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Item 5.6 Item # 5.6. • G� City of Elk ........... River MEMORANDUM TO: Planning Commission FROM: Michele McPherson,Director of Planning DATE: October 23, 2001 SUBJECT: Case No. OA 01-09 Request by the City of Elk River to Amend Business Park District Permitted and Conditional Uses Request The Planning Commission is asked to consider an amendment to the Business Park District • standards to establish definitions for warehousing and showrooms and to allow showroom space, repair/servicing of equipment, and increased warehouse space. Attachments • October 2, 2001 Brookstone, Inc. letter regarding warehouse amendment • Existing Business Park District language • Proposed Business Park District Overview In 1995 the City created the Business Park District to encourage a higher level of industrial development. The district's purpose statement and uses clearly indicate the City's desire to promote high value buildings and the creation of jobs. In 2001,the Planning Commission recommended and the City Council adopted revised business park building design standards to continue to encourage high value building construction, but to allow more choices in acceptable building materials. Brookstone,Inc.,in its conversations with staff,has continued to express a concern with the limitation on warehouse uses within the Business Park District. Staff,the City Attorney,and Brookstone,Inc. have prepared the proposed language for consideration by the Planning Commission. The proposed language was reviewed by the Economic Development Authority at their October 8th, 2001 meeting. Memo to Planning Commission/OA 01-09 October 23,2001 Page 2 • Analysis The current language limits warehouse uses to 30 percent of the permitted use unless a conditional use permit is granted. Mr.Martens,representing Brookstone,Inc.,has expressed a concern with this limitation as well as the lack of showroom and repair as permitted uses in the district. Staff has been working with Mr.Martens regarding an ordinance amendment to allow uses more typical of the current industrial market within the Business Park District,however, there is a need to balance this with the overall purpose of the district which is to encourage businesses which generate a high number of jobs per square foot,rather than predominantly warehouse uses. The changes proposed to the Business Park District would allow: (1) Warehouse space up to 50 percent of the entire building (2) Showroom uses (3) Repair and maintenance uses excluding auto repair Also proposed are definitions for warehouse and office showroom uses. The letter submitted by Mr. Brookstone expresses his position. The Economic Development Authority directed staff to allow aggregation of warehouse space in a multi-tenant building, however,capped the maximum amount of warehouse space in any building at 65 percent. Recommendation • Staff recommends that the Planning Commission recommend approval of the proposed language to the City Council. • S:\PLANNING\MICHMC\PLREPRTS\OA01-09.DOC OCT 042.;01 BROOKSTONE,INC. • `f #g u/ ; • 7400 Metro Blvd..Suite 212 Edina,Minnesota 55439 612.837.9167 phone 612.837.8010 fax Tuesday, October 02, 2001 Ms. Catherine Mehelich Director of Economic Development City of Elk River 13065 Orono Parkway PO Box 490 Elk River, Minnesota 55330 Dear Cathy: Further to numerous discussions with the City of Elk River's planning director, Michele McPherson, and our scheduled appearance before the EDA of the City of Elk River on Monday, October 8th, I am writing this letter to state the position of the Elk River Business Park owners with regard to the proposed modifications to the permitted and conditional use sections of the B-P Business Park District. Our response to date has been based upon concerns we have had with the limitation on the amount of warehouse space in our office/warehouse buildings. We appreciate the opportunity to work together with you on this issue and to present our point of view to various approval groups. While we clearly understand the City's desire to maximize job growth and job opportunities within the city, from the very beginning, we envisioned both build-to-suit and multi-tenant office/warehouse buildings. While not in any way a firm plan, a conceptual plan showing buildings ranging from 30-60,000 square feet were laid out in the various parcels as we worked our way through the approval processes. Throughout the Twin Cities, office/warehouse buildings are a mix of, to one degree or another, finished and unfinished spaces. The finished spaces and these are generally all permitted uses under your zoning by-laws, include offices, showroom and laboratory and other highly finished work areas. The unfinished areas, that is the warehouse portion of the office/warehouse term, include pure warehousing and distribution, shipping and receiving facilities, light manufacturing, repair and maintenance, vehicular storage, and research and testing. On some occasions, the unfinished area is upgraded to include air conditioning, a higher level of lighting, etc. and in some cases, whether for manufacturing or warehousing, is left in a more warehouse form. While manufacturing is generally a part of most business parks, given that approximately 16% of overall employment in this Country is accounted for by the manufacturing sector and given further the significant amount of manufacturing that has moved overseas, the dominant use in the unfinished portion of office/warehouse buildings is not manufacturing but all of the other industrial uses mentioned above. The finish percentages for office and showroom spaces are generally higher in locations within close proximity to downtown areas and major metropolitan landmarks such as airports, major shopping facilities, and also at locations having some commercial aspect to them. This location does not offer the proximity to major landmarks but it does have a commercial aspect to it given the exposure of at least some portion of the buildings to highway 169 together with the adjacency to the retail development to the north. However, generally, the kinds of • office/warehouse buildings envisioned for this location would not be finished greater than 25-40%. This leaves 60-75% of unfinished space and our concern is with limiting the use of this space in such a manner that we are unable to effectively market this property. Also, these are aggregate numbers. In individual tenant spaces, unfinished areas will range from 0 to 100%. We have always felt that your building codes could much more effectively regulate the issues at hand and meet your goals by requiring some kind of public hearing approval for buildings that are clearly designed as distribution buildings. For example, our first building is an 18' clear height with bay sizes of less than 5,000 square feet. The NAIOP definition of distribution is far outside those parameters. A distribution building would be in the clear height range of 24'-32' and have bay sizes ranging from 8-15,000 square feet with much greater depth than our first building has or that we anticipate having for other future buildings. If you deem it necessary to place percentage limitations on the amount of warehouse space, then we would request the following: • We would like to see the 50% limitation on warehouse space be viewed in aggregate for any particular building rather than on an individual tenant basis. This would allow more flexibility on our part with regard to marketing and individual tenant negotiations. The goals of the City would simply be established and achieved on an overall square footage basis rather than on an individual square footage basis. • We would also like to raise the maximum percentage of warehouse allowed under the conditional use section from 65% to a higher number and simply not preclude an approval, for example, of a build-to-suit for a company that Elk River desires to attract to its community and under a specific percentage limitation would be precluded from doing so. We have written this letter in the spirit of working together with the City of Elk River in a positive and collaborative manner based upon the intent established when the development agreement was first negotiated and entered into. Our requests, we believe, do not deviate from those goals and are more in synch with market in general and also for this site, specifically. We are hopeful of a positive response when we meet before the EDA on October 8`h and subsequent meetings with the planning commission and city council. If any additional information is required, please call me. —Y. •-ry truly, Richard V. Martens President RVM/bb • Cc: Michele McPherson—City of Elk River Jim Winkels —Partner, Elk River Business Park, LLC Liza Robson — Partner, Elk River Business Park, LLC Tony Gleekel- Siegel, Brill, Greupner, Duffy& Foster, P. A. Existing Language • 16. B-P Business Park District (Existing Language) STATEMENT OF PURPOSE: The Business Park District is established to encourage a planned, integrated environment for certain industrial, office, and commercial uses which are compatible with, and compliment each other as well as the surrounding land uses . The underlying land use designation within the district may vary, either light industrial or highway business . Development within the Business Park district will correspond with the land use designation. Industrial and office uses allowed where the land use designation is light industrial, and commercial uses allowed where the land use designation is highway business. It is the intent of this ordinance that development reflects common themes using compatible architectural design and consistency in signage, landscaping, and lighting. It is also the intent to encourage businesses which generate a high number of jobs per square foot rather than predominately warehouse type uses . A. Permitted Uses i. Permitted uses allowed when the underlying land use is light industrial : • a. Light Manufacturing b. Research and development laboratories c. Government, business, and professional offices d. Mail order operations e. Telecommunication operations f. Sherburne County fair ii. Permitted uses allowed when the underlying land use is highway business: a. Health athletic clubs b. Personal service establishments c. Financial institutions B. Accessory Uses: • i. Off-street parking lots or facilities ii. Private recreational facilities iii . Public shelters and essential services iv. Retail Sales provided the following conditions are met: a. The retail sales activity is not located in an administrative office facility, but is located within a business, the principle use of which is not commercial sales. b. The retail sales activity shall not occupy more than fifteen (15%) of the gross floor area, or a maximum of 5, 000 square feet of the occupied quarters, whichever is less. c. The retail sales activity is related and subordinate to the principle use. d. No sign identifying or promoting that retail sales occur within the building shall be visible from outside the building. C. Conditional Uses: • i. Conditional uses allowed when the underlying land use is light industrial: a. Any permitted use which involves more than 30% warehouse space b. Vocational, technical and trade schools c. Loading areas/overhead doors when located in front yards d. Above ground storage tanks ii. Conditional uses allowed when the underlying land use is highway business: a. Hotels and motels b. Licensed day care facilities c. Retail shops and stores which compliment and serve the Business Park subject to the standards set forth in 2 (j ) below. d. Motor vehicle specialty service stations • e. Loading areas/overhead doors when located in front yards • f. Multiple tenant buildings g. Restaurants (Class I) • • Proposed Language 16. B-P Business Park District 111 STATEMENT OF PURPOSE: The Business Park District is established to encourage a planned, integrated environment for certain industrial, office, and commercial uses which are compatible with, and compliment each other as well as the surrounding land uses . The underlying land use designation within the district may vary, either light industrial or highway business. Development within the Business Park district will correspond with the land use designation. Industrial and office uses allowed where the land use designation is light industrial, and commercial uses allowed where the land use designation is highway business. It is the intent of this ordinance that development reflects common themes using compatible architectural design and consistency in signage, landscaping, and lighting. It is also the intent to encourage businesses which generate a high number of jobs per square foot rather than predominately warehouse type uses. A. Permitted Uses i . Permitted uses allowed when the underlying land use is light industrial: a. Light Manufacturing • b. Research and development laboratories c. Government, business, and professional offices d. Mail order operations e. Telecommunication operations f. f. Sherburne County fair q. Warehouse s.ace not ex_ceedina fifty percent (5n) of the entire bui1 :1 nt_; h. Showroom Space i . Repair and maintenance, excluding <_.uto repair ii. Permitted uses allowed when the underlying land use is highway business: • a. Health athletic clubs b. Personal service establishments • c. Financial institutions B. Accessory Uses: i. Off-street parking lots or facilities ii. Private recreational facilities iii. Public shelters and essential services iv. Retail Sales provided the following conditions are met: a. The retail sales activit' not located in an administrative office facility, but is located within a business, the principle use of which is not commercial sales. b. The—retail sales activit shall not occupy more than fifteen (15%) of the gross floor area, or a maximum of 5, 000 square feet of the occupied quarters, whichever is less. c. The retail sales activity is related • and subordinate to the principle use. d. No sign identifying or promoting that retail sales occur within the building shall be visible from outside the building. C. Conditional Uses: i. Conditional uses allowed when the underlying land use is light industrial: a. Any prmittcd use ich inv clvcc more than warchcu:c opac, Warehouse space exceeding fifty percent (50% ) of the total building floor area up to a maximum of sixty-five percent (65% ) b. Vocational, technical and trade schools c. Loading areas/overhead doors when located in front yards d. Multiple tenant e. Above ground storage tanks • ii . Conditional uses allowed when the underlying land use is highway business: • a. Hotels and motels b. Licensed day care facilities c. Retail shops and stores which compliment and serve the Business Park subject to the standards set forth in 2 (j ) below. d. Motor vehicle specialty service stations e. Loading areas/overhead doors when located in front yards f. Multiple tenant buildings g. Restaurants (Class I) Warenouse space shall mean the space used for storing merchandise or commodities . The area occupied by the act of shipping or receiving merchandise shall not be included in the floor area calculation for warehouse space . Office/Showroom space shall mean space that is utilized primarily f.)r the display of products manufactured. Such space may or Iiay • finished. •