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04-28-15
nkevrlle AGENDA Economic Development Commission April 28, 2015 — 4:30 p.m. City Hall, Marion Conference Room 1. Call to order 2. Introduction of New Members 3. Election of Officers 4. Approval of March 24, 2015 minutes 5. Review ImageTrend's Request to Amend Contractor for Private Development 6. Review Request for Tax Increment Financing for Mendell Inc's Proposed Expansion. 7. Discussion of 2014-16 Strategic Plan for Economic Development 2015 Work Program 8. Directors Report 9. Adjourn Attachments: March, 2015 Building Permit Report Foreclosure Report dated March 31, 2015 from the Dakota County CDA "Job Vacancies Climb to 88,900 in Fourth Quarter," Minnesota DEED News Release, March 31, 2015 "State Gains 7,800 Jobs in March," Minnesota DEED News Release, April 16, 2015 "Two TIF Deals, Two Very Different Strategies," Mpls./St. Paul Business Journal, 3/13/15 "Amazon plans to employ 1,000 at new distribution center in Shakopee," StarTribune, April, 22, 2015 "Subsidy for Amazon faces scrutiny in Shakopee," Finance and Commerce, April 22, 2015 Memorandum T!'I No. -3 City of Lakeville Community & Economic Development To: Economic Development Commission Tck From: Rick Howden, Economic Development Specialist Copy: David L. Olson, Community & Economic Development Director Justin Miller, City Administrator Date: April 24, 2015 Subject: Election of Officers In line with new board and commission appointments made by the City Council on March 26th, EDC election of officers will take place at this month's meeting. EDC members elected Glenn Starfield as Chair, Sheila Longie as Vice Chair, and Joe Julius as Secretary for 2014. Action Requested: Commissioners are asked to elect officers to serve the 2015 year. CITY OF LAKEVILLE ECONOMIC DEVELOPMENT COMMISSION MEETING MINUTES March 24, 2015 Chair Starfield called the meeting to order at 4:30 p.m. in the Marion Conference Room at City Hall. Members Present: Comms. Starfield, Emond, Matasosky, Vlasak, Collman, Longie, ex -official members Tim Roche, City Administrator Justin Miller, and Mayor Matt Little Members Absent: Comms. Tushie and Smith Others Present: David Olson, Community & Economic Development Director; Rick Howden, Economic Development Specialist. 2. Approval of January 27, 2015 meeting minutes Motion Comms. Emond/Longie moved to approve the minutes of the January 27," 2015 meeting as presented. Motion carried unanimously.' 3. Discussion of 2014-2016 Strategic Plan for Economic Development 2014 Work Program Mr. Olson presented an update of the Strategic Plan for Economic Development 2014 Work Plana An informal discussion started with Strategic Initiative A: Conduct a market analysis to determine target markets with a special emphasis on higher education which supports Strategic Priority 1: High Skill, High Wage Jobs. Mr. Olson stated that as previously discussed with the EDC, that it would not be cost- effective to hire an outside consultant to conduct a market analysis and that there was a great deal of information available for the Twin Cities Region through Greater MSP and the University of Minnesota's Humphrey School of Public Affairs. This information will be utilized to identify industry clusters that are present and active in Lakeville as well as to identify the industry clusters, markets and businesses that the City should market toward. A question was raised in regard to staff's capacity to actively market business in certain industries due to the likelihood of a heavy workload in 2015. Commissioner Longie suggested that an action item be added to the 2015 Work Plan which would revive the Marketing Committee to enhance the City's marketing efforts without a burden on staff's time that she would lead. At this time, Mayor Little provided an update to the EDC on the recent City Council retreat that took place on Saturday, March 21 st. Mayor Little stated that the Council discussed utilizing the EDC as an outreach team with protocols in place to respond to certain developments with potential and existing business news. Reactivating business retention visits and the "Spotlight on Business" program, attainable workforce housing and transportation from Park and Ride sites and the industrial park were also discussed by the Council. Financial incentives in regard to fees were also discussed by the Council. This includes a study to evaluate all of the City's fees and compare to other suburban cities in the Twin Cities Metro Area. Also discussed were fee waivers, fee financing and the City's overall fee policy could assist in the City's economic development. The Mayor also touched on discussion surrounding downtown Lakeville and his desire to have this area be different and better than any other city. In order to accomplish this, Mayor Little suggested that one potential area to address would be increasing density in order to have more people closer to downtown. In order to achieve this, condo policies and height restrictions on buildings downtown should be looked at and potential changes made. Mr. Olson reviewed 2014 Progress on Strategic Priority 2: Infrastructure to Leverage Opportunities including Co. , Rd. 50/Kenwood Trail Economic Development Study, the Alternative Urban Areawide Review (AUAR) for Interstate South Logistics Park and the City's recent use of Tax Increment Financing. Due to the time, the rest of the work plan was reviewed individually by the EDC. Mr. Olson stated that staff would take the, EDC's comments and those from Mayor Little on behalf of the City Council and draft a 2015 Work Plan for discussion at the April 28th EDC Meeting. 4. Update on the Status of the County Road 50 Study Mr. Olson stated that the City and County have retained Hoisington Koegler Group Inc. and SRF for an Economic Development / Planning Study for the proposed expansion of Co. Rd. 50/Kenwood Trail between Dodd Blvd. and Ipava Ave. The purpose of the study is to review options to mitigate the impact on existing businesses adjacent to the County Road. Staff has had numerous meetings with the existing businesses along this corridor and are close to coming up with a concept that is agreeable to all of the business owners. Once a concept is approved, then the challenge will be coordinating the implementation. 1 5. Director's Report Mr. Olson reviewed the Director's Report. City staff recently confirmed United Products/Allied closed their business location at 21470 Grenada Avenue in Airlake Industrial Park. The company plans to lease the property which consists of a 45,000 square foot building on nearly 10 acres. Mr. Olson also mentioned the letters that were recently sent to MOM Brands by both the City of Lakeville and the State of Minnesota indicating our willingness to work with them and Post Holdings to attempt to ensure that they maintain a base of operations in Lakeville. Mr. Olson mentioned that the City Council re -appointed Jim Emond Sr. and Sheila Longie to fill the remaining one and two year terms created by the resignation of Joel Akason and Joe Julius. The new members that were appointed to three year terms are Quenton Scherer with Metro Equity, Bob Gillen, owner of Porter House Restaurant in Lakeville along with other restaurants in other communities, and Steve Rajavuori with REI Property Management. 7. Adjourn Meeting adjourned at 5:56 p.m. Respectfully submitted by: Rick Howden, Economic Development Specialist City of Lakeville Community & Economic Development Memorandum To: Economic Development Commission From: David L. Olson, Community and Economic Development Director Copy: Justin Miller, City Administrator Rick Howden, Economic Development Specialist Date: April 24, 2015 Subject: Review of Requested Amendment to the Contract for Private Development with ImageTrend 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 Contract established a sale price of $627,589 for the property. 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 the 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 in addition to the just under 100 jobs that existed in 2009. As the attached letter from Mike McGrady of ImageTrend indicates, the company completed their first phase expansion of 27,000 square feet at the end of 2011 and has created 60 new jobs which is nearly three times the number of new jobs required under the contract. ImageTrend has the capacity to add an additional 100 employees in their existing building over the next three years. Mr. McBrady will be in attendance at Tuesday's meeting to provide additional information on ImageTrend and the anticipated growth of the company. An amendment to the original Contract for Private Development was approved in March of 2013 that extended the completion of the second expansion phase from November 2013 to December 2015. Based on current hiring forecasts, , ImageTrend will not need additional office space until the end of 2018 and as a result they are requesting an amendment to the current Contract for Private Development to extend the completion date from December 31, 2015 to December 31, 2018. At this point, ImageTrend will have completed their second phase expansion and will have grown to approximately 300 employees. ImageTrend continues to be a fast growing company in Lakeville and has met and far exceeded the original job creation goals that were put in place in the 2009 Contract for Private Development. The jobs that are being created at ImageTrend are the high -skill and high wage jobs that have been identified as one of the goals of the City's Strategic Plan for Economic Development. Staff recommends approval of this requested contract amendment to extend the completion date for the second building expansion phase to December 31, 2018. Action Requested: Staff is requesting a recommendation from the EDC to the City Council to amend the Contract for Private Development with ImageTrend to extend the completion date of their Phase B expansion from December 31, 2015 to December 31, 2018. March 30, 2015 David Olson Community & Economic Development Director Lakeville City Hall 20195 Holyoke Ave. Lakeville, MN 55044 Re: Contract for Private Development dated August 31d, 2009 Dave: As you remember in August of 2009 ImageTrend entered into a Contract for Private Development with the City of Lakeville. At the time we owned and occupied the 33,000 sq. ft. of office space that housed our then just under 100 employees. The contract was entered into with the understanding that ImageTrend would continue doing business and grow herein Lakeville. We have done just that and plan on continuing. We have increased our employee base from 100 to 160 during that period. This is many times the jobs we agreed 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. We later amended that agreement with the City of Lakeville to have Phase B completed by December 31, 2015. As we look to the future and our growth rates, below is how we see ImageTrend growing over the next few years. • We have space for another 100 employee 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 2017 in excess of 20,000 sq. ft. • We would construct the second Phase B building in the summer of 2018. 20855 KENSINGTON BLVD LAKEVILLE. MN 55044 TEL- 1,952.469., 589 46 IMAGET�REIVD IN+C. pAx�1.952 98'5.6671 WWW IMAGETRENP COM • Upon completion prior to December 31" 2018 we will have fulfilled our Phase B obligations completing our agreement. • We would move in late 2018 -- early 2019. We would have the second building occupied in 2019 with about 300 employees. We would then expand into that space for years to come as the business continues to grow. We are asking the City of Lakeville for an amendment to our building Contract for Private Development agreement to accommodate these plans. This simply extends our Phase B completion date from December 31" 2015 to December 3 l' 201 B. Let me know what the next step may be. Best Regards, 20855 KENSIN43TON BLVD LAKEVILLE. MN 55044 TEL- 1 952 4$9.1589 FAX -1 952.99'5.5571 WWW IMAGETRENO COM F IMAGETREND SNC C31 -S# Bar I Opp 0 C - - - - - - - - - - - - - - -- il I ---------------------------- f I IT- "M%d I" ti" i - - - - - - - -- 15 -- - - - - - - - - - - Ise suRrAcr STA NOTE: THE EXISTING 31,200 SF BUILDING AT THE CURRENT OFFICE/WA REHOUSE RATIOS REQUIRES 139, PARKING STALLS. SITE STUDY C 2 -STORY BUILDINGS WITH SURFACE PARKING AND UNDERGROUND PARKING GARAGES II EAST SITE: 26,600 SF ADDITION WEST SITE: 44,000 NEW BUILDING f i 12.600 ADDITIONAL SF I I EXISTING EAST: 31,200 SF I 1 103,800 TOTAL SF L------------------------- I ---- &0 STALLS 10 STALLS X, Q IMAGE TREND SITE STUDIES 2-2-2009 SCALE: 1'- 00-0- ko"H It so 0 200 100 0 100 3 114 STALLS V F f rM•I r -M yl !Ifv, -4— %lH •064 M1 F L H Moz O 20. a O U N N U rn GI a C f0 a XID ~ C w M U o N m -a G> ca f6 a U O ;� m O t v J a o F f rM•I r -M yl !Ifv, -4— %lH •064 M1 F L H Moz O 20. Receipt# 263612 T713689 TORRENS FEE $46.00 Recorded on: 3/28/2013 02:33:50PM By: SJS, Deputy Certificate #: 147341 Return to: CITY OF LAKEVILLE 20195 LYOKE AVE OLAKEVILLE, MN 55044 Joel T. Beckman Registrar of Title Dakota County, MN 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 /!91'4 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; RECEIVEECEIVED MAR 2 P 2013 MAR Z 0 2013 169063 1 DAKOTA COUNTY Ti4XATlQN & DAr`:U i rt �uUialTY fA; I:iK)N & RECOF06 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: 1. 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 LIE VIR STATE OF MINNESOTA ) )ss. COUNTY OF DAKOTA ) Charlene Friedges, The foregoing instrument was acknowledged before me this / � 6 ) g g g day of l�'ld� , 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. PENNY6R M(3 RIM-,NNOTARY PUBLIC • RINNZSTAtqCOmmission EiresJen31,2o15 Notary Pu is 169063 2 STATE OF MINNESOTA ) )ss. COUNTY OF o`6 ) The foregoing instrument was acknowledged before me this 1 4 k day of , 2013, by KcLaA M,mcand Vai , the ---Fr.3 tAe and i" �ecr respectively of ImageTrend Development, L.L.C., a Minnesota limited liability company, on behalf of the company. Notary Public DRAFTED BY: �T4 CAMPBELL KNUTSON, P.A.JA 1380 Corporate Center Curve, Suite #317'.rTe<®REBS 1 PiotaZoAro ry PUWIC-M"'n�sota an Eagan, Minnesota 55121 �.; ' MY cort+'�ri �'�"�S'°,�vv Telephone: (651) 452-5000 AMP 169063 3 EXHIBIT "A" LEGAL DESCRIPTION OF THE PROPERTY Lot 4, Block 1, Fairfield Business Campus 2nd Addition, Dakota County, Minnesota 169063 Memorandum n No. City of Lakeville Community & Economic Development To: Mayor and City Council Economic Development Commission From: David L. Olson, Community and Economic Development Director Copy: Justin Miller, City Administrator Rick Howden, Economic Development Specialist Date: April 24, 2015 Subject: Review of Preliminary Tax Increment Financing Application from Mendell Inc. The City recently received an application for Tax Increment Financing (TIF) assistance from Mendell Inc. Mendell is a medical device manufacturing company located 21463 Greneda Avenue in Airlake Industrial Park. Mendell relocated from Bloomington to Lakeville in 2003 and currently operates in a 28,600 square foot building and currently has approximately 94 employees. As a result of continued growth of their business, Mendell is proposing to construct a 18,200 square foot addition to their building and add 12-25 new jobs over the next two years. The average salary of these jobs will range from $51,000 to $59,300. Bryan Bartz, President of Mendell Inc. will be present at both the City Council Work Session on April 27th and the EDC Meeting at April 28th to discuss company's continued growth in Lakeville. The request for Tax Increment Financing is to assist in filling a project financing gap of approximately $436,612. Mendell is also in the process of submitting an application to the State of MN Job Creation Fund program which is administered by the MN Department Employment and Economic Development (DEED) to fill a portion of the project financing gap. The City Council approved a resolution of support of this application at the April 20th City Council meeting. The level of assistance under the Job Creation Fund program is determined by the number and wage level of the actual jobs that are created and retained for at least one year as well as the total capital investment in building improvements for the project. The plans for the proposed expansion were forwarded to the County Assessor's Office to determine the estimated market value of the Mendell property after completion of the expansion. The Assessor's Office has determined that the range of the market value for the expanded Mendell building to be between $52 to $56 per square foot. Using the higher end of this range results in a net increase of market value for property tax purposes of $1,047,200. This results in a total estimated amount of $114,000 of tax increment being available during the nine year period in which tax increments can be captured for an Economic Development TIF District. The TIF application from Mendell indicates that any TIF assistance be provided on a pay-as-you-go basis which means that TIF funds would be reimbursed on an annual basis after the payment of property taxes has occurred. This eliminates any financial risk to the City. While the amount of available TIF assistance for this project does not fill the financing gap, when matched with State of MN Job Creation Fund reimbursements, should be able to offset the majority of the financing gap for this expansion project. It should also be noted that TIF funds are only available to reimburse eligible site improvements which are currently estimated at $359,000. Requested Action: If the Council and EDC support this preliminary request from Mendell for TIF assistance, the next step would be for the City HRA Board and City Council to call for a public hearing to consider the creation of a new Tax Increment Financing District and retain Springsted to prepare the required TIF Plans and notifications to Dakota County and ISD #194. April 21, 2015 Mr. David Olson Community and Economic Development Director City of Lakeville 20195 Holyoke Avenue Lakeville, MN 55044 Dear David: Re: Proposed Expansion — Incentive Request Specializing in Prw:ision Machining of Custom Pi;sd,'cat awica Components Thank you for previously meeting with our firm over the past two years to discuss and seek solutions for our proposed expansion and the potential assistance the City of Lakeville can provide. We sincerely appreciate how creative your staff has been to investigate scenarios/options that: • Maximize building expansion and employee parking opportunities • Storm water solutions, pond sizing and locations We include, for your consideration, the application form, fee and additional information for your review. Please proceed with your process — time is of the essence. I rely, Bryan z, PC17 President SSI 21463 Grenada Avenue Lakeville, MN 55044 phone 952.469.5500 fax 952.469.5511 weww.mendell.com CIT`' OF LAKEVILLE TAX INCREMENT FINANCING I ARPLICATION PROJECT: Mendell Addition 1. Business Name: Mendell, Inc. Address: 21463 Grenada Ave., Lakeville, MN 55044 Telephone: 952-469-5500 Contact: Bryan Bartz 2. Brief description of the business: Precision machine shop for the medical device industry. Mendell specialized in high precision machining of implantable devices, surgical instruments and diagnostic equipment. 3. Present ownership of the site: Lakeville Technologies, LLC. 4. Proposed project: (Building square footage, size of property, description of buildings — materials, etc.) The addition will be approximately 18,700 sq. ft. and will expand the existing manufacturing operation as well as facilitate warehouse and shipping/receiving activities. The construction materials will match the existing building — architectural concrete wall panels with steel bar joist/deck roof. The extensive windows will enhance the production areas within the building. 5. Total Estimated Project Costs: a. 1. Land Acquisition 1.18 acres $ 215,883.00 est. 2. Plat/Land development $ 79,552.28 est. b. Site Development $ 359,697.00 est. C. Building Cost $1,254,235.00 est. d. Soft Costs (Design/Engineering) $ 273,548.00 est. e. 1. Financing Costs $ 65,204.00 est. 2. Impacts from Incentives • TIF Application costs Not included • TIF/DEED Benefits Not included f. Contingencies Included 3% Total $2,248,119.28 est. 1 6. Estimated Project Costs Eligible for TIF Assistance (i.e. Acquisition, Demolition, Site Improvements, Utilities, Streets): a. Land Cost $215,883.00 b. Road Cost N/A c. Site Improvements $359,697.00 7. PLEASE SUBMIT PROJECT PROFORMAS SHOWING NEED FOR ASSISTANCE (I.E. WITH ASSISTANCE AND WITHOUT). See attached "Exhibit A" (Lease Market Study) 8. Total Estimated Market Value at completion: $2,854,300.00 approximately 9. Estimated real estate taxes upon completion: $104,191.00 +/- approximately 10.Source of Financing a. Equity TBD b. Bank Loan TBD c. TIF (Gap) Up to $436,612.00 Total TBD 11. Amount of Assistance (Estimated Gap): $436,612.00 +/- 12.Type of Assistance Requested (Upfront or Pay -as -you -Go): Pay as you go 13. Name & Address of architect, engineer, and general contractor: APPRO Development, Inc. 21476 Grenada Ave. Lakeville, MN 55044 Contact: Jack Matasosky 952-469-2171 2 14. Project construction schedule: a. Construction Start Date b. Construction Completion Date c. If phased project: N/A July 1, 2015 approximately December 1, 2015 2015 Year 100% Complete 15. State specific reasons why assistance is necessary for the project (the "abut for" test). The construction costs for the addition — when combined with the original building — are excessive for "market rate" rents and cost capitalization. Please review attached lease pro -forma study. 16. Please indicate how the project would meet one or more of the following: Economic Development goals; creation of jobs that pay wages adequate to support households, job retention, or tax base expansion. The project will keep 93 jobs, paying an average of $60,200.00/year. The company anticipates an additional 12-25 jobs, paying an average of $51,000.00 to $59,297.00 /year. Hiring of these positions is anticipated to begin as early as April 2015. The typical Mendell employee is a highly trained machinist and these jobs are highly valued in the community. The building design is a tribute to the company's employees — incorporating the highest quality of infrastructure and finishes to create a great working environment. 17. Municipal Reference (if applicable). Please name any other municipalities wherein the applicant, or other corporations the applicant has been involved with, has completed developments within the last five years. The company moved to Lakeville from Bloomington, MN in 2003. The company expanded their building in 2008 and has once again outgrown their present space. 18.Additional Comments: 19.Submit this form along with an initial $500 nonrefundable application fee. An additional fee of $5,500 will need to be submitted should the request for assistance proceed. ADDITIONAL DOCUMENTATION AND CHECKLIST Applicants will also be required to provide the following documentation. 3 All personal financial information will be kept private and confidential. ❑ 1. Written business plan or a description of the business, ownership/ management, date established, products and services, and future plans. ❑ 2. Two year financial projections, or if housing project, or leased space, include a 10 -year operating pro -forma. ❑ 3. Letter of commitment from other sources of financing, stating terms and conditions of their participation in the project. ❑ 4. Initial nonrefundable application fee of $500, with a $5,500 fee to follow should the request for assistance proceed. In addition to defraying the cost of staff time, the fee will be used to pay costs associated with processing this request for financial assistance such as legal, engineering and financial analysis. The City reserves the right to stop the processing of the request until additional fees are paid should the original amount be insufficient to pay such costs. That portion which remains unspent, if any, will be returned only if the project is denied approval. ❑ 5. Attach the following documentation: Part 1 — Corporation/Partnership Description Part 2— List of Shareholders/Partners Part 3 — Description of Project Exhibit "A" Part 4 — But For Analysis Part 5 — List of Prospective Lessees Part 6 — Legal Description, Property Identification Numbers, maps of the project area, and project renderings Part 7 — Public Purpose Narrative Part 8 — Sources & Uses of Funds — Additional Information Exhibit "B" Jobs data The undersigned certifies that all information provided in this application is true and correct to the best of the undersigned's knowledge. The undersigned authorizes the City of Lakeville to check credit references, verify financial and other information, and share this infor ion with other political subdivisions as needed. The undersigned also a ees to rovide anynon.ittioI information as may be requested by the City after th filing of this applica Applicant Name By Bryan Bartz Its CEO Date April 21, 2015 Cc: Jack Matasosky, APPRO Development, Inc. 0 Mendell, Inc Office Manufacturing Automated Manufacturing/Warehouse Warehouse Mezzanine Total Lease Study 4-21-2015 Existing Building 41,505 sq. ft. 1,243 sq. ft. 23,502 sq. ft. 3,240 sq. ft. 32,490 sq. ft. Site Area 1.89 Acres Off-site (market) lease rates: With Proposed Addition 7,359 sq. ft. 4,277 sq. ft. 36,314 sq. ft. 3,240 sq. ft. 51,190 sq. ft. 3.07 Acres Exhibit A Office 7,359 sq. ft.@ $10.00/sq. ft. (midpoint) $ 73,590.00 (cost range $7.50 - $12.50 sq. ft./net) Manufacturing 4,277 sq. ft.@ $6.60/sq. ft. (midpoint) $ 28,228.00 (cost range $4.70 - $8.50 sq. ft./net) Automated Manufacturing/Warehouse $181,570.00 36,314 sq. ft.@ $5.00/sq. ft. (midpoint) (cost range $4.20 - $5.80 sq. ft./net) Warehouse/Mezzanine 3,240 sq. ft.@ $4.10/sq. ft. (midpoint) $ 13,284.00 (cost range $3.60 - $4.60 sq. ft./net) Approximate net rent/year $296,672.00 (Target Rate) Actual project costs/lease capitalization rates: Land (total acreage 3.07 acres) 133,730 sq. ft. $ 561,663.00 Building shell costs — Original with addition $3,300,000.00 Tenant Improvements — Production specific — original w/addition $ Not Included Finance costs (assumed) $ 65.204.00 Total Project Cost $3,926,867.00 Lease Capitalization (usin14 actual costs): $3,926,867.00 @ 8.5% CAP rate = $333,784.00 Actual Lease Rate $333,784.00 (Actual Lease Rate) — $296,672.00 (Target Rate) = $37,112.00/year (gap) $37,112.00 (gap) — 8.5% (CAP rate) = $436,612.00 (project cost gap) G4 rl o N •� N r_ O CL a W L fQ C M m N 0 0 0 0 O 00 0 O LO 0 0 0. 0 yl O 0 r� 0 Ln 00 O Ln Ln M o O o o o 0 r� 1, O n O Ln Ln 0 0 0 O AO Il 00 00 lD Lr) 00 n O V)- c I V)- t/} LD N t/} t/} bA lfl O O O O ,4 en O LD O t/} V} t/1• V} V). V). 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C C O L aJ O H L c Y , Q 4J _ C b0 O W > C O � •� Lu U f0 4J N yE U >C_ cu (0 ,m G V = Q Q * dF dE 9F jF dF leuOissa}OJd V)- V} if,, V} V)• V} V} lfl Ln ri N 0 � N Ln r -i r -i N r� V>• I Vr N O N O O ri ri 1 LD lepisnpul v m 0 0 K E v -0 v v Ol v m v E E 0 v E � m c U N +J U C — 0J � !_ Q N Q CL :u Q c OD bA Q C U C C en w m Q•1 NIn bOD U Y L cu i t t L -r- L, Cb U ,n G ccU G CCU G CCU G U J LL jF �F 9F iE lepisnpul v m 0 0 K E v -0 v v Ol v m v E E 0 v E � m c Mendell, Inc Employees by City As of March 31, 2015 City Headcount % Apple Valley 2 2% Bloomington 9 10% Burnsville 2 2% Dundas 1 1% Eagan 8 9% Eden Prairie 1 1% Elko 2 2% Faribault 2 2% Farmington 9 10% Hastings 1 1% Lakeville 18 19% Lonsdale 3 3% Maplewood 1 1% Medford 3 3% Mendota Heights 1 1% Minneapolis 2 2% Montgomery 2 2% New Hope 1 1% New Prague 4 4% Northfield 4 4% Oakdale 1% Pine Island 1 1% Prior Lake 2 2% Randolph 1 1% Richfield 2 2% Rosemount 3 3% Saint Paul 1 1% Savage 2 2% Shakopee 2 2% South St. Paul 1 1% St Paul 1 1% Grand Total 93 Z=. 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W to " N N v L� -0 - 2 i t- ro '0 = * N O O C C4=Z_C ®O tf ro C Ln L. :a✓ N -0 — O N II1 m U � C is U! C = o ccu 0 4 —0 c v>1 'A to O = 'm ro E 'c N (/0] rra m_ ro ._ ro fb Gi w +' -p - (31 > ro m U, AN I.L X C A4J N Ems— Q¢+�54 E v LLro 0 10 C= �+ i ro =O E ro r0 ECO O m¢ L rp N L L w L w "c J Q cid D- 0) 0- N N Cr: D ol ro ll O C 'O U ZI C rA A U� - C O O) 4) Q) C= ro QU owmccp1O> 0`o LL C7 C, U) a) Ln 7 0� C) ro u) E$-' C7 OU M ro 0)� U � C CY 0 o x ii U) M ,: IM C O m U N Springsted Incorporated 380 Jackson Street, Suite 300 Saint Paul, MN 55101-2887 Tel: 651-223-3000 Fax: 651-223-3002 www.springsted.com DRAFT MEMORANDUM TO: David Olson, Community and Economic Development Director FROM: Mikaela Huot, Vice President/Consultant DATE: April 22, 2015 SUBJECT: Preliminary Financing Projections for proposed new TIF project (Mendell Expansion Project) The City of Lakeville has received a Tax Increment Financing (TIF) assistance application for the proposed expansion project of an existing business. The applicant, Mendell, Inc, is proposing an approximate 18,700 square foot expansion to its existing facility to accommodate future growth of the company. The purpose of this memorandum is to provide a summary of Springsted's review of the preliminary application and preliminary tax increment revenue projections based on the information made available to us relative to the proposed project. Tax Increment Assumptions Springsted made certain assumptions to calculate the estimated amount of tax increment revenue generated by the proposed new project. Those assumptions include the following: Tax Increment Financing (TIF) District — Economic Development For our analysis we anticipate that the proposed project would qualify under the Tax Increment statute as an economic development district. • Economic development districts must consist of a project that is in the public interest because: o It will discourage commerce, industry, or manufacturing from moving their operations to another state o It will result in increased employment o It will result in preservation and enhancement of the tax base ■ Qualification as economic development TIF District i Maximum TIF District term o 8 years after receipt of first increment o 9 total years • Base value: o Existing land and building City of Lakeville, Minnesota Proposed TIF District No. 20: Mendell Expansion Project April 22, 2015 Page 2 o PID: 22-31060-01-010: $1,769,700 • Estimated incremental value estimated to be new building value only 0 18,700 square foot building expansion o $56/square foot estimated valuation o $1,047,200 • Construction complete prior to December 31, 2015 o 100% assessed in January of 2016 for taxes payable in 2017 • Payable 2015 tax rates remain constant through district term o City: 38.948% o County: 29.633% o School: 31.459% o Other: 5.033% o Total: 105.073% sk Fiscal disparities contribution rate of 39.37227% o Contribution made from TIF district property • Current class rates remain constant through district term • 3% annual market value inflator • Developer Payment 0 95% pledged to TIF costs 0 5% withheld for administrative expenses Tax Increment Revenue Estimates Thank you for the opportunity to be of assistance to the City of Lakeville. Please let me know how we can best assist you as this project moves forward and should you have any questions please feel free to contact me at 651.223.3036 or mhuot j( springsted.com. Projected Amount Estimated total gross revenues $120,260 Estimated City Retained Amount 5% $6,014 Estimated Total Net Revenues $114,246 Estimated Present Value date of 6/30/15 and 4% interest rate $89,617 Thank you for the opportunity to be of assistance to the City of Lakeville. Please let me know how we can best assist you as this project moves forward and should you have any questions please feel free to contact me at 651.223.3036 or mhuot j( springsted.com. 0 O~ r Q 0 0� rl- N N Cf) C _O O d M O O O O O) CA 0) (A 00 (fl W Z00 d9 O O M V IQCOO ONO M O ;.St N (6 _ C N y N � M ti' Z � r N o O V N 0 Iq ur o (O CMD CND CO (O CD (O (O CO (O (O (O (O O ,C O r O J N O r N LO V3 U O 00 L _ C:O XN O M N Lo M CM r- N (O f6 O I- E O OD O O N M Iq CO n M N N M M M CM M M M N O J 6 N r 0 r r r r r r r r r (n Z C(O OO = O O O (O n n 00 co O Cn O O VIT V V V (n LO V C7 N Q U O � � N .O3 M (A � 4) J � Q (J o U Z U O O V' co N 00 (O (n ui (o O � cu (6 0 000 a N V (I(9 (O O 00 NO � ID C E M y � - -- M C,4 N- -- r O N 0 O (� b3 Vj V M CA r co (LO (MO cn w -r, ihb�ihc�MMcoc�Mcncn n n n n n n n n n n n (D -o0000000000 E m� �LOLOLOLOLO�LOLOLO 0ui 0 0 0 0 0 0 0 0 0 0 U L C N O O CO O M M 00 r O (C) NNNOO LO N V d H C(O OO N 2 +3' CL(O � � � 4) o U Z U Z a ++ o V (h O O M CO 00 0 '7 O N N Vj V M CA r co (LO (MO 0 3 N (i ti (n o0 00 00 0o ao 06 600 N O N M NCO co d Q C V r V V V V V d' V' d• a c d� O N C U V V V d V V M Cl) M M Cl) Cl) M M Cl) M 0 V ❑� 3 J O Z n� v LU O Q� •� C7 Nr IT n M 0 CO (O O M C O v 01 C C C X ,-' (0 m m ( tq W O N'T (00 W r O O +a H m CL M It V �� LO LO u) (n (D (4 (D M M (() CO LO LO LO (O LO (() LO CN E O Cf CL m C z m i x W C �% C V W +� _= C -a Y O O O N C� a0 O W O O O n It CO N N V CO CO O O CO n n CO O O N Cl) N �( N NCMv(()n 00 OO x d/if C ` �' Y n1- OO mmwOmwm LL LO +' N (� > = = C w w r r N N CV N N N (V N N (DH(7 'a Y Nm J (ll N M N r V J d LL H R a O= N N N N N N 0 '0 C!1 Q) �o.ac o w= °xo C •� y r haw M M M M M M M M M M M rrrrrrrrrrr - - - - - ---- -- v�¢a a c��a`a I It a 1 0 _ (A0 g gm y �g�ooi Cn m�ao IN 11111111111111MI([(( I It 3Nn A-LH3dOHd -- -- — �--- __-- i JJ I 51 uu � 11y sll'I hi H3�Pl. 133a1S 439LZ I n 4 I /A, g do"5/'\ a 1 0 _ (A0 g gm y �g�ooi Cn m�ao 3Nn A-LH3dOHd -- -- — �--- __-- i JJ I 51 uu � 11y sll'I hi H3�Pl. 133a1S 439LZ I n 4 I /A, g do"5/'\ nta:k�Rvil'lze Memorandum 7, �-I' im N o. City of Lakeville Community & Economic Development To: Economic Development Commission From: Rick Howden, Economic Development Specialist Copy: David L. Olson, Community & Economic Development Director Justin Miller, City Administrator Date: April 24, 2015 Subject: 2015 Strategic Plan for Economic Development Work Plan In January 2014, the City Council accepted the EDC's 2014-2016 Strategic Plan for Economic Development. This plan has provided the EDC and staff with a basis to focus on specific initiatives during this three-year period. The 2014 Work Plan Update as discussed at the EDC's March meeting serves as the foundation for the activities staff will pursue in 2015. Please review the attached draft 2015 Work Plan for an update of the actions identified by the EDC and City Council. Target dates will be developed once the work program has been approved. Recommended Action: Staff is requesting EDC consensus on the draft 2015 Work Plan. 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Q O Lnct y O O O 0 O by C 4-JCU O E CZ Q O 0 En 31 cz -O > m �. iUO t Q W5 C]" X ct 'O 4� O 'EV1 b w O Ca ;Ei c� O V cz O °' cC ct co v U LU y O 4Js. (, V O O cz SOA V U '��' .& C),� w ,> 4O > •�rA 4-J �r Q. O 4- V A V) 4-1o o � bA O O cz A U vii b Q J bA cC Qi CC ¢i 4-.+ O •� v bA Z: Q" � y � O N �sem. Ei 00 0 4.o ' U y = = � Vj = .fl o V w C[.' N bD bA Cd ++ 0 O ;.. y r. (u co tz" = O 6 cz O ^d . -4:: 4Jv °' °' o uA V) Q Q o 0 �. cc vii' cxd V a oG C. = E G, v Laklte Memorandum 0. City of Lakeville Community & Economic Development To: Economic Development Commission From: David L. Olson, Community and Economic Development Director Copy: Justin Miller, City Administrator Rick Howden, Economic Development Specialist Date: April 24, 2015 Subject: April Director's Report The following is the Director's Report for April, 2015. Building Permit Report The City has issued building permits with a total valuation of $43,886,952 through March. This compares to a total valuation of $31,697,031 for building permits issued through March of 2014. The City issued commercial and industrial permits with a total valuation of $19,013,000 through March compared to a total valuation of $1,651,000 during the same period in 2014. Three building permits issued in the month of March accounted for majority of this amount. The City issued permits for the new Lakeville Medical Office Building located on 185th Street near Kenwood Trail, the Fulford Warehouse expansion for BTD located on Cedar Avenue south of County Road 70, and the FedEx Freight building to be located at the intersection of Dodd Boulevard and County Road 70. The City has also issued permits for 56 single family homes through March with a total valuation of $18,761,000. This compares to 81 single family home permits through March of 2015 with a total valuation of $28,074,000. The City has issued permits for 10 townhome units through March with a total valuation of $2,504,000. This compares to zero townhome permits issued through March of 2014. Recruitment & Retention: Tips & Strategies for a New Era Event This event was sponsored by the Dakota County CDA and Dakota -Scott Investment Board. It was held on Wednesday, April 22"d at the Ames Center in Burnsville. The featured speaker was Jody Thompson with Results -Only Work Environment (ROWE). A panel discussion during the event included representatives from BTD Manufacturing and MOM Brands. Approximately 60 persons attended this free event. Rick Howden served on the planning committee for the event. Page 2 Angry Inch Brewing Company On April 23rd, the Planning Commission approved a Conditional Use Permit to allow a small brewery and taproom operated by Angry Inch Brewing Company. The taproom will be in the former Ace Hardware building, which will also be occupied by Motley Crews Heavy Metal Grill. This is the first brewery and taproom for the City of Lakeville following a Zoning Ordinance amendment in 2014 to allow this use. America's Best Communities Prize Update Frontier Communications along with DISH Network and CoBank are sponsoring the America's Best Communities Prize competition among communities throughout Frontier Communications' 27 state service areas. The City of Lakeville along with the Lakeville Area Chamber of Commerce and Lakeville Area Public Schools submitted an application in March. On April 29th, 50 quarter -finalists will be announced and will receive $50,000. There were 347 communities that applied for this award including six from Minnesota which are; Apple Valley, Burnsville, Chisago, Fairmont, Lakeville and Worthington. Development Update On April 20th the City Council approved the Preliminary and Final Plat and a Conditional Use Permit for SuperAmerica Gas Convenience Store to be located in the TimberCrest shopping center on 185th Street. This new SA will be located at the corner of 185th Street and Orchard Trail just east of Buffalo Wild Wings. The City also recently issued the building permit for the Heavy Metal Grill which will be remodeling the south half of the former Ace Hardware Store in Downtown Lakeville on Holyoke Avenue. 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Dakota County M_ Community Development I. Agency CDA To: Dakota County Cities From: Lisa Alfson Date: March 31, 2015 Re: Foreclosure Update Dakota County Stats — February 2015 • # of Sheriff Sales in February — 36 (compared to 57 in February 2014) • Total Sheriff Sales for 2015 — 101 (compared to 129 Jan. -February 2014) • # of Notices of Pendency Filed in February — 93 • # of Notices of Pendency Filed in 2015 — 187 A Notice of Pendency is filed by a mortgage company's attorney as official notification that the foreclosure process has begun. Not all of these result in Sheriff Sales. Mapping Using Dakota County GIS httl2://gis.co.dakota.mn-us/website/dakotanetgis/ The Dakota County Office of GIS is updating the 2015 Foreclosures and Notice of Pendency layers on a monthly basis. If you need assistance using this Web page, please call Randy Knippel or Mary Hagerman with the Office of GIS at (952) 891-7081. If you have any concerns, please call me at (651) 675-4467 or send me an email at lalfsonO-dakotacda.state mn us. Dakota County Foreclosure History At -A -Glance Eight years has gone by since the foreclosure crisis began, and most communities seem to be recovering. In Dakota County, foreclosure numbers indicate that housing is headed in the right direction. From the 2000-2006 "pre -crisis period," the average total Sheriff Sales per year was 354. Last year, there was a total of 680 Sheriff Sales, which is a significant decrease from the peak of the foreclosure crisis in 2010, when 2,147 Sheriff Sales were recorded. ILP: CDA Dakota County Community Development Agency The following chart illustrates the past 14 years of Dakota County Sheriff Sale history. 2500 2000 1500 1000 500 Dakota County Sheriff Sales 206 147 1860 1581 880 925 6 36 4' 454 tic- --- -. 80 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 # Sheriff Sales In 2014 the Minnesota Homeownership Center (HOC) conducted a review of homeowners served by the Center's Network. HOC noted that factors such as loss of job/reduced household income, medical bills, and divorce accounted for almost 75 percent of foreclosures in the state. Although Sheriff Sales are on the decline, a number of factors still make it difficult to know when they will return to pre -crisis levels. For example, December 2014 figures from the U.S. Bureau of Labor Statistics showed that the unemployment rate in Dakota County is back to pre -crisis levels at 3.2 percent, however, many households still live on a very tight budget because they earn much less than they did a few years ago. Additionally, many homeowners may never be able to recoup the equity they lost when housing prices plummeted, and as a result, the risk of default still remains a real option for many families. Nevertheless, as the economy continues to improve, housing prices appreciate, and more mortgage loans are made under a more stringent underwriting standard, it is safe to predict that foreclosure numbers will continue to fall. The HOC report can be viewed in its entirety at http://www.hocmn.orv—/reports-resources/stateofhomeownership/. 1. w w t. C V EV 1\ N E LO V N 40 VI 111 — N = vn O � � w O� V Ln 1\ N M LO V N 40 N Ln 00cy 00 'O _ O d- O� M O Ln Ln H O N � i 0 � % O i C + N o u 111 O N L + 41 h %0 (/1 + Q I* %O i N� 0 in 1 g A0,N i L _ i i M O d u9 t11 C O— 1, M— IA ►p N A tf �O � + i y 2 � (4 N C4 d U)c �� 'C 0 E t 4, V Q Q Q Q m W LL = > C J 0oo4'E d (A 3: N 000 R V C 4) V C 4)Ln � o O N u O � zLL C d N C a O 0 E N Cd V 41 , O v Z N w O L ttl V CQJ CL 0 o -0 Z a+ y O Z °1 N LU o� Z� 0 N Y1 O N co N N N N— — N u O z 4 u 0 a 0) a 3 C >11 to i CL .Q d� rn U. 1 N 41 00 FA c 2 > � 2 CW) vi C cAdr ed e£ 41 � •di V 0 +�+ � td LU I SJE�I�i0 C d N C a O 0 E N Cd V 41 , O v Z N w O L ttl V CQJ CL 0 o -0 Z a+ y O Z °1 N LU o� Z� Olson, David From: DEED Media < M N DEED@ public.govdelivery.com > Sent: Thursday, April 16, 2015 9:45 AM To: Olson, David Subject: State Gains 7,800 Jobs in March awkififliffil-ope WON— For Immediate Release April 16, 2015 NEWS RELEASE Contact: Madeline Koch, 651-259-7236 madeline.kochCabstate.mn.us Steve Hine, 651-259-7396 Steve. h i neCabstate. m n. us State Gains 7,800 ]obs in March ^,Unemployment rate at 3.7 percent for eighth straight monthN ST. PAUL — Minnesota employers add 7,800 jobs in March, according to seasonally adjusted figures released today by the Minnesota Department of Employment and Economic Development (DEED). The agency said the state has added 50,829 jobs over the past year, a growth rate of 1.9 percent. The U.S. rate of job growth during that period was 2.3 percent. The state's seasonally adjusted unemployment rate was 3.7 percent for the eighth consecutive month. The U.S. unemployment rate in March was 5.5 percent. The labor force participation rate increased for the third straight month by 0.3 percent, reaching 70.5 percent. The Minnesota labor force now has 3.02 million workers. Education and health care led all sectors in March with 5,800 new jobs. Other sectors with gains were trade, transportation and utilities (up 1,800), government (up 1,700), manufacturing (up 1,600), information (up 800) and other services (up 700). Financial activities held steady. Sectors losing jobs were professional and business services (down 3,600), construction (down 800), leisure and hospitality (down 100), and logging and mining (down 100). Education and health services led all sectors on an annual basis with 14,246 new jobs. Other sectors gaining jobs in the past year are professional and business services (up 8,973), trade, transportation and utilities (up 8,499), leisure and hospitality (up 8,037), manufacturing (up 6,794), other services (up 3,263), information (up 505), financial activities (up 426), government (up 67), and logging and mining (up 44). Construction (down 25) is the only sector that lost jobs in the past year. In the Metropolitan Statistical Areas, the following regions gained jobs in the past 12 months: Minneapolis -St. Paul MSA (up 2.1 percent), Mankato MSA (up 1.9 percent), St. Cloud MSA (up 1.9 percent), Rochester MSA (up 0.9 percent) and Duluth -Superior MSA (up 0.3 percent). DEED has added a section to its website that examines the unemployment rate by demographics (race, age and gender) and looks at alternative measures of unemployment. Go here for details. DEED is the state's principal economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development. For more details about the agency and our services, visit us at http://mn.ciov/deed/ . Follow us on Twitter at twitter.com/mndeed . Over The Year Employment Seasonally adjusted Not seasonally adjusted r Unem to went � March 2015 f February�fi ' March 2015 March 2014 Rate 3 7 _ 2015 Minnesota _� 3.7 4.5 5.3 U.S.l 5.5 ; 5.5 5.6 �� 6.8 _ Employment - ` March 2015 F ebru'15 March'14- March March'14- March '15 Non -Farm Employmenty 2015 i _ _ _ 1.9 -+u { Level Change ��Change -.-- _.__-.___- �Mmnesota _ _ __ T --i,844,800 -T� __ _ 2,837,000 F 50,829 1.9 U.S. W� 141,183,000141,057,0001 W a f Construction 3,112,000 2.3 Over The Year Employment Growth By Industry Sector (NSA) OTYJob OTY Growth U.S. OTY Growth Change Rate (%) I I Rate (%) Non -Farm Employmenty 50,829 �_ _ _ _ 1.9 -+u 2.3 -Total j Logging and Mining- _ 44 - 0.7 ---ja 0.2�W�� W a f Construction _ -0.0_ 4.9 _ Manufacturing �a--25 T 6,794 _ ...J 2.2 1.6 8,499 r_.._ I 1.7 i� _� _ FTrade, Trans. and Utilities _- 2.3 ;Information -�� 5051 _ 1 0 � 2.1 Ficial nanActivities 426 T_ 0.2 1.9 Prof. and Bus. Services 1 8,973 2.6 � 3.5 I Ed. and Health Services 14,246 , 2.9 2.5 3.4 Leisure and Hospitalit y 8,037 ; 3.4 �� Services 3,2637 2.9 _Other Government 67 0.0 0.3 i Metropolitan Statistical Area Minneapolis -St. Paul MN -WI MSA Duluth -Superior MN -WI MSA 4 Rochester MSA St. Cloud MSA Mankato MSA OTY Employment Change (#, NSA) 39,632 __.401 - ---_�1,056---� 2,018 —1,061 -30- OTY Employment Change (%, 2.1 0.3 0.9 1.9 1.9 Upon request, the information in this news release can be made available in alternative formats for people with disabilities by contacting the DEED Communications Office at 651-259-7161. Minnesota Department of Employment and Economic Development Communications Office Phone 651-398-9459 or 1-800-657-3858 - TTY 1-800-657-3973 An equal opportunity employer and service provider. • Questions? Contact Us D Irt�IMrrt of bro""M snd E De1rliop"00 STAY CONNECTED: M© �l SHRRE SUBSCRIBER SERVICES: Manage Preferences i Unsubscribe I Help DEED is an equal opportunity employer and service provider. This email was sent to dolson@ci.lakeville.mn.us using GovDelivery, on behalf of: Minnesota Department of Employment and Economic Development • 332 Minnesota Street Suite E-200 - Saint Paul, MN 55101 (800) 657-3858 3 SAM BLACK -ock Development pians a •y tower at this Mill District site. pillion deal to buy a development the Mill District where he plans to t 400 -unit condo complex. :ped Stanton what motivates him to _ctive and not just sit on his invest - and retire. He said it's Shamrock's or so employees, the people here who work with ie said. "They have jobs and tam- [ do good work. What good would ie?" ---_.-.—Z..—.__ .,o_—— . Radission Red in downtown Minneapolis. "You've got to stay tuned," he said. "We are looking at a bunch of opportunities, and clearly, with Minneapolis being our home base and an important part of our global heritage, a Radisson Red will show up in Minneapolis" Radisson Red is a new brand for Minnetonka -based Carlson The millennial - aimed concept is expected to have about 150 rooms and Include a bar and deli They're considered a step down from Carlson's Radisson Blu brand. The first Red is slated to open in China in 2016. More: bizj.us/1dyfzx - Nick Halter contributed to this report. bizj-us/1e2c61 I CARGILL BEGINS S30M PROJECT s�. d save you ;e rent. )ace can leave you paying s. Take the direct route the online matchmaking directly to their ideal to hidden commissions. 5s that can save you as for the lease of your life. Crelow.com/free. place Cargill Inc will soon begin a major renovation of its headquarters that will eventually let it sublease one of its other corporate buildings The renovation, at 15407 McGinty Road W in Minnetonka, will include an extensive remodeling and modernizing of the More: bizi us/1dx5tp GASSEN BUYS LINDEN HILLS SITE Minneapolis developer Clark Gassen and two Investment partners have acquired the former Famous Dave's in the Linden Hills neighborhood of Minneapolis where they're planning to build a residential complex Gassen, Jake Schaffer and an undisclosed Investor bought the property in February for $1.68 million through an Edina -based entity called 43UP, according to a certificate of real estate value filed with Hennepin County The seller was Golden Valley -based Linden Landholdings. The Famous Dave's BBQ Shack at the site, 4264 Upton Ave. S, closed a year ago Developer Mark Dwyer won approval for a four-story, 20 -unit condominium project on the site after an intense battle with neighbors in the area, but the development plan didn't come together. The site will probably be a mixture of residential and retail, Schaffer said "We want a nice boutique project, not something really big" More: bizj.us/1e4n09 TWO TIF DEALS, TWO VERY DIFFERENT STRATEGIES A pair of apartment deals in different suburbs are seeking economic development subsidies One of them includes tax abatement and both request tax increment financing, or TIF, which uses anticipated tax revenue generated from the increased value of a property to help pay for development costs DORAN COS BROOKLYN PARK Developer: Bloomington -based Doran Cos Project cost: $90 million Subsidy request: $4 million tax abatement, plus $3 million TIF Description: 610 West Apartments, 6701 Oak Grove Parkway N., will include a mix of market -rate, upscale multifamily housing, underground parking and other amenities. Why the subsidy: The development would not proceed without them because "the construction cost _. exceeds the anticipated rents that can be achieved in Brooklyn Park's market today," according to a city memo Status: The subsidy was approved March 9 by the city's Economic Development Authority The development plan and subsidy will be considered by the City Council in March and April. IF - CITY OF MINNETONKA MINNETONKA Developer: St. Paul -based At Home Apartments, Mark Cashill, principal Project cost: $20.3 million Subsidy request: $2-5 million TIF; $575,000 low -Income housing tax credit Description: The 106 -unit, 4 -story apartment building at 5709 Rowland Road will include 21 units that are affordable for renters who make 50 percent of the area median income. The project has 116 Interior parking spaces in an underground garage and a 54 -stall surface parking lot. Why the subsuidy: To offset the cost of the affordable units Status: Goes before the City Council March 23 Olson, David From: Sent: To: Subject: Af, For Immediate Release March 31, 2015 DEED Media <MNDEED@public.govdelivery.com> Tuesday, March 31, 2015 9:58 AM Olson, David Job Vacancies Climb to 88,900 in Fourth Quarter NEWS RELEASE Contact: Madeline Koch, 651-259-7236 madeline.koch�state.mn.us Oriane Casale, 651-259-7383 oriane.casale�state. mn.usmn.us Job Vacancies Climb to 88,900 in Fourth Quarter -Openings up 47 percent from one year ago; highest level since 2001 N ST. PAUL - Job vacancies in Minnesota rose to 88,900 in the fourth quarter of 2014, a 47 percent increase from the same period a year earlier, according to figures released today by the Minnesota Department of Employment and Economic Development (DEED). The agency said Minnesota had 1.1 unemployed people for every vacancy in the fourth quarter. A year earlier, there were 2.1 unemployed people for every vacancy. The fourth quarter 2014 ratio of unemployed people to vacancies was the second lowest on record. Total vacancies in the quarter were the highest since the second quarter of 2001, when the state had more than 115,000 job vacancies. "The figures indicate the economy is growing and that companies are making more opportunities available to job seekers," said DEED's Labor Market Information Office Director Steve Hine. "The labor market is expected to continue tightening as more baby boomers retire and companies hunt for workers to replace them." The study found that 55.4 percent of the vacancies (49,300) were in the seven - county Twin Cities. The remaining vacancies (39,600) were in Greater Minnesota. Vacancies were up 48.6 percent from a year earlier in the Twin Cities and up 45.6 I percent in Greater Minnesota. The Twin Cities now has a 1 -to -1 ratio of unemployed workers to job vacancies. Greater Minnesota has 1.2 unemployed workers for every job vacancy. Health care and social assistance led all sectors in the fourth quarter with 21 percent of the openings. Accommodation and food services had 13.4 percent of the job vacancies, followed by retail trade (12.6 percent), manufacturing (11.1 percent) and educational services (6 percent). Firms in the middle-sized range (10 to 249 workers) accounted for 63.7 percent of the vacancies. Large firms (250 and above) accounted for 19.6 percent of the vacancies, while small firms (fewer than 10 workers) had 16.7 percent of the vacancies. Among other findings of the study: 1. Forty percent of job vacancies were for part-time employment. Part time is defined as fewer than 35 hours per week. 2. Eleven percent of job vacancies were for temporary or seasonal work. 3. Thirty-nine percent of vacancies required some level of post -secondary education or training beyond a high school diploma. 4. Forty-six percent of job vacancies required one or more years of work experience. 5. The median (50th percentile) wage offer for all job vacancies was $13.29 per hour. Wage offers are highly correlated with experience and education requirements. On average, the more education and experience required, the higher the wage offer. 6. Fifty-two percent of vacancies offered health insurance. Health care benefits are far less common for part-time job vacancies than for full-time job vacancies. Go here to see more details in the fourth quarter report. DEED conducts the Job Vacancy Survey in the second and fourth quarters each year to gauge hiring demand and to determine job vacancy characteristics by industry, occupation and firm size in Minnesota. DEED is the state's principal economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development. For more details about the agency and our services, visit us at http://mn.gov/deed/-. Follow us on Twitter at twitter.com/mndeed . z 4/22/2015 StarTribune - Print Page Amazon plans to employ 1,000 at new distribution center in Shakopee Article by: Kristen Leigh Painter and Kavita Kumar Star Tribune staff writers April 22, 2015 - 8:36 AM Amazon.com Inc. is planning to build a distribution center in Shakopee that will employ 1,000 people and quicken its deliveries in the region. The online retailer is seeking about $5 million in tax breaks, Shakopee Mayor Brad Tabke said Tuesday. "It is an extraordinary project we are really excited about," he said. Amazon plans an 820,000- square -foot building, most of it used as warehouse space, that will open in early 2017, according to a document outlining the company's tax request. The estimated market value of the facility is $55 million, the document said. Analysts say Amazon often spends about $100 million to build such centers, which it equips with the latest robotics for storing and sorting goods. The 63 -acre site for the proposed facility is south of Hwy. 101 at Shenandoah Road, in an existing industrial park owned by Bloomington -based United Properties. Tabke said the process for considering the tax breaks is just beginning and the Amazon facility would require significant improvements to the existing infrastructure and roads. United Properties declined to comment and Amazon did not return requests for comment. Tabke said United is still negotiating the land sale with Amazon, but the city document shows the company plans to break ground by June. The news confirms speculation that Seattle -based Amazon was eyeing a Minnesota expansion, which was triggered when the company began charging sales tax to its online customers in the state last October. The company at the time said it was "considering various opportunities." Online retailers that don't have physical stores don't have to charge state sales tax unless they have a physical presence or affiliated business in the state. According to Amazon's website, it has fulfillment centers in 25 U.S. states. The closest to the Twin Cities is in Kenosha, Wis. As online shopping has become more popular, many retailers have been looking for ways to deliver packages more quickly to customers' doorsteps. Many brick -and -mortar companies have been promoting services where shoppers can buy items online and WJ Amazon plans to build a distribution center in Shakopee similar to this one near Seattle, shown in a 2014 photo. Erica Schultz, ,Z_ Amazon.com Inc. plans to build a distribution center in Shakopee. In this photo, a worker puts a label on a package at an Amazon distribution center in Palo Alto, Calif. Paul Sakuma, Amazon.com plans to -break ground on a Shakopee distribution center in June. Paul Sakuma - AP file, httpJAvww.startribune.com/printwbcieA'd=300852681 1/2 4/22/2015 StarTribune - Print Page pick them up in a nearby store. But online -only retailers such as Amazon have to depend more on building nearby distribution centers as they look to speed up delivery times. "Life is getting better if you shop on Amazon," said Gene Munster, an analyst for Piper Jaffray in Minneapolis. A distribution center in the region will mean that more items will be available for two-day delivery under the retailer's Prime membership program, he said. Sunday and same-day delivery will not be far behind. Amazon currently has same-day delivery in about 14 cities. Meanwhile, Target Corp. also has been testing same-day delivery in Minneapolis and a handful of other cities since last year. Wal-Mart Stores Inc. has dabbled with same-day delivery in the Twin Cities, too. "For a company as aggressive as Amazon is, it's shocking how long it's taken for them to get" to the Twin Cities, Munster added. While the center will be primarily used for processing shipments, about 70,000 square feet — or 15 percent — will be used for offices. In the past couple of years, Amazon has been building smaller "sortation centers" that don't stock products, but where already packaged boxes are sorted to individual post offices in order to get items to customers' doorsteps faster. The company now has more than a dozen of those typically 300,000 -square -foot centers. The plans in Shakopee appear to be more like those of full-blown fulfillment centers, which tend to be around 1 million square feet. Wal-Mart is opening a 420,000-square400t food distribution center in Mankato later this year to supply area stores with groceries. That center will employ about 300 workers. Shakopee, with a population of just over 39,000, made headlines in 2013 by landing a Shutterfly distribution center that employs close to 400 people. 'We've been working really hard on economic development in the city. All of these projects are unique and different," Tabke said. "This is a lot bigger in scope, so it is harder to compare to other projects." Kristen Leigh Painter • 612-673-4767 Kavita Kumar • 612-673-4113 © 2015 Star Tribune http://uvww.startribune.com/printarticlef?id=300852681 212 Home / News / Economic Development / Subsidy for Amazon faces scrutiny in Shakopee v Amazon's potential Shakopee facility would go on vacant land at the southeast quadrant of Highway 101 and Shenandoah Drive, near Valleyfair and Canterbury Park. (Staff photo: Bill Klotz) Subsidy for Amazon faces scrutiny in Shakopee By: Karlee Weinmann and Adam Voge April 22, 2015 2:08 pm 0 Shakopee officials have so far touted Seattle -based Amazon's prospective plans to build a new distribution facility as a job -creating boon to the local economy, but with a $5 million public subsidy on the table, there's blowback brewing in the City Council. Amazon proposes to build an 820,000 -square -foot fulfillment warehouse on about 63 acres at the southeast corner of Highway 101 and Shenandoah Drive, according to a memo on file with the city. Its $55 million new facility is expected to generate 1,000 new jobs and to spur new infrastructure in the surrounding area. Proponents say the subsidies bring Shakopee into clearer view as a destination for marquee companies and major employers. But City Council Member Matt Lehman, who has come down on both sides of tax increment financing deals in the past, said the upside is murky. "We're attracting businesses by paying them to come here at our residents' and existing businesses' expense," Lehman said in an interview. "That's why they're all coming here, because we're giving them the world." Shakopee Mayor Brad Tabke, who was quoted about the deal in initial news stories and has pushed for subsidies, couldn't be reached for comment Wednesday. Amazon's TIF proposal will go to a public hearing May 19. The Seattle -based online retailer didn't return a request for comment. The development site is just west of Valleyfair and north of Canterbury Park and Sever's Corn Maze. Electronic connections company TE Connectivity occupies a new building immediately south of the Amazon site. Scott County values the land at $7.18 million, according to property tax records. Bloomington -based United Properties, which owns the site, couldn't be reached for comment. Amazon would be the latest — and highest -profile — among a string of companies laying down roots and beefing up operations in Shakopee. Against the backdrop of ongoing negotiations with the company, the city is weighing a request from Amazon to pick up part of the tab through a tax increment financing package. It's an increasingly familiar call in growth -hungry Shakopee, which in recent years has signed off on financial assistance packages for Shutterfly, Emerson and others. The Minnesota Department of Employment and Economic Development has also played a role, including by providing a $1 million loan through its Minnesota Investment Fund to back Shutterfly's expansion. Shakopee City Council Member Kathi Mocol said Wednesday she's "excited about the opportunity" to talk to Amazon, but stopped short of declaring overwhelming support for or opposition to the project's potential use of public money. "As far as TIF and tax abatement go, it's a great tool if you use it properly," she said. "...We're still at the very start." The potential payoff for Shakopee this time around is especially unclear, Lehman said, because many of the 1,000 new jobs expected at the facility would be low-paying, entry-level positions — not the salaried positions that come with a corporate development and funnel more cash back into the community. Shakopee Economic Development Coordinator Samantha DiMaggio hasn't yet ironed out specific hiring plans with Amazon but said the company would offer details at a May 19 hearing before the Shakopee Economic Development Authority. The city's business subsidy rules mandate the pay rate for jobs created as part of the project at least doubles the federal minimum wage, setting a $14.50 -per -hour threshold. The wages won't match big-ticket corporate development, but DiMaggio said the workforce expansion on its own would prop up the area. "I've heard from some neighbors and other communities around the area," she said. "We still have a great need for those kinds of jobs." Workers at the site will likely come from around the metro, DiMaggio said. Shakopee's unemployment rate stands at 3.8 percent, according to state data. Its population hovers near the 40,000 mark and its median income, at last check in 2013, outpaces the state average at $79,743. The potential influx of workers traveling to Shakopee has already stoked chatter over transit expansion to accommodate them. Particularly given Amazon's marquee name, she expects a strong pull in the Twin Cities workforce. "This will be the first thing for us where people may be crossing the river to come here for jobs," DiMaggio said. The potential Amazon site is among the last currently developable parcels in the city, Mocol said. Amazon anticipates breaking ground in June and finishing the building in August 2016. The warehousing and distribution building would also include about 70,000 square feet of office space.