost parking if the
Jackson Block area is developed. It was stated that most downtown business owners do not
have the luxury of a free parking lot near their stores. MetroPlains explained that all Jackson
Block parking spaces would be replaced.
Regarding visibility issues, it was stated that the visibility of Kemper Drug would be
unaffected if the Jackson Block area is developed and that the increase of business due to the
development would outweigh the visibility concerns.
Special HRA Minutes Page 4
!:_n_e__,__: 2__o_o__!_ .......
It was the consensus of the HRA that MetroPlains present the Jackson Block/Bluff Blo/;~~
r;adrekVecleOnPtTr.ent concept ara public Open House on June 18th from 6:00-8:00p.m.at Liff~.) v
4. Adjournment
There being no other business, COMMISSIONER MOTIN MOVED TO ADJOURN
THE MEETING. COMMISSIONER LIESER SECONDED THE MOTION.
THE MOTION CARRIED 5-0.
The meeting of the Elk River Housing and Redevelopment Authority adjourned at 7:36 p.m.
Heidi Hall
Economic Development Assistant
ELK RIVER REVITALIZATION PRELIMINARY TIMETABLE
July '03 Purchase Agreement or Memo of Understanding w/City of Elk River
July 24, '03 MHFA Application
Aug-Oct '03 Development Agreement
Sept. '03 Environmental Review
Sept.-Oct. '03 TIF Conclusion
Oct. '03 DTED Application/Small Cities Group
Nov. '03 MHFA Award
Sept.'03-Jan. '04 Site Acquisition/Relocation
Sept.-Nov. '03 Plan Preparation
Nov.- Dec. '03 Plan Approvals
Jan.-June '04 Pre-sales of 'For Sale' Units
Jan.-March '04 Financial Closings
Jan.-March '04 Jurisdictional Authorities Sign-offs/Approvals
April-May '04 Demolition
May-June '04 Infrastructure Improvements
June'04-June '06 Construction of Two Phases