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IWAts city of <br />I)NEW <br />MGHTON <br />the city that works for you <br />DATE: August 28, 2015 <br />Community Assets & <br />Development Department <br />MEMORANDUM <br />TO: Economic Development Commission <br />FROM: Janice Gundlach, Asst. Director of Community Assets & <br />Development/Planning Director <br />SUBJECT: Blocks B & D in New Brighton Exchange <br />The City continues to work with Ryan Companies and Colliers International on <br />marketing and development efforts for Blocks B and D on the east side of Old Highway 8 <br />NW within New Brighton Exchange. These two blocks are the remaining developable <br />blocks (excluding CSI, APi options) within all of New Brighton Exchange. Additionally, <br />the City continues to work with Barr Engineering on the environmental challenges in <br />New Brighton Exchange. The purpose of September's meeting is to gain a greater <br />understanding of these blocks and how the current market conditions and environmental <br />constraints will guide future build -out. Several attachments are provided to aid in the <br />discussion. <br />MARKETING UPDATE <br />Colliers staff will be available to provide a brief update on market conditions affecting <br />land development in New Brighton Exchange. Based on the most recent market reports <br />generated by Colliers (attached), the following paragraphs offer a high-level summary of <br />the land development, office, and industrial markets, which directly relate to development <br />in New Brighton Exchange. <br />The land development market is currently driven primarily by apartment, <br />retail/hospitality, and industrial development. Neither blocks B or D are slated for <br />residential, nor could they accommodate residential uses because of their proximity to <br />Old Miller Dump. Additionally, the MPCA treats hospitality (hotels) in a similar <br />restrictive manner to residential. With no direct access to Interstates 694 or 35W, New <br />Brighton Exchange has never attracted retail users. There may be opportunities for <br />limited industrial, which will be discussed later in this memo. <br />The general office market is primarily driven by absorption of existing vacant space. <br />With flat rental rates and a number of large blocks of office space available, users <br />generally prefer to utilize existing space as opposed to developing new buildings. A few <br />exceptions (CSI for example) have/are seeking development of new space primarily <br />