HomeMy WebLinkAboutNovember 16, 2011 finance and Real Estate Workshop Notes Finance and Real Estate Work Group Meeting
November 16, 2011
Attendees:Tony Shertler, Kim Montgomery, Ellen Jones, Kevin Staunton,Andrew Dresdner, Mike Lamb,
Bruce Jacobson, Peter Sussman, Bright Dornblaser
TS—since its a slow market right now, it's the right time to Plan;there is no immediate opportunity to
catch.
There are statutory opportunities that expire on June 1 2012. Edina can move TIF money around from
Centennial lakes/Southdale,for example,to GV is they can get private development in the ground by
June 1, 2012.
TIF—can you trap it, redirect it, use it.
Typically TIF is used to write down land or for parking
Have to determine if the city has programmed proceed to something else.
KS—what are the possible uses and sources
TS—control and competitiveness—assess the strings attached with each bucket
Increment vs abatement (right down to zero, redirect, invisible)
ML—400-500 spaces will cost 9-10 million
TS : Assessments are additional costs to property owners—not invisible
Other buckets: public sources, non profit/philanthropic, and City tax Funds.
The game is matching sources and uses
You try to get as many public outcomes as possible so you can qualify for more sources
As you put your vision together consider tax credit funding, CDBG
Affordable housing opens up many sources.
The costs are going to exceed the values since the Bus Garage has a 2.5 Million replacement cost.The
site also needs new pedestrian connections as well as possible clean up.
KM—how much does the entire area throw off
TS—TIF$can only be used to improve. Comps—CSM site=55K/yr in taxes. This would retire the debt
on a 700,000 bond. Not enough to relocate the Bus Garage.
KM—want to see the cost of public infrastructure so we can arrive at a $that tells us our target.
TS—when working for non-profits your$comes in over years, not in one lump sum.
KM—we are in no rush,we should get the design we want,then wait until the timing is right.
TS—is there a place on the site where value can really take off without diminishing the public benefits of
the project.
The only thing worse than plutonium is public ownership
ML—where should we make our first investments, and why?
KS—what are the different economic development tools for the City vs. the School District
TS—school could vacate the Bus Garage to the HRA
KM—cloverleaf for the P and R and bus Garage. Keep the busses in place until the cloverleaf is ready to
go.
KM—have not seen a developer project that I have liked. look at Nambi Park in Osaka—this resembles
the scale of what we are looking for.
TS—it is best to delay costs as long as possible.
Sequencing: Public Realm, Bus garage,then Public Works; Phase 2: Private Development
Real Estate&Finance
•
• Response to market
• Response by next June...some potential spin to this project
o Trap it
o Redirect it
• TIF uses...write down land
o Write down parking
• Public Works site already owned
• Costs
o Demolition and
o Structured parking
• List the buckets of potential funding
o control and/or competitiveness
o Potential taxes for P.W.S. depending on land use
o TIF...site has to be able to pay it's own cost
o Abatement
o Assessment... "cost on top of"
• Negotiate value within the site...
o private development
• Market will take care of itself
o @ GD...cost exceeds value (Bus site)
• How much tax does this site throw off? (today)
• What are the negatives that we're addressing at Grandview?
o 'X' $of public infrastructure
o 'X' $from taxable housing
• Cost Estimate for Phase 1 Public Improvements
o Streets (walks, lights,etc.)
o Public Realm
o Civic Building(s)
o Other—parking etc. etc. (Enterprise Funds)
• Private
o Revenue estimate from taxable property development
• Public
o Revenue from other sources
o Revenue from 'Donations' (Philanthropic)
• Work Tasks
o Cost
o Revenue
o Sequence
o Phase One
• Multi-use...Public/Private blur is a challenge in MN
• Less entangled is better...but it shouldn't preclude shared space/Public& Private partnership
• Where does development start?
o What Public investment piece will lead and encourage the next steps
• City-controlled bus storage property
• Assessment of risk
o What is this list now?
• Never seen a developer designed project that was worth anything
o Osaka...Nambi Plaza
Finance and Real Estate
■ "Buckets" of Potential Funds
➢ TIF/Abatement
➢ Assessments
➢ Private Development
➢ Other Public Sources (i.e., MHFA, Met Council, MnDOT, etc.)
➢ Non-Profit and Philanthropic
➢ City Tax Funds
• Sequencing
➢ Phase I
■ Public Realm
■ Bus Garage
■ Public Works
➢ Phase II
■ Private Development
• "To Do"
➢ Estimate Public Costs—Public/Community Uses, Public Realm, etc.
➢ Consider Potential Sources and Trade-Offs
• Sequence
➢ Scope of Phase I