05-27-1986 SCM
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A spec1al meeting of the Hopkins C1ty Council was held on
May 27, 1986
Present were Mayor Lavin, Councilmembers: Shirley,
Redepenning, Milbert and Anderson. Also present were staff
members Rapp, Kerrigan and Maas. Also present was Bob
McDonald from the CCDC Organizat10n and Nelson Berg from the
Ma1n Street Economic Development Committee.
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The purpose of the meeting was to cons1der the development
proposed by Derrick Companies for the Harriman and Specialty
blocks. City Manager Rapp deta11ed what he felt were the
pros and cons of the proposed development. He stated that
on the pro side was the fact that detailed preliminary plans
and costs were in place and created a workable subsidy. The
development would complete two projects that were considered
priorit1es by the City. Sign1ficant space had already been
committed for the Spec1alty Block. The concept appeared to
be the type of development desired by the City. The
development team has good creditals and the timing 1S good,
since the developer is at hand.
He stated the cons, in his opin10n, were as follows:
Negative references for the developer
concern and the City would need to be
with this developer.
which ra1sed some
careful in dealing
The high cost of acquiring additional property.
The cost of acqu1r1ng park1ng space.
The tenant composition may not fit the original concept.
Loss of the Farmer's Market.
Committing the Harriman Block to get the Specialty Block.
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Mr. Rapp stated that it
is imperative that the
to get suff1cient cash
project.
has become apparent to staff that 1t
Harriman Block be developed in order
to help out the Specialty Block
Loss of opportun1ty to go with other developers, if we go
with this developer.
Specialty Block requires significant subsidy.
DEVELOPER REFERENCES
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communities who worked with th1S developer said you have to
protect yourself by working out a solid secure deal.
Make sure they have the f1nanc1al capabilities before
beginning the project.
Willmar is now in court regarding a Derrick project.
(Derrick Companies response to a question regarding this was
that the SU1t is against Derrick, the person rather than the
Derrick Companies).
The development "team" is strong.
We would need to be protected in the development agreement
no matter who the developer was.
*********D1Ck Krier of Derrick Companies entered the meeting
at this point.*********
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Dick Kr1er presented the attendants at the meet1ng with
a letter list1ng issues that he felt were not completely
resolved and his proposals for resolving them.
1. The need
development so
tenant.
to proceed
that they
as rap1dly as possible with this
would not lose their pr1me office
2. The need to be assured that substantial parking will
exist in the area so that the shopping development can
proceed.
3. The need to be assured that they would not be taking
undue financial risks by the imposition of unreasonable
restraints.
He stated he would 11ke to have six months to put forth a
complete effort to lease the space out to the tenant mix
that the City desires. After six months, if he is not able
to get the type of tenants which the City desires, he wants
a year to pursue tenants who, in his opinion, create a
sound shopping area. He would want to proceed with the
apartments as soon as the Redevelopment Contract is signed.
The project would be started 1-1/2 years after the
development agreement is s1gned, and it would take
approximately ten months to complete the project.
After thoroughly discussing the pros and cons, the Council
felt the following three issues made the proposal
unacceptable.
1. Closing of First street
2. Add1tional acquisit10ns in the downtown to add to
Specialty Block.
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3. Proposed tenant mix.
The Council decided in a 5 - 0 vote to discontinue the
exclusive development rights of the Derrick Companies.
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Respectfully submitted,
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Jea;i2,
Elren Lav1n, Mayor_
Council Members:
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