HomeMy WebLinkAbout2012-01-23 Park Board PacketAGENDA
CITY OF EDINA, MINNESOTA
SPECIAL PARK BOARD MEETING
CITY COUNCIL CHAMBERS
Monday, January 23, 2012
7:00 P.M.
CALL TO ORDER
II. ROLL CALL
III. APPROVAL OF MEETING AGENDA
IV. COMMUNITY COMMENT
During "Community Comment, " the Park Board will invite residents to share relevant
issues or concerns. Individuals must limit their comments to three minutes. The
Chair may limit the number of speakers on the same issue in the interest of time and
topic. Generally speaking, items that are elsewhere on tonight's agenda may not be
addressed during Community Comment. Individuals should not expect the Chair or
Board Members to respond to their comments tonight. Instead, the Board might refer
the matter to staff for consideration at a future meeting.
V. REPORTS/RECOMMENDATIONS
A. Hornet's Nest at Braemar Arena Proposal
VI. CORRESPONDENCE AND PETITIONS
VII. CHAIR AND BOARD MEMBER COMMENTS
VIII. STAFF COMMENTS
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The city of Edina wants all residents to be comfortable being part of the public process. If you need
assistance in the way of hearing amplification, an interpreter, large -print documents or something,
please call 952-927-8861 72 hours in advance of the meeting.
\cORPOR�*'i�
1898
REPORT/RECOMMENDATION
To:
EDINA PARK BOARD
Agenda Item
Item No. V. A.
From:
John Keprios, Director
Park and Recreation Department
Action
Discussion
Information
Date: January 23, 2012
Subject:
Hornet's Nest at Braemar Arena Proposal
ACTION REQUESTED:
Staff recommends that the Park Board approve the proposal of the Hornet's Nest
project at Braemar Arena.
INFORMATION/BACKGROUND:
As outlined in the enclosed packet of information provided by Eric Anderson, the
Hornet's Nest at Braemar Arena is a proposal to build a two-story building addition just
to the north of Braemar West Arena. This addition would include permanent locker room
facilities for the Edina High School's boys and girls varsity and junior varsity hockey
teams on the lower level. The upper level would include space for a training facility, a
pro shop retail store, and a quick serve restaurant.
The proposed lease revenue is projected to cover the debt amortization, tax and
insurance and operation expenses for the entire facility, including the locker rooms. Our
current staffing levels would be sufficient to support the maintenance of this facility.
The training facility would be an asset to Braemar Arena. Off -ice training is an important
component of athletic development. It is very important to the skill development of the
student athletes, however it is also important injury reduction. Many Edina student
athletes consistently drive outside the borders to train at facilities in Eden Prairie, St.
Louis Park and other communities where their athlete is able to train on and off the ice.
Our goal at Braemar Arena is to create an environment that is convenient and
welcoming to Edina families. This facility will help us accomplish this goal. We believe
we would see an increase in spring, summer and fall ice rentals as a result of providing
a complete hockey experience. In 2010, Braemar lost a summer ice rental customer
who offered camps for our Edina hockey players. The customer expressed the lack of
off -ice training opportunities as the primary reason for leaving Braemar.
Table of Contents
ProjectSummary........................................................................................................................................................................................3
TheNeed....................................................................................................................................................................................................4
Benefitto the Community.......................................................................................................................................................................... S
ProgrammaticElements.............................................................................................................................................................................6
Hornet's Nest Locker Room........................................................................................................................................................................7
StreetLevel................................................................................................................................................................................................9
ConstructionCosts...................................................................................................................................................................................11
Debt.........................................................................................................................................................................................................12
CashFlow.................................................................................................................................................................................................13
BoardMembers.......................................................................................................................................................................................14
Project Summary
Braemar Ice Arena is one of the finest hockey facilities in the state of Minnesota. However, the arena was constructed in 1966. At
that time, locker rooms were constructed for general purpose and did not differentiate between squirt and high school players, nor
were locker rooms differentiated for boys and girls players. Over the last 44 years, the amenities of arenas throughout the state have
evolved. Today, state of the art locker room and training facilities for boys and girls high school programs are found in Blake, Breck,
Benilde St. Margarets, Centennial, Chanhassen, Duluth, Eden Prairie, Holy Family, Minnetonka, Mound-Westonka, Park Cottage Grove,
Prior Lake, Providence Academy, Roseau, Stillwater, Wayzata, White Bear Lake, and Woodbury to name only a few.
Currently, both of Edina's men's and women's varsity players store their gear at their homes. On game night, the players meet at the
high school where their gear is put into a trailer. The player and their gear are then transported by bus to Braemar Arena. Upon
arrival at Braemar, the players are put into one of the general-purpose locker rooms where they change into their gear. After the
game, players can use the facilities at Braemar to shower. However, the shower facilities have changed very little since 1966. Many
are not in working order. When a player chooses to use the outdated facilities, it is not uncommon to see a player sprinting down the
halls of Braemar in a towel to reach one of the working showers. When all the players are dressed, the players board the bus again
and they and their gear are transported back to the high school. Weight training is done at the high school and is shared with
multiple sports. It is often overcrowded. There is a small shooting area located in the Braemar South rink. Otherwise, there is no
training area for weight training or important skill development like puck handling and shooting.
Drive for the Hive was formed as a 501 (c)(3) for the purpose of constructing and soliciting donations for the Hornet's Nest project.
The Hornet's Nest project envisions the construction of a locker room and training facility adjacent and connected to Braemar Ice
Arena. The project would include a total of four locker rooms - two locker rooms for the men's varsity and junior varsity program
and two locker rooms for the women's varsity and junior varsity program. Each locker room will contain an area for player's lockers,
bathrooms and showers, coach's locker areas, and equipment/trainer's room. The training facility would include a weight training
area to help players build their strength, and a skill development area to help players improve their puck handling skills, shooting
skills, and their skating technique. The breadth of skill sets represented at the training facility will help reduce the number of training
visits to skill -specific trainers at multiple facilities in different cities within the Minneapolis metropolitan area.
In the following pages you will see the need for the Hornet's Nest project, the benefit to the community and the project layout. The
cost of the project is estimated at $4 million. Drive for the Hive is proposing a public/private partnership. Drive for the Hive would
privately raise $1 million. The City of Edina would provide tax-exempt bond financing in the amount of $3 million. Rent from the
project would be used to retire the debt.
The Need
One needs only to compare the difference between the locker room facilities utilized by our high school hockey programs and the
state of the art facilities utilized by many competing programs throughout the State of Hockey to see the need for this project
Edina Hockey Locker Rooms
Minnetonka Hockey Locker Rooms
Benilde St. Margaret's Hockey Locker Room
Stillwater Hockey Locker Room
Competing programs like Minnetonka, Benilde St. Margaret's and Stillwater have locker rooms dedicated to their boys and girls
varsity and junior varsity hockey programs that include individual locker stalls, showers, restrooms, coaches lockers,
equipment/training rooms, and separate training facilities.
Benefit to the Community
Since 1966, Edina hockey has earned the respect
of its opponents throughout the state of
Minnesota. During that time, the boys varsity
hockey program has won 10 State Championships
and earned trips to the State Tournament on 33
occasions. The girls varsity hockey program has
established itself as a perennial powerhouse
earning state runner-up honors in 2010 and 2011
with its third consecutive trip to the State
Tournament.
The Hornet's Nest project will provide a world-
class training facility for the use of the high school
hockey programs and the use of the hundreds of
players who are part of the Edina Hockey
Association. Currently, a large number of
community members drive outside of the
community of Edina for training in puck handling;
shooting, skating, and weight training. The
Hornet's Nest Project will provide community
members with a training center that covers all of
those disciplines in a facility that is not only
within Edina, but directly connected to Braemar
Arena.
The success of the hockey program is both a
reflection of and a reflection upon the City of
Edina. The Hornet's Nest project will honor the
Championship tradition established by former
Hornets and provide a new home for the
champions of tomorrow.
Programmatic Elements
The project contemplates
construction of a new facility on the
north side of Braemar West (in
green on the right) with
programmatic elements totaling
3 1,82 8 square feet on two levels.
The lower level includes locker
rooms for both the boys and girls
varsity hockey program, and the
boys and girls junior varsity
program totaling 14,748 square
feet
The street level includes a 7,280
square foot training facility, 6,790
square feet of retail, and a 3,010
square foot restaurant The
programmatic elements of the
street level total 17,080 square
feet.
Lower Level Locker Rooms
Boys Varsity Locker Room
3,162
Boys Junior Varsity Locker Room
3,162
Girls Varsity Locker Room
3,162
Girls Junior Varsity Locker Room
3,162
14,748
Street Level Training and Retail
Training Center
7,280
Retail
6,790
Restaurant
3,010
17,080
Total
31,828
6
Hornet's Nest Locker Room
The locker room is divided into
four separate areas.
Locker Area
The locker area includes individual
wood locker stalls, a video screen
and a whiteboard area for coach to
player instruction.
Restroom Area
The restroom area includes toilets,
urinals (boys), sink and mirrors,
and showers.
Coaches Locker Area
The coach's locker area includes
individual wood locker stalls,
restroom, and shower facilities.
Equipment/Training Area
The Equipment Training area
includes an equipment workbench,
stick racks, skate sharpening area, a
washer and dryer, and
physical/medical trainer's tables.
SCHEMATIC LAYOUT LOWER LEVEL - LOCKER ROOMS
Street Level
The street level is divided into a
Training Center, retail area, and a
restaurant area.
Training Center
The Training Center area includes
an area for shooting, puck handling
and weight lifting. Multiple
experienced third -party operators
have expressed interested in
operating the training facility and
would agree to a long-term lease
commitment.
Retail Area
The retail area includes 6,790
square feet for a retail sporting
goods store. We have spoken with
several operators of retail sporting
goods stores that are interested in
locating here.
Restaurant Area
The restaurant area includes 3,010
square feet for a quick -serve
restaurant. We have spoken with
several operators of quick -serve
restaurants that are interested in
locating here
Below is a projected rent roll for the Hornet's Nest project. Base rent is projected based on market rents. Operating expenses are
based upon discussions with the General Manager at Braemar Arena, Susie Miller, consistent with existing operating expenses at
Braemar Arena.
HORNET'S NEST RENT ROLL
10
Per Square
FootMonthly
Total
Annual
Total
Tenant
Square Feet
Base Rent
Op Exp. Tax & Ins.
Gross Rent
Base Rent
Op Exp.
Tax & Ins.
Gross Rent
Base Rent
Op Exp
Tax & Ins
Gross Rent
Locker Rooms
14,748
$0.00
$3.00
$0.00
$3.00
$0
$3,687
$0
$0
$0
$44,244
$0
$0
Training Center
7,280
$9.00
$3.00
$2.00
$14.00
$5,460
$1,820
$1,213
$8,493
$65,520
$21,840
$14,560
$101,920
Retail
6,790
$20.00
$3.00
$2.00
$25.00
$11,317
$1,698
$1,132
$14,146
$135,800
$20,370
$13,580
$169,750
Restaurant
3,010
$15.00
$3.00
$2.00
$20.00
$3,763
$753
$502
$5,017
$45,150
$9,030
$6,020
$60,200
Total
31,828
$20,539
$7,957
$2,847
$27,656
$246,470
$95,484
$34,160
$331,870
10
Construction Costs
The Hornet's Nest project will be bid among multiple general contractors. Prior to then, Kraus -Anderson Construction Company
provided the following construction cost estimates.
HORNETS NEST CONSTRUCTION COST ESTIMATES
11
Dimensions
Construction Costs
Lower Level Locker Rooms
Length
Width
SF
Per sq. ft.
Cost Total Cost
Boys Varsity Locker Room
62
51
3,162
$125
$395,250.00
Boys Junior Varsity Locker Room
62
51
3,162
$125
$395,250.00
Girls Varsity Locker Room
62
51
3,162
$125
$395,250.00
Girls Junior Varsity Locker Room
62
51
3,162
$125
$395,250.00
Egress Corridor
15
140
2,100
$125
$262,500.00
Subtotal
14,748
$1,843,500.00
Street Level
Training Center
104
70
7,280
$125
$910,000.00
Retail
97
70
6,790
Restaurant
43
70
3,010
$125
$376,250.00
Subtotal
17,080
$2,135,000.00
Total
31,828
$3,978,500.00
11
Debt
Based upon preliminary discussions
with City of Edina Finance Director
John Wallin, the project should qualify
for tax exempt financing. Mr. Wallin
estimated that the financing would
fully amortize over a 20 -year term
with interest rates currently at 3.00°/x.
The amortization table to the right
shows the schedule for debt
repayment.
Hornet's Nest Debt Amortization
Debt $2,978,500.00
Term 20 Years
Rate 3.00%
Annual Pymt $200,201.99
Payment Interest Principal Balance
$2,978,500.00
1 $200,201.99 $89,355.00 $110,846.99 $2,867,653.01
2 $200,201.99 $86,029.59 $114,172.39 $2,753,480.62
3 $200,201.99 $82,604.42 $117,597.57 $2,635,883.05
4 $200,201.99 $79,076.49 $121,125.49 $2,514,757.56
5 $200,201.99 $75,442.73 $124,759.26 $2,389,998.30
6 $200,201.99 $71,699.95 $128,502.04 $2,261,496.27
7 $200,201.99 $67,844.89 $132,357.10 $2,129,139.17
8 $200,201.99 $63,874.18 $136,327.81 $1,992,811.36
9 $200,201.99 $59,784.34 $140,417.64 $1,852,393.71
10 $200,201.99 $55,571.81 $144,630.17 $1,707,763.54
11 $200,201.99 $51,232.91 $148,969.08 $1,558,794.46
12 $200,201.99 $46,763.83 $153,438.15 $1,405,356.31
13 $200,201.99 $42,160.69 $158,041.30 $1,247,315.02
14 $200,201.99 $37,419.45 $162,782.53 $1,084,532.48
15 $200,201.99 $32,535.97 $167,666.01 $916,866.47
16 $200,201.99 $27,505.99 $172,695.99 $744,170.48
17 $200,201.99 $22,325.11 $177,876.87 $566,293.61
18 $200,201.99 $16,988.81 $183,213.18 $383,080.43
19 $200,201.99 $11,492.41 $188,709.57 $194,370.86
20 $200,201.99 $5,831.13 $194,370.86 $0.00
12
Cash Flow
HORNET'S NEST CASH FLOW PROJECTION
Capital Reserve $2,024 $7,650 $16,937 $29,944 $46,732 $67,362 $91,896 $120,396 $152,926 $189,550
HORNET'S NEST CASH FLOW PROJECTION
Year 1 Year
2 Year
3 Year
4 Year 5 Year 6 Year
7 Year 8 Year
9 Year 10
REVENUE
Training Center
$79,869
$81,466
Training Center
$65,520
$66,830
$68,167
$69,530
$70,921
$72,339
$73,786
$75,262
$76,767
$78,302
Retail
$135,800
$138,516
$141,286
$144,112
$146,994
$149,934
$152,933
$155,992
$159,111
$162,294
Restaurant
$45,150
$46,053
$46,974
$47,914
$48,872
$49,849
$50,846
$51,863
$52,900
$53,958
Rental Revenue
$246,470
$251,399
$256,427
$261,556
$266,787
$272,123
$277,565
$283,117
$288,779
$294,554
Reimbursement Revenue
$85,400
$87,962$90,601
$133,050
$93,319
$96,118
$99,002
$101,972
$105,031
$108,182
$111,428
Total Revenue
$331,870
$339,361
$347,028
$354,875
$362,906
$371,125
$379,537
$388,148
$396,961
$405,982
EXPENSES
Operating Expenses
$174,231
$179,458
Operating Expenses
$129,644
$133,533
$137,539
$141,665
$145,915
$150,293
$154,802
$159,446
$164,229
$169,156
NET OPERATING INCOME
Net Operating Income
$240,985
$245,210
Net Operating Income
$202,226
$205,828
$209,489
$213,209
$216,990
$220,832
$224,736
$228,702
$232,732
$236,826
CAPITAL EXPENSES
Capital Expenses
$0
$0
Capital Expenses
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Cash Flow After Capital Expenses
$202,226
$205,828
$209,489
$213,209
$216,990
$220,832
$224,736
$228,702'
$232,732
$236,626
DEBT SERVICE
Debt Service
$200,202
$200,202
Debt Service
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
Cash Flaw After Debt Service
$2,024
$5,626
$9,287
$13,007
$16,788
$20,630
$24,534
$28,500
$32,530
$36,624
Capital Reserve $2,024 $7,650 $16,937 $29,944 $46,732 $67,362 $91,896 $120,396 $152,926 $189,550
HORNET'S NEST CASH FLOW PROJECTION
Capital Reserve $230,333 $275,342 $324,642 $378,301 $436,388 $498,972 $566,122 $637,909 $714,404 $795,680,
13
Year 11 Year 12
Year 13 Year 14 Year 15
Year 16 Year 17 Year 18 Year 19 Year 20
REVENUE
Training Center
$79,869
$81,466
$83,095
$84,757
$86,452
$88,181
$89,945
$91,744
$93,579
$95,450
Retail
$165,539
$168,850
$172,227
$175,672
$179,185
$182,769
$186,424
$190,153
$193,956
$197,835
Restaurant
$55,038
$56,138
$57,261
$58,406
$59,574
$60,766
$61,981
$63,221
$64,485
$65,775
Rental Revenue
$300,446
$306,454
$312,584
$318,835
$325,212
$331,716
$338,350
4345,118
$352,020
$359,060
Reimbursement Revenue
$114,770
$118,214
$121,760
$125,413
$129,175
$133,050
$137,042
;141,153
$145,388
$149,749
Total Revenue
$415,216
$424,668
$434,344
$444,248
$454,387
$464,767
$475,392
$486,271
$497,408
$508,810
EXPENSES
Operating Expenses
$174,231
$179,458
$184,841
$190,387
$196,098
$201,981
$208,041
$214,282
$220,710
$227,332
NET OPERATING INCOME
Net Operating Income
$240,985
$245,210
$249,502
$253,861
$258,289
$262,785
$267,352
$271,989
$276,697
$281,478
CAPITAL EXPENSES
Capital Expenses
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Cash Flow After Capital Expenses
$240,985
$245,210
$249,502
$253,861
$258,289
$262,785
$267,352
$271,989
$276,697
$281,478
DEBT SERVICE
Debt Service
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
$200,202
Cash Flaw After Debt Service
$40,783
$45,008
$49,300
$53,659
$58,087
$62,583
$67,150
$71,787
$76,495
$81,276
Capital Reserve $230,333 $275,342 $324,642 $378,301 $436,388 $498,972 $566,122 $637,909 $714,404 $795,680,
13
Board Members
ERIC ANDERSON, CCfM
Eric is a partner for City Center Realty Partners, LLC. CCRP specializes in the
development, redevelopment, and acquisition of commercial real estate including
office buildings, retail and mixed-use projects. Prior to joining City Center Realty
Partners, Eric was Director of National Equity Programs for G.E. Capital. He was
° responsible for forming joint ventures with real estate developers throughout the
U.S. Previously, Eric was Vice President of Newcourt Capital's Structured Finance
Group where he acted as an advisor in commercial real estate transactions. Prior to
that, Eric served as Senior Account Executive with MetLife Capital Corporation
where he originated loans and joint ventures for retail, industrial, and office projects.
Eric received his B.A. from St. Olaf College and holds a Certified Commercial
CITY CENTER Investment Member (CCIM) designation.
REALTY PARTNERS
TIMOTHY WELCH
Tim Welch is an MSBA Board Certified Real Property Law Specialist. He has
significant experience in government relations at the municipal level, including
zoning, licensing, and development issues. In addition, he provides general
representation for developers and owners of numerous commercial real estate
properties; landlords and tenants in all facets of leasing. Tim represented the
Minnesota Wild in the leasing and construction ofXcel Energy Center and led a
team involved in the development ofTarget Field for the Minnesota Twins.
LEONARD
STREET
AND
DE I NARD
14
STEVE BROWN, CCIM
As Senior Vice President of the Healthcare Group, Steve Brown is responsible for
providing real estate consulting and advisory services to healthcare organizations,
corporations and clinical practices both locally and throughout the United States.
Steve has 26 years of commercial real estate experience, predominately focused in
office and medical space in the Minneapolis metropolitan area.
Steve was a member of the Edina Planning Commission for 11 years. He was also
a member of the 2008 Comprehensive Plan Task Force helping lead the year long
process of updating the Comprehensive Plan for the City of Edina.
NORTHMARW
MARTY NANNE
Marty is a founding Principal and President of the KNW Group. He started his
career as an independent insurance specialist in 1992 helping clients and their
advisors in the areas of corporate owned life insurance, estate planning, charitable
giving, income replacement and disability insurance. Marty attended the University
of Minnesota where he had an elected major of sociology and speech
communications. He has his LUTCF certification and MDRT Top of he Table
Producer designation. He holds Series 6 (Investment Company ProductsNariable
Contracts Limited Representative), 63 (Uniform Securities Agent State Law
Exam), and 65 (Uniform Investment Adviser Law Exam) Securities registration, as
well as life, health and variable annuity insurance licenses in a number of states. He
■1 is a registered representative and and Investment Adviser Representative with NFP
iSecurities, Inc. He is a member of the Pacific Life Advisory Board and the
Minnesota Chamber of Commerce Board. He is also an amateur scout for the
THE K N W G R 0 U P Minnesota Wild of the National Hockey League.
15
GREG DORNBACH
Greg is founder and President of DGD Foods, Inc. Prior to forming DGD, Greg
served as Senior Vice President of Sales & Marketing of Lettieri's, Inc., a division
of Hot Stuff Foods LLC. He has over 26 years of sales experience in the frozen
food and convenience store industry including positions with ConAgra Frozen
Foods, Sales Force, Inc. and L.S. Sorem. He is a graduate of Miami University
where he played his collegiate hockey.
L_31A�dr7_\�L�l'7
With over two decades of insurance experience, Bill founded Legacy Quote where
he serves as the Managing Director providing life insurance solutions for
prominent doctors, lawyers and business owners. Prior to forming Legacy Quote,
Bill ran the Midwest office for American General covering Minnesota, Wisconsin,
North and South Dakota, and Iowa. Prior to that, Bill was the District Manager
for'Ae Equitable. He is a graduate of the University of Michigan where he earned
a degree in economics and played his collegiate hockey.
P,.Oq LEGACYO.UOTE
16
JON FOUST
0 ROXBURY
. , V-;"li
1.
LENORE EVERSON, MD
Jon is responsible for leading Roxbury's nationwide marketing and business
development effort. In addition to servicing many of the firms largest client
relationships, he is a member of the firms Oversight Committee and Board of
Managers. Prior to joining Roxbury in 2000, Jon was a principal and director of
marketing and client service for Winslow Capital Management, a Minneapolis-
based money management firm specializing in large institutional accounts. He
previously was vice president of institutional marketing with Investment Advisors,
Inc. Jon began his career with the Saudi International Bank in London, England
and has been in the investment management business for more than 20 years. He
has a B.A. in economics and psychology from St. Olaf College.
Dr. Everson is an Associate Professor of Radiology at NU Design Medical
Technologies, Inc. NU Design is a privately held medical software and
teleradiology company specializing in the women's healthcare market.7he web -
based technology platform automates the overall effectiveness of healthcare
facilities while providing connectivity to remote facilities and Radiologists. Dr.
Everson is a graduate of Georgetown University.
17
BETH WILLIAMSON
18