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15 - 9th Ave North (Former Snyder Property)MEMORANDUM TO: Honorable Mayol and Hopkins City Council Members FROM: Kersten Elve it for of Planning & Development DATE: June 6, 2013 SUBJECT: 15 9th Avenue North (Former Snyder Property) A discussion of the potential acquisition of the former Snyder property at 15 9th Avenue North is scheduled for the June 11, 2013, work session. The following is a summary of the issues: Background Last year City staff began discussing the need to develop additional parking around 8`h Avenue for two primary reasons: To provide for additional development along 8th Avenue, south of Mainstreet, enhancing the connection to the proposed SW LRT station at 8th Avenue and Excelsior Boulevard. By building structured parking north of Mainstreet on a site that would include both the City's lot 700 and the vacant Snyder property, we would free up lot 200 (on 8th Avenue south of Mainstreet) for development To help support the retailers and restaurants we hope to attract to developments such as Marketplace & Main and the former Glenrose building. The City was successful in securing grants through the Met Council and Hennepin County for $600,000 and $400,000 to acquire the property. The grants are tied to the Snyder property and require the construction of parking, and in the case of the Met Council funds, structured parking. Requests for grant funds for the construction of a ramp have not been successful. The estimated cost of construction of a ramp is approximately $17,000 per stall, or $3.4 million for 200 spaces. The exact sizing of the ramp would vary depending on whether or not it was a joint development project or stand alone structure. Because of this significant cost and the City's limited funds, the concept of a joint development has been discussed. Under this scenario, the City would purchase the Synder property with grant funds and contribute the land to a development project that included both structured parking and development. The development, possibly a medical office use, would contribute to the construction costs of the parking and there would be a shared parking agreement. Property Information The property is currently listed at an asking price of $1,199,000. An appraisal of the property was conducted in August of 2012 that established the value at 650,000. The property listing and information on other available property is attached. In April, the City of Hopkins, through a grant from the Met Council, conducted a Phase I and Phase II environmental review as well as a hazardous materials survey. Those studies indicate some environmental conditions that would require remediation. Staff has not entered into negotiations with the owner's representative regarding the sales price or terms. Is there a need for additional parking in this location? Based on the parking analysis that is currently being completed, it appears as though there is a need to build additional parking capacity in our system in the general location of the Snyder property. Other possibilities exist for a structured parking location, but the funds and the property are available today for the Snyder site. What are the options at this time? The City has several options to consider including the following: • Negotiate an option to purchase the property and market a joint development project through a RFP or RFQ process. Along with this, staff would recommend discussing the possibility to use grant funds to also acquire the properties at 26 and 30 8th Avenue North and to determine the interest of those property owners in selling their property • Purchase the property and continue to work towards either single use parking or joint development, taking the risk that we may not be able to perform on the terms of the Met Council grant • Decide to let the Snyder property and grants go while continuing to explore parking structure options on other sites Staff will be prepared to discuss this in more detail at the Council work session. Minnesota Commercial Real Estate Listing Detail - For Sale Snyder Drug Building Listing ID# 1237804 Page 2 of 2 Snyder Dr Options: Print Version 11Hp I Demographics I Bird's Eye View Hopkii Couni T! Listing $ 149.4.- Options: 49.4: For More Information Contact: Ed Hanlon - Edina Realty Inc Phone: (952) 945-3163 1 Fax: 952-938-7707 1 Email: click hi Property Summary - Snyder Drug Building Property Type: Retail Year Built: Total Building Sq Ft: 8,024 Total Sq Ft of Lot: Total Rentable Area: 0 Total Acres of Lot: Total Units: Cap Rate: Status: Available Number of Floors: NOI: Construction Type: General Zoning: R-1 Description Development Opportunity in Hopkins CBD - Snyder Drug Building .45 Acre Lot 152'x 129' Zoned B2 CBD with its own and municipal parking approved Drive Up window in 'o8. Well maintained i/1 block from mainstre( ther retail stores, hardware, bank, gorcery, liquor etc. All information provided is deemed reliable but is not guaranteed and should be independei © Copyright 2013 MNCAR 16800 France Ave #760 , Edina, MN 55435 1 Ph: 952.908.1780 1 Fax: 952.908.1799 1 Home http://epd.mncar.org/index.cfm?fuseaction=property.detailfs&ln=1237804 06/06/2013 Minnesota Commercial Real Estate Page 1 of 1 Minnesota Commertial Real Estate - Minnesota Coni—CoI Prcg>erty For Sale - Minnesota Commercial Properties For t. ase AGENT ID PASSWORD —� Submit Forcot Password? HOME MEMBERSHIP ASSOCIATIONS MNCAR EXCHANGE JOIN EVENTS RESOURCES OUR SPONSORS GREATER MN CONTACT US Listing Detail - For Sale 1200 Mainstreet $499,000 Listing ID# 1237437 1200 Mainstreet 1200 Mainstreet Hopkins MN 55343 County: Hennepin TS Map: 119/ Listing Type: Retail $ 85.30 per Bldg SF Options: Print Version I MN I Demographics For More Information Contact: Ed Hanlon - Edina Realty Inc Phone: (952) 945-3163 1 Fax: 952-938-7707 1 Email: click her Property Summary - 1200 Mainstreet Property Type: Retail Year Built: 1950 Total Building Sq Ft: 5,850 Total Sq Ft of Lot: 11,326 Total Rentable Area: 0 Total Acres of Lot: 0.26 Total Units: Cap Rate: 0.04 Status: Available Number of Floors: 1 NOI: 20,000 Construction Type: Masonry General Zoning: Description 1200 Mainstreet Well maintained Corner Central Biz district Retail/Office/Heated Shop w/ Drive -In. Two tenants in place; one 1700 [/] on Mainstreet Mo to Mo. One 600 [/] on Mainst Vacant 3600 [/] HVAC Grage w/ Drive -In two year lease. Recent updates (Roof, HVAC, Floor) in rear space with Office and drive-in. Extra lot included. All information provided is deemed reliable but is not guaranteed and should be independently verified © Copyright 2013 MNCAR 16800 France Ave #760 , Edina, MN 55435 1 Ph: 952.908.1780 1 Fax: 952.908.1799 1 Home I Site Map If= BBB. Click for Review http://epd.mncar.org/index.cfm?fuseaction=property.detailfs&ln=1237437 06/07/2013 Minnesota Commercial Real Estate Page 1 of 1 Mnnesola C ommeroal Real Estate Minnesota Com uaI Property For Sale - Minnesota Corn -I Properties Foi i -.a s+ AGENT ID PASSWORD [ Submit Foraot Password? HOME MEMBERSHIP ASsoaATIONS MNCAR EXCHANGE JOIN EVENTS RESOURCES OUR SPONSORS GREATER MN CONTACT US Listing Detail - For Sale 1209 Mainstreet $329,000 1209 Mainstreet 1209 Mainstreet Hopkins MN 55343 County: Hennepin Listing Type: Retail, Industrial $ 65.80 per Bldg SF Options: Print Version I Mao I Demooraohics I Bird's Eve View Description 1209 Mainstreet All information provided is deemed reliable but is not guaranteed and should be independently verified. © Copyright 2013 MINICAR 16800 France Ave #760 , Edina, MN 55435 1 Ph: 952.908.1780 1 Fax: 952.908.1799 1 Home I SiteMa IBB. Click for Review http://epd.mncar.org/index.cfm?fuseaction=property.detailfs&ln=1249514 06/07/2013 For More Information Contact: Ed Hanlon - Edina Realty Inc Phone: (952) 945-3163 i Fax: 952-938-7707 i Email: click h r Property Summary - 1209 Mainstreet Property Type: Retail, Industrial Year Built: 1950 Total Building SgFt: 5,000 Total SgFt of Lot: 7,841 Total Rentable Area: 0 Total Acres of Lot: 0.18 Total Units: Cap Rate: Status: Available Number of Floors: 2 NOI: Construction Type: Brick General Zoning: Description 1209 Mainstreet All information provided is deemed reliable but is not guaranteed and should be independently verified. © Copyright 2013 MINICAR 16800 France Ave #760 , Edina, MN 55435 1 Ph: 952.908.1780 1 Fax: 952.908.1799 1 Home I SiteMa IBB. Click for Review http://epd.mncar.org/index.cfm?fuseaction=property.detailfs&ln=1249514 06/07/2013 Minnesota Commercial Real Estate Page 1 of 1 Minnesota Commercial Real Estate Minnesota Commercial Property For Sale - Minnesota Commercial Properties For Lease AGENT ID PASSWORD [ ^I Submit Foraot P iiiini d? HOME MEMBERSHIP ASSOCIATIONS MNCAR EXCHANGE JOIN EVENTS RESOURCES OUR SPONSORS GREATER MN CONTACT US Listing Detail - For Sale 1728 Mainstreet Listing ID# 1247652 Options: Print Version I Mao I Demographics I Bird's Eye View $311,000 1728 Mainstreet 1728 Mainstreet Hopkins MN 55343 County: Hennepin Listing Type: Retail $ 138.22 per Bldg SF For More Information Contact: Aaron Barnard - Cushman & Wakefield/NorthMarq Phone: (952) 465-3372 1 Fax: 952-893-8293 1 Email: click here Property Summary - 1728 Mainstreet ............. -.... . Property Type: Retail Year Built: 1968 Total Building Sq Ft: 2,250 Total SgFt of Lot: 11,761 Total Rentable Area: 0 Total Acres of Lot: 0.27 Total Units: Cap Rate: Status: Available Number of Floors: NOI: Construction Type: General Zoning: Description 1728 Mainstreet Former KFC. All information provided is deemed reliable but is not guaranteed and should be independently verified. © Copyright 2013 MNCAR 16800 France Ave #760 , Edina, MN 55435 1 Ph: 952.908.1780 1 Fax: 952.908.1799 1 Home I Site Mao http://epd.mncar.org/index.cfm?fuseaction=property.detailfs&ln=1247652 Click for Review 06/07/2013