HomeMy WebLinkAbout2023-08-24 HRA Regular Meeting PacketAg enda
E dina H ousing and R edevelopm ent Author ity
City of E dina, Minnesota
City Hall Council Chambers
Thursday, August 24, 2023
8:30 AM
Watch the m eeting on cable TV or at EdinaMN.gov/LiveMeeting s or
Facebook.com /EdinaMN.
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E nter Conference PIN 7493765#
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I.Call to Ord er
II.Roll Call
III.Pledge of Allegia n ce
IV.Ap p roval of Meetin g Agen d a
V.Com m unity Com m en t
Du ring "Com m unity Com m en t," th e Edin a Housing and Redevelop m ent
Au thority (HRA) will in vite resid ents to sh are new issues or con cern s tha t
h aven't been con sid ered in th e p ast 30 da y s b y th e HRA or w h ich a ren't
slated for fu ture consideration . Individ u als m u st lim it their com m ents to
three m inutes. Th e Ch air m a y lim it the num ber of sp ea kers on th e sa m e
issue in th e interest of tim e a n d topic. Gen era lly sp ea king, item s tha t are
elsewhere on tod ay's a genda m a y not b e addressed d u ring Com m unity
Com m en t. In d ividua ls sh ould not expect th e Ch air or Com m issioners to
resp ond to th eir com m en ts toda y . Instead the Com m issioners m ight refer the
m atter to sta. for consideration a t a fu ture m eeting.
VI.Ad option of Con sen t Agenda
All a genda item s listed on the consent a genda a re con sid ered rou tin e and
will be en acted by one m otion. There will be no sepa rate d iscussion of such
item s unless requested to be rem oved from the Con sen t Agenda by a
Com m ission er of the HRA. In su ch ca ses the item w ill b e rem oved from th e
Consent Agen d a and con sid ered im m ediately follow ing the a d option of th e
Consent Agen d a. (Fa vorable rollcall vote of m a jority of Com m issioners
p resent to approve.)
A.Dra ft Min u tes of the Regu la r Meetin g August 10, 2023
B.Am en d Con tra ct for Private Developm en t with Un ited Prop erties Residen tial,
LLC
C.Am en d Con tra ct for Private Developm en t with Jester Concepts, LLC
VII.Executive Director's Com m ents
VIII.HRA Com m issioners' Com m en ts
IX.Ad jou rn m ent
Th e E d ina Housing a n d Redevelop m ent Au thority wa n ts all pa rticip ants to be
com fortable b ein g pa rt of th e p u b lic p rocess. If y ou n ee d a ssista n ce in the w a y of
h ea ring am pli9ca tion, a n in terp reter, large-p rint docum en ts or som ethin g else,
p lease ca ll 952-927-8861 72 hou rs in advance of the m eeting.
Date: August 24, 2023 Agenda Item #: VI.A.
To:C hair & C ommis s ioners of the Edina HR A Item Type:
Minutes
F rom:Liz O ls on, Administrative S upport S pecialist
Item Activity:
Subject:Draft Minutes of the R egular Meeting August 10,
2023
Action
Edina Housing and Redevelopment
Authority
Established 1974
C ITY O F E D IN A
HO US I NG & R EDEVELO P MENT
AUT HO R I T Y
4801 West 50th Street
Edina, MN 55424
www.edinamn.gov
A C TI O N R EQ U ES TED:
Approve the draft minutes of the regular meeting August 10, 2023.
I N TR O D U C TI O N:
AT TAC HME N T S:
Description
Draft Minutes from Augus t 10, 2023
Page 1
MINUTES
OF THE REGULAR MEETING OF THE
EDINA HOUSING AND REDEVELOPMENT AUTHORITY
AUGUST 10, 2023
7:30 A.M.
I. CALL TO ORDER
Chair Hovland called the meeting to order at 7:30 a.m. then explained the processes created for
public comment.
II. ROLLCALL
Answering rollcall were Chair Hovland, Commissioners Agnew, Jackson, Pierce, and Risser.
Absent: None.
III. PLEDGE OF ALLEGIANCE
IV. MEETING AGENDA APPROVED - AS AMENDED
Motion by Commissioner Jackson, seconded by Commissioner Pierce, approving the
meeting agenda as amended, removing Item VI.D.
Roll call:
Ayes: Agnew, Jackson, Pierce, Risser, and Hovland
Motion carried.
V. COMMUNITY COMMENT
No one appeared.
VA. EXECUTIVE DIRECTOR’S RESPONSE TO COMMUNITY COMMENT
Executive Director Neal said there were no community comments received at the last meeting.
VI. CONSENT AGENDA – ADOPTED AS AMENDED
Member Jackson made a motion, seconded by Member Pierce, approving the consent
agenda as presented:
V.A. Draft Minutes of the Regular Meeting of June 8, 2023 and the Special Meeting of
June 15, 2023
V.B. Request for Purchase; Change Order No. 1; FC22-11 50th and France Parking
Ramp Repairs
V.C. Modify Forgivable Loan Agreement with Edina Chamber of Commerce
V.D. Amend Contract for Private Development with United Properties Residential,
LLC
V.E. Approve Subordination Agreement to Environmental Covenant at 3930 and
3944 Market Street
Rollcall:
Ayes: Agnew, Jackson, Pierce, Risser, and Hovland
Motion carried.
ITEMS REMOVED FROM THE CONSENT AGENDA
V.B. REQUEST FOR PURCHASE; CHANGE ORDER NO. 1; FC22-11 50TH AND FRANCE
PARKING RAMP REPAIRS – BID TO THE RECOMMENDED LOW BIDDER, RAM
CONSTRUCTION, $405,998 AWARDED
The Commission inquired about repair estimates for the south and north ramp and if the higher
priority items slated for summer 2020 were addressed then spoke about the costs and if there would
be additional repair requests in the future.
Minutes/HRA/August 10, 2023
Page 2
Economic Development Manager Neuendorf shared the work to date for the publicly owned ramp
constructed in 1968 and in need of repair. He said the both ramps were inspected annually and
scheduled for regular maintenance then noted the north ramp was constructed in 1992 with newer
additions and the scope of repair was much less. He said the focus for repair was on the south and
north ramps that require regular work but would not be as invasive as this year and would include
more routine repairs.
Facilities Supervisor Darsow responded that staff addressed all high priority items structural repairs
listed in the 2021 report in the north and south ramps then described the additional structural
column repair needed in the south ramp and shoring which was the reason for the closure as the
columns on the lower level supported the third and fourth decks. He shared the entire ramp was
open but certain stalls closed for painting, concrete curing, and electrical work.
Motion by Commissioner Risser, seconded by Commissioner Jackson, approving the
request for purchase; Change Order No. 1; FC22-11 50th and France Parking Ramp
Repairs, awarding the bid to the recommended low bidder, Ram Construction,
$405,998.
Roll call:
Ayes: Agnew, Jackson, Pierce, Risser, and Hovland
Motion carried.
VII. REPORTS AND RECOMMENDATIONS
VII.A. PREPARATION OF LOAN AGREEMENT WITH HAWKEYE HOTELS DBA FIFTH
SIDE LODGING, LLC. – AUTHORIZED
Economic Development Manager Neuendorf shared background information stating this item
pertained to financing of a new hotel to be constructed at Pentagon Village - 4931 West 77th Street.
This project was approved in 2019 and on track for construction in 2020 but was negatively impacted
by the pandemic and paused for more than three years while the hospitality industry in the Twin
Cities recovered. The developer was now ready to proceed with construction but had been
impacted by dramatic price increases and reduced access to debt. The project would result in a $41
million investment in Edina and staff confirmed the project was eligible to participate in Edina's
SPARC financing program. He shared background on the developer JR Hospitality and
owner/operator of Hawkeye Hotels then outlined the project in detail that included 5 stories, 239
guest rooms, shared parking, and guest amenities. He outlined the estimated gap from increased
construction costs and reduced debt coverage that resulted in a $2 million financing gap. He shared
about the HRA objectives and SPARC outcomes that included support of new businesses and
investment, increased property tax base and revenue, and jobs. Mr. Neuendorf outlined a summary
of general loan terms for a loan amount of $2 million with $30,000 fees and an estimated term of
10 years maximum with a negotiated interest rate. Staff recommended that legal and financial
advisors be engaged to assist staff in preparation of a loan agreement that would enable this project
to proceed and noted approval of the loan agreement would be scheduled for an upcoming HRA
Board meeting.
Commissioner Agnew’s acknowledged her employment with Marriott Flag and their relationship
with Hawkeye Hotels and recused herself from the item and left the dais.
The Board asked questions and provided feedback.
Motion made by Commissioner Jackson, seconded by Commissioner Risser, to
authorize staff to prepare a loan agreement with Hawkeye Hotels dba Fifth Side
Lodging, LLC for future HRA Board consideration.
Roll call:
Ayes: Jackson, Pierce, Risser, and Hovland
Minutes/HRA/August 10, 2023
Page 3
Abstain: Agnew
Motion carried.
Commissioner Agnew returned to the dais.
VIII. EXECUTIVE DIRECTOR’S COMMENTS – Received
VIII.A. PROJECT UPDATE – Received
IX. HRA COMMISSIONER COMMENTS – Received
X. ADJOURNMENT
Motion made by Commissioner Jackson, seconded by Commissioner Pierce, to adjourn
the meeting at 8:43 a.m.
Roll call:
Ayes: Agnew, Jackson, Pierce, Risser, and Hovland
Motion carried.
Respectfully submitted,
Scott Neal, Executive Director
Date: August 24, 2023 Agenda Item #: VI.B.
To:C hair & C ommis s ioners of the Edina HR A Item Type:
R eport / R ecommendation
F rom:Bill Neuendorf, Economic Development Manager
Item Activity:
Subject:Amend C ontract for P rivate Development with United
P roperties R es idential, LLC
Ac tion
Edina Housing and Redevelopment
Authority
Established 1974
C ITY O F E D IN A
HO US I NG & R EDEVELO P MENT
AUT HO R I T Y
4801 West 50th Street
Edina, MN 55424
www.edinamn.gov
A C TI O N R EQ U ES TED:
Approve the First Amendment to the C ontract for P rivate D evelopment with U nited P roperties R esidential,
L L C .
I N TR O D U C TI O N:
T his item pertains to the sale of real estate at 5146 E den Avenue for redevelopment as a senior housing
cooperative.
T he pre-development work for this project has taken longer than initially expected. T he extra time is due to the
complexities working collaboratively with two other parties (the C ity and J ester R estaurants) to ensure that all the
goals of the parties are achieved. P ursuit of H U D financing in a frequently changing economic environment also
contributed to the delay.
T his amendment is shaped to allow a Spring 2024 groundbreaking of the senior housing with the restaurant to
follow 12 months later. T his amendment is synchronized to align with the companion restaurant project by J ester
C oncepts, as well as the future City plaza project.
S taff recommends approval of the F irst Amendment to the Contract.
AT TAC HME N T S:
Description
Contract Amendment United Properties Residential
DMFIRM #408744966 v3
227636v2
(reserved for recording information)
FIRST AMENDMENT TO
CONTRACT FOR PRIVATE DEVELOPMENT
THIS FIRST AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT,
(the “Amendment”) made on or as of the ___day of August, 2023 (“Effective Date”), by and
between the EDINA HOUSING AND REDEVELOPMENT AUTHORITY, a public body
corporate and politic under the laws of the State of Minnesota (the “HRA”) and UNITED
PROPERTIES RESIDENTIAL LLC, a Minnesota limited liability company (the “Developer”).
WITNESSETH:
WHEREAS, HRA and Developer are parties to that certain Contract for Private
Development dated June 2, 2022 (the “Contract”), with respect to the “HRA Property” as defined
in the Development Contract and legally described on Exhibit A attached hereto; and
WHEREAS, HRA and Developer desire to update the Contract and amend certain
provisions therein as set forth below; and
NOW, THEREFORE, in consideration of the premises and the mutual obligations of the
parties hereto, each of them does hereby covenant and agree with the other to update and amend
the Contract as follows:
ARTICLE I.
AMENDMENTS TO DEFINITIONS
In addition to the current definitions in the Contract, the following definitions are added:
“Declaration of Restrictions” means the Declaration of Restrictions to be
executed on the Closing Date, in recordable form affecting the Property, the Restaurant Lot
and the Park Lot.
DMFIRM #408744966 v3 2
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“Declaration of Restrictive Covenants (Housing)” means that certain Declaration
of Restrictive Covenants between HRA, Developer and Applewood Pointe Cooperative, a
Minnesota cooperative corporation, related to the use and occupancy of the Senior Housing
Facility to be executed on the Closing Date, in recordable form affecting the Property.
“Senior Housing Facility” means Applewood Pointe Cooperative’s senior housing
facility to be constructed on the Property.
ARTICLE II.
AMENDMENTS TO REPRESENTATIONS AND WARRANTIES
There are no amendments to Article II of the Contract.
ARTICLE III.
CONVEYANCE OF PROPERTY
Article III updated provisions. Article III of the Contract is updated with revisions to
Sections 3.4(j)(ii), 3.6 and 3.7 and the addition of new Section 3.11:
Section 3.4(j)(ii). Second Due Diligence Period. Section 3.4(j)(ii) of the Contract is
deleted in its entirety and replaced with the following:
(ii) Second Due Diligence Period. Developer may terminate this Agreement by giving
written notice to HRA prior to the expiration of the Second Due Diligence Period. If
Developer elects to terminate this Agreement prior to the expiration of the Second Due
Diligence Period for failing to achieve the Pre-Sale Requirements, the HRA shall retain
fifty percent (50%) of the Earnest Money and the remaining Earnest Money shall be
refunded to Developer.
Section 3.6. Closing. Section 3.6 is deleted in its entirety and replaced with the following:
Section 3.6 Closing. Subject to the terms and conditions of this Agreement, the Closing
shall occur on or before Friday, May 3, 2024 or a prior date as may be agreed upon in
writing by the HRA Executive Director and Developer (“Closing Date”). The conveyance
contemplated in this Contract will be closed through an escrow arrangement with the Title
Company.
Section 3.7. Closing Documents. Section 3.7 of the Contract is amended to the extent
necessary to include the following:
Additional HRA Documents. In addition to the HRA Documents identified in the Section
3.7 (a) of the Contract, at the Closing, the HRA shall also execute and deliver the
Declaration of Restrictions and the Declaration of Restrictive Covenants (Housing)
Additional Developer Documents. In addition to the Developer Documents identified in
the Contract, at the Closing, the Developer shall also have executed, on its behalf and on
behalf of the Cooperative the Declaration of Restrictive Covenants (Housing).
DMFIRM #408744966 v3 3
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Section 3.11 Additional Provisions. The Contract is updated with a new Section 3.11.
Section 3.11. Additional Provisions.
(a) Status of Initial Due Diligence Period. HRA and Developer agree
that the Initial Due Diligence Period as identified in Section 3.4 (b) of the Contract has
expired.
(b) Inspection Rights and Obligations. Notwithstanding the expiration
of the Initial Due Diligence Period, Developer shall have to right to continue to: (1)
examine the Property Documents; (2) make physical inspection of the Property; (3) procure
financing sources for construction of the Minimum Improvements for the Senior Housing
Facility; (4) determine anticipated phased construction schedule; (5) obtain final land use
approvals for the proposed development; and (6) review title to the Property. In this regard,
Developer and its authorized employees, agents, contractors and representatives
(collectively, “Developer’s Representatives”) shall be entitled to continue to enter upon the
Property at all reasonable times up to the Closing Date for the purpose of continuing
inspections, investigations, surveys and testing of the Property (collectively,
“Inspections”), all upon reasonable prior oral or written notice to the HRA. All Inspections
shall occur at reasonable times agreed upon by the HRA and Developer. Developer shall
pay all costs and expenses of all Inspections. Notwithstanding anything herein to the
contrary, Developer shall not perform soil tests, asbestos or lead tests, or perform tests of
a similarly intrusive nature without the prior written consent of HRA, which consent shall
not be unreasonably withheld, conditioned or delayed; provided, however, Developer shall
have the right to complete a Phase I and a Phase II environmental report as part of such
Inspections.
(c) Responsibilities During the Second Due Diligence Period. During the
Second Due Diligence Period (as the same may be further extended by written agreement
between the parties), the parties will work in good faith to:
(i) confirm the physical delivery condition of the Property at Closing,
including, but not limited to, establishing responsibility for
maintenance of the public sidewalk serving the Property and
establishing any actions necessary to finalize maintenance
responsibility.
(ii) finalize the terms and forms of agreements to be delivered at Closing
for (i) the Restrictive Covenants; (ii) a declaration restricting the
height of any building on the Restaurant Lot to no more than three
stories for a period of at least 10 years; (iii) the Declaration of
Restrictive Covenants (Housing) and (iv) any easements determined
by the parties necessary for their intended uses of their respective
lots within the Plat including, but not limited to:
(a) an easement for the proposed private driveway
serving the Property and benefitting the Restaurant
DMFIRM #408744966 v3 4
227636v2
Lot, which easement addresses the following : (i) that
all responsibilities and costs for construction,
maintenance, repair and significant improvement
responsibilities of the driveway shall be borne by the
Developer; (ii) use of the shared access driveway by
and between Developer and Restaurant Lot; and (iii)
defaults and rights and remedies upon default.
(b) an easement for access over the westerly 10 feet of
the Property (except a width less than 10 feet as
necessary so as not to encroach on proposed Senior
Housing Facility improvements) and over the
westerly 10 feet of the Restaurant Lot for the benefit
of the Restaurant Lot and the Park Lot; and
(c) temporary construction easement(s) over the
Restaurant Lot and the Park Lot to serve the Property
and the Restaurant Lot for staging grounds for the
construction of the improvements on the Property
and the Restaurant Lot;
(d) An access easement for the portion of the private
driveway on the Restaurant Lot benefitting the
Property which easement addresses the following:
(i) that all responsibilities and costs for construction,
maintenance, repair and significant improvement
responsibilities of the driveway shall be borne by the
owner of the Restaurant Lot; (ii) use of the shared
access driveway by and between owner of the
Restaurant Lot and Developer; (iii) defaults and
rights and remedies upon default and (iv) the private
driveway on the Restaurant Lot may be constructed
after the occupancy of the Senior Housing Facility.
(e) A retaining wall easement benefitting the Restaurant
Lot which easement addresses the following: (i) that
all responsibilities and costs for construction shall be
borne by Developer and construction will be
consistent with the retaining wall identified in
Grading Plan C3-1 for the Property as shown in
Exhibit B attached hereto and completed on or before
construction of the proposed parking lot on the
Restaurant Lot; (ii) responsibilities for the costs of
maintenance, repair and significant improvement;
and (iii) defaults and remedies upon default.
DMFIRM #408744966 v3 5
227636v2
(d) Title and Survey. The Developer shall be responsible for performing any
and all title and survey examination or due diligence of the Property that the Developer
deems prudent, at the Developer’s sole cost and expense, except as otherwise provided in
this Agreement. The HRA will provide marketable title to the Property at Closing, but the
HRA is otherwise not providing any representations or warranties as to the condition of
title and Developer expressly waives any claims the Developer may have against the HRA
in connection with any title defects. Notwithstanding the foregoing, the HRA: (i) shall
indemnify Developer, its successors and assigns from and against any claim related agrees
to reasonably cooperate with Developer to cure any title defects that may exist before
Closing.
(e) Confirmation of purpose and expiration of Second Due Diligence Period.
By Notice from Developer to HRA dated July 26, 2023, Developer extended the Second
Due Diligence Period to October 25, 2023. By way of this Amendment, the Second Due
Diligence Period is extended to February 1, 2024 and if necessary, shall be further extended
to April 1, 2024 if Developer demonstrates at least 45% of the Cooperative Units are pre-
sold on February 1, 2024. If fewer than 45% of the Cooperative Units are sold on February
1, 2024, extension shall only be allowed by Amendment of this Contract. To confirm, a
purpose of the Second Due Diligence Period is to provide a specific time period for
Developer to complete the Housing and Urban Development pre-sale financing
requirements for senior cooperative units within the Senior Housing Facility. (“Pre-Sale
Requirements”). Developer shall use commercially reasonable efforts to market the senior
cooperative units and complete the Pre-Sale Requirements. The Developer may waive the
Second Due Diligence Period upon Developer achieving the Pre-Sale Requirements by
written notice to the HRA.
ARTICLE IV.
CONSTRUCTION OF MINIMUM IMPROVEMENTS
Section 4.2 Section 4.2(a) of the Contract is deleted in its entirety and replaced with the
following text:
(a) On or before March 1, 2024, the Developer shall submit to the HRA
Preliminary Construction Plans (site plan for the Property and schematic plans for the
Minimum Improvements) for review and approval by the HRA for general compliance of
the Plans with the terms of this Contract.
(b) If the Developer desires to make any material change in any
Preliminary Plans after their approval by the HRA, the Developer shall submit the proposed
change to the HRA for approval. If the Preliminary Plans, as modified by the proposed
change, confirm to the requirements of this Contract with respect to such previously
approved Preliminary Plans, the HRA shall approve the proposed change and notify the
Developer in writing. Note that the HRA’s consent to material changes is on behalf of the
Seller only; such changes are also subject to review by the City of Edina from a regulatory
perspective.
DMFIRM #408744966 v3 6
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ARTICLE VI.
PROHIBITIONS AGAINST ASSIGNMENT AND
TRANSFER; ENCUMBRANCES; AND INDEMNIFICATION
Section 6.1 Article VI of the Contract is amended as follows, with the inclusion of new
subsection 6.4(g):
(g) Notwithstanding any other provision in the Contract or this
Amendment to the contrary, HRA shall indemnify and hold Developer, its successors and
assigns, harmless from and against any claim, charge, expense, undertaking or obligation
with respect to constructing a retaining wall on the Property arising from that certain
Warranty Deed dated May 25, 1953 and recorded as document no. 2830879 in Book 1970
Page 279 in the office of the Registrar of Titles, Hennepin County, Minnesota, provided
that the need for such retaining wall is not due to the action of the Developer, its successors
and assigns. Such indemnification obligation shall be memorialized in the Deed.
ARTICLE VII.
Events of Default
There are no amendments to Article VII.
ARTICLE VIII.
ADDITIONAL PROVISIONS
Section 8.1. Article VIII of the Contract is amended as follows, with the inclusion of new
subsection 8.11 to read as follows:
8.11 Title of Project Changed. The parties agree that the title of the Contract shall be
changed to “Contract for Private Development – United Properties Senior Housing
Cooperative at 5146 Eden Avenue Site”. Developer agrees not to use the names
“Grandview Yard” or “Grandview Yards” in its naming of the Project or in future
references to the Project.
IN WITNESS WHEREOF, the HRA and Developer have each caused this Amendment
to be duly executed in their respective names and behalf, as of the Effective Date.
[Remainder of page intentionally left blank]
[Signature pages to follow.]
DMFIRM #408744966
227636v2
EDINA HOUSING AND
REDEVELOPMENT AUTHORITY
By:
James B. Hovland
Its: President
By:
James Pierce
Its: Secretary
Attested By:
Scott Neal
Its Executive Director
STATE OF MINNESOTA )
)ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this _____ day of August, 2023,
by James B. Hovland and James Pierce, respectively the President and Secretary of the Edina
Housing and Redevelopment Authority, a public body corporate and politic under the laws of the
State of Minnesota, on behalf of the public body corporate and politic.
Notary Public
DMFIRM #408744966
227636v2
UNITED PROPERTIES RESIDENTIAL
LLC
By:
Name:_______________________________
Its:__________________________________
By:
Name:_______________________________
Its:__________________________________
STATE OF MINNESOTA )
)ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this _____ day of August, 2023,
by _____________________________and ________________________, the
________________________________and ______________________________ respectively of
United Properties Residential LLC, a Minnesota limited liability company, on its behalf.
Notary Public
DRAFTED BY:
Campbell Knutson
Professional Association
Grand Oak Office Center I
860 Blue Gentian Road, Suite 290
Eagan, Minnesota 55121
Telephone: (651) 452-5000
DMFIRM #408744966 v3
227636v2
EXHIBIT “A”
LEGAL DESCRIPTION OF HRA PROPERTY
Lots 2, 3, 4, 5, 6, 7, 8, 9 and 10, and the East 90 feet of Lots 11 to 19 inclusive, all in Block
2, Grandview Heights, Hennepin County, Minnesota according to the recorded plat thereof;
And
That part of Government Lot 8, Section 28, Township 117, Range 21, lying North of the
centerline of Eden Avenue and East of a line drawn parallel to the main track of the
Minneapolis, Northfield and Southern Railway from a point on the North line of said
Government Lot 8 distant 582 feet East from the Northwest corner of said Government Lot
8.
DMFIRM #408744966 v3 10
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EXHIBIT B
RETAINING WALL DEPICTION
Date: August 24, 2023 Agenda Item #: VI.C .
To:C hair & C ommis s ioners of the Edina HR A Item Type:
R eport / R ecommendation
F rom:Bill Neuendorf, Economic Development Manager
Item Activity:
Subject:Amend C ontract for P rivate Development with Jester
C onc epts, LLC
Ac tion
Edina Housing and Redevelopment
Authority
Established 1974
C ITY O F E D IN A
HO US I NG & R EDEVELO P MENT
AUT HO R I T Y
4801 West 50th Street
Edina, MN 55424
www.edinamn.gov
A C TI O N R EQ U ES TED:
Approve the Second Amendment to the Contract for P rivate Development with Jester Concepts, L L C.
I N TR O D U C TI O N:
T his item pertains to the sale of real estate at 5146 E den Avenue for redevelopment as a multi-story restaurant
with indoor and outdoor dining.
T he pre-development work for this project has taken longer than initially expected. T he extra time is due to the
complexities working collaboratively with two other parties (the C ity and U nited P roperties) to ensure that all the
goals of the parties are achieved. P ursuit of H U D financing in a frequently changing economic environment also
contributed to the delay.
T his amendment is shaped to allow a Spring 2024 groundbreaking of the senior housing with the restaurant to
follow 12 months later. T his amendment is synchronized to align with the companion senior cooperative housing
project by United P roperties, as well as the future City plaza project.
S taff recommends approval of the S econd Amendment to the C ontract.
AT TAC HME N T S:
Description
Amended Contract - Jester Concepts LLC
1
227640v1
SECOND AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT
THIS SECOND AMENDMENT TO CONTRACT FOR PRIVATE
DEVELOPMENT ("Second Amendment") is entered into as of the ________day of August,
2023, by and between Edina Housing and Redevelopment Authority, a public body corporate
and politic under the laws of the State of Minnesota (the "HRA"), and Jester Concepts LLC, a
Minnesota limited liability company ("Developer").
R E C I T A L S
A. Developer and the HRA are parties to that certain Contract for Private Development dated
effective June 2, 2022 (the "Original Contract") with respect to real property located in the City
of Edina, Minnesota, as more particularly described in the Original Contract.
B. Developer and the HRA entered into a First Amendment to Contract for Private
Development, dated February 27, 2023, to provide for an extension of time for due diligence,
identification of additional due diligence work, and extension of the closing on the sale of the
property (“First Amendment”).
B. Developer and the HRA now desire to amend the First Amendment and Original Contract
to further extend the time period for due diligence, further clarify due diligence work and extend
the time period for closing in the manner set forth below.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and for
good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the
HRA and Developer agree as follows:
1. Paragraph 2 of the First Amendment is amended to read as follows:
2. Extension of the Due Diligence Period. Developer and the HRA hereby
acknowledge and agree that the Due Diligence Period as identified in Sections
3.4(b) and 3.4(i) of the Original Contract is hereby extended to May 3, 2024, except
as otherwise provided under Paragraph 5 of the First Amendment.
2. Paragraph 3 of the First Amendment is amended to read as follows:
3. Extension to Closing Date. Developer and the HRA acknowledge and agree that
the Closing Date as identified in Section 3.6 of the Original Contract is hereby
amended to occur on or before three hundred sixty (360) days after Closing on the
sale of the Senior Cooperative Lot, as defined in the Purchase Agreement but no
later than May 1, 2025.
3. Paragraph 4 of the First Amendment is amended to read as follows:
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4. Extension to Final Zoning Approval. Developer and HRA acknowledge and
agree that the final zoning and site plan approvals, including the Site Plan
Performance Agreement (SPPA) shall be secured no later than September 30, 2024.
The Developer agrees to prepare and submit documents as typically required by the
City of Edina to secure such approvals.
4. Paragraph 6, new subsections (g) and (h), of the First Amendment are hereby deleted.
5. Paragraph 7 of the First Amendment is hereby amended to read as follows:
7. Finalize Easements during Due Diligence Period . Developer and the HRA acknowledge
and agree that Section 3.4(c)(2) of the Original Contract is hereby amended and restated in
its entirety to provide as follows:
(2) Finalize terms of any easements and/or agreements determined by the
parties necessary for their intended uses of their respective lots within the
Plat, specifically, without limitation:
(a) That certain Grant of Permanent Public Access Easement for
sidewalk on the Property;
(b) That certain Temporary Construction Easement on the Park Lot to
serve the property for staging grounds for the construction of the
improvements on the Property;
(c) That certain Declaration of Easements, Covenants and Restrictions
for the Property pursuant to Section 3.13 of the Purchase
Agreement;
(d) The form of an Easement and Maintenance Agreement for Restroom
Facility on and Access to the Property, subject to revisions based on
the final site plan for the Property prior to Closing;
(e) The form of an access easement over the Senior Cooperative
Property benefitting the Property for the proposed private driveway
serving the Senior Cooperative Lot and the Property, which
easement addresses the following: (i) that all responsibilities and
costs for construction, maintenance, repair and significant
improvement responsibilities of the driveway shall be borne by the
Senior Cooperative Developer; (ii) use of the shared access
driveway by and between Developer and Senior Cooperative
Developer; and (iii) defaults and rights and remedies upon default.
A cost share agreement and easement between Developer and the
Senior Cooperative Developer for the proposed private road serving
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the lots within the Plat and operation and maintenance of the private
road;
(f) The form of an access easement for truck turnaround over the
portion of the private driveway on the Property benefitting the
Senior Cooperative Property which easement addresses the
following: (i) that all responsibilities and costs for construction,
maintenance, repair and significant improvement responsibilities of
the driveway shall be borne by the owner of the Property; (ii) use of
the shared access driveway by and between owner of the Property
and Senior Cooperative Developer; and (iii) defaults and rights and
remedies upon default.
(g) An easement for access over the westerly 10 feet of the Property for
the benefit of the Senior Cooperative Lot and Park Lot;
(h) That certain Temporary Construction Easement over the Property to
serve the Senior Cooperative Lot for staging grounds for the
construction of the improvements on the Senior Cooperative Lot;
(i) That certain Temporary Construction Easement over the Park Lot to
serve the Property for the construction of the improvements on the
Property;
(j) If necessary, the cost share agreement and easement between the
Developer, and the HRA for the shared stormwater facility
benefitting the Property and Park Lot addressing (i) construction
costs of system; (ii) repair and maintenance responsibilities,
significant improvement responsibilities, and cost-sharing of each,
and (iii) defaults and rights and remedies upon default;
(k) A retaining wall easement over the Senior Cooperative Property
benefitting the Property which easement addresses the following:
(i) that all responsibilities and costs for construction shall be borne
by the Senior Cooperative Developer and construction will be
consistent with the retaining wall identified in Grading Plan C3-1
for the Senior Cooperative Lot as shown in Exhibit A attached
hereto and completed on or before construction of the proposed
parking lot on the Property; (ii) responsibilities for the costs of
maintenance, repair and significant improvement; and (iii) defaults
and remedies upon default.
For all agreements and easements related to the Senior Cooperative Property,
Developer agrees to provide written approval of the final proposed agreements prior
to the expiration of the Second Due Diligence period provided under the Contract
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for Private Development between the HRA and United Properties Residential LLC
for the Senior Cooperative Lot, as amended (“Senior Cooperative Contract”).
Developer acknowledges that such agreements and easements will be recorded with
the closing on the Senior Cooperative Contract.
6. Paragraph 9 of the First Amendment is amended to revise Section 3.7(a)(xix) of the
Original Contract to read as follows:
(xix) The access easement for truck turnaround over the Property benefitting the
Senior Cooperative Property abutting the westerly portion of the private
driveway.
7. Paragraph 9 of the First Amendment is amended to revise Section 3.7(a)(xxi) of the
Original Contract to read as follows:
(xxi) The cost share agreement and easement for shared stormwater utility
facilities between the HRA and the Developer.
8. Paragraph 10 of the First Amendment is amended to revise Section 3.7(b)(xiii) of
the Original Contract to read as follows:
(xiii) The access easement for truck turnaround over the Property benefitting the
Senior Cooperative Property abutting the westerly portion of the private
driveway.
9. Paragraph 10 of the First Amendment is amended to delete Sections 3.7(b)(xiv) and
(xv) of the Original Contract are hereby deleted.
10. Paragraph 10 of the First Amendment is amended to revise Section 3.7(b)(xvi) of
the Original Contract to read as follows:
(xvi) The cost share agreement and easement for shared stormwater utility
facilities between the HRA and Developer.
11. All references to “Purchase Agreement” within the First Amendment are hereby
revised to read “Original Contract.”
12. All references to a “private road” within the First Amendment and Original
Contract are hereby revised to read “private driveway.”
13. Miscellaneous. All capitalized terms contained herein which are not defined shall have the
meanings ascribed to them in the Original Agreement. The Recitals set forth above are
incorporated herein as if fully restated. This Amendment may be executed in several counterparts,
and all so executed shall constitute one agreement binding on all parties hereto, notwithstanding
that all parties are not signatories to the original or the same counterpart. The exchange of signature
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pages by facsimile or Portable Document Format ("PDF") transmission shall constitute effective
delivery of such signature pages. Signatures of the parties hereto transmitted by facsimile or PDF
shall be deemed to be their original signatures for all purposes. In case of any inconsistency
between this Amendment and the Original Contract, the terms of this Amendment shall control.
The Original Contract, together with the First Amendment as amended by this Second
Amendment, embody the entire understanding between HRA and Developer with respect to its
subject matter and can be changed only by an instrument in writing signed by HRA and Developer.
Except as modified by this Second Amendment, the Original Contract and First Amendment are
ratified, affirmed, in full force and effect, and incorporated herein by reference.
[balance of this page intentionally left blank; signatures set forth on the following page]
SIGNATURE PAGE TO SECOND AMENDMENT TO
CONTRACT FOR PRIVATE DEVELOPMENT
227640v1
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date and
year first above written.
HRA:
Edina Housing and Redevelopment Authority,
a public body corporate and politic under the laws
of the State of Minnesota
By: ______________________________
James B. Hovland
Its: President
By: ______________________________
James Pierce
Its: Secretary
Attested By: ______________________
Scott Neal
Its: Executive Director
SIGNATURE PAGE TO SECOND AMENDMENT TO
CONTRACT FOR PRIVATE DEVELOPMENT
227640v1
DEVELOPER:
Jester Concepts LLC,
a Minnesota limited liability company
By: _______________________________
Brent Frederick
Its: Chief Manager
SIGNATURE PAGE TO SECOND AMENDMENT TO
CONTRACT FOR PRIVATE DEVELOPMENT
227640v1
EXHIBIT A
RETAINING WALL