2018.03.07 EDC - Laserfiche WebLink

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Community Assets & Development Department MEMORANDUM DATE: March 2, 2018 TO: Economic Development Commission FROM: Janice Gundlach, Asst. Director of Community Assets & Development/Planning Director SUBJECT: Korean Church Redevelopment Update The purpose of the memo, and the March Commission meeting, is to update the Commission on efforts that are underway to advance redevelopment of the Korean Church property. While no action is necessary at this time, the information contained in this memo is important context for upcoming meetings where the Commission will be asked to make recommendations to the City Council. Staff has conducted 12 developer meetings regarding the Korean Church property. Staff met with Aeon, Sand Companies, Dominium, Schafer Richardson, Sherman Associates, MWF, Northbay Companies (formerly CPM), Timberland Partners, Stuart Companies, Pulte, Inland Development, and Norhart Homes. All seem to have varying levels of interest. Beyond the listed developers staff has met with, staff has also corresponded with United Properties, Village Cooperative and Doran, who have communicated they do not have interest in the property. More recently, staff has been in contact with Alatus, who has also expressed interest, but has been unable to schedule a meeting. Below is a summary of information we’ve heard from the developers noted above regarding the Korean Church redevelopment property: • Retail is not suitable for the site because traffic counts are too low and there is no visibility on a major thoroughfare. Sherman Associates even indicated they are having trouble filling retail space in Minneapolis. • Senior cooperative developers are not interested in the site due to lack of visibility. There are really only two developers who work in this market (United Properties and Village Cooperative) with both declining the site. Doran declined the site for the same reason. • Affordable housing is most viable due to high demand, but a funding gap would exist. The sources to fill the funding could include tax credits, grants, land write-down, TIF, etc. • Under an affordable project, 4% tax credits are most practical being the site likely won’t score well enough to be awarded 9% credits based on the competitiveness of the higher credits. Reasons for lower scores under the 9% credit include the site not meeting the economic integration criteria, adjacent to a railroad, and no access to light rail. Economic integration is where the median family income of the community meets or exceeds the 40th percentile of median family income (earns 7 points) or 80th percentile of median family income (earns 9 points).