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11/05/1987 JOINT MTG - 5070Joint Housing & Redevelopment Authority and City Council Meeeting Thursday, November 5, 1987 5:30 P.M. Nasim Qureshi Director o� HRA CITY OF FRIDLEY A G E N D A SPECIAL JOINT MEETING - HOIISING & REDBOELOP1�iBrIT AIITHORITY AND CITY COIINCIL THIIRSDAY, NOVF.MBER 5, 1987 5:30 P.l�t. Location: Community Room I- Catered dinner at 5:30 p.m. CALL TO ORDER: R�LL CALL: IMPROVEMENT EXPENDITURES SATELLITE FIRE STATION CIVIC CENTER UPDAIE URBAN DESIGN STANDARDS HRA ANNUAL REPORT LAKE POINTE BRIEFING OTHER BUSINESS: ADJOURNMENT: MATERIAL FOR THE SATELLITE FIRE STATION ITEM I�IILL BE AVAILABLE AT THE MEETING r, SUBJ�: Imprwenent Expenditures �I�. ifiiversity Ave. Corridor Intersections Landscaping Hic�way Li jnting S ic,g�al Impr ov enent s Frontage Raad Lic�ting Renairx7er of Corridor Publ ic Raanp Hic�way 65lMoore Lake Drive West Nbor e Lake ibld Centr al RQa, Lic�ting, Corridor It�ns Rioe Creek Road Diversion Lic,�ting, Corricbr Iteans Nbore Lake Water Qual.ity Central Parkway Njedian Util iti es Bikeway Landscaping Street Lic�ting � Parking Lot Mississippi Str eet Impravenents A�ase I Phase II Senior Housing Soil Correction Nor th Area Fbncling 83rd Ave./Main St. Upgrade 83rd Traffic Sic�als Nbore Lake Drainage West Basin East Basin Development Assistanoe Center City SW Quadrant Aiase I Phase II I� Quadrant Nbon Plaza Redevelopnerit Colunbia Park Properties North Estates Apts. Osborne Road 81st and Main Hillwind Are,a �� 500,000 522, 000 409,000 1,000,000 1,000,000 600,000 400,000 500,000 400,000 500,000 250,000 150,000 250,000 350,000 200,000 150,000 100,000 300,000 1,200,000 600,000 200,000 400,000 200,000 850,000 200,000 100,000 ��9.000 11,781,000 Octaber 29, 1987 � �. . 460,000 160,000 200,000 200,000 300,000 1,500,000 1,000,000 1,000,000 600,000 200,000 400,000 200,Q00 500,000 1,000,000 200,000 85,000 75,000 150,000 25,000 200,000 500,000 150,000 250,000 350,000 200,000 150j000 100,000 300,000 1,200,000 800,000 850,000 13,305,000 — • �.-;'�— 1 ��y� , �;; i� � t � �•:. Engineer�ng N Sewe� � x Water � � O Parks p 3 Streets VV Maintenance MEMORANDUM - Nasim Qureshi, City Manager � �FW87-348 TO: Jock Robertson, CcaunLmity Developnent Director FROM: John G. Flora, public Works Director DATE: October 28, 1987 SUBJECT: Civic Center Reaodeling �' �•' . If the City or i�2A is to advertise for the expansion and renovation of the Civic Center area, it woulc3 be appropriate to accomplish this early in the year in oraer to obtain the more favorable construction bids. The magnitude of the project would require Council and I�2A appraval of the project and then a minimun 21-day advertisement before bicl� oould be open. Depending on the Boarman schedule for construction, drawings and specifications and sinoe we only have 3 i�aining Council meetings ana 2 HI2A neetings this year, it would be a�gropriate to obtain early approval for the advertisement of the work if it is desired to awarci the project in January or February of 1988. If you need any assistance in pre�aring the appropriate resolutions andfor ucivertisements, we will be glad to assisti you. JGF/ts , ; i � ., � • �DUStNG and REDEVELOPMENT AUTHORiTY COMMISSION MEMBERS: LAWRENCE COMMERS, CHAIRMAN DUANE PRARE VIRG�IIA SCHNABEL WALTER RASMUSSEN JOHN MEYER I CITY OF FRIDLEY MEMO T0: Nasim Qureshi, City Manager MEMO FROM•.r;Jock Robertson, Community Development Director MEMO DATE: October 30, 1987 REGARDING: Civic Center Renovation Cost Estimates ihe attached schematic estimates contain only the "basic needs" budget for audio/ visual (A/V) equipment. This estimate only updates the present A/V capability broadcasting Council meetings, providing basic control room equipment plus three 25" color monitors for remote locations. An upgrading including super VHS equipment, individual TV monitors for each Council member, an overhead camera and video projection would cost and additional $60,000. JLR/dm M-87-215 EXECUTIVE DIRECTOR: JOCK ROBERTSON 6431 UNIVERSITY AVE. (612) b71-3450 FRIDLEY, MN 55432 EXT. 117 . _ _. ._ _ ..�_. ._ � . _:y. _ _� .. _. � _ . ,..... �.. .._. `. �`•.-' �- r • n � a� � N N CA a� �, �� z�� H � �+Eiy+ � �� w �� z �� W M 8� �� z � �� -V+ H � �� O � '"� � � � di � � � C � � .� '� •�-1 V � N v �7 � r-1 � � � � � w� � . � � � � .� � � [ b : � 8 � � � � � � 8 � .� � �,�,�� fi•� � � � � �� H � S � � � � � O N N N O O Q�1 O�'1 O 1'� � 'V� ,D N e� � V' �-�-1 � t7 v "' N � .-°i .-i `.� o� ri V} N f? N V1 (/� N V► V1 � A O ul O �!1 O O Fi O N V� t'7 O O � � � �n � .-i n `oa � � ��N N ri �� b � � � � rn��a a � � � g � � �',� �.f � � � Q � O O y 6 O� � � � �i �� "� � a � � � aQ" w�'�i� � a, � 3 C �'.�'� c � '' � � � � � � � �� Gq V A W W H � � ._. .. ... J .,e ,.w .,d� � .w �a--l{ � � O � � .� � �' � � � .'�' � � � � � � � � � � .� � .� � � � � � � .� 0 �v 3 � � � �8 w � � � M O O O O 1� O � tll M M ri � @ � �O r �i ao N qt tA� t? N pY t/► t? Vt O O O O O O O O N M N r'1 r � � � � S i • i � C � 6 � O � � ' °° �a � � �� a � � � � � � ��'� � r.� Oq U A W N i--1 '_ '_ � _. � _ .... �✓ .� .. � M E M 0 R A N D U M T0: HONORABLE MAYOR AND ME1�ERS OF THE FRIDLEY CITY COUNCIL FRaN1: NASIM M. QURESHI, CITY MANAGER SUBJECT: FRIDLEY URBAN DESIGN FRAMEWORR -DATE: OCTOBER 16, 1986 In the last 20 years, the City of Fridley has incorporated overall community planning conaepts into specific areas to achieve intended development goals whieh have improved service to the community and maintained the image of a modern, efficient community. E�camples of the City's efforts include: Street Improvements Before the City adopted street improvement standards, 85� of City streets were oil stablized streets with high maintenance costs. Over a period of time, these streets have been replaced by streets with proper cross seetion and concrete curb and gutters. Surface Treatments The street surface treatment program was instituted along with street reconstruction to protect the investment citizens were making to their City streets. The process of seal coating streets reduces wear of streets aad inereases the longevity of street surfaces. Storm Sewer and Drainage System � Part of the street reconstruction program provided that the City require proper storm sewer and drainage programs. Because of these efforts to implement this program, over 90$ of City area has proper storm sewer and drainage systems. Trafffic Safety A comprehensive traffie safety program was adopted to provide: 1. Traffie signals 2. Intersection safety improvements 3. Center line and intersection striping The City has made great strides in this area and continues to implement the program on a City-wide basis. Publie Right-of-Way E�haneement 1. Billboard and substandard sign removal. The City adopted updated standards to remove all substandard signs. Placement of signs anywhere in the City is now strictly enPorced by quality standards. 2. The City has worked with the Minnesota Highway Department and Anoka County to provide for plants and trees along public right-of-ways such as University Avenue and East River Road. 3. The City adopted a reforestation program to replace trees whieh have been lost to disease. 4. There has been a eoneentrated effort to enhance intersections by providing red brick dividers. • Urban Design Memo � Oetober 16, 1987 Page 2 Public Lands and Parks 1. The City has instituted programs to provide good park identification signs with aesthetically pleasing landscaped areas. 2. Yines and hedges have been provided to screen off play and parking areas. Up�raded Zoning Ordinance � Over the years the City has uggraded zoning ordinanees in aa effort to provide attractive landscaped areas along with underground sprinklers for all grassy areas and the screening of all parking surfaces. Comprehensive Development Guidelines With eaeh new development project, the City has worked with developers to produce a coordinated design program incorporating specific design standards for signage, landscaping, lighting, facade treatments, eolour schemes and parking treatments. This coneentrated effort to provide a quality development is exemplified in Center City, East River Road Business Center, University Industrial Park. The City is currently formulating the same eoordinated design theme for the proposed Moore Lake Commmons project. Together with the coordinated design program for each development prajeet, the City is working hard to upgrade and enhance the visual outlook of major City throughfares such as University Avenue and Central Avenue. FRIDLEX IN THE 21ST CENTIIRY Eaeh of these steps when viewed over the past two decades, has had a positive visual impact on the image of the City of Fridley. In consideration of the many positive ehanges over the years, it may now be the time for the City to develop a comprehensive urban standards framework whieh will outline the vision of the community as it moves into the 21st century. A well designed urban community in the 21st century will be a community whieh successfully ineorporates the elements of both the publie and private sectors of our community. Therefore, any vision must include design frameworks for public right-of-ways, major private developments and plans for publie lands and park systems. Public Right-of-Way Plans for future public right-oP-way improvements should include a coordinated scheme of roadway and walkway landscape treatments, street surface treatments, integrated lighting systems, street furniture and a coordinated signage program with emphasis on major interseetion signs, gateway, arterial and connector street community identification signs as well as neighborhood identification signs. Neighborhood identification signs provide an opportunity for eitizen participation and enhanee a sense of community identity. Private Development Unlike a relatively young community with room for expansion, Fridley is an established community which will continue to experience the trend oP community redevelopment and revitalization, Therefore, it may be necessary for the City to Urban Design Memo ' October 16, 1987 PaBe 3 develop a formal policy requiring all projects to adhere to a coordinated program of signage, lighting, landscaping, parking lot treatments, colour scheme and facade design. Public Lands and Parks In keeping with the effort to ereate a coordinated design seheme for.private development, a similar program should be devised for the City's publi.c lands and parks. An improved signage program, landseape program and general upgrading oP the parks system would serve to enhance the community's recreational environment. F�camples inelude ponding improvements at the Springbrook Nature Center, improved bikeways and walkways in and around City parks and publie lands as well as the upgrading of the public land around the Moore Lake east basin. The goal of this concentrated effort to create a coordinated desi,gn framework for the City is to develop an attractive, unified and distinctive appearance for the community; to ereate a positive image oP our City that is remembered by visitors long after they leave our City and also further enhances a sense of pride for the people who reside in the eommuaity. Many communities in the Metro area have integrated an urban design framework in selected development areas. Their efforts are concentrated only in a small area of their community. Our goal is to extend the concept of a comprehensive urban design framework to the entire community; to ineorporate a unique total urban design "look" to all areas in the city. It is important to realize that the optimum strategy is not only to ereate a distinctive image for the City but do so at a reasonalble cost, keepin,g in mind that low maintenance is a consideration in all projects. Equally important is proteeting the City's investments from vandalism. Even the best projects can detract from the total beauty of any development if they cannot be maintained or are at the mercy of vandals. All improvements must be constructed as vandal-proof as is reasonably possible. In the last few weeks, the City staff has begun to work with the idea of a community-wide urban design framework. This framework would extend into all areas of development/redevelopment projects, both public and private, and could serve as the catalyst to the creation of specific development guidelines dedicated to quality projects now and for the future. Therefore, I would like to discuss this idea with you at the next Council meeting. 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''��, �. � ��; ,,, i� � � ��: y�` � ,.�'• 4�'�7� � � £� -r.�. ;.� � ;�.. �,.�I'- �• � �• ,�� R , laM � L' �ank r�ay aCquere �i�ogh$� r��ae First hational Bank of St. Pau] many acquire Columbia Heights &'Iall and an office building owned by Tcrry Evenson in lieu of foreclosure, according to Columbia Hcights At- torney Ron Kalina. " The properties were developed by Evenson in 19II1 and 1982 with tax-increment bonding funds provided by the Columbia Heights Hotising and Redevelopment Authority (HRA). The original agreements include a 9�year lease with Evenson for the city-owned plaza praperty usecl for nuto banking� according to Kalina. An af�eement between the HRA and Gay Realty for operation of th2 parkin� ramp ex- pired in September, Kalina said. . Kalina reported to the City Council Monday that he, HR.A Director Tadd Stutz and City Manager Rabert Bac�vinski met with bank officials last we�k to discuss concerns of th� bank and city. �o��iaE� i� c��nc� ��Ce�a� Anolca County Commissia�er James Kordialt will speak on extracting methane gas from land4"ills to �enerate e�ectrictiy at the annual conference of the National Association of Consumer-Owned G�s Systems later this month. Kordiak will describe t11� county's pilot methane extratian facility and the county's plans to build a gas extraction plant to provide electricity to thousands of homes. l�iethane gas is naturally produced at most landfill sites as garbage decays. At the Anaka Re�ional Sanitary Landf�il, the methane is exUacted from th� landffl an�l pum�C'i to an electrical generator that serve.� a small castin�;� company. - - -_ _ _ �.�.� waa ��voa. oa K. ,9a .. •� "d t9.'t$1-'i�K4_.';�t:!�sy. ♦ MEMBEA O� TME SE�RS �IN4NC1�: NETWOAN ��Y B�AtrKCR 0 � �;,; October 28, 1987 Mr. Jock Robertson CIVIC CENTER 6431 University Avenue N.E. Fridley, NIN 55432 Dear Jock: COLDWELL BANKER COMMERCIAI REAL ESTATE SERVICES DniS�on o� COItlwYtl Banker COmmerual G�oup. Inc 900 SECOND AVENUE SOUTH. SUITE 800 MINNEAPOLIS. MINNESOTA 55402 The enclosed proposal for exclusive listing of the development site at the southwest intersection of University Avenue and Mississippi Street is in response to our initial meeting on Wednesday, September 16, 1987. Thank you for the opportunity to submit our proposal. We very much look forward to working with you to secure the appropriate developer(s) and assure the City of Fridley that its needs are being met. Coldwell Banker possesses a depth of marketing expertise that should naturally designate us to be the exclusive agent for your project. We understand your desire to create the "downtown concept" at this significant intersection. Promoting a quality development on this corner is a challenge we are looking forward. A mixed use project, including an apartment complex and commercial shopping center space, we also feel is in the best interests of the community and City of Fridley. The following proposal will address, on a preliminary basis, our capabilities as a company, our recommendation as to the development of the site, our market overview of the Fridley trade area, a marketing plan, and other noted items that are indicative of our interest in working with you, the HRA, and other community leaders that will be involved. Jock, we are prepared to approach the project with full force and swiftly enact our marketing plan to meet your timetables. Please note that in the course of reviewinq the following proposal, if any questions arise do not hesitate to call. Thank you again for your consideration. Sincerely, �� _-� ��/� i iPeter B octi' � (612) 349-8919 PB:nll G301PL1 ' �N'�"----__.. Jeff Nammacher (612) 349-8921 `�� Wally Wilber (612) 349-8916 MARKETING PROPOSAL PREPARED FOR: MR. JOCK ROBERTSON COMMUNITY DEVELOPMENT DIRECTOR CITY OF FRIDLEY SUBJECT PROPERTY: SOUTHWEST CORNER UNIVERSITY AVENUE AND MISSISSIPPI STREET FRIDLEY, MINNESOTA PREPARED BY: PETER BLOCH, RETAIL SPECIALIST JEFF NAP'II"IACHER, RETAIL SPECIALIST WALLY WILBER, COMMERCIAL SPECIALIST COLDWELL BANKER COMMERCIAL REAL ESTATE SERVICES 900 SECOND AVENUE SOUTH, SUITE 800 MINNEAPOLIS, MINNESOTA 55402 (612) 338-4700 OCTOBER 28, 1987 TABLE OF CONTENTS I. PROPERTY DESCRIPTION II. MARKET OVERVIEW III. MARKETING STRATEGY IV. MARKETING ACTION PLAN V. RECOMMENDATIONS VI. SAMPLE MARKETING SCHEDULE VII. LISTING AND COMMISSION AGREEMENTS VIII. SUMMARY SAMPLE MARKETING MATERIALS - APPENDIX I. PROPERTY DESCRIPTION The development site addressed in this proposal is on the southwest quadrant of Mississippi Street and University Avenue, Fridley, Minnesota. The site is comprised of nine parcels totaling 427,987 square feet or approximately 9.8 acres. The site is being considered for redevelopment where participatiori in either tax increment financing or revenue bonds by the City of Fridley is expected to occur. Access to the property is expected to be provided at two or three curb cuts on the northern perimeter bound by Mississippi Street. Limited egress on the eastern perimeter is expected to be provided under various scenarios to University Avenue traveling south. The accessibility to the proposed development site is not excellent and will need to be addressed as site plans unfold. ,c'RN�R �uu � t�twrc,l �UADRANT STATISTICS i ��t , " " . ' ' _ • - a�v, �i =- --� ' ' . . ' _ _. - ��5�3��f .�i�"' - � �'_ ��VA N , �.� '�-��- :.�; 1 yATB _ . ,�„ .. . ..,.�.. �. ;. � � � . ; �.� i�.r� �: �% i � . _. .. _ . �.� . _�-: PII� � 1F3�24-32-0001 B 14-3�-24-32-0046 j C 14-30-24-32-00�7 � 14-30-24-32-0048 E 14-30-24-32--0049 ,` F 14-3�24-32-0050 G ia-30-24-32-0051 ; 1� Y4-30-24-32-0056 ; � 14-30-24-32-0058 T$I1d &.�sirrss Sq. FC. E�t. l4ct. Qa2ue Amoo� Station 15,625 S 70,300 � 4.50 11,390 S 31,300 @ 2.75 �opping Center 18,753 $ 51,600 @ 2.75 Burger Ring 61,891 S170,200 @ 2.75 (�r wash 15,190 S?�6.100 e 1.72 R 0. i�L 7,500 S 2.200 l.29 D�i ty Qu�een 11,625 $ 46,500 @�.00 Liquor Store 83,963 $209,900 @ 2.50 Rioe plaza 202,050 $351,400 @ 1.74 Imprwenents Sg. Ft.. Lbl 1 az s 1,588 S 44,1A0 14,000 2,470 2,079 738 11,904 10,890 $276,500 $150,500 $ 17,900 $ 20,400 S318, 600 $210,600 � 9.825 ac. �27,987 $959,500 @2.24 . 43,669 51,038,600 's/ � 2/87� �'t' � � � � c � �i� c �' t � � .1_i -' � :� C M , f• � � � �� f :' � --1 , ''•� � ---- � :� V '` ;__:;__ : � -:; -- .. _w_, ,., �.� �• � -- �-• :. II. MARKET OVERVIEW Geographically, Fridley is a uniquely located city which enjoys many positive attributes, both for its local residents and businesses, as well as regional and national companies who have chosen Fridley as a good place to locate their business. Subject property is located in what is part of a redevelopment district designated to promote the concept of a"downtown" Fridley. This tax incr�ment district has promoted new development in the area including Columbia Park Medical Group, Fridley Plaza Clinic and Office Building, Target Stores Northern Operations Center and the remodelling and expansion of the Holly Shopping Center. The City of Fridley's population exceeds 30,000. Its residents enjoy an average family income approaching $30,000 per year. Age distribution reveals a younger demographics the further north you move in Fridley with an median age of approximately 30 years of age and under 10 percent over the age of 60 years. Land use in Fridley is evenly distributed between residential, commercial/industrial, and public land, all creating a nice balance of the total land use. Fridley also serves as a conduit for traffic travelling between Minneapolis and the northern tier suburbs. Average daily traffic counts on both University Avenue and Central Avenue are in excess of 28,000 cars per day. Fridley currently enjoys a very low vacancy factor in retail shopping centers located in and about the Fridley area (see Appendix A- Retail Base and Vacancy Figures). Northtown Mall currently has plans for expansion which includes a Main Street Department Store, who is a new entry to our marketplace. Additionally, Shorewood Plaza has recently been purchased with plans of complete redevelopment which include a drugstore and a sports and health club. In evaluating the market surrounding the proposed redevelopment site, we look at the following factors in determining its suitability for a mixed use development. These included: * Site Evaluation - a review of the site as it relates to potential access, automobile traffic counts, and existing and complimentary retail uses in the area as they relate to the development concept. * Com,petitive Shopping Facilities - retail centers serving the market area surrounding the proposed redevelopment site. Tenant mix, price orientation and merchandising quality of each shopping area to determine potential retail gaps and opportunities for the proposed redevelopment site. Based on our field observations, as well as analys�s of merchandise offerings at the competitive centers in the surrounding trade area, we perceive the following: * Shopping goods in and immediately surrounding Fridley are most prevalent at the moderate price level with additional representation of discount oriented merchandisers. * A second retail gap in the marketplace is food services. Surrounding the subject property, there is potential for additional sit-down restaurants so that shoppers don't have to leave the area and drive north or south along University or north on Central Avenue. * Food for at-home consumption is potentially not available surrounding the subject property. We assume that supermarkets generally fill this need. Currently, Snyders has added a grocery section to their existing drugstore in the Holly Center to capitalize on this void. We believe there is opportunity for either a conventional or a downsized supermarket concept offering higher quality goods with an emphasis on service. Specialty food merchandisers could also augment and compliment the merchandising in the area. * Shopping today incorporates some form of entertainment. For example, Northtown Mall includes Cinemas as a successful part of their mix. Having some form of entertainment could increase the drawing power to a site and length of shopper visit. III. MARKETING STRATEGY You should expect your marketing agent to fulfill certain responsibilities. As your exclusive agent, Coldwell Banker will do the following: o Represent your interests in a professional and competent manner at all times. o Use our best efforts to identify and contact a�ll logical prospects for the Property. o Obtain the highest possible development use, on terms and conditions acceptable to you as promptly as possible. o Regularly advise you regarding prospects, market conditions and trends, and the progress of the marketing effort. As you know, Coldwell Banker is the largest full service real estate brokerage company in the United States. Established in 1906, Coldwell Banker maintains 96 offices in major cities throughout the country. Our Edina office opened in 1974. It has a staff of 35 including 25 sales representatives who specialize in the leasing and sale of industrial, office, retail and investment properties. In order to better serve our growing clientele base, Coldwell Banker opened a second office in downtown Minneapolis in December, 1984. It has a staff of 33 including 22 salespeople. Marketing Team Three Coldwell Banker salespeople will be personally working on your development project; Peter Bloch, Jeff Nammacher and Wally Wilber. This is recommended to provide greater service and more in-depth follow through. Peter is a retail specialist working the downtown and suburban St. Paul area. Jeff specializes in retail development and leasing in the northern tier suburbs. Wally will assist in approaching the development community, on a local, regional, and national scale. In addition to Jeff Nammacher, Peter Bloch, and Wally Wilber having the primary responsibility for the marketing of your project, our entire staff in the Twin Cities will also be made aware of your property. Coldwell Banker has a highly experienced and capable staff of retail specialists operating out of our two commercial sales offices located in Downtown Minneapolis and Edina. Each of these individuals will be made fully aware of the availability of this proposed development and will be encouraged ta present it to their clients. The key ingredient attract developers and systemically. following manner: in a successful marketing effort to is contacting the best prospects quickly We propose to market this project in the Prospect Identification. Coldwell Banker maintains a computerized proprietary retail, office, and industrial user data bank. This marketing tool enables our salespeople to identify the best prospects and target them for direct contact by mail, telephone or in person. Coldwell Banker is also in regular touch with a large number of local, regional and national developers and investors who are active in this market. Promotional and Sales Materials. Coldwell Banker will use its resources to produce a set of marketing materials for your property. The materials will include a data sheet on the property, as well as a brochure. This marketing information will be distributed to qualified prospects. Personal Contacts. Coldwell Banker will also make personal contacts with prospective developers and tenants who have been identified and qualified through our information systems and knowledge of the market. An active cold calling program will also be initiated to thoroughly expose your property to prospective tenants and buyers. Internal Broker Cooperation. Information on your property will be disseminated to all appropriate salespeople inside our two local offices. Each salesperson is in regular contact with a large number of developers and tenants. Additional Broker Support. As mentioned above, Coldwell Banker currently has 53 salespeople in its Edina office and the downtown Minneapolis office. Should any of these salespeople uncover suitable prospects for your property, they will make the prospects immediately aware of its availability. Broker Cooperation. Coldwell Banker will cooperate with all of the qualified commercial real estate brokers in the community. We will provide these cooperating brokers with information on your development project, and in the event a cooperating broker procures a prospect with whom a transaction is finalized, Coldwell Banker will share its commission with the cooperating broker. .� Commercial Multiple Listing Service. Coldwell Banker will submit a data sheet on the Property to the Greater Minneapolis Board of Realtors Commercial Multiple Listing Service, which will be published with a photo in the CIMLS Monthly Catalog. Property Sians. If appropriate, Coldwell Banker will place signs on the Property in accordance with municipal regulations and the owner's � recommendations. Coldwell Banker will be responsible for the cost of these signs. Progress Reports. Coldwell Banker will provide regular reports to you detailing our marketing activities. These reports will be submitted in a form and intervals to be agreed upon between the City of Fridley and Coldwell Banker. Outline of Marketinq Plan 1. Generate developer and tenant marketing packages. 2. Disseminate information on the development site to all Coldwell Banker sales personnel. 3. Order Coldwell Banker signs, if appropriate. 4. Complete and send in the local commercial and industrial multiple listing sheet information. 5. Order tenant and developer prospect lists. 6. Present marketing material to logical prospects. 7. Commence follow-up with prospects. 8. Procure developer(s) for the property as soon as possible at the highest possible price. 0 IV. MARKETING ACTION PLAN A. Pre-Marketing Responsibilities: Prior to beginning any marketing program, it is essential to generate primary market research and a well-conceived leasing strategy to be used as a selling tool for bringing in a developer and promoting interest from targeted tenants for the project. Our responsibilities during this phase will be as follows: � 1. Primary Market Research: Conduct a thorough analysis of base square footages, tenant mixes, tenant rents and sales volumes in selected retail centers trade area. Provide quantitative and qualitative information necessary to generate answers and give direction to the size, design and scope of the retail component. 2. Leasing Plan• To develop a leasing plan that is driven by using market information collected and previously generated architectural designs. 3. Pro Forma Rents: To assist developer with economic analysis in the preparation of income and expense projections for the project. 4. Standard Finish: We will provide input for the preparation of outline specifications for building standard tenant finish work with the developers architect. 5. Demographics/Marketing Materials: To make recommendations regarding the appropriate marketing materials for the project. This includes providing in detail demographic reports for the general package. B. PROMOTION AND LEASING For obvious competitive reasons, we feel it is extremely important to promote this project in a highly visible and professional manner. Our objective is to maximize the exposure to qualified developers and potential tenants deserving of a project of this type. , The following will outline the various items of promotion we propose to use in securing both developers and potential tenants. 1. Tenant Exposure: We believe principle emphasis should be placed on a tenant proposal package in utilizing new and previously generated materials to effectively generate interest to the site. This would include: a. Brief introductory section on the City of Fridley's, goals and objectives and commitment to a quality development b. Site plan c. Brief description of potential project design for discussion purposes with the tenant d. Demographic report for the area e. Other pertinent marketing facts such as traffic counts, new development and the quality of strong retailers currently serving the area 2. Developer exposure: In conjunction with exposing the property to potential retailers, we would generate a second package to be distributed to national, regional and local developers qualified to consider this opportunity. In this developer proposal package, we would include what was provided to the tenant along with information on the City of Fridley's interest in assisting the development process through their "city center tax increment district" along with examples of past participations of the city with new development. Once the tenant and developer packages have been generated, we would begin immediately with giving the property maximum, immediate exposure. The key to Coldwell Banker's development and leasing program is making direct personal contact with perspective developers and potential tenants. By direct we mean first qualifying the prospects who will be contacted according to criteria that make them logical candidates for the project. Some would be contacted by phone first and others by letter. In no ev�nt would we simply rely on flyers distributed by mail to do the job. An important aspect of our marketing approach will be to provide simultaneous market exposure to both the developers and retail tenants. Our office has developed and maintains a proprietary developer and retail tenant directory. Both directories contain pertinent information on current activities in the local, regional and national marketplace. These directories will enable us to get to the prospects in a logical and efficient manner. V. RECOMMENDATIONS We feel that the market surrounding the proposed site presents opportunities to retailers who can provide products and services not currently available in the trade area. Due to existing retail competition and price positioning in the trade area, we propose that the project emphasis should be viewed as a traditional or conventional shopping center mix geared to moderate to middle income households, with a smaller percentag� of the mix containing some moderate positioned retailers. The quality of the retail should be contemporary in design, yet modest in price levels. It should then stand apart from other existing retail in and around Fridley. In this way, the project will appeal to a defined trade area residents and have the broadest appeal. We also believe that certain food services could be incorporated into the mix to serve not only shoppers, but the captive daytime office population nearby. We agree with the City's current ideas with approaching the property as a mixed use development similar to the City of Richfield's Lyndale/Nicollet Hub Development Project combining commercial and residential facilities on one site. We recommend, however, that special consideration be given to the retail portion of the development to insure the retailer's success and the success of the overall development. This includes critical design issues such as providing easy and convenient access to the site, good exposure and visibility to tenants from both University Avenue and Mississippi Street, and easy parking with direct access into the retailer's space. It is equally important to strategically target the size and type of tenant so as to incorporate a mix that serves the needs of the trade area residents and that fills any existing retail voids. It is vitally important that the potential developer of this mixed use project be experienced and have a track record in this type of development. The project needs to be responsive to the realities of our marketplace. This includes creating a residential and retail component that works for the people who live there as well as both the retail tenants and the prospective shoppers. With the above in mind, we recommend a complementary marketing process for securing a developer and the pre- leasing of the proposed mix use project. We believe this type of marketing approach, briefly described below, is most appropriate for securing a qualified developer while also attracting potential tenants to the site to drive the project. Phase 1. Immediately begin prospecting for major anchors that would accommodate a minimum of 10,000 to 20,000 square feet plus and would be a primary focus to enable a designated developer to draw up spec plans for the site. The square footages mentioned are not to be carved in stone, but merely a place to start from. It is our experience that any major anchor that shows an interest can and will spur the rest of the project. Phase 2. Once we begin prospecting for potential anchor tenants, we also would begin exposing this development opportunity to national, regional and local developers who can generate a close working relationship with the City to build a successful market driven development on the proposed site. VIZ. LISTING AND COMMISSION AGREEMENTS Retail Listina We propose a twelve-month aforementioned development opportunity in Fridley is requiring a comprehensive Bankers part. exclusive listing for the site. The development a long term project effort on Coldwell , We also propose our commission be based on the underlying market value of the land only. Current improvements because of necessary demolition will not be recognized relative to our commission schedule. VIII. SUNII�ARY We are confident we can procure a developer for the SEC of Mississippi and University during the term of the listing. We also believe we are the real estate service company best able to represent you on this property. . An important consideration that distinguishes Coldwell Banker Real Estate Services is that w� do not compete with our clients. We are not brokers/developers who lease, manage, and sell properties for our own account. We believe this gives us an essential objectivity in representing your interests. A summary of the more important benefits Coldwell Banker provides includes: o Reputation and Credibility o Strength of Sales Force o Retail/Developer Network o Specialization o Market Knowledge o Computerized Prospect Data Bank o Accountability o Full Service Capability Coldwell Banker is prepared to begin marketing the Fridley development site with your authorization. We request a twelve month exclusive listing for the proj ect. The listing Agreement and Commission Schedule, if fully executed, will contain the full agreements between the City of Fridley and Coldwell Banker Real Estate Services. Although the foregoing marketing plan sets forth the guidelines we intend to follow, this plan shall in no way condition or modify the terms of the Listing and Commission Agreements. ___ . VI. SAMPLE MARKETING SCHEDULE d WEEK 1-2 o Familiarize ourselves with all aspects of the property o Place signs on property, if appropriate o Assemble information for marketing flyers WEEK 3 o Develop prospect mailing list for cold calling o Place property in the CIMLS o Presentation to Coldwell Banker Brokers o Finalize marketing flyer WEEK 4 o Contact all members of brokerage community o Begin contacting prospects by mail and phone o Prepare monthly marketing update for the City of Fridley WEEK 5 o We will use our best efforts and continue to contact all logical prospective developers for the Fridley development mailings, and personal presentations. Again, our objective is to give maximum exposure to your project. ' a • � _ _ , � ��!o�.-. C3 COMMERC�AI REAL E5T,4TE SEaviCES THE COLDWELL BANE:ER DATA BANKS Coldwell Banker has two proprietary computerized data banks containing informo- tion on industrial and office tenants which enable us to conduct more efficient and effective marketing efforts. The Data Banks enable Coldweil Banker to identify and qualify prospective p�r- chasers and tenants according to their: • Present Location • Lease Expiration Date • Size of Present Space • Business Type (Standard Industrial Classification) Prospects sharing all quolifying criteria are the most logical to contact initially Cr�teria can be changed to enlarge the prospect pool as the marketing effort progresses or as market conditions dictate. �� . � - ��- .��-- `'. � ��_-_ ,Li.�::.�.:,��: COMNtFC�A. FE/+; ESTGTE SERVICES COMPUTERIZED AVkILABLE PROPERTIES SYSTEMS Cold�r✓el1 Banker maintains these proprietary market data systems. , AVAlIABLE OFFICE PROPERTIES SYSTEM An inventory of aii existing and under construciion, mu�ti-tenant officE bu�;:: �,�s. 30,000 square feet and larger, located in the Twin Cities me{r�politan ar� ; Bu�!dina in`�rmot��n in` �udes Ad�ress Buildi�g area Bu+iding aaa Number of floors Floor size Sp�ce avc�!�bl� Contiguous space avai�able Data avaii�ble Lease rcte Taxes and operotin� expenses AVAILABLE INDUSTRIAL PROPERTIES SYSTEM • An in'✓2'l�J�� of indust��a� propert;es hovin� 10,OOC squ��efeet, or mor�, of o: �;:� �: space and locate� in the Tw�n Cit�es mEtropoliton orea. Building Information includes: Address Building size Space available Date available Clear hei�ht Electric service Available docks Rail availability Parking spaces Land area Office area Sc�les priceiLease rate Coldwell Banker provides our customers with complete, accurate, and u�to-date market intormation io help them make better informed decisions about their commercial real estate needs. C, • I I i I � � � . I � � I, � I + I R � i I ja � I O N '� a f i � d � � � a� a� x I I � I � O I I ` I I °' i i X � � � . ' , " � I � ! , � ; � , : � �� ' ; � j I � � � � ' � � : � � � � ; ; : � � i i�� ' Q i � , ; �, � � ! j ` E � � v� � � , , � c � p � Y i O �' lC ; � ' a �, ; c� ! ' W i � i � � T ' y C }� C � N � � ' � � V fC C� fn y �� i '. Q a cv a� � � c i � � F- O O� 7 y u�i � I 2 U U Q m X � I , O � a v � c ; c� i I a ! , ' � i � i � � j i i I I � � Q O I � W� � , � I I I a �0 , � i I Ow ; ' o � I � � ; 0. ! z I N ' I � W I U I vn �' Q c��pi y I a i � .+a, N i � �� N ' ., Q N C ' d C IJ ' - y f0 y I � d °s W � � d E �, Q � a N � � ' i v ,� � a� '� 'n, � � p ` `' Q � ;» � � O � 0 cC ,� « � i y � h �p �U _ � a C U � J � � I i i ; I I i � I i i � ; � I ! ' � i , � � i ' i I i � I�' � I I � � j i i i �� I':; I ! � i i ! ! ( � � � ; � , i , ; � � ; i � � � � � � i � i ; i ; ' ; , , ! ; i , � � i i � ' I I I � i � � I i i i I � I I � � � �I I 1�� ; j � ! i ' ! � i I � I ! • .-: � , � a, r WAYNE G•POPNAM RA`IMOND A. MA1K 1406EA W.fGMNOBRICN DCNVER KAUFMAN AOSERT A.MINIBM ROLFE A.WOAD6N 6.MARC M�M�T[M�[AD BRUCE P.-N��LLIS FPtCDERICK S. RIGMAf9D5 G.ROBERTJOMNSON GARY R.MACOMBER ROBERT S.BURK MUGN V. PLUNI(E'nr �� TIiED6NiCK C.BROwN TMOMAS K.BEW6 JAMES f7.STE1L6N �JAMES O.LOCKHART . ALL£N W. MINDERAKER GLIFFORO M,6RECNE O. WILIiAM KAUCMAN MICFIAEL O. F17EEMAN r+ow� LAPRY D.CiP£l JANIE S.MAYERON TMOMAS J.OAWR[TT JAMES A.�AYN[ DAVID A.JON[S L6E E.E�i[EMw A{,A�N FR�CON PATRICIA A.JENE[N lCSl1E 61LlETT[ MICNAEL T. NILAN ROBEWT M,LYNN . TNOMAS M. S7PKIN5 ROBERT C.MO�LANCN TNOMAS F.N[LSON TMOMAS J.RAD�O OAVID I.MASNMALL KATMLEEN M.MARTIN JONN GCM�LDS DOUGLAS P. SEATON TMOMAS E.SANN[F1 POPHAM, HAIK.SCWNOBRICH � KAUFMAN, LTD. �J300 PlPER JAfFRAY TOWER MINNEAPOLIS, MINNE50TA 55402 TEIEPMONE 612-333-4800 . TELCCOPIER RD SAM MYEW5,111 6iz_�334�z��3 R�CMAND A.KAPL SUtTE 2a00 1200 SEVENTEENTN STREET DENVER,COLORADO 80202 TELEPMONE 303-893-1200 TELECOP�ER 903-893-21G4 SUITE 300 souTH JBOO M $TREET� N. W. WASNINGTON, D. C. 20036 TE�EP�iONE P02-B28-53p0 TELECOPIER 2.02-826-531� DIRECT DIAL NUMBER 612-334-2609 October 30, 1987 Mr. Daniel P. O'Keefe 2200 First Bank Place East Minneapolis, Minnesota 55402 AN eRUCE S. Ms*NCE'�CAs pARV D.OLACKFORD ECOTT E.:1ICMTEN . PAUL J. LIN6TROTM $C07T A. SMITN E1.�2A06TM MTNOMPfON It6�TN J. MALIELAND . � MARK /.PE7[WfOM D. RANDALL SOVEN ONIAN N.JOMN60N TIMOTMY W. KUCK CAWOI s.BWANlOM ■RUC6 A, rETENEON JULIE A.SW[1T2ER TNOMAS G MIELENl1AUiEN KATMLEEN M 9LAY2 . MICNA6L D.CMRISTEN60N J.MICMAEL SCMWART2 �ARAYE M.OS.OWN6 TOOD M.JOMNSON J[IF1�CY r, CAIRN3 LOUIf P. fMITM fRANCIi .!. GONNOLLY �NUG6 w. {.ITTIC MARK F. PALMA RU58411 8: PON[fiA SRYAN 4.CRAW►OAD uwvio K.wroca �MATT+�tw GDAMON � .lOMN W. AROVO � QRE40R�O.eROOKEW Wt4NAM M.OJIL6�JR. Tewnwrate w, cosse�to J056rM D. VAS� � SRIAN� W. OMM 8T[V6N A. GMEL[SiJ�K OA6001iv B.fCOT7 SMARON �N.IULI.MER .O►COVNLCL , FR[O L.MORRIlON D R A F T Re: City of Fridley - Lake Pointe Development Our File No. 10407-001 Dear Dan: The City of Fridley has now concluded all site development and construction work possible on the Lake Pointe Corporate Center project, given tl�e present status of project permits and approw als. I am writing to inform you that your client's current share of the public improvements cost is $198,272.12. In addition, I want to reaffirm that my client has more than fulfilled its contractual obligations. It is now up to Woodbridge to begin meeting its responsibility so that t'his project can go forward. As you probably know; the zedevelopment contract, obligates your client to bear one-half the cost of public improvements in excess of $2,190;000.00. The Woodbridge-Lake Pointe Project design cost as of �ctober 20, 1987 is as #ollows: i I '1 i i i `� Mr. Daniel P. O'Keefe , October 30, 1987 Page 2 Sunde Engineering _ Subterranean Engineering Ernst Associates I S2zort, Elliott & Hendrickson Total Design Cost: - $180,671.50 - $ 73,120.90 - � 9,751.19 - $ 8,340.80 $271,884.39 The construction cost to date is as follows: Enebak Construction Park Construction Minnesota Valley Landscaping H & S Asphalt Tota1 Construction Cost Total Design and Construction Cost - $1,223,498.50 - $ � 233, 820.00 - $ 455,650.97 - $ 387,764.10 $2,300,733.57 $2,57Z,fs17.96 a�a=mas�a�a�s Woodbridge's one-half share of the above costs is $191.,308.98. In addition, Woodbridge must pay �6,963.14 for an SEH intersection alignment design change and the installation of light pole bolts. Thus, Woodbridge owes Fridley �198,272.12 as of October 20, 1987. We should have the complete ana final costs available next month, but request payment now of the stated total. Before additional project work can proceed, Woodbri8ge must finish the platting of the property. The filing of the plat and the satisfaction of the conditions in the Phase I Site Escrow Agreement provides for the following: (1) release of escrow funds; (2} transfer of documents (including the execution and recording of the assessment agreement); and (3) conveyance of Phase I Parcel to the Lake Pointe Investment Company. Obviously, the conveyance of this property is conditioned on your client`s commitment to carry out the project. We expect to receive one plat from Woodbridge which provides the right of way for the internal road system and for the Trunk Highway 65 intersection. Fridley will then submit the Trunk Highway 65/West Moore Lake Drive roadway conneetion shown on the plat to MnDOT and complete its contractual obligations. The MnD�T I I. Mr. Daniel P. O'Keefe � October 30, 1987 Page 3 approval process will take several months, but the approval pro- cess can only be initiated after the plat is recorded. � � � We must secure your client's construction schedule as soon as possible. The redevelopment �ontract sets forth the following completion dates: Total Gross Square Footage of Substantially Completed Minimum Improvements 120,000 200,000 400,000 746, 000 Date of Substantial Completion June 30, 1988 December 31, 1991 December 31, 1996 December 31, 2001 It is essential that Woodbridge immediately inform my client Qf the project status. You must also be aware that MPCA Indixect Source Permit 86-4, which was obtained by Larkin Hoffman, is based upon your client's data, including the preliminary intersection drawings submitted to MnDOT. If Lake Pointe intends to change its project, it must determine whether mociifications of the MPCA permit must be reguested by the c7evelaper before construction proceeds. If Woodbridge is not in conformity with the MPCA permit, the deve- loper must secure advance written approval from MnDOT and the DNR of plans to construct improvements for the intersection of West Moore Lake Drive, old Central Avenue, and Trunk Highway 65. Similarly, the MPCA must also grant advance written approval, including a determination that the modifications do not reyuire a new ar revised permit. Given the foregoing and the obvious deficiencies in antici- pated tax revenues which were based upon a construction scheaule that is no longer operable, it is essential that Fridley receive an update regarding your client's position. Action must now be taken by h*oodbridge to get the project underway. Tax revenues and future payments to general obligation bondholders and revenue 'bondholders are directly related to the building constrnctfon schedule. , '=� Mr. Daniel P. O'Keefe � October 30, 1987 Page 4 Please give this matter prompt attention. Inquiries are being r ceived from potential developers relative to the property and development status. and I wish to update the mem2iers�of the City Co ncil and the Housing and Redevelopment Authority. Very truly yours, Raymond A. Haik RAFI/rhs :'513y cc: Vi gil Herrick Da id Newman Ma or and City Council/City of Fridley Ci y of Fridley Housing & Redevelopment uthority � � — r, % .L �_ w�, ,� —. � . . � � ! � � ,�� G� �, �j - F c:.�� /. � �C=: ; /,,, � `� �� - - � - /�' � / ♦ 'Y ��}�,�� • .. . - . � � . •`' CJ � ' y •�� F� �. t ; i � �;9� ; . ' �� . r � f �'' � i , �"'�',� � � �. �. f � C j f F f r• r/� . � l� l-. l j _ - . � � .. � . . . � 3 1 r : ► : _ . a� � �� anr ei7�e�3ua . � - � � . . �� r_ , < . ��i � � � � � - � ,� � . , �,��r . � w � ; . . '�.� �' C • � F ..- �. � , � � . , ,.. : I � � ^ � ^ � 3 � R� s�, g:i �aa �� a 3 � • � � �: , p:^'s e_- � s== s;; c°s x�..- x i r }� V�� 9 �$#`'"s ��a �3�'�3�� /. , � i � ,� � _ � � � � � $ �3� � �33 � �� /iy� ' ii� a s � ..� � � � ^ �i! � �� ";�� $S r ; � � 3 ?` ' c � t � • � � " $�� i+ �� * ••s y � . � . p 0 W �� 6 . . . z �. ��•.�.� � � �� _ .Q . . . F �• � . � � � � � � r� �. �. �� v� , _ �„ . _ � _ . .� � -. � �,s„� F s - �' � � � . . : t �� . �"- Z � ' �:;;,. �-i � _ � � ,,,� � � - � J • � `� � „ y � . . � � . ��t. �_ �. . . � � � � 9 GrOtl A1Nfl0'J � � . . � , �irb. � ' W� �. r }- ; �v� � � f Zr _ �, ,.,,, . { ,_, , ; i � �� * .,� � � _ � . � �� .:��. ,�, �� - �, u, . FE . f �;: _ - h �g � � ~ � _ � � � � � � -� Z � � :� r � . �� W � ,� �` �; �, V � � W t I n � n • a n r � , � � � r. � � �I .�. . . . .. . . W � � � �� m � W� N Z : _.. . o- a . �3 �� : �� : : — OFFICE :'r �TAIOP Of�ioe - ' update "� FEW STARTS PLANNE� FOR METRO AREA �"«PP�Y � the 71vin Cities d- fia market is dimirrishing, ao- ' cording w brokers and leasing agems who P�� v�crviews u iast 71�esday� A�sso�ciation d Indu�n'�al a�d Otfia ParYs (NAIO�. 'They said �drc number af nav projeRs underway or planned hav� significamiy decreased from laa year, and absorptioe hes f rcduced vacancy ler+els in mon aras. ( piace n U�ie rsovc�rsu� js u� � �� C� said mocting mode�Chuck 7hchfarberd Primc Ucti+elopment Cory. An NAIOP report which opmpila� the �. dings estimated a taal Tw•in Citia aPfice � sc�rQtion of 2.88 miilion square feet since i�t fall s revieN: and an average area vacancy r�e d' f7 perceru. 7Te "base uniwerse," or tolal diice speoe in d,e Tw;� Cuia, is 4I.1 rtWliau square feet. Thc reprnt did not include buitdings with Iess than 20.000 square fcet, and quoted u( fice figures in terms drentable square �oet. Italsodid not cou�tt su.called'•inuitutioml•• buildings. those for the most part occuPied bY one corponte tenant, nor did it �i�� medical office or government oftice , buildings. Chuck Gturia of Coldweli Banker i euimated anmial net absorption of 267AOp squarc fcet and an overal) vacancy rat� �(28 percem in the soutlxast sector of the 7ivin ��. nK �ay y��a uK ��e � �t the Twin Cities as consisting of E. Hloom- ington and RichtMld north o{thc Minnesola River. and f��an. Apple Valley and Burn- sville to the south of it. Eighty percem dthe 2.6 million squan ket o{ dfice spaoe is located north of the river, near the Minncapolis-St.Paul lntcrnationa! Airport. �►PPIe Vallc� Comnwns p, com�eled dtis � yw at L5025 Glazier A►e. in Appk �+atkp b1' P. R. Development Co., is the new�est offia ' building in Ne area. ApproximatelY 25ppp I aquare feet remaining at the building is drc �� ilable spact Iess than ou�e d �ra*dd � No«n��bu�w�r� arc urden►aya ed �rthe nezt su months. Caturis said' .P 7be Iattitude among deveiopers is, ••Bring u� a� anchor tenant and oNy then will we gp � �arted diggi�g:' he stid. 7'hat secros to be d�e prc�ailing attitude among developen throughout the 71vie Cities, aceoodi� to other presnnatioos. Mike Koehler of Edge Commen:ial Rea1� 9.�s'�`•n�'"o��t�� '� cumeM;acar�cy of 18 pereeM and an annwl nn absorption of 831,9W square ket. in a�, Edina. Fden Piairie and a!� a� wcst otl-35W and sotith dHi�hwry 7, N� ProjaYS totali� 1.2 m�llions�e foet arc undcr oonstructi� or have beeo � rcccntly mmpleted. About 95QU00 scp�aR feet ofthac spacel�asYa tobe 1eas�d. Nonew • �� ••�s� ara normw�est sator, (north d Highway 7 and we� of I-35V1� with %S milliai squarc ket doffia space. has a 27 1x� �'rate. andanestimatedannuv � �dPrim�Dc �pn�i�� i � ! < c i � tl D Y a a r a � is w Jo a nc �p �nnus! nq ��qq � S57A32 aqiwelat: howcvier, 7Mnrs� b"shadow ap�oe — ap� kaced but notyet ��a�� wn �ui �r �e — �c �e 7i00.U00 to 650,000 sqaarc fru a mone realiuic absorption ra1e. Wf"" �"°jects comPleKd with;n dK pdt 3"�*+"� °°u"ted, the vacancy �e rises b g peroaK. Atd wl�en olfia p�ojxts wideroon- �uaion — Nonvest Cenrcr, Li0 S. F'�, and the Crown Rofler MiU — ur cpmplqed nat y�ar vacarKies wili be 18 peram 10 20 P�rant,'IYautz prodieted, Nowerer, with manyProjeccs�ed6at � � a p�oss➢�bk�t� �aiod wlxn ia new afFicea�e wiU be b� m dow�uo�m Minneapolis. 71x vscancy we � wa.arov e�t aw�o ro s a�a. Aeaemers said mrage net rnrts fot new 7�vinCitiesaffia�e fromSllbSo vin t� so� sector to SU. in dvw�own Minneapolis. All the prcsemers weae �elt� tant to talk �ublicly sbout cor�cessi�, diough Cmuna said d►� � the airpvn and south dthe river marka coneessions a�e roo- ��c�c u ,��ox�a�ddK 1�e �alue, ana a� `i�d�r eo�;;ons,R � 0 m the SZ.SO oo S3 a squsne ibot rar�, —�r�h i � . .. . . , i appears thene is u caro�cti�m, ta • � .. � o��pp in the ?�vi t�i � lang plcu�e in �J n Cit� — C6uck � Grlson Centsr M the la�gest P�I� belrg buik M the north �u+d +wA4wMest sutwd COMMENTARY A C10USe Of OO1Cl Wd�f;T Risk �kin8 and sun�' seem 6n be inher+a� daits df,just abont anyone in die rc,al estate in�u�so it c�rne as no iast v�eelc whai wha we w�ene given may foracasts �or the affia roarket�� The oocasion wAS the annual offxx update dfheNationa! Associatic�' Of Off CC 8t1d IIIduStfiB� i"dfkS (T1Al��. '�IG OMCtllQttl�► t�ICRIC W85 tit8f •�� ge�g �.. VI�e11, maybe so — evenwally. But fa naw. it's p�etty ha�d to ugue with the n�mbers, and the numbers shoufd r�ke even the sunniest doptimisLs pout �uu a litt�. 0 Consider this: V�ancy tates in �w�ery goographic martca top !S peraa�t. Some go as high �8 Perornt and, ia sar�e pockds within those marlac�, h'lae EaSan. rates top 40 penea�t. Mo� af d�at vacam spaa a ia twildit�gs �s tFI8n two y�eatS Old. Consider tFliS: IA Cvery Singk n�alicst tllele iS �1861nIdatN d'dike spaoe. It rangra fmm a low of2byeus wa high dsix r��s� �01�'I'S S8y t�1Ci�C Bt+C d100Ui8$�g SigtiS. T7fC[�L �E vCry+ j�W, � �Y• PmJ� that are �n d�e planni� smg�, Tn�e, but tha+t auene v�ery few tha projccg ia t!x planning at�e a Y�ar ago. eithcr, a�d a�ly a oou�dd�ose ever brolae ground. Furrlxnnorc� ProJ� �� Pi��B � d�'� a� 6e« toaay s�nry ana absorpt,on t�s. p�oOr: nx e�itnatea �pply o� space has incrr,a.sed in all but two markets during the pau yrar Dev!elopers and brnkers expecting absorption w remain as hrald�y as it ' 6as been may be f�ing a la�g wait, if la� woek's economic irdicators are srry s;gn. The vulaa'liry in d,e stock and bord mauicttc ard clirnbin8 inte�est t8tes mean Co ratiOns ere gOin� mon�Y u�g � on delx �r capital expansqn have less a be kss wi8- d In a sady published earlier this ysay David Birr�, dir�octordthe Centq� far Real Fstate Dcvelopmaa at the Mass�useus Lutitnte af 7bc�ogy piedided a dramatic drop in the gravth otdu workfot�oe. Whik vNe found �aWt with some�� af the repwt, its eonclusions a6au �e gro+»h of if IC WOfIC fOIGC 81W l�SU1�dCIlL�tld �' O�K�G SpYOC, dt8w11 ftb[tl 8%Nt�C data base, w�erE pretty to argue a�. � 71�ispa� y�ear has baen �gh � mvy o�'�oedev�e�s, 'I�;j,+v� � themsetves slashing rates and ot�ering huge o�.si� in oider to cab- pete for tenants, even if it means surteMering c�sh 8vw now in anticiQa- don of the future. Th ,ry've seen ftiends ud oolka�ues turn prapetly b�k m�� sw�e. there are of iux devel� � s�es au d�e toa,�y Md ' S�, ax lack of,�c�+P� w�1 l�p�+�ery�e, in t� wng run ce�na,ou�l, lende�s. not devrlopecs, �ncthe rnodit tor d�at). Birt %r most d�eiopeas es n �Pr+np�c�ty owners it's bxn a 6ou8h Y�ar. ard things will trat gt mucU 15�8. � �: i,''` �� i �/�� ,� MINNESOTA CHAPTER National Association of Industrial and l�f�ce Parks 1987 ANNUAL OFFICE SPACE UPDATE SUMMARY TABLE BASE 1987 N�.1' yEARg UNIYERSE �i OF ABSORPTION OF VAGANCY MARKET AREA (sq.tt.) TpTA,L (aq•ft.� SUPPLY (+1�) Airport & South oi t6e River: 2,648,300 6.4 ?b7,000 2.9 Z8.1 Sont6west: 9,554,000 23.2 831.907 2.6 18A � Wesi & NortLwest: S,S69,778 13.5 606.137 2.8 27 St. PAnI Suburba: 3,146,390 ?.7 175.000 S.S 26 St. Panl CBD: 6.071,S4S 14.8 130,000 6.0 11 � Minneapolis CBD: 14, l 50,000 34.4 8ST,032 3.6 �0.9 T01'AI.S: 41,140.013 100�i 2,887.076 — 179�• •VACANCY FOR ENTIRL BI-ME7ROPOLITAN AREA. OC'i'pBFR 1987 i I. p . I I �;� � I � sQu� �� i,000,000 900,000 soo,000 �oo,000 600,aoo soo.000 400,000 300.000 200.000 100.000 -0- �Rs io 9 8 7 6 S 4 3 2 1 -0- WEST & N�RTHWEST SUBMARKET . , ABSORPTION TRENDS . � � 19aS 19a6 1%7 TREND IN YEARS OF SUPPLY 198.i 1956 1987 � r� MARKET DATA REPORT Submarket: West & Northwest � A. TOTAL UNIVERSE: (BASE) 1. Total Universe of Spaa S,S69.778 s.f. - 2. Total Vacancy 1,491,'888 s.f. Percent Vacant 2790 Percent Occupied 73y6 B. NEW SPACE AVAILABLE FOR LEASE TOTAL BUILDING AVAILABLE S.F. 1. Projects completcd but not fully leased 588,691 s.f. 209,444 s.f. 2. Projects under construction but not fully leased 933,550 s.f. 797,550 s.f. 3. Projects planned but not fully leased 256.000 s.f. ?A�,000 s.f. Total new space added to universe 1.778,241 s.f. 1,214,994 s.f. C. PROJECTED UNIVERSE AFTER NEW SPACE IS ADDED: D. ES'fI11lATED ANtiUAL NET ABSORPTION IN SUBMARKET E. NET RENTAI. RATES Existing Universe � Projects compieted but not fully leased F. AVFRAGE RENTAL RA?FS Existing Universe Newly Developed Space • Years supply equals [A2 + Bl] = D 7,348,019 s.f. 7,716,882 s.f. 606,137 s.f. Annually 2.8 years Years Supply' LOW HIGH 4.71 15.00 12.50 I7.00 Gross Rent 15.09 19.94 T&OE Base 5.69 3.76 Net Rent 9.40 16.18 . - - .,.M._.r...�.._ .< _.. ��: —� = ----- �_