july 14, 2015. cal brink, economic development director brian pellowski, pbk investments (overall...
TRANSCRIPT
MARKET STREET MALL REDEVELOPMENT
July 14, 2015
Introduction
Cal Brink, Economic Development Director Brian Pellowski, PBK Investments (overall developer). Eric Miller, Sambatek
Introductory Project Background Actions This Evening:
Resolution Granting Vacation of a Portion of Peterson Street Resolution Approving Marshall Square Addition Final Plat Consider & Approve Ordinance Amending Chapter 86 of the
City Code of Ordinances relating to Planned United Developments
Adopt Planned Unit Development (PUD) Agreement Resolution Approving Contract for Private Development Resolution Approving Reimbursement for TIF proceeds HRA Meeting Tonight Adopt Resolution
Development Site Plan
Mall Demolition 65,488 sf (45% of total)
Mall Improvements $5.95M
84,070 sf Mall Retail Lots $1.96M
20,700 sf (4 bldgs.) Apartments $7.11M
72 units Hotel $4.28M
56 rooms
Project Summary
Mall and Retail 50% complete by December 31, 2016 and 100% complete by December 31, 2017.
Apartments 25% complete by December 31, 2015 and 100% complete by December 31, 2016.
Hotel 25% complete by December 31, 2015 and 100% complete by December 31, 2016.
Project Construction Schedule
Development Site Plan
What Is Tax Increment Financing (TIF)? A financing tool Used by local governments Finances qualifying costs of new
development or redevelopment Uses the incremental increase in taxes Prequalification findings (complete)
1. Redevelopment District2. “But for” TIF the project would not occur3. Conforms to City comprehensive plan4. Will afford maximum opportunity for
redevelopment by private enterprise
Historical TIF In Marshall
Industrial: Schwans (numerous), MCP (ADM), Heartland (Turkey Valley Farms), US Bank, Grillworks, Bend Rite, Action Sports, Beverage Wholesalers, Runnings
Workforce Housing: Parkway Additions, Dano Addition Apartments (Taylor), Downtowner Apartment (including law office site)
Assisted Living: Hill Street Place, Heritage Pointe
Commercial Redevelopment: SuperValue, Downtown Block 11, Southwest Sanitation, Prairie Pride/N. Ambulance Facility, Memorial Park, Marshall Hotel (pending)
Aviation Business Expansion: Airpark East
Sources of TIF FundsTIF District No. 1-13
25-Year Max
Pay 2015 $5,634,200
$29,156,382
TIF Revenue Illustration
Dollars Used for Project TIF Expenses
Pay 2016 $4,910,100
Uses of TIF FundsTIF Project Area No.1
TIF Redevelopment District
Minn. Stat. 469.174, subd. 9 Tax Increment Financing (TIF) Market Street Mall TIF established for the
purpose of financing “redevelopment” Tax increment generated in a defined
district area Expenses eligible in defined project area Delineated in the TIF plan Approved by the HRA and City
TIF Redevelopment Example
OAKDALE, MN
TIF Redevelopment Example
WORTHINGTON, MN
Editorial: Mall site offers ample opportunity Feb 5, 2015 at 8:17 a.m.“…Rather than shake our heads and doubt such a vision, we should all do our part in getting behind it — and collaborating where we can as community members to make it come to fruition.”
TIF Revenue
Max term 25 years. “Pay as You Go”
developer assumes risk/returns.
April Max increment revenue $11,463,169
April Estimated max present value TIF $5,776,313
TIF Revenue
Final Total Max increment revenue $8,797,827
Final Max present value TIF Note $4,140,837 plus interest at 4% of $3,175,598
City retains 15% administrative & redevelopment cost plus surplus $1,481,392
Initial Request was approximately $5.7M and was reduced to $4.14M based on the financials
Estimated TIF Eligible Costs
Description Cost ($)TIF Revenue Note Principal (Public utilities, site improvements, demo, etc.)
$4,140,837
TIF Revenue Note Interest (Payments @ 4%)
$3,175,598
Administrative & Redevelopment Expenses (15% plus surplus)
$1,481,392
Total $8,797,827
AgreementEligible TIF Expenses
Existing site parking demolition, mall structure demolition, reconstruction of north wall.
Mall related reconstruction of watermain, sanitary sewer, stormsewer, sidewalks, new parking lot, curb & gutter, security lighting.
Mall related electrical and plumbing rework.
Current tenant relocation.
AgreementIn-Eligible TIF Expenses
No TIF (privately financed) mall interior remodeling, landscaping, site engineering, and architecture.
No TIF (privately financed and separate developer) for apartment construction, site improvements and infrastructure connection lines directly benefitting the property only.
No TIF (privately financed and separate developer) for hotel construction, site improvements and infrastructure connection lines directly benefitting the property only.
Developer’s Investment
Description Costs
Mall Redevelopment $12,928,875Apartments $7,111,500Hotel $5,676,500TOTAL $25,716,875*
* The proposed tax increment assistance amount of $4,140,837 is approximately 16.1% of the total project budget $25,716,875.
Existing Conditions
Existing Conditions
Mall Elevation Concept
Mall Elevation Concept
Mall Elevation Concept
Site Plan
Approximate Demo Area 65,488 sf (45% building)
Existing Interior View
Utility Plan
Landscaping Plan
Apartment Elevation Sketch
Apartment Elevation Sketch
Grandstay Hotel Sketch
Grandstay Hotel Example
Recommendations
Tonight Resolution Granting Vacation of a Portion of Peterson
Street Resolution Approving Marshall Square Addition Final
Plat Consider & Approve Ordinance Amending Chapter 86 of
the City Code of Ordinances relating to Planned United Development
Adopt Planned Unit Development (PUD) Agreement Resolution Approving Contract for Private Development Resolution Approving Reimbursement for TIF proceeds HRA Meeting Tonight Adopt Resolution.
Project Comments
Cal Brink, Economic Development Director Brian Pellowski, PBK Investments, Inc. (Market
Street Mall developer).
Peterson Street Vacation Public Hearing
Council Initial Comment and Questions. Public Comment:
Approach Podium to Address the Mayor and Council.(Please Refrain From Audience Comments) State Name and Residence Prior to Questions or
Comments. Council Continue Discussion. Council Close Public Hearing.
Further Discussion and/or action by the City Council After Public Comment Completed.