IV.6. Second Amendment to PUD/Development Agreement – Mokabaka, LLC; Elverum (CR2016-056)May 13, 2016
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Council Report 2016-056
SECOND AMENDMENT TO
PUD/DEVELOPMENT AGREEMENT — MOKABAKA, LLC
Proposed Action
Staff recommends adoption of the following motion: Move to approve Second Amendment to
PUD/Development Apreement between Mokabaka, LLC, and the Citv of Hopkins.
With this motion the amendment will be drafted and executed.
Overview
In November 2013, SSI Properties, acting on behalf of Mokabaka, LLC, and the City of Hopkins,
entered into a PUD/Development Agreement stating the terms and conditions for acquisition of the
former Leaman LiquorlNelson's Meats and Syndicate Sales properties and the redevelopment
thereof. The agreement stated that Mokabaka, LLC, was to commence construction no later than
December 1, 2013, and substantially complete construction, including the demolition of the Syndicate
Sales building, within 18 months thereafter.
Mokabaka, LLC, began construction of the new building with the time identified in the agreement, but
was unable to complete construction within the original 18-month period. Wet weather conditions,
poor soils, and contractor delays on both the Shady Oak Road and the redevelopment projects were
all factors, and as a result, the HRA approved an extension of the date for completion of construction
of the Minimum Improvements to May 31, 2016.
While the work is close to being completed, the demolition of the Syndicate Sales building will not be
able to be accomplished by this date. Staff is recommending a six-month extension, to November 30,
2016.
Primarv Issues to Consider
Syndicate Sales has begun to remodel the property at 24 Shady Oak Road in anticipation of moving
into the building early this summer. That will allow their current building to be demolished and a
parking lot constructed, which will serve both the Snap Print development, as well as the VFW. This
amendment will allow additional time to complete the project.
Supportinq Document
Agreement — Mokabaka, LLC
i
Director of(Planning & Development
Financial Impact: $ 0 Budgeted: Y/N _ Source:
Related Documents (CIP, ERP, etc.):
Notes:
SECOND AMENDMENT TO PUD-DEVELOPMENT AGREEMENT
By and Between
THE CITY OF HOPHINS
and
MOKABAKA LLC
Dated: May , 2016
This Instrument drafted by:
Kennedy & Graven, Chartered (SJR)
470 U.S. Bank Plaza
200 South Sixth Street
Minneapolis, MN 55402
479099v2 AMB HPI45-0
THIS SECOND AMENDMENT TO THE PUD-DEVELOPMENT AGREEMENT (the
"Second AmendmenY') is made and entered into this _ day of May, 2016, by and between the
City of Hopkins, Minnesota, a municipal corporation under the laws of Minnesota, (the "City"),
and Mokabaka LLC., a limited liabiliry company under the laws of Minnesota, (the
"Developer");
WHEREAS, On November 20, 2013, SSI Properties, Inc., a corporation under the laws
of California ("SSI"), the Developer, and tbe City entered into a PUD-Development Agreement
(the "PUD Agreement") stating the terms and conditions of the City's approval of PUD zoning
and a Development Plan for the development of certain real property legally described in Exhibit
A attached hereto (the "Real Property"). The PUD Agreement was filed for record on November
27, 2013, as Hennepin County Registrar of Titles Document No. T05135961. By a Quitclaim
deed recorded November 27, 2014, as Hennepin County Registrar of Titles Document No.
T5135956, SSI transferred fee title to the Real Property to the Developer; and
WHEREAS, Paragraph 11 of the PUD Agreement stated that the Developer is to
commence construction of the Improvements (as defined in the PUD Agreement) and
development of the Real Property in accordance with the terms and conditions of the PUD
Agreement no later than December 1, 2014, and substantially complete construction within 18
months thereafter.
WHEREAS, Developer and the City entered into an amendment to the PUD Agreement
(the "First Amendment") on the 29`�' of October, 2014, whereby the City agreed to extend the
time allowed under Paragraph 11 of the PUD Agreement; and
WHEREAS, under the terms of the First Amendment, the Developer is required to
commence construction of the Improvements (as defined in the PUD Agreement) no later than
December 31, 2013, and the Developer shall also substantially complete such Improvements no
later than May 31, 2016; and
WHEREAS, the Developer, due to circumstances outside of its control, will not be able
to substantially complete such Improvements by May 31, 2016, and has requested additional
time for complerion from the City; and
WHEREAS, the City wishes to enter into this Second Amendment granting the
Developer additional time for substantial completion under the PUD Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and other good and valuable
consideration hereinafter set forth, the City and Developer hereby agree to enter into this Second
Amendment and amend the PUD Agreement as hereinafter provided:
1. Incorporation of Recitals. The recitals set forth above and the exhibits attached
hereto, if any, are incorporated herein by reference as if set forth herein.
479099v2 AMB HPI45-4
2. .Ainendment of the PUD A�reement as Amended. Paragraph 11 of the PUD
Agreement, as amended by the First Amendment, shall be deleted in its entirety and replaced
with the following new paragraph 11:
Time of Performance. The Developer shall commence or continue construction
oF the Improvements and the development of the Real Property in accordance
with the terms and conditions of this Development Agreement no later than
December 1, 2013, and shall substantially complete construction of the
Improvements and development of the Real Property no later than November 30,
2016.
3. Reasonable Efforts. The Developer agrees to use all reasonable efforts to
substantially complete all work contemplated in the PUD Agreement no later than August 31,
2016.
4. Effect on the PUD Agreement. Any other terms, agreements, requirements or
conditions contained in or required by the PUD Agreement shall remain in effect and any such
other terms, agreements, requirements, or conditions of the PUD Agreement that are required to
be modified to be consistent with this Second Amendment shall be appropriately modified and
revised to be in accordance with the terms of this Second Amendment, with any such required
modification or revision constituting a necessary condition of the approval of this Second
Amendment. Except as specifically provided in this Second Amendment, the PUD Agreement
remains unaltered and in fiall force and effect.
/SIGNATURE PAGES FOLLOWJ
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IN WITNESS WHEREOF, the City has caused this Second Amendment to be duly
executed in its name and behalf, and the Developer has caused this Second Amendment to be duly
executed in its name and behalf on or as of the date first above written.
CITY OF HOPHINS
By:
Molly Cummings
Its: Mayor
By:
Michael J. Mornson
Its: Ciry Manager
STATE OF MINNESOTA )
) ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me on this day of May, 2016,
by Molly Cummings and Michael J. Mornson, the Mayar and City Manager, respectively, of the
City of Hopkins, a municipa] corporation under the laws of the state of Minnesota, on behalf of
said municipal corporation.
Notary Public
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MOKABAKA LLC
By:
Dan Dorholt
Its: Chief Manager
STATE OF MINNESOTA )
) ss.
COUNTY OF )
The foregoing instrument was acknowledged before me on this day of May, 2016,
by Dan Dorholt, the Chief Manager, of Mokabaka LLC, a limited liability company under the
laws of the state of Minnesota, on behalf of said limited liability company.
Notary Public
479099v2 AMB HPI45-4
EXHIBIT A
LEGAL DESCRIPTION OF REAL PROPERTY
Lot 1, Block 1, Dorholt Addition, Hennepin County, Minnesota
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MORTGAGEE'S CONSENT
0
the mortgagee named in that
certain Mortgage dated , 2013, which was recorded on , 2013,
with the Hennepin County Registrar of Titles as Document No. , hereby
consents to the foregoing Second Amendment to the PUD-Development Agreement and agrees
that said Mortgage shall be subject to and subordinate to said Second Amendment to the PUD-
Development Agreement.
By:
Its:
State of Minnesota )
)ss.
County of )
The foregoing instrument was acknowledged before my on this day of
, 2016, by the
, of , a under the laws
of the state of , on behalf of .
Notary Public
479099v2 AMB HP145-4
0