HomeMy WebLinkAbout1. Work Session Report
4646 Dakota Street SE
Prior Lake, MN 55372
CITY COUNCIL WORK SESSION REPORT
MEETING DATE: DECEMBER 22, 2014
AGENDA #: WORK SESSION
PREPARED BY: DAN ROGNESS, COMMUNITY & ECONOMIC DEVELOPMENT DIRECTOR
AGENDA ITEM: (1) SENIOR HOUSING DEVELOPMENT PROPOSAL
(2) FINAL TRANSIT MERGER BRIEFING
DISCUSSION: Introduction
The purpose of this Work Session is to allow Dominium, a developer of senior
rental housing, to present their proposed redevelopment project. They would like
input from the City Council before they decide whether or not to move forward.
Staff will also provide a briefing on the final transit merger actions for discussion;
this item is on the City Council meeting Consent Agenda.
History
Senior Housing
: Dominium has a signed purchase agreement on a 2.3-acre site
that includes the Gateway Mall building, currently home to McGeez Closet, Pizza
& Pasta, and Prior Lake Shoe Service. Nearly one-half of the 22,650 square foot
building is vacant. The property was purchased in January of 2007 for $2.7 million;
that owner lost the property back to the lender, Wells Fargo, in 2014. The County’s
current estimated market value is $1.76 million; the current purchase price is $1.3
million. Ten years ago, the property was valued by the County at $1.57 million
followed by its highest value of $2.6 million in 2009/10.
Transit Merger
: On August 11, 2014, the City Council approved the execution of
two merger agreements with Minnesota Valley Transit Authority (MVTA), including
a consolidation agreement and an amended joint powers agreement. City staff
identified the proposed transfers of Prior Lake’s transit reserve fund account as
part of the merger.
Current Circumstances
Senior Housing
: Dominium will present a PowerPoint of its proposed senior
rental housing project of 171 units on this site. All units will be affordable of high
quality using various funding sources: federal housing tax credits, tax-exempt
bonding, and tax increment financing. Representatives will fully describe the pro-
ject, costs, financing, timeline, etc. City actions will include a Comprehensive Plan
amendment, rezoning, city bond financing, tax increment financing, and waiver of
some development fees. Dominium’s most recent similar project is currently under
construction in Crystal (see article attached).
Transit Merger
: The staff report is provided as a Consent Agenda item for the
nd
December 22 City Council meeting. The proposed use of the city’s transit re-
th
serve funds has changed since the previous August 11 meeting.
Conclusion
Senior Housing
: Dominium is seeking input/questions from the City Council in
order to determine whether their proposed project is a good fit with Prior Lake’s
goals for housing and redevelopment. It will require significant local financing re-
sources in order to be developed as affordable senior housing.
Transit Merger
: Prior to the City Council meeting, time is allowed in a work ses-
sion format to have final discussion on transit merger actions.
ISSUES: No decisions are being made for the Dominium project, but feedback is desired by
the developer, whether positive or negative. The transit merger is fully imple-
mented on January 1, 2015, so final City Council approval is necessary to com-
plete final merger actions.
FINANCIAL Local financial support will be necessary for the proposed senior housing project.
IMPACT:
The spend-down of transit reserves is provided for in the staff report.
ALTERNATIVES: Discussion Only
RECOMMENDED N/A
MOTION:
ATTACHMENTS: 1. Senior housing redevelopment site map.
2. Article on the Dominium project in Crystal.
3. Pictures of Dominium projects.
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