HomeMy WebLinkAboutItem 08March 14, 2013 Item No.
SECOND AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT
WITH IMAGETREND DEVELOPMENT, L.L.C.
March 18, 2013 City Council Meeting
Proposed Action
Staff recommends adoption of the following motion: Move to approve the Second Amendment to
the Contract for Private Development with ImageTrend Development L.L.C.
Approval of this motion will result in ImageTrend's second expansion phase being completed by
December 31, 2015.
Overview
In August of 2009, the City Council approved a Contract for Private Development that
authorized the sale to ImageTrend of a City -owned 3.39 acre lot adjacent to their existing
building located at 20855 Kensington Boulevard in the Fairfield Business Campus. The terms
of the Contract called for one third of the sale price to be paid by ImageTrend at the time of
closing. The remaining two thirds of the purchase price would be forgiven if ImageTrend
completed their first expansion by the end of 2011 and a second phase was required to be
completed by the end of 2013. The total of the two expansions is required to be a minimum
of 50,000 square feet. The contract also required that ImageTrend create a minimum of 21
additional jobs.
As the attached letter from Mike McBrady of ImageTrend indicates, the company completed
their first phase expansion of 27,000 square feet by the end of 2011 and has created 46 new
jobs which is more than double the number required under the contract. ImageTrend has the
capacity to add an additional 100 employees in their existing building over the next three
years.
As a result, ImageTrend will not need additional office space until the end of 2015 and thus
are requesting an amendment to the current Contract for Private Development to extend the
completion date from November 30, 2013 to December 31, 2015. The EDC reviewed this
request at their February meeting and unanimously recommended approval.
Primary Issues to Consider
• Will the requested amendment alter the public purpose of the original Contract for Private
Development? Staff's opinion is that it does not.
Supporting Information
• Second Amendm Contract for Private Development with ImageTrend Development
David L. Olson, Community and Economic Development Director
Financial Impact: $ None Budgeted: Y/N Source:
February 19, 2013
David Olson
Community & Economic Development Director
Lakeville City Hall
20195 Holyoke Ave.
Lakeville, MN 55044
Re: Contract for Private Development dated August 3' 2009
Dave:
As you remember in August of 2009 ImageTrend entered in a Contract for Private
Development with the City of Lakeville. At the times we owned and occupied the 33,000
sq. ft. of office space that housed our nearly 100 employees.
The contract was entered into with the understanding that ImageTrend would continue
doing business and grow here in Lakeville. We have done just that and plan on
continuing. We have increased of employee base from 100 to 146. This nearly twice the
jobs we agreed to in the original Contract for Private Development agreement. We
invested in a 27,000 square foot addition to our building at a cost of over two million
dollars. This completed the Phase A requirements of our agreement.
Our original Contract for Private Development agreement stated that our Phase B 20,000
sq. ft. construction would be done by November 30, 2013. As we look to the future and
our growth rates below is how we see ImageTrend growing over the next five years.
• We have space for another 100 employees in the present 60,000 sq. ft. building.
• With our hiring curve that should take 3 years to fill the building to capacity.
• We would plan our second Phase B building in 2014 in excess of 24,000 sq. ft.
• We would construct the second Phase B building in the summer of 2015.
• Upon completion prior to December 31" 2015 we will have fulfilled our Phase B
obligations completing our agreement.
• We would move in late 2015 — early 2016.
• We would have the second building fully occupied in 2018 with about 300
employees.
We are asking the City of Lakeville for an amendment to our building Contract for
208 5 5 KENSINGTON BLVD
L A K E V I L L E, MN 55044
TEL - 1 .952.469.7 589 IMAGETREND INC.
FAX- 1.952.985.5677
W W W . I M A G E T R E N D. C O M
Private Development agreement to accommodate these plans. This simply extends our
Phase B completion date from November 30, 2013 to December 31" 2015. Let me know
what the next step may be.
Best Regards,
r
/Jl. ,
McBrady
ImageTrend, Inc.
208 5 5 KENSINGTON BLVD
L A K E V I L L E, M N 55111
TEL- 1 .952. 1 589 ', IMAGETREND INC.
FAX-1 .952.99855 " " "' .5671
W W W. I M A G E T R E N D. C 0 M
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SECOND AMENDMENT TO CONTRACT
FOR PRIVATE DEVELOPMENT
IMAGETREND DEVELOPMENT, L.L.C.
THIS SECOND AMENDMENT TO CONTRACT FOR PRIVATE
DEVELOPMENT, made on or as of the day of March, 2013, by and between the CITY
OF LAKEVILLE, a Minnesota municipal corporation (the "City ") and IMAGETREND
DEVELOPMENT, L.L.C., a Minnesota limited liability company (the "Developer ").
WITNESSETH:
WHEREAS, the City and the Developer have entered into a Contract for Private
Development dated August 3, 2009 and recorded in the office of the Dakota County Registrar of
Titles on August 27, 2009 as Torrens Document No. T649971 (the "Contract "), as amended by First
Amendment to Contract for Private Development dated June 20, 2011 and recorded with the Dakota
County Registrar of Titles on June 22, 2011, as Document No. T681035 ( "First Amendment ")
regarding a sale to the Developer of approximately 3.39 acres of real property (the "Property ")
legally described on the attached Exhibit "A ",
WHEREAS, Developer completed the first Phase expansion of 27,000 square feet prior
to December 31, 2011 and created 46 new jobs, more than double the number required under the
Contract;
WHEREAS, Developer has the capacity to add an additional 100 employees to the
existing building and will not need additional office space until the end of 2015;
WHEREAS, Developer is requesting that the time frame for completion of Minimum
Improvements for Phase B be extended to December 31, 2015;
WHEREAS, the City is willing to amend the Contract in accordance with Developer's
request;
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NOW, THEREFORE, in consideration of the premises, the Contract and the mutual
obligations of the parties hereto, the City and Developer hereby amend the Contract as follows:
Section 4.3 of the Contract is hereby amended to read as follows:
Section 4.3. Construction of Minimum Improvements. The Developer shall
substantially complete construction of the first Phase of the Minimum Improvements,
except for (i) landscaping (ii) exterior matters such as final lift of asphalt, striping, etc.
and (iii) minor "punch list items," on or before December 31, 2011. The construction of
the remaining Phase (Phase A or Phase B) shall be substantially completed on or before
December 31, 2015.
2. Except as specifically provided herein, the Contract remains unchanged and in full
force and effect. Capitalized terms not otherwise defined herein shall have the meanings ascribed to
them in the Contract.
IN WITNESS WHEREOF, the City has caused this Agreement to be duly executed in its
name and behalf, and the Developer has caused this Agreement to be duly executed in its name and
behalf, on or as of the date first above written.
CITY OF LAKEVILLE
Matt Little, Mayor
Charlene Friedges, City Clerk
STATE OF MINNESOTA )
)ss.
COUNTY OF DAKOTA )
The foregoing instrument was acknowledged before me this day of , 2013, by
Matt Little and by Charlene Friedges, respectively the Mayor and City Clerk of the City of
Lakeville, a Minnesota municipal corporation, on behalf of the corporation and pursuant to the
authority granted by its City Council.
Notary Public
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IMAGI, TREND DEVKLOPMENT, L.L.C.
STATE OF MINNESOTA )
)ss.
COUNTY OF -aid +a )
WE
Pres
The foregoing instrument was acknowledged before me this of A ^
2013, by Mc,wt (t`b,1► and Vim.( M�6„� , the cue and
Mcw1�� respectively of ImageTrend Development, L.L.C., a Minnesota limited
liability company, on behalf of the company.
i / /W'
Notary Public
DRAFTED BY:
CAMPBELL KNUTSON, P.A.
1380 Corporate Center Curve, Suite #317
Eagan, Minnesota 55121
Telephone: (651) 452 -5000
AMP
ROBERT JAMES NOVAK
3`. s Notary Public - Minnesota
MY commission Expires Jan 31, 2016
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EXHIBIT "A"
LEGAL DESCRIPTION OF THE PROPERTY
Lots 1 and 4, Block 1, Fairfield Business Campus 2 nd Addition, Dakota County, Minnesota.
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CITY OF LAKEVILLE
ECONOMIC DEVELOPMENT COMMISSION
MEETING MINUTES
February 26, 2013
Chair Matasosky called the meeting to order at 4:30 p.m. in the Marion Conference
Room at City Hall.
Members Present: Comms. Matasosky, Vlasak, Longie, Brantly, Starfield, Tushie,
Schubert, Ex- officio member Chamber of Commerce Executive Director Todd
Bornhauser, Ex- officio member Mayor Matt Little, Ex- officio member City Administrator
Steve Mielke.
Members Absent: Comm. Smith, Emond.
Others Present: David Olson, Community & Economic Development Director; Adam
Kienberger, Economic Development Specialist; Mike and Valerie McBrady, Rob Novak,
ImageTrend.
2. Approval of January 22, 2013 meeting minutes
Motion Comms. Tushie / Brantly moved to approve the minutes of the
January 22, 2013 meeting as presented. Motion carried
unanimously.
3. Review of Proposed Amendment to the ImageTrend Contract for Private
Development
Mr. Olson introduced Mr. McBrady from ImageTrend and provided background
information on the request regarding the proposed amendment to the ImageTrend
Contract for Private Development.
Mr. McBrady reviewed a presentation on ImageTrend and noted that they currently
employ 146 people with an expected growth rate of 20% per year. They are
seeking an extension to fulfill the building expansion component of the Contract for
Private Development and noted that they have already more than doubled the job
creation requirement of the agreement.
Comm. Tushie asked what the original goal of the City was in the development
agreement, jobs or building square footage.
Mr. Olson responded that the negotiated land sale to ImageTrend was predicated
on both jobs and building expansion. The Contract required the creation of 21 jobs
and 50,000 square feet of building expansion. To date ImageTrend has completed
a 27,000 square foot expansion, and has created 46 new jobs.
Comm. Tushie noted that the 27,000 square feet of office space expansion is more
valuable than 50,000 square feet of warehouse space would be in the City.
� c Pa e 2
Economic Development Commission Meeting Minutes, February 26, 2013 ma m ` y g
Coupled with the significant amount of high - paying jobs created, ImageTrend is well
within the original intent of the development agreement.
Motion Comms. Tushie /Starfield moved to recommend that City Council
amend the Contract for Private Development with ImageTrend to
extend the completion date of their Phase B expansion to
December 31 2015. Motion carried unanimously. [Chair
Matasosky abstained from the vote]
4. Presentation of the 2012 Economic Development Annual Report
Mr. Olson reviewed the 2012 Economic Development Annual Report.
[Comm. Vlasak excused himself from the meeting at 5:00 p.m.]
5. Update on Business Marketing Strategy Implementation Project
Mr. Kienberger provided an update on the recent activities related to the
implementation of the business marketing strategy.
Comm. Tushie inquired about a focused approach to target markets and suggested
there might be some benefit to creating a stand -alone website for economic
development.
Comm. Starfield noted the benefits of using a contact management client such as
Constant Contact to track impacts of messaging.
6. Director's Report
Mr. Olson reviewed the Director's Report and highlighted the launch of the Open to
Business Program which will have office hours in City Hall the fourth Tuesday of
each month from 1:00 p.m. to 3:00 p.m.
Mayor Little provided an update to the EDC on the last City Council work session
where they discussed commercial and industrial park dedication recommendations
and the recommended TIF and Tax Abatement policies.
7. Adjourn
Meeting adjourned at 5:45 p.m.
Respectfully submitted by:
Adam Kienberger, Recording Secretary