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HRA 10/18/2005 - 29596^ CITY OF FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY COMMISSION OCTOBER 18T", 2005 CALL TO ORDER Chairperson Commers called the Housing and Redevelopment Authority meeting to order at 7:00 p.m. ROLL CALL Members Present: Larry Commers William Holm Pat Gabel Virginia Schnabel Others Present: William Bums, Executive Director Ann Bolkcom, Ward Councilmember Paul Bolin, Assistant HRA Director Scott Hickcok, Community Development Director Gay Cemey, HRA Counsel Jeff Magdik, Vice President, Blue Print Homes Mike Misquick, Sales and Marketing, Blue Print Homes Blue Print Homes was called to attend this special HRA Meeting to discuss the Gateway West Project in detail. Mr. Misquick provided a brief background of Blue Print Homes. Blue Print Homes is a third generation ^ general construction company that was renamed six years ago. They provide new construction for single family homes offering custom design and build services. Recently Blue Print Homes has expanded and added broker and real estate services. This is working well having both teams working together. Commissioner Commers stated that HRA has owned this property for 10-12 years and is ready to develop the area. When the Gateway East was completed, HRA was not overly happy with the results. Because of this outcome, HRA has asked Blue Print Homes to come in and discuss some of the issues and concems regarding the Gateway West project. A preliminary plat drawing was distributed for everyone's review. Currently the drawing is for 16 lots and Commissioner Commers questioned if the decision to have 16 lots was driven by the cost of the land. Mr. Misquick commented that they would like to put as many homes as city code allows on the Gateway West area. The object is to optimize the land and with 16 lots shown in the plat drawing, the lots are not too small and will create a nice community environment. Commissioner Commers questioned if the price of the land was reduced, would they consider larger lots in the area. He also asked what Blue Print Homes has invested in the property thus far. Mr. Magdik stated that if the cost of the land was reduced, they would still go ahead with the preliminary plat drawing. The funds they have invested into Gateway West include development surveying, spring Preview commitment and signs are on hold. Whether HRA decides on 16 or 14 lots won't make a difference, Blue Print Homes will work with the city regardless. The current plat drawing works well with 16 lots as indicated in the preliminary drawing. Commissioner Holm questioned the three lots that face Burger King and if they will be hard to sell. ^ Mr. Magdik commented that those may be the three lots they build the model homes on. Mr. Misquick added that the Burger King lots are the only lots that do not back up to University Avenue. HRA Blue Print Homes Meeting October 18, 2005 ^ They are larger than other lots and will make a good impression as people enter the area. If they don't build the first models on these lots, they will probably be the first lots to sell. The price point is right and once marketable and saleable homes are built he is confident the lots will sell. Commissioner Schnabel asked what the price point of the homes on those lots will be. Mr. Magdik said the average price of the homes will be $250,000- $300,000. He added that the model is likely to be priced less than the homes that people build as many buyers choose to upgrade materials etc. Mr. Misquick added that the MHFA is offering an incentive program for first time home buyers. If they purchase a home for $289,000 they qualify for a mortgage rate of 5%z% plus an extra $3,000 off. He has a banker lined up and plans to have at least one of the models at this price point. This will be a great way to market these homes and he doesn't foresee many homes over $350,000. Commissioner Holm questioned the preliminary plat drawing and if they thought of closing off 57�' Place. Mr. Hickcok commented that in order to vacate the street they would have to put in a cul-de-sac. Although this would look nice, the survey analysis would not work well and using the existing infrastructure would work better. Mr. Bolin added that the city engineering department supports 57�' Place as it has a full right of way, utilities are in place and we would have to replace all services if we closed off that street. Commissioner Gabel questioned if there was anything else that could be done to not have those lots face Burger King. Mr. Magdik confirmed that the only answer would be to put in a cul-de-sac. He also stated that he did � not see these lots to be a problem and they would sell. Mr. Misquick mentioned that we need to remind ourselves who is coming into this development. This area is being marketed to young families and first time home buyers. Blue Print Homes recently finished homes in Hugo where the lot price alone is $135,000. This is too expensive for many buyers and if young families want to build a quality home in a nice development, this will be affordable for them. Blue Print Homes hopes to sell as many homes at the $289,000 price point to market the special financing mentioned earlier. If the buyer wants to build a more expensive home, the price will be driven by the home owner. Blue Print Homes can offer a home to a first time home owner and to someone who is looking to build a home for $500,000+. The goal is to use every inch of square footage and provide quality craftsmanship at an affordable price. People will be excited and increase their options. Commissioner Gabel questioned if the 14 or 16 lots would be preferred. She lives in the area and is concerned of the small size of the 62' lots. Mr. Misquick stated that 16 lots work great in the area. 14 lots are doable but the lay out on the preliminary plat is their preference. Whether there are 14 or 16 lots, the space between the houses (15 feet) will be the same. Home owners always build to the maximum width of the lot so they can have a larger front and back yard. Many owners feel that the side yard is a waste of space and hard to landscape. Homes that are built to the lot capacity have attractive street appeal. If the home is wider than deeper, that is the home that sells because it looks larger. Mr. Bolin added that the preliminary plat drawing shows various sizes of lots in the area. There is no uniformity to the lots and 60' is the minimum standard for the Hyde Park Area. Mr. Hickcok commented that the city ordinance was adopted in 1976 to set the minimum lot ^ requirements to 60' in the Hyde Park area. Commissioner Commers stated that the original thought for the Gateway West area was to provide nice homes along University Avenue and HRA is concerned the lots are too small. HRA wants to make sure HRA Blue Print Homes Meeting October 1 S, 2005 ^ the new development will meet their expectations. Commissioner Gabel questioned the details of the decorative fences that will go up along University Avenue. Commissioner Schnabel questioned if there would be greenery or required landscaping along the fence. Mr. Hickcok commented that there are funds in the budget for an ornamental fence. This will create a consistent look along University Avenue and require minimum upkeep. They will encourage homeowners to screen and landscape around the fence to keep a uniform look. Commissioner Burns questioned if the privacy fence landscaping could be controlled through a covenant Mr. Magdik agreed that uniform landscaping and fence look would really be nice if kept consistent. Commissioner Gabel questioned if we could require landscaping around the fence in the home owners contract. Mr. Hickcok stated that a$5,000 per lot landscaping allowance will be in the contract. Mr. Magdik added that homeowners are required to install sod and an irrigation system. $5,000 should be sufficient for the home owner to landscape and meet other requirements. Commissioner Commers questioned where the cost for the fence in on the profile. � Mr. Bolin stated that $75,000 is budgeted for the fence and is in the Site Improvement and Preparation costs. Commissioner Schnabel questioned if the intention was to put the garage on the front of the homes facing the street. Mr. Magdik shared several views of different options for a garage and some drawings even had the garage around the back of the home. He has walked the Gateway West area several times and can visualize certain homes on certain lots. Commissioner Gabel asked what the average square feet will be for the homes on a 60' lot. Mr. Magdik noted that the square footage could vary depending on the home owner's preference. The square footage could range from around 1200 square foot rambler to a 2400 square foot finro story home. Mr. Misquick added that they built a 1480 square foot home on a 40 foot lot. The homes can have look out windows and a finished basement. These square footage measurements do not include the basement. Commissioner Commers questioned the upgrades homeowners can add to the homes and the cost. Mr. Magdik stated that the upgrades are totally up to the buyer. The basic construction will be the same in all homes, but the buyer has the option of upgrading items if they wish. All homes will have wide trim, panel doors, $20 yard flooring allowance, vinyl tub surround, etc. The options are open for the buyer, but the basic construction of each home is still quality. When they install the heat and air conditioning, they install enough capacity so when the homeowner finishes the basement it would still be sufficient. ^ Mr. Misquick noted that all allowances and quality construction will not change from the homes build in the price range of under $300,000 to a$700,000 home. The allowances that the homeowner has for appliances, lighting and flooring are feasible for the home. Some buyers may not want an appliance HRA Blue Print Homes Meeting October 18, 2005 ^ allowance and would like to purchase those on their own. The contract will vary from buyer to buyer depending on what they would like, but the quality of the construction will remain the same. Mr. Magdik added that they will insulate and sheetrock the garage in the models and work with the buyer as to what they want in their custom home. Options are open. Commissioner Schnabel asked if there was a change order fee in the contract. Mr. Misquick said there is a$100 fee in the contract but to date they have never charged a homeowner, it is just a precaution. After the home owner is in their home for 11 months, Blue Print homes will come back and fix anything needed. Mr. Magdik shared a spec sheet and purchase agreement and passed it around for review. Commissioner Schnabel asked what type of driveway will be offered. Mr. Misquick stated that black top is half the price of concrete, so that is what most will select. Commissioner Burns asked what type of siding will be on the homes. Mr. Misquick said the home owner will be required to put vinyl on three sides of the home with a different front. The material on the front of the homes will vary but they dress up the front of the homes to be unique. Blue Print Homes have several different looks for the home owner to choose from. Commissioner Gabel asked if all the homes will have a different look with concerns about having too many materials used in the area. �' Mr. Misquick stated that the materials are price driven. Blue Print Homes uses a lot of shakes, freeze boards, bold colors and shutters. Commissioner Gabel asked if the trees, such as the elm trees, will stay or be taken down. Mr. Magdik stated that they will mark out the trees to save. They would like to save as many trees as possible as they are a good seller for the lots. Commissioner Burns asked if the new commuter rail coming into the area will help market the homes. Mr. Misquick stated that the market for the area is young families and people currently living in the area who don't want to move out. Location will drive people in and the majority will be younger, downtown people. They will be in the parade of homes in the spring and place a trailer on the property with available plans. He thinks the commuter rail won't hurt or increase business but the Medtronic workers may be interested in this area. Professionals will be attracted to the area as they can buy a new home construction under $300,000 that is close to work and shopping. Mr. Magdik commented that the trim work and style of homes they build remind many buyers of their mother's homes where other buyers may consider this look "retro". They vision putting in older looking style homes, having 5 panel doors, porches, flower boxes, deck on the backside etc. He said Blue Print Homes is very excited to get started on the project and get signs up on the Gateway West lots. This will be a good look for the City of Fridley. Commissioner Commers asked where we were regarding the reverter option. Ms. Cerney stated that the reverter is the ability of authority (HRA) to get land back if the builder doesn't �--1 build on the land as specified. The larger concern is to secure obligation to buy the lots from the city of Fridley. The reverter is a problem with Blue Print Homes as they do not have the right of the property. The best contract option HRA can have with the developer is to sell them two to three lots at a time. This will be the security mechanism in the contract to make sure they take and build on all lots. � ���, HRA Blue Print Homes Meeting October 18, 2005 Mr. Magdik noted that they have been working with an attomey with the intention to build 16 homes on the Gateway West property. Blue Print Homes intention is to purchase all of the parcels as quickly as possible and they want to build on all 16 lots. They intend to build 16 nice homes within finro years. They do not want to give back any of the lots they purchase from HRA. Commissioner Commers asked if anyone else had any legal or general questions for Blue Print Homes. He also stated that this sounded fair to everyone. Commissioner Schnabel asked if we were working on a letter of credit with Blue Print Home attorneys. Mr. Magdik stated that they intend to build a home as fast as possible so they in turn get paid and then can pay the City of Fridley. This is why Blue Print Homes jumped on the spring Parade of Homes to market this area early. Ms. Ann said she is excited to get this development going. She does not want all homes to look the same and understands the builder's idea of encouraging different looks with porches, decorative fences, landscaping etc. This will be a huge boost to the Hyde Park neighborhood. Mr. Misquick stated that they are excited to build in this small community and has the ability to build quality homes in the Hyde Park area. This will be a great addition to the area. Mr. Hickcok noted that the next steps will be to sign the final terms and agreement contract at the November meeting. A set back code change will be brought forth to the Planning Commission meeting on October 19�', 2005. We are asking to change the set back and space requirements between houses. Currently the code is to have ten feet on one side and five feet on the other side of the home. We are proposing to change the code to seven and one half feet on each side of the home leaving 15 feet ^ befinreen homes. This will allow the home owner to center the home on the lot and they will have more flexibility with floor plans. We are also proposing to change the front yard setback from 35 feet to 25 feet. ADJOURN The meeting adjourned at 8:25 p.m. Respectfully Submitted, ���2���-� � _ Krista Monsrud Recording Secretary �, � L tl � � � CITY OF FRIDLEY SIGN-IN SHEET � HOUSING & REDEVELOPMENT AUTHORITY MEETING � `-� �C � G� �l • D" ---------------------------------------------------------------------- ---------------------------------------------------------------------- Name and Address Agenda Item of Interest � �e��� ��a�/�6� �✓"���"`�- �`'// B�dJ� � � ,�����,�'s� L � L � � �, �. �n .� ,t-� � A �,�� ��ei��- �-! -m � � �: �. h� o � F,��� LE�