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4.1.a. PCSR 06-23-2020 C ty nr Elk = Request for Action Diver To Item Number Planning Commission 4.1a Agenda SectionFimune eeting Date Prepared by Public Hearings 23, 2020 Zack Carlton,Planning Manager Item Description Reviewed by CommonBond Elk River Housing Limited Chris Leeseber , Senior Planner Partnership— 19522 Holt St. NW Reviewed by Land Use Amendment from Highway Business to High Density Residential, Case No. LU 20-02 Action Requested Recommend,by motion, approval or denial of the Land Use Amendment to change the land use from Highway Business to Residential If a recommendation of approval is made, staff recommends the following conditions: 1. City Council approval of the associated Plat, CUP/PUD, and c U easement vacation. CR 33 If a recommendation of denial is made, staff recommends the following justifications: • 1. The city has limited developable commercial/business land and RR amending the property to residential will further reduce the limited inventory. Hwy 1.01 2. The property is located adjacent to a regional highway and _ CP 12 within the Urban Service Boundary and removing it from a 1 . _ Highway Business land use will not accommodate increased demand for retail and service opportunities. Background/Discussion The subject property,located southwest of the intersection of Highway 169 and 197`''Avenue,is currently zoned Planned Unit Development (PUD) and has an underlying Land Use of Highway Figure i Business. The applicant is proposing a 60-unit multi-family residential apartment building in the Elk Ridge Center commercial development. In order to compete this project,the applicant will need approval of an amendment (LU 20-02) to the Land Use plan, a plat (P 20-05) to establish the developable parcel, and receive a Conditional Use Permit (CU 20-07) to establish a residential PUD. The Elk River Vision A Y�elcoming community nvith revolutionary and spirited resourcefulness, exceptional P U W E H E o s r service, and community engagement that encourages and inspires prosperity ,g /` UR The underlying land use must support the proposed residential use,which it currently does not,requiring the requested Comprehensive Plan amendment from Highway Commercial to Residential. The existing commercial development is surrounded by single-family homes, a religious institution (residential zoning district), and Highway 169. The subject site is also located along what will become a frontage road connecting two planned interchanges at 197`''Ave/169 and 193Td/169. The interchanges are planned for construction in 2023 and 2024,potentially have significant impacts to surrounding land use needs and guidance. The city is also beginning the Comprehensive Plan update,which includes a focused analysis of land use impacts due to Highway 169 improvements. The city currently has limited opportunities for developable commercial land, especially near the Highway 169 corridor, and this project if approved,will further reduce the already limited inventory. Excerpt from the Comprehensive Plan The Highn ay Business land use ranges from moderate to high intensi0forms of commercial development in Elk River. Businesses in this category may be the largest both in terms of si.Ze and tralcgeneration n'hile also providing services and convenience types of business. Market orientation tends to be regional in nature. Development orientation tends to be tonvard regional highnrays. Future Hi ay Business developments should be located n ithin the Urban Service Boundary and adjacent to regional highn�ays nrith both visibility and access. Examples of Highn"ay Business uses include discount retailers, grocery, restaurants, automotive sales and service,general merchandise, and professional services. The Highnray Business land usefollows the High "ay 969 and High "ay 90 corridors.An important planning issue is providing options to accommodate increased demand for retail and service opportunities that meet access, visibility, and si.Ze requirements. The property is located adjacent to a regional highway and within the Urban Service Boundary. Removing the parcel from the Highway Business land use designation will impact future commercial development opportunities for retail and service uses along 169. The City Council,in May 2019, reviewed a concept plan for this project and generally supported the project through a resolution that was used in an application for state funding. The resolution did not bind the city to future approvals of the project but outlined the process for review. Public Hearing Staff has received numerous comments regarding the proposed project,a few in favor but an overwhelming majority of the comments opposed to project. These comments are attached to the Conditional Use Permit (CU 20-07) Request for Action. Financial Impact None Statutory Review Period Per State Statute §15.99, the required 60-day review period ends on June 23, 2020. The applicant has requested the review period be extended to July 21,2020. Council Meeting If acted on, this item will go to the July 6, 2020, City Council meeting. Attachments ■ Location Map ■ Applicant's Narrative ■ Existing/Proposed Exhibit ■ Property Owner's Letter CommonBond Communities is pleased to propose Elk Ridge Lodge – a new construction, affordable apartment building located at 19522 Holt Street Northwest within the existing Elk Ridge Shopping Center. The proposed project includes 60 apartments with 120 stalls of surface parking. The property will have on- site management and maintenance staff and will include amenities such as on-site washers/driers, a high- quality exterior play area, oversized closets and on-site storage. The building itself will be attractive and finished with high-quality exterior materials as further described below. The location is highly desirable and supportive to CommonBond’s planned development as it is near numerous services, amenities and jobs, all of which will be utilized by our future residents. The location of these services in the immediate of vicinity of the site, including groceries and child care, makes the location absolutely stellar for multifamily housing. This addition of housing to the property will also enhance the vitality of the existing commercial uses, by adding users and developing one of the last outlots for this shopping center. We believe multifamily represents the highest and best use for the site, especially given it has been marketed by the current owner for a number of years without another viable development opportunity. We further believe multifamily will continue to be the highest and best use after the planned reconstruction of nearby Highway 169 interchanges. Please note that the property has been actively listed for sale for a number of years by the existing, experienced owner/developer, which is Hempel Companies. Elk Ridge Lodge will add users and a visually prominent and attractive building to a parcel that has not until now attracted a viable development proposal. The proposed circulation contemplates directing traffic to the southern portion of the site, taking advantage of a less-utilized point of access from Holt Street, mitigating impacts to existing ingress/egress on the northern end of the site. Further, access will not occur from Irving Street Northwest, ensuring neighboring uses are not impacted by the proposed project. Additionally, the development will build upon the attractive aesthetic already in place at the shopping center, with following elements included: faux stone and brick masonry, fiber cement board siding, and high-quality landscaping. The design intent is to match and build upon the existing aesthetic of the Elk Ridge Lodge Shopping Center and its design guidelines. Elk Ridge Lodge will be owned and managed by CommonBond. CommonBond is a Saint Paul-based non- profit affordable housing provider founded in 1971. CommonBond owns and operates properties in Minnesota, Wisconsin and Iowa, with our largest presence being in the Twin Cities metro. The following are several hallmarks of CommonBond’s ownership and management philosophy: • Long-term owner: CommonBond has sold just one property in its nearly 50 years of existence, demonstrating deep investment in long-lasting relationships with the communities in which it works. Such an ownership strategy also informs our high-quality design and construction standards; • Attentive, Resident-Focused Manager: CommonBond manages all 100-plus properties that it owns, providing consistency and continuity of service for its residents, neighbors and the community as a whole. Such a management philosophy leads to us to have extremely high resident satisfaction rates and to be invited back into communities for successive developments. The project is been awarded its required financing is expected to close and commence construction in fall 2020, a with a project completion approximately 12 months thereafter. The following addresses specific questions required of the Conditional Use Permit narrative: 1. What is being proposed? The project will include a new construction, 60-unit apartment building with 120 surface parking stalls. 2. How is the request consistent with the City of Elk River Comprehensive Plan? The proposed project will require an amendment to the Comprehensive Plan. As described above, the project is located in a commercially zoned area, but the area has failed to garner any viable commercial proposals after many years of marketing and development proposals by its owner/broker, Hempel Properties. We believe multi-family housing is the highest and best use of the property. 3. Hours of operation. As the proposed project is residential, the property will be in continuous use. The rental office will establish regular business hours at a later date. Typical business hours are weekdays and some evenings and weekends. 4. Number of employees. The proposed project will have a site manager, site maintenance technician and site caretaker. 5. Number of parking stalls, existing and additional. The proposed project will have 120 (2/unit) new surface parking stalls (there are no existing parking stalls). This deviates from the required parking of 150 spaces (2.5/unit) and none of the stalls are proposed to be enclosed. CommonBond has developed similar sites and found that this quantity and type of parking works well for our residents. A small portion of the parking (17 square feet) will be within the 25’ foot buffer for the stormwater pond. The pond has a retaining wall at this location, so there will not be a direct hydraulic connection between the parking and the pond, and we propose planting a dense groundcover between the parking lot and the stormwater pond. 6. Is there proposed screening of the site. There will be a trees along the east side of the building to provide screening from Holt Street. There is existing vegetative screening on the west side of the side along Irving Street. There is existing vegetative screening and a berm along the south edge of the site between the proposed building and residential area. 7. Proposed building materials. The proposed building materials comply with the design standards. The building will have a continuous and consistent elevation, that uses a variation of materials, colors, and textures in combination to provide visually interesting appearance. The building materials will also be consistent with other buildings in the area. 8. Signage. There will be one monument sign that will be 5’- 2” long x 1’- 0” deep x 6’- 2” tall. It will be located at the entrance to the parking lot. The sign will be an illuminated and painted aluminum cabinet that sits atop masonry to match the building. 9. Is there outdoor storage? The proposed project will not include any outdoor storage. The following addresses specific questions required of the Land Use Amendment Applicaiton narrative: 1. Detailed description/scope of the project. The proposed project will include a new construction, 60-unit apartment building with 120 surface parking stalls built on an existing outlot of the Elk Ridge Shopping Center. The building will be three stories in height plus a pitched roof. The building’s access will be provided by existing connections from the Elk Ridge Shopping Center and will additionally include a landscaped trail connection to the existing trail on Irving Street. 2. What is being proposed? The project will include a new construction, 60-unit apartment building with 120 surface parking stalls. 3. What are the reasons/purposes for the proposed Land Use Change? The proposed project is located in a commercially-zoned area, part of the existing Elk Ridge Shopping Center. The proposed project will be residential in use, therefore requiring a land use change. 4. What has changed to warrant the Land Use Change? Market conditions no longer make a commercial use feasible at this location. The project location is one of the last developable outlots in the Elk Ridge Shopping Center and was initially conceived to be junior box retailer or pad retail development. After many years of active marketing by the property owner, Hempel Companies, no viable commercial projects emerged. Additionally, the location is highly conducive to residential use, which will further make the existing commercial uses viable by adding additional users. 5. How is the request consistent with the City of Elk River Comprehensive Plan? The proposed project will require an amendment to the Comprehensive Plan. As described above, the project is located in a commercially zoned area, but the area has failed to garner any viable commercial proposals after many years of marketing and development proposals by its owner/broker, Hempel Properties. We believe multi-family housing is the highest and best use of the property. 6. How is it compatible with surrounding properties. The proposed project is compatible with surrounding properties by integrating into existing access through the site, by complimenting and building upon the existing design aesthetic of the site, by not requiring any shared parking from other uses by adequately parking on-site and by developing a landscaped trail connection to the existing trail along Irving Street. 7. What are the benefits to the City. The proposed project will benefit the city by putting vacant land into a productive, tax paying use; by enhancing the value of neighboring commercial uses by adding new site users; and by adding to much-needed affordable housing supply for the community for which there is a great shortage. The following addresses specific questions required of the Easement Vacation narrative: 1. Detailed description/scope of the project. The proposed project will include a new construction, 60-unit apartment building with 120 surface parking stalls built on an existing outlot of the Elk Ridge Shopping Center. The building will be three stories in height plus a pitched roof. The building’s access will be provided by existing connections from the Elk Ridge Shopping Center and will additionally include a landscaped trail connection to existing trail along Irving Street. 2. What is the purpose of the Easement Vacation? What is being proposed? The easements to be vacated are drainage and utility easements. The subject easements were entered into when the project was initially conceived as a junior box retailer or pad retail development. Now that the project includes a multifamily use, these easements locations are no longer appropriate. 3. How is the request consistent with the City of Elk River Comprehensive Plan? The proposed project will require an amendment to the Comprehensive Plan. As described above, the project is located in a commercially zoned area, but the area has failed to garner any viable commercial proposals after many years of marketing and development proposals by its owner/broker, Hempel Properties. We believe multi-family housing is the highest and best use of the property. 4. What has changed to warrant the Easement Vacation? The subject easements were entered into when the project was initially conceived as a junior box retailer or pad retail development. Now that the project includes a multifamily use, these easements locations are no longer appropriate. 5. How is it compatible with surrounding properties. The proposed project is compatible with surrounding properties by integrating into existing access through the site, by complimenting and building upon the existing design aesthetic of the site, by not requiring any shared parking from other uses by adequately parking on-site and by developing a landscaped trail connection to existing trail along Irving Street. 6. The DNR must be notified and provide comment if adjacent to water. Not applicable. 7. What are the benefits to the City. The proposed project will benefit the city by putting vacant land into a productive, tax paying use; by enhancing the value of neighboring commercial uses by adding new site users; and by adding to much-needed affordable housing supply for the community for which there is a great shortage. ST ANDREWST ANDREW April 16, 2020 City of Elk River 13065 Orono Parkway Elk River, MN 55330 Attn: City Councilmembers RE: Elk Ridge Lodge Letter of Support Dear Planning Commission Members, I am providing this statement in regards to the land use approvals requested by CommonBond related to Elk Ridge Lodge at the Elk Ridge Shopping Center. CommonBond has a purchase agreement with us for this site and is proposing to develop an approximately 60-unit, new construction multifamily apartment building. We are eager to work with CommonBond on this project. I understand that some may have concerns about rezoning this site from commercial to residential, but in our opinion, the site’s highest and best use is fulfilled by CommonBond’s proposal. We say this with great confidence, as our firm has developed properties across all commercial product types in our nearly 20 years of existence. Simply put, we would not be looking to sell this property if we saw a demand for a commercially-oriented use – as we would develop it ourselves. We shared this feedback with the City Council when the project was first reviewed in May 2019 and continue to feel this way. We have marketed the site for 15 years for a variety of different commercial uses including junior box retail and medical office, but failed to receive any feasible interest or purchase offers. We believe the market is clearly indicating that a commercial use for the site is not likely any time in the near or distant future. We also believe that even after the planned reconstruction of Highway 169 intersections, this will continue to be the case. This is because as the site is tucked so far back from the highway, it does not have sufficient visibility to garner commercial/retail interest. The remaining developable land in the shopping center, totaling approximately 3.49 acres, is a far better candidate for commercial development as it is much closer to and more visible from the highway and we will continue to pursue those types of users earnestly. We also consider CommonBond’s proposed use to be highly additive to our existing property as it will add a highly visible, multi-story structure with a design consistent to the already developed parcels, providing the area greater visibility and a stronger sense of place. I know that CommonBond has made design enhancements since its initial application to strengthen the visual connection and consistency with the neighboring buildings. The project will help provide the live-work-play element that is so critical to successful mixed-use developments. The proposed Commonbond development will also be complimentary and add residents and potential customers to the site, which will make the current businesses that much more viable and sustainable. Finally, we believe the development will also be accomplished in manner that improves circulation within the existing drive network of the site. Thank you for the opportunity to provide our feedback for your consideration. Please feel free to contact me with any questions at ben@hempelcompanies.com or 612-355-2608. Sincerely, Ben Krsnak Hempel Companies '00� CommonBond Communities ■ CommonBond C O M M U N I T I E S Saint Paul-based 501(c)(3) non profit organization founded in 1971. Core beliefs and principles: Long-term Ownership: We have only sold one property in our nearly 50 years of existence. We invest and build relationships in the community we serve for the long-term. Self Management: We manage all 100+ properties we own ourselves; this makes us directly accountable and responsive to our residents, neighbors and community members. Service-Enriched Housing: All 100+ properties we own benefit from resident services; this means our properties have record-low turnover and are positive community assets. Mission • Build stable homes, strong Every person has a dignified, affordable futures, and vibrant communities. home that supports independence and advancement within a fl• . community E ] 1111 nd Communities Our - Edueatian �t �ammunity Building Adrrancementt two - Property age' op - Management equip people to Empower residents succeed in school to connect, lead, and and jolas shape community Resident • 'd highand community engagement. _ quality on-site management, ■ ■■ � � Stability ! Advantage # , stableEnsure a Life-enhancing to oundation for residents to achieve their goals support and � �-fealth � Wellness Prompts healthy living ko improve well-3�eing Common6ond Communities Residents Housing 10 , 645 communities Residents 120 Housing 559 Communities Residents Housing Communities Commonl3ond • - Closest I& Pine Point Apartments Sunwood Village 10701 Hanson Boulevard NW I Coon Rapids, MN 7750 Sunwood Drive NW I Ramsey, MN Acquired 2017; rehab in progress Built in 2016 " u,. � - 7N ff] Drive by s or Rainbow Plaza schedule Galway Place Townhomes 820 West Main Street Anoka, MN 11240 Osage Street NW I Coon Rapids, MN Acquired 2017; rehab in progress a tour! Acquired in 2017; rehab completed in 2020 r.. CommonBond • - Newest Headwaters Landing Dublin Crossing 20169 Fitzgerald Trail 1440 Patriot Drive Forest Lake, MN Mankato, MN Built in 2020 Built in 2018 ' i f E 9 41 AM DUBLIN Drive by or schedule a tour! Ah In In I Affordable Housing in Elk River Elk River has 298 affordable ""Affordable housing is housing units in six communities. Only four units were vacant important to a strong when last surveyed. 2COC10CI'ly and d healthy Through 2025, the City will have a community. . " and ' . . .the demand for 177 new affordable lack of affordable developments. housing [for] people of The top in-demand jobs (see all ages and incomes next slide) are in retail, services and causes families stress, related industries, where wages don't support the cost of housing. dampens productivity and stifles job growth:' Source: City of Elk River Comprehensive Housing Needs Analysis Source: Elk River Cifv Comprehensive Plan In-dema r jobs donit coverou si n r The median earnings for most of the top in-demand and high-gfwwth jobs throughout Minnesota do not cover housing costs for t ■ ■ room apartme ntor ■ ti - t for i 1 WADES & HORSING AFF RDABILITY IN SHERBURNE COUNTY $61 ,230 Salary needed toaHard med ia n--ga lu e ha.me $43,560 Salary needed t4afDrd S31,76 0 35,172 two-bedraormapadment $25,701 $ 4,623 $211811 $21,449 $26,395 ,annual median inrame �. Y 'Y 1. Y Y J i• prDjectedjob Y Y growth by 2026 Retail Retail Super Pewo 7aI cashier Food Prep Hoare Personal Customer Sales Care Aide &Servintq Health Aide Carekde Service TOR IN-DEMAND JOBS, 20 17 FAST GROWING JOBS BY 2026 `iew jabgrovolh Hours per week minim u m wag e e mp leye %of em pl ap°ee5 who live � � in the Central -- mintwarktaaFfardi•bedroomapartment 6 � in county OfWDrkplace 29% _ PlanningArea by 26,629 Source: Minnesota Housing Partnership In S A& A& • Demand is local As is typical in our other housing communities, the demand is filled by local residents. Headwaters Landing oil Apartments in Forest Lake opened April 1, 2020 Headwaters Landing Resident Incomes It will be fully leased with 75 days of opening 45% of residents came from the City of Forest Lake; an ■ Seniors/Disabilty ■ Teachers additional 33% came from Retail/services Construction/Transportation/ Manufacturing communities with 7.5 miles of ■ Healthcare ■ Unemployed the property. — ------------' ` e .a 1 ti I p p , I I I I New Horizon Academy I r I p KEY I I 0 Main Entry I PROPOSED L O D G E p r Accessible Parking/ I Ramps I © Tot-lot Playground p — �' p Q Parking Entrance L ___ © TrailStreecet 6on: i--------------- p Irving Street `"'� �` �.�,~ —," 0 Trail Connection: North Businesses a ,.; ',rte• --s .4.. tty':. �� 0 25 50 Fir "7 No access off Irving Street NW One free-of-charge parking stall per bedroom a' -- o r� All cement siding, cultured stone, wood corbels, and design elements to complement existing aesthetic Adheres to design requirements established for Shopping Center _ 1 bill- .. a- All cement siding, cultured stone, wood corbels, and design elements to complement existing aesthetic Adheres to design requirements established for Shopping Center "M Land is presently zoned for commercial uses. Permissible developments would generate 1,000 to 2,000 vehicle trips per day.* Proposed development would generate far fewer vehicle trips at 360 per day.* No access to nearby residential streets. *City staff estimates r-- - l ©v I - I II I I`, I I 1 O _ I I I I Cdr I ' f New NQIIZOO Academy � Aa , I W I I Cb LLL- I -y I I I e Y Property Values: Affordable housing is an asset ""A recent study found little to no evidence to support the claim that affordable housing developments stimulated a decline in their surrounding housing markets; in fact, each of the areas analyzed displayed stronger market performance after affordable housing was built." Source: Fami/y Housing Fund "The bottom line for [those] who fear that property values will take a hit when a low-income housing project locates nearby is that their anxiety is largely unfounded..." Source: Tru/ia Property Values: Affordable housing is an asset Average Salles Price Per Finished Square Foot of Humes Sold Three Years Before and After Construction of Affordable Rental Housing $1H f �1 construction of Affard3lbIe I Wo PerItA Housing $17• 49I $170 sm $151 U $160 42 1 PIS 3 Yns 112M 2 YW ple 1 Yr Pmt 1i' Yr POSt2 YfS Pmt 31FS• NUe-Data sets qiwA pre-and post-cownxtm periods tram 1111/1NO thredr 112 .fXM The dccrtiase In price per rustbed squam f t In Uf a two yeas parlor to stnrcltlon was.due largely to the t'rousing market craGh that was occurring mound the sarrke true- Additionally, kwD of the areas studled bad a large number or MWGF harry-, new homey ucpenen red a greaWr dedlrte In frame during the crash than existing stock, Turther depreminq the group mwag*_ Property Values: Recently completed projects r - DUBLIN CROSSING __ i' clonwood Village: DW%nm r*-ossing: Opened in 2016. Opened in 2018. Values of properties within 750 Values of properties within 500 feet changed as follows: feet changed as follows: 2018-19: increased by 13% 2018-19: increased by 13% 2019-20: increased by 39% 2019-20: increased by 14% On-site management for a safe community Property managers complete crime prevention training : 8 hour training on how to determine the use or presence of drugs, how to report it, techniques to keep crime down. Monthly crime reports reviewed, and each property has an assigned police liaison Crime-free policy in lease to enforce when appropriate Project Ti alin "%law Planning Commission : June 23, 2020, 6 : 30 p. m . City Council : July 6, 2020, 6 : 30 p. m . Construction Start: November 2020 (estimated) Construction Completion : October 2020 (estimated) Commonl3ond Contactsc; Andrew Huahes Director of Acquisition & Development 651-265-4735 andrew. hughes@commonbond.org Cecile Bedor Executive Vice President of Real Estate 651-265-4739 cecile.bedor@commonbond.org