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Home My WebLink AboutItem 03.c City of Lakeville Administration Department Memorandum To: Mayor and Members of the City Council From: Allyn G. Kuennen, Assistant City Administrator Copy: Justin Miller, City Administrator Date: August 20, 2015 Subject: Packet Material for the August 24, 2015 City Council Work Session. Agenda Item: Review of 183rd Street Property Development Proposals. In the late 1990’s the City purchased 60 acres of land located on the west side of Dodd Boulevard and north of 183rd Street as part of the King Park acquisition process. In 2005 25.24 acres was sold to Lifetime Fitness for the construction of their facility and in 2007 7.5 acres was used for the construction of the Police Station. Approximately 19 acres of the remaining property is available for development. Staff is periodically contacted by developers or investors interested in acquiring the remaining 19 acres. At the March 23rd work session the City Council reviewed several options for the use or sale of the 183rd Street Property and directed staff to prepare an RFP to obtain proposals for the sale and development of the property. Four developers responded to the RFP. The proposals are attached for your review and summarized in the attached PowerPoint presentation. Staff will be available at the August 24th work session to review each of the proposals and to discuss the next steps. If you have any questions before the work session, please contact me at 952-985-4402 or at akuennen@lakevillemn.gov. 183rd Street Property Request for Development Proposals Lakeville, Minnesota—Positioned to Thrive August 24th City Council Work Session Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Property History: In the late 1990’s the City acquired 60 acres of land located on the west side of Dodd Boulevard and north of 183rd Street with the King Park acquisition In 2005 25.24 acres was sold to Lifetime Fitness for the construction of their facility In 2007 7.5 acres was used for the construction of the Police Station Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Approximately 27 acres of the property remains undeveloped: •19 acres that are developable (Outlots B & D) •8.59 acres in greenway/wetland located between Outlots B & D Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Zoning and Surrounding uses: Outlot B: RS-2, Single Family Outlot D: RS-3, Single Family Lakeville, Minnesota—Positioned to Thrive 183rd Street Property The City is periodically contacted by developers or investors interested in acquiring the remaining 19 acres for development. At the March 23rd work session the City Council reviewed several options for the use or sale of the 183rd Street Property and directed staff to prepare an RFP to obtain proposals for the sale and development of the property. Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Goals of RFP A residential development that is in character with the surrounding neighborhoods Creative development design and housing styles Increased residential opportunities and choice of housing products A development pattern complementary to the surrounding neighborhoods and the City of Lakeville Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Country Joe Homes DR Horton Homes Encore Development Homestead Partners K. Hovnanian Homes KJ Walk Lennar Mattamy Homes Meridian Land Co. Ryland Group SBF Development Shamrock Development Summergate Development Winkler Development The RFP was advertised through the City’s media outlets and sent to the following list of companies that are actively developing within the Community: Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Four developers/home builders submitted proposals for consideration: DR Horton Homes KRB Development Pulte Homes Ryland Homes Lakeville, Minnesota—Positioned to Thrive 183rd Street Property DR Horton Homes Proposal: $1,250,000 ($65,789/acre) 22 Single Family Homes (rezoning required to RS-3) 23 Detached Townhomes (rezoning require to RM-1) Home Builder – DR Horton Homes Lakeville, Minnesota—Positioned to Thrive 183rd Street Property DR Horton Homes Alternative Scenario: Land swap for a portion of the Mullen/Streefland property adjacent to the future extension of 185th Street. Lakeville, Minnesota—Positioned to Thrive 183rd Street Property KRB Development Proposal: 1,550,000 ($81,578/acre) 39 Single Family Homes (rezoning required to RS-3) Home Builder – Multiple (Ryan Real Estate, Brandl Anderson, Keyland, etc.) Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Pulte Homes Proposal: $1,300,000 ($68,421/acre) 22 Single Family Homes (rezoning required to RS-3) 31 Detached Townhomes (rezoning required to RM-1) Home Builder – Pulte Homes Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Ryland Homes Proposal: $840,000 40 Single Family Homes ($44,210/acre) Home Builder – Ryland Homes Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Summary of Proposals: DR Horton $1,250,000 ($65,789/acre) 22 Single Family Homes (rezoning required to RS-3) 23 Detached Townhomes (rezoning required to RM-1) Home Builder – DR Horton Homes Alternative Scenario: land swap for a portion of the Mullen/Streefland property adjacent to future extension of 185th Street. KRB Development $1,550,000 ($81,578/acre) 39 Single Family Homes (rezoning required to RS-3) Home Builder – Multiple (Ryan Real Estate, Brandl Anderson, Keyland) Pulte Homes $1,300,000 ($68,421/acre) 22 Single Family Homes (rezoning required to RS-3) 31 Detached Townhomes (rezoning required to RM-1) Home Builder – Pulte Homes Ryland Homes $840,000 40 Single Family Homes ($44,210/acre) Home Builder – Ryland Homes Lakeville, Minnesota—Positioned to Thrive 183rd Street Property Next Steps for Council: Determine whether to move forward with the sale of the property, and, if so Determine which proposal(s) warrants further consideration U-B-HORMN0N.'SE PROPOSAL CITY OF LAKEVILLE 183RD STREET PROPERTY D.R. Horton, Inc. -Minnesota 20860 Kenbridge Court, Suite 100 Lakeville, MN 55044 www.drhorton.m July 31, 2015 Mr. Allyn Kuennen Assistant City Administrator City of Lakeville 20195 Holyoke Avenue Lakeville, MN 55044 RE: 183" Street Property Request for Proposals Dear Mr. Kuennen: TRANSMITTAL LETTER via email: akuennen@lakevillemn.gov D.R. Horton, Inc. — Minnesota ("Horton") is pleased to submit this letter summarizing the following proposed terms to be incorporated into Horton's purchase of the 183" Street Property. Purchase Price: The Purchase Price for the Property is $1,250,000, or $60,000+ per acre. Earnest Money: Horton will pay to the City $5,000 of non-refundable Earnest Money within ten (10) days of full execution of a purchase agreement. In addition, Horton agrees to pay all City legal expenses related to the preparation of the purchase agreement in excess of the $5,000 of non-refundable Earnest Money. Due Diligence: Upon execution of a purchase agreement, Horton agrees to immediately begin its inspection of the property, including environmental studies, soil borings, wetland delineations, tree survey, boundary survey, and topographic survey, as required to submit complete applications for development to the City of Lakeville. Closing: There shall be a single Closing on the Property. The Closing shall occur within thirty days after the later of final plat approval from the City and approval of all required wetland permits, if any, from the Army Corps of Engineers. Alternative Scenario: Horton has reached an agreement for the acquisition of the Mullen/Streefland property located East of Dodd Boulevard and South of King Park, which could be incorporated into the deal at the City's option. This alternative is briefly described elsewhere. We look forward to again partnering with the City of Lakeville on another quality neighborhood. Please contact me with any questions at 952-985-7827 or.ramullenbach@drhorton.com Sincerely, /-Ilawe,L.w Ron Mullenbach Land Manager DEVELOPMENT CONCEPT AND PROJECT APPROACH d° teat+ CREEK GREENWAY PROPERTY - -_. LAKIMLL& MN *Development concept also attached as separate file. The 183 d Street Property represents the opportunity to complete development of this quadrant of the Lakeville community bounded by Dodd Boulevard, Ipava Avenue, and Highview Avenue. D.R. Horton is both a developer and a builder. As such, we are able to provide a continuity from home site to home site. Our vision for this neighborhood includes two components (a traditional single family neighborhood and a lifestyle neighborhood) which we believe are necessary to achieve the goals outlined in the City's RFP: Create compatibility with surrounding neighborhoods; • Provide a development pattern complementary to and compatible with the surrounding and non-residential land uses; • Provide creative development design and housing styles; and • Increase residential opportunities and choice of housing products. Traditional Single Family Neighborhood Our Development Concept includes 22 single family home sites on Outlot B, which is bounded on the North by existing RS -2 District single family homes; on the East by RS -3 District single family homes, on the South by a wetland complex, and on the West by the Eastview Elementary ball fields. Currently, two neighborhood streets, Idawood Path on the North and 179th Street on the East are stubbed to the property. The City of Lakeville approved a rezoning from RS -2 to RS -3 District in the adjacent Rose Creek neighborhood for the home sites along existing 179th Street. Our Development Concept includes a similar request to rezoning the area north of the wetland from RS -2 to RS -3 District. By doing so, all homes along 1791h Street will have consistent and compatible sizes along its streetscape. Since no homes in the existing neighborhood to the north front on Idawood Path, the North boundary of this property functions as a reasonable and appropriate transition between lots sizes. We'd propose to build homes similar to what we are currently building in Lakeville, which are comparable in size and finishes to what exists to the North in the Andersons Century Farm neighborhood and what is under construction in the adjacent Rose Creek neighborhood. We would not propose any Association or neighborhood monuments for this area. We believe this approach will lead to a seamless transition between neighborhoods and integration of residents within this area of the community. We'd anticipate a 12-18 month build -out period once the home sites are permit -ready; we feel moving through the site efficiently (rather than piecemeal over 2-3 years) will be beneficial to those residents to the North that are impacted by this construction activity. Lifestyle Neighborhood Our Development Concept includes 23 detached townhome sites on Outlot D, which is bounded on the North by a wetland complex, on the East by the Lakeville Police Department, on the South by 183rd Street and Lifetime Fitness, and on the West by an existing single family neighborhood. Currently, there are no streets stubbed to the property or intersections on the south side of 183rd Street. This portion of the property is currently zoned RS -3 District. The proposed lots would require rezoning to RM -1 District. Ever since D.R. Horton developed the 100+ detached townhomes in Dodd Marsh Highlands, we have repeatedly heard from Lakeville residents, Lakeville staff and Lakeville officials that we should build more of that style of home in Lakeville. This neighborhood would have modest entrance features, association - maintained common areas (lawn and snow), single -level living, and low -maintenance finishes. This site presents the perfect opportunity to provide a housing choice for modern lifestyles in an area that provides security, access to fitness facilities, proximity to retail and restaurants (centrally located among downtown Lakeville, Heritage Commons, TimberCrest and Crossroads), an established trail system and natural amenities. The slightly more dense single family detached land use provides a perfect land use transition in this area surrounded by non-residential uses (Eastview Elementary, Lakeville Police Department, Lifetime Fitness and the Water Treatment Facility). We'd anticipate an 18-24 month build- out of this area. Broader Context The Development Concept purposely avoids any impact to the tributary or the existing wetland complex out of respect for that natural feature. Hyde Park Avenue has been extended as a minor collector connection between the single family neighborhoods to the North and Dodd Boulevard. We'd want to explore with the Lakeville Area School District and the City of Lakeville a trail to connect the traditional single family portion of the neighborhood to Eastview Elementary. A second trail connection between the single family portion of the neighborhood and the detached townhome neighborhood may also be beneficial to provide pedestrian access to Lifetime Fitness and provide a pedestrian loop. Alternative Scenario: Mullen/Streefland Property As stated above, Horton has an agreement with the members of the Mullen and Streefland families to acquire their two properties totaling just over 40 acres located East of Dodd Boulevard and South of King Park. While the current owners have interest in selling the property for development, the City may have some interest in acquiring this property due to the following: • Right-of-way, and potential ponding areas, to accommodate the planned future extension of 185th Street (CSAH 60); • Protection of the Vermillion River tributary and adjacent buffers; • Protection of a wooded area identified for preservation by the Comprehensive Parks, Trails and Open Space Plan that would tie the existing greenway trail in Chokecherry Hill to King Park; and • Elimination of incompatible single family land uses adjacent to a County arterial roadway with limited street access as a result of recent development approvals. If the City would like to make its acquisition of this property part of the transaction on the 183rd Street Property, Horton would open to that discussion. FINANCIAL CAPACITY We believe the financial strength of a homebuilding company is an important consideration, especially in today's uncertain economic environment. Below are a few items for your consideration in determining our ability to not only complete the acquisition and development of this site, but also "be there" for our homebuyers both during the construction process and after they have closed on their new home: • Since D.R. Horton was founded in 1978, we have delivered more than 500,000 homes to our homebuyers. • D.R. Horton, Inc. is a publicly traded company, listed on the New York Stock Exchange under the ticker DHI. • For each of the past 13 years, we have delivered more homes to our customers than any other homebuilder in the United States. • Our stockholders' equity at June 30, 2015 was $5.6 billion, one of the highest of the public homebuilders. • Our total cash at June 30, 2015 totaled $817.3 million. PROJECT SCHEDULE SubmitProposal.........................................................................................................................July 31, 2015 Purchase Agreement Negotiation/Execution...........................................................................................TBD • Dependent upon City timelines Wetland Delineation.........................................................................................Late Summer/Early Fall 2015 • Must be completed during growing season Soil Borings/Soil Testing.................................................................................... Late Summer/Early Fall 2015 • Should be completed prior to frost conditions Tree Survey.......................................................................................................Late Summer/Early Fall 2015 • Must be completed during growing season Sketch Plan Application Submittal....................................................................................................Fall 2015 • The ability to complete site inspection and submit sketch plan application is dependent upon when a purchase agreement is finalized Preliminary Plat Application Submittal ........................................... Within 60 Days of Sketch Plan Approval Final Plat Application Submittal ............................................... Within 60 Days of Preliminary Plat Approval Closing................................................................................................. Within 30 Days of Final Plat Approval • Timeline is dependent upon City approval timeline, but we'd anticipate being through the process and able to Close in Spring 2016 Site Construction Activities..........................................................................................................Spring 2016 ModelStarts..............................................................................................................................Summer 2016 Site Development Complete.............................................................................................................Fall 2016 ModelOpenings................................................................................................................................ Fall 2016 Neighborhood Build-Out...........................................................................................................Summer 2018 STATEMENT OF QUALIFICATIONS The Minnesota division of D.R. Horton, Inc., has been building quality homes and developing strong neighborhoods in the City of Lakeville, and across the Twin Cities, for over twenty years. Our Lakeville neighborhoods include Argonne Farm, Chadwick Farm, Cherry Highlands, Cherry Hill, Crossroads, Dodd Marsh Highlands, Fieldstone Creek, Quail Ridge, Stone Ridge, Vermillion Springs, and Zweber Farm. Currently, we have over a dozen active neighborhoods across the Twin Cities ranging in size from single home site construction in Edina, a 22 home site neighborhood with boat slips on Lake Minnetonka, and over 160 home site neighborhoods in Apple Valley and Eagan. Regardless of size, we approach each neighborhood with respect for the site's natural features, a focus on lasting quality, and a passion for detail. In the last 5 years we have completed numerous neighborhoods that are comparable in scope. The following list includes a few of the neighborhoods we've developed in the last two years alone: Orchard Cove: 22 home site subdivision in the City of Minnetrista on Lake Minnetonka Alcove at Lake Riley: 28 home site subdivision in the City of Eden Prairie on Lake Riley Hickory Shores South: 34 home site subdivision in the City of Prior Lake off Rice Lake Hillcrest: 164 home site subdivision in the City of Eagan adjacent to Lebanon Hills Regional Park Stone Ridge; 45 home site subdivision in the City of Lakeville overlooking Lake Marion Eastridge Woods: 135 home site subdivision in the City of Cottage Grove abutting the East Ravine Cascades: 37 home site subdivision in the City of St. Michael abutting Regal Creek In addition, the Minnesota division built its headquarters in the Fairfield Business Campus home in 2000 and currently employs over 90 people. I, as do several of our employees, call Lakeville home and are very proud of our long tradition of building homes and neighborhoods in this community. Creating value every step of the way was the Company's signature focus when Donald R. Horton unveiled his first neighborhood in the Dallas/Ft. Worth area over three decades ago. As the Company grew from a local homebuilder, to a regional homebuilder, to ultimately the largest homebuilder in the United States, that philosophy has never wavered. The Project Team will include three primary individuals within nearly a century of experience in the homebuilding industry, each of whom will be supported by our entire D.R. Horton team: Mike Suel, Land Development Manager: Mike has over 30 years of experience designing and developing neighborhoods both with a municipality and the last 16 years with D.R. Horton. Mike will have primary responsibility for project design and governmental approvals. Dave Klee, Land Development Manager: Dave has over 30 years of experience in site grading and development, including experience with both site development contractors and developer/builders. Dave is a tireless manager of all of his sites and has an acute attention to detail. Randy Kulzer, Construction Manager: Randy has over 30 years of home construction experience, the last 21 with D.R. Horton. Randy has a passion for building quality and delivering on commitments to each and every homeowner and sets those expectations for the entire construction team at D.R. Horton. 178th ST. W. JIF76 { Nk It, IA w4 S ROSE CREF'k T{C]i:1. � 99 IS .- .. � 1791h ST. Ebi1V14fV - }1 + 1I 10 te�,n;.. ''\ t5Y i3Rl1 CT- K 4� Ih1&GERM LM- -� _ �ea•... � ti C^ �. DATA fl -5 183 04. •' Y 4 r �- ..:t4 2Me, fozA S OSMIroxIV July 29, 2015 Allyn Kuennen, Assistant City Administrator City of Lakeville 20195 Holyoke Ave Lakeville, MN 55044 RE: 183RD STREET PROPERTY RFP To whom it may concern: Please accept this Proposal from our Development Company — KRB Development Our contact information is: KRB Development 14750 Cedar Ave South Suite 100 Apple Valley, MN 55124 Contact —William Ryan 612.718.2800 Email — paula(cDryanrealestate.com We are proposing to purchase the subject property for $1,550,000 with Earnest Money at time of Request For Proposal of $100,000.00 Terms - Cash — Closing to be within 15 days of preliminary plat approval. The contingencies would be obtaining preliminary and final plat approval on the concept plan attached. Minimum of 39 lots, 85' wide. 1richro.USOSMros0 Development Concept See attached from James R. Hill —J 4 AI, IE�r—�)��/lt\I /�r—NITI IL)\f [—A LJhA—/,/-\n lr'I 1 /1IVLJ L\I�\�.V1v vL_IV VI\�I /-1I \IVOIJIVLJ C] uu rL.v l C 7 1 A N 1 n r 1^ n n l i, r- N I T I>\ / /-1I VUC_ \.,V I N LCL_ v 1 lJI \ I Prnne Deaarfn,len r—A L)h A TI IIL)r A U U r V 1 i-11 \ V f l l I. \ LJ A F', f',I n LJ LJ V �� cmllut C. ItosACRlve, aaordinq to lho reun.dodplazthercoP, Dakela Comuy, Mhuleao,a 4eA ondo,O,X1..0 CRHEF:OREENWAY 4UDI'I'ICs1:, nttmdinglolhcrccwdcd pl9 NercoF. SITE DATA TOTAL SITE AREA uul4. / OF LOTS [)ako[n GownY. �,lrvurna I ",as+3s.F. T ft ` _ WdMD,%POO CREEK GREEYN'.4Y NOOI'I'ION,aroedinb to the rtcaNeJ pIM,Meo[ oataacawv.�4110-rc.ola>:xcerrmuna,Ae�,ined,9ronows. OUTLOT AREA \ /l11{� r c Cammeruialfie noNieeq roma afaeid 6m,Helf o[IAo xnMweel pe�u,er, mince Nm,iifl9 -- de see 5]munVee 44 ecconde N'e ex,ed bevii doe the nosh lint ofadd Earl Half of 2 111 Y e a,e n u F e 91 se Uu xonhwett Qu Gaence of 322.64 fm; IM1erce swh.n degsaes 34 nun ewnb •1 5 ,1 � ap sT. y. r= � � c�N�aice nrd9.d 0�feet in the Poinl ofbeginninboflM1a Lmdloln Aesmted mance (, Souh'_4 de see 34 minutes 40 acu;da E�.adealanea of ll A.Il leer, Ihmre Anieh 8 dg , sr. I ns ¢_4o--_- J! — nAFp en of ndnma s; mcwdewm nmemnee ar2l.0 rtt, lhaaee Nem�IL,u:we�a sA '$ _ nunmeauae<onde weelnalalaz,a oe lAo.00 rte: dw�a.e snnm vl deArtee ol,�dnme 4s = 2 a \ 9Tfi STREET rnnd Lu.an A'e%A 11,lnbs.UreeC hcn<e Nenh l6d 9m nose„ inn Weata \ 'q less sr. '•, a;ela,we oelest, mence Nodn os depe.e AA mewaz 47 a.ceeda wea • 1 1 ' 1 '6� \' —_ ndi.Vurce oP l_GS9 feel lolhe poiN afbegituin¢. 99 10s .R 1"19SN 5� 14s y� aF. --gip---- - 12 13sF. � I sr. I 4 ,ssa] SF. I v 2 3 4 OUTLOT A IL C ' '3 7 mow, 4 mer---- \�P 5 - 11163 S.F. 8 r -LA.p - / .eSP' J s 5 / 122L a ` `Cy- "z „9SF. .z., SF. CUTLOT m I OUTLOT E F- T o \ / IL -T ZOMNG INFORI CURRENT ZONING —NORTH OF CREEK RS -2 —SOUTH OF CREEK RS -3 REQUEST RE—ZONING OF RS -2 TO RS -3 SITE DATA TOTAL SITE AREA 19,02 AC. / OF LOTS 39 LOTS LOT AREA 14.17 AC. RIGHT OF WAY AREA 3.05 AC. OUTLOT AREA 1.79 AC, SINEJF FAMIIY 'I= k DATA 1"-3) MIN. LOT AREA 11,000 ST MIN. LOT AT SCORNER R5 FEET AREA MIN. LOT AREA FOR CORNER LOT MIN. LOT MD1H AT SETBACK FOR CORNER LOT E. 12'S.F. 00 FE 7ET FRONT 30 FEET SIDE (HDIISE) 10 FEET S10E (SME£f) 20 FEET REAR 30 FEET 4 ACNE IH F<Ef I Inch = So last E5 it -------------- ------ -- ------------ I r --------- 1 r- cc ---------- -- "'o F ------- 4 12. th E-i z 9 I PON OLE 11 lM.0 HWL ( A-S DATE 7/15/15 REVISIONS SOLE M FEET CAD FILE 22853-10-0 PROJECT NO. 22853-10 1.1 i'� - ' 'o - r ..- •mow 1 tw- y i i _.', - a !I � �t? wo toa*• ,14 ♦♦ �� .051.2 t ; 6c � y � J 6 jo O�iasO HYL1 047.2/�i � 01 � �, ` t� R� 11 toa�•T� \� b-4a ,,. .m'`- , `t t � \.v. - ��sa �: I 0 ! , U] s >- ` _ � = _-� p 1 tda7• T7 \ t rose= _ ... F /p / 6 9oFN.0 Oa8.4 1 i — / 1 - x - 77- DRAWN BY �fJLS DATE / 7/15/15 ,. .. ' REVISIONS / IN FEE 1DD 150 CAD FILE \ feel iiiia en 22953-10—G 1 in — W PROJECT NO. 22953-10 1.2 cS Ih" !� j I I 13 . 1- ----------------- E� C_----_—___—___ __, r__ _ _----_____-7 _---- _ _ f ______ N 'PKsaxR > ___— — ,a,a.aa------ I r------- 1 —� r------� r-- cc g 6 GZ s J^1 1 r� ixJ, 1 1 I s 2 1'vL 1 3 ��tii ii ii I€ I 'mom 11 1 "1 I I I I I I I I , 1 II 1 1 I I J I 11 1, II II �i 8 '`� nI - �iL-------------- �� $ v 11 11 _� �('a�' �'� i i I i eE�➢�g Ci 1 10 15 11 �i� L11 14P. 12 13 d r x wW 1 I' _ --___— J —� -, I I POND 1 % 1 11 / Ir�ry ,ouAio I 11 HVA. M7 _ DRAWN BY - As 2 \\ /, 2 iI moi' f. -`N 7°TE 15 3 \\ \11/�\ i ; �i REVISIONS SOME IN FEET CAD FILE min - 5o m.t 22853-10-U PROJECT NO. 22853-10 Z1 J� 4 SCALE IN LEFT SO 100 150 1 Inch � 5o kel b 6 a�_ �§aaE�a a a W�gr IS IR�D Dw DRAWN BY JLS DATE 7/15/15 REVISIONS CAD FILE 22853-10—U PROJECT NO. 22853-10 22 / 4 SCALE IN LEFT SO 100 150 1 Inch � 5o kel b 6 a�_ �§aaE�a a a W�gr IS IR�D Dw DRAWN BY JLS DATE 7/15/15 REVISIONS CAD FILE 22853-10—U PROJECT NO. 22853-10 22 2TIChMA5'OSMMS 0 Project Approach -- Anticipated Development sequencing would be to begin City review process by September 2015. Obtain necessary approvals by April 2016. The size and scope of this project should not require more than one construction season to complete the grading, utility and street construction. Anticipated construction is for 2016. The larger lots seem to provide a good continuity to adjacent areas. We have attached some of the plans from each of the three builders on the type of homes we expect to be constructed in this area. This group of developers collectively brings to this development style, customization, quality and a variety of beautiful homes. Nestled amongst three other developments this property will possess large 85' lots, distinguished architectural designed homes that have opulent lots with a large amount backing up to much desired wooded/wetland area. 2 r,f ffofA SOSMZVSV Financial Capacity We have worked with various banks for the financing of multiple developments including KleinBank, Tradition Capital Bank and Bremer Bank. We had one of our banks provide a letter verifying that we have the funds to pay cash for the subject property and a commitment that the Bank will provide funds necessary to develop the subject property. Project Schedule Anticipate beginning site grading by May or June 2016. This site may have sustained wet soil conditions after spring thaw and rains. Grading in dryer weather is desirable. Site is significantly short of necessary fill material. Timing of grading may be dictated by availability of soil suitable for import. Completion of streets by October 2016. NIGHMAS OSMriesAr Statement of Qualifications KRB Development, LLC is a cooperative venture which was created by three companies, for the purpose of acquiring and developing land projects for single family home sites. KRB Development consists of three companies with over sixty years of experience and collectively are responsible for over thousands of new construction homes over the last several decades. The members of KRB consists of William Ryan of Ryan Real Estate/Topaz, LLC, Dave Anderson of Brandl/Anderson Homes and Gary Horkey of Key Land Homes. KRB has built homes in the south suburbs for over thirty years. We have recently developed land in Rosemount "Prestwick Place", Apple Valley "Quarry Ridge", Prior Lake "Eagle Creek Estates and Markley Lake Woods", Lakeville "Kyla Crossing and "Enclave at St. Frances Woods". Included with this letter we will include a letter from each Member further outlining their qualifications and experience. RYLAND HOMES' TWIN CITIES DIVISION 7599 Anagram Drive Eden Prairie, MN 55344 952.229.6000 Tel 952.229.6024 Fax www.ryland.com LETTER OF INTENT July 31, 2015 Mr. Allyn Kuennen Assistant City Administrator City of Lakeville 20195 Holyoke Avenue Lakeville, MN 55044 RE: 183rd Street Property - Lakeville, MN Allyn: Pursuant to our recent discussions The Ryland Group, Inc. ("Ryland") is interested in purchasing approximately 27+/- gross acres, 19.01+/- developable acres, of raw land located west of 1791" Street West & north of 183rd Street West, commonly referred to as the 183' Street Property (the "Property"), in Lakeville, MN. This letter sets forth, on a non-binding basis, certain business terms which, if acceptable to the seller(s), would form the basis for a definitive, binding purchase and sale agreement ("PSA") for the Property, the initial draft of which Ryland would prepare. The terms of the agreement would be generally structured as follows: 1. NUMBER OF LOTS: Ryland proposes to purchase the Property for the purpose of developing approximately forty (40) single-family lots on which to construct single-family homes. 2. PURCHASE PRICE: The purchase price ("Purchase Price") for the Property shall be Eight Hundred Forty Thousand Dollars ($840,000). The purchase price is calculated on per lot basis with forty (40) lots being purchased at Twenty One Thousand Dollars ($21,000) per lot. 3. PURCHASE SCHEDULE: Ryland will agree to purchase the Property April 1, 2016 subject to receiving preliminary plat approval for the City of Lakeville resulting in a minimum of forty (40) single family lots. 4. DEPOSIT: At the time of execution of the contract, Ryland will post a deposit in the form of (i) an irrevocable letter of credit or (ii) cash equal to Seventy Five Thousand Dollars ($75,000) to be held by First American Title Company. The earnest money will be refundable through the Feasibility Period. Upon expiration of the Feasibility Period all earnest money will be non- refundable except in the event of Seller's default or the failure of one or more Conditions Precedent as outlined in the Purchase and Sale Agreement. All earnest money shall be applicable towards the Purchase Price. 5. FEASIBILITY PERIOD: Ryland shall have one hundred fifty (150) days from the contract date to complete a Feasibility Study on the Property including title review and physical testing on the Property. 6. CONDITIONS PRECEDENT: Ryland's obligation to settle on the purchase of the Property shall be contingent upon the successful preliminary plat approval of the Property, approval of any architectural requirements enforced by the City of Lakeville, Seller, private association, homeowner's association or architectural review committee or any other governmental authority and corporate approval. Seller shall pay all Ievied, pending and special assessments associated with the Property prior to closing. With your affirmative response, we will instruct Ryland's attorney to prepare a contract in accordance with the terms outlined herein. By executing this letter of intent, the parties agree to make good faith efforts to agree on a contract of purchase and sale. Nevertheless, neither party shall be under any binding obligation until such time as a mutually agreeable contract is fully executed by the appropriate officers/partners in each of our organizations. Seller(s) agrees not to market the Property or solicit or entertain any offers to purchase the Property from others until the earlier to occur of (a) the date on which the parties mutually determine that they cannot reach agreement on a contract or (b) 30 days from the date after which Seller countersigns this Letter of Intent. If we do not receive from you a countersigned copy of this letter within 30 days of the date hereof, then the terms of this letter shall be deemed null and void. Please contact us with any questions or comments that you may have regarding these matters. Thank you for providing Ryland with this business opportunity. Sincerely, THE RYLAND GROUP, INC. (Ryland) Q By: Name: Michael P. Ramme Title: Vice President of Land Acquisition - Twin Cities Division Seller(s) hereby agrees to sell the Property to Ryland and to cease marketing the Property in accordance with the above terms and conditions, subject to the signing of a mutually agreeable contract of sale incorporating the above terms. Seller(s) By: Name: Title: Date: I' V I \ f Qo�, on' -> uw I i N F,9�T 11x;w I �NP,R9 f, N w Y F iota N R ii H ��! •Y Q� —H 4 � L_______ •� 8 -�. 5 � ,. 1 . `,.,- a 1�� '. j' . � � 179TH STREET WEST e MH 1 INV 1,-2.ss . S-• e RE IN V1E051/5 189038.96 _ _ d I tl 10 - '- 1 ,• -� � _� ,ter,-- - - - -' "r, 2 � I I I RE f1.95 �-� `•1 ' 1 �� 1 �. -' A INV 104]96 C 1059.98�,LYJ _ 1 5 1 � 1 j 1 r 14 t', _ rA -.I "p 1 - .� 111 :..11•., _ _ _ _ i RRE1052.25 INV 103982 C>✓;"�- - jn r1 �/] y i 1 O 1 MH6 1 NV RE 1104236 C- . - - DATE 2/04/13 N REVISIONS BENCHMARK T.N.F. ELEV.-1059.71 - NLS SIO[ OF IIYDE PARK AVENUE AT — ENO OF THE EXISTING ROAD. H. ELEV-1-66 SOU-HNEST QUADRANT OF HYDE PARK AVENUE & '7611H STREET WEST, CAD FILE SCALE IN FEET 22853CFFSITE D So 100 150 PROJECT NO. 1 50 feet 22853 7.10 � SSMN 4 tl�_6 •Sa2[ r _ _ '(.i � � ,✓, � 5 �. E �J ___� � �' �� C% �l RE 1062.95 „~' ✓'' � ` \ 0. , �` 1 __J \� � � I }i 15 12 13 2 ;11 I,;a9az cc y ,.. I 1 54.30 ` INV 1042.30 � y SSMH 9 RE1145 7.40 3 --d INV 4s.4o IA— y r I _ I 1� - �....._53 ��. F,Et�� d•y' �,�..�,s,�-- lf� 3 /;' I` `r x66a�g$e ✓ nl k."-e- ta- 6 1i.. INY 1050.35 C !H a SKH 10 INV �14 'r I s 3 HE 10- 2 NI,WO si NV 10 Bn 10 pa DRANK BY DATE 2/04/13 REVISIONS BENCHMARK T,N.H. ELEV.-1059.71 — MEST SIDE OF H,DE PARK AVENUE AT THE END OF THE EIATING ROAD. TN.H. ELEV=1-66 - SOOTH_7 DOID NT x CAD FILE H— PARK A—E k —TH STREE- NrST. SCALE IN FEET 228530FFSITE 0 50 100 ts0 Miiiia PROJECT NO. I.'n,h = 50 iW 22853 7.10 Request for Proposal 183rd Street Property City of Lakeville.. Minnesota Prepared for: The City of Lakeville Prepared by: Pulte Homes of Minnesota LLC Pulte July 31, 2015 Transmittal Letter Pulte July 31, 2015 Mr. Allyn Kuennen, Assistant City Administrator City of Lakeville 20195 Holyoke Avenue Lakeville, MN 55044 akuennenAlakevillemn.gov Re: Request for Proposal, 183d Street Property, Lakeville, Minnesota Dear Mr. Kuennen: Pulte Homes is pleased to respond to the City of Lakeville's Request for Proposal for the sale and development of 19.01 acres of residential property located on 183d Street in Lakeville, Minnesota. The new homeowners of our consumer inspired homes in Lakeville will benefit by the numerous amenities at this site, like the expansive greenway corridor, access to high quality schools, numerous recreation alternatives, proximity to emergency services and the nearby Life Time Fitness facility. As stated in the Pulte Homes Vision Statement: "We build consumer inspired homes and communities to snake lives better". Pulte Homes has extensive experience in development and partnering with cities on City owned property. Most recently, Pulte Homes acquired a 26 acre parcel in 2014 from the City of New Brighton and is currently creating a new neighborhood comprised of 89 single family homes and 36 townhomes. It is because of these past experiences in partnering with municipalities that we are excited about this development opportunity to help create a vibrant and exciting new neighborhood for many people to call `home' in Lakeville. Our Team at Pulte Homes has put a significant amount of thought, analysis, and effort into how we will: • Efficiently develop the Property • Build housing products that are consumer inspired and of high quality • Measure the economic value of the Property for the City and how that value impacts all parties While we believe there is more work to do with the City's input on the site design, we are confident our proposed mix of traditional single family and also single -level, detached, age targeted housing opportunities satisfies the demand from multiple demographic groups in Lakeville and will make for a highly regarded and sought after neighborhood in Lakeville. The terms under which Pulte Homes proposes to purchase the 19.01 acres from the City of Lakeville are as follows: 7500 Office Ridge Circle. Suite 525 Eden Prairie. MN 55344 Pulte 1. Buyer: Pulte Homes of Minnesota LLC, a Minnesota Limited Liability Company and wholly owned subsidiary of PulteGroup, Inc., a Michigan Corporation (herein after "Pulte") 2. Purchase Price: $1,300,000.00 3. Deposits: Pulte will deposit a $25,000.00 Initial Deposit within 5 days of the Contract and which will be held by the Title Company and applied against the Purchase Price at the Closing or disbursed per the terms of the Contract. Pulte will also deposit a $25,000.00 Additional Deposit within 5 days of the City's approval of the Preliminary Plat for the development of the Property, which Additional Deposit together with the Initial Deposit, will be held by the Title Company and applied against the Purchase Price at the Closing or disbursed per the terms of the Contract. 4. Closing: The Closing of the Property will be the later of 30 days after the City's approval of the Preliminary Plat for the development of the Property or May 1, 2016. S. Feasibility Period: The Feasibility Period shall begin on the date of the Contract and expire on the 1201h day. During the Feasibility Period Pulte shall perform due diligence. 6. Conditions to Closing: The following conditions must be satisfied prior to Closing: a. No moratorium with respect to the issuance of building permits. b. Approval by the City of the Preliminary Plat for the development of the Property. c. Pulte's corporate headquarters shall have approved the purchase of the Property d. Pulte shall have received any offsite utility, drainage, construction or other easements required for the development of the Property. 7. Taxes and Special Assessments: General real estate taxes for the Property shall be prorated as to the date of Closing and all special assessments, if any, will be the responsibility of the City. S. Real Estate Commissions: Pulte and City are responsible for their respective commissions, if any. 9. Real Estate Contract: Both the City and Pulte agree to use `best efforts' to negotiate a mutually agreeable Contract to be fully signed on or before September 4, 2015, Our Team at Pulte would be happy to discuss the content of our Proposal and we look forward to forging a solid relationship with the City of Lakeville based on collaboration, partnership, and trust. Sincerely, ale000",fg 0401", David B. Deebach, Manager Land Acquisition Pulte Homes of Minnesota LLC 7500 Office Ridge Circle, Suite 325 Eden Prairie, MN 55344 Telephone: (952)229.0724 Email: david.deebach@pultegroup.com 7500 Office Ridge Circle. Suite 525 . It f Eden Prairie. MN 5534 Development Concept Sketch Plan [ImppsM Zmlm lortb laurel 100 Nina fmd� Immmi pulte i A21mg MUM Ir bulk t rgayr 11,•M7 rrry n v vDnvw-lprr LA]MVRJA bONNEBOTA ALLIANT ......... m ,is Development Concept Supporting Information Site Data PID 1 = 224178000021 (9.91 Acres) — North PID 2 = 224178000040 (9.1 Acres) — South Total Gross Area = 19.01 Acres Net Buildable Acres = Undefined — Wetland limits require updating Properties in Vermillion River watershed and within City's Farmington Outlet Total Single Family Lots: = 22 (85' WIDE LOTS PER RS -3) = 31 (55' WIDE LOTS PER RST -2) = 53 TOTAL LOTS (2.79 LOTS/GROSS ACRE) Existing Zoning North Parcel - RS -2 Min Lot Area = 18,000 SF Min Corner Lot Area = 15,000 SF Min Lot Width = 100' Min Corner Lot Width = 120' Min Front setback = 30' Min Side Setback = 15' Side Corner Yard = 30' Min Rear Setback = 30' ]Nlte:, Proposed Zoning North Parcel - RS -3 (Single familv homes Design Standard Required Provided Min Lot Area = 11,000 SF 11,050 SF (Average = 15,680 SF) Min Corner Lot Area = 12,500 SF 13,740 SF Min Lot Width = 85' 85' Min Corner Lot Width = 100' 100' Min Front setback = 30' 30' Min Side Setback = 10' 10' Side Corner Yard = 20' 20' Min Rear Setback = 30' 30' We Build Consumer Inspired Homes and Communities to Make Lives Better Existing Zoning South Parcel - RS -3 Design Standard Required Min Lot Area = 11,000 SF Min Corner Lot Area = 12,500 SF Min Lot Width = 85' Min Corner Lot Width = 100' Min Front setback = 30' Min Side Setback = 10' Side Corner Yard = 20' Min Rear Setback = 30' Pronosed Zoning South Parcel - RST -2 (Detached townhomes Design Standard Required Provided Min Lot Area = NA 7,150 — 20,672 SF; (Average = 9,647 SF) Min Lot Width = NA 55' Min Corner Lot Width — NA 70' Min Unit Width = 25' 40' Min peripheral setback = 30' 30' Min Front setback = 30' 30' Min Side Setback = NA 5' and 10' Min Rear Setback = NA 30' Front fagade stone/brick = 25% 25% Association maintained site required and provided 150'-600' Engineering Design Standards Design Standard Required Proposed Typ Street ROW Width = 60' 60' Cul-de-sac ROW Width = 50' 50' Local Street Width = 32' BB 32' Cul-de-sac- Street Width : 28' BB 28' Cul-de-sac Length = 150'-600' 415', 253', 1,022' (variance to avoid wetlands) Cul-de-sac Min Radius = 48' 48' We Build Consumer Inspired Homes and Communities to Make Lives Better Project Approach Pi-il I te We at Pulte drive to develop communities and build high quality, consumer inspired homes to make lives better. We do this by strong up front planning, only picking the best locations where people want to live, fully understanding the market needs and wants from a location, community, and home, and by accentuating the natural and manmade site amenities of the area. The City of Lakeville's property, the subject of this proposal, provides unique attributes that are the cornerstone for our proposal: take advantage of the greenway areas and views, be proximate to community amenities such as the schools, open spaces and trails, Lifetime Fitness, and the police station, be accessible to regional transportation systems and quality retail, and finally integrate into the existing neighborhoods in the area. Project Approach When evaluating properties for development potential, we try to balance two primary factors: 1) What does the site "want to be" from a market demand standpoint and how do we differentiate the site to be where the consumer wants to live? 2) What are the site and regulatory constraints? Our market research indicates that there is strong demand in the Lakeville area for high quality single family homes and "active adult" or age targeted housing. In particular, there are many active adult Lakeville residents who would like to stay in Lakeville, but are unable to find the product that suits their needs and wants. Our proposal serves both of these critical segments of the market, while successfully integrating into fabric of the existing single family neighborhoods to the north and east. There are a number of site and regulatory constraints that must be incorporated into our site plan and housing products: zoning, engineering standards, stream setbacks, wetland buffers, topography, flood protection, utility easements, etc. Although at this early stage it is impossible to know whether we have learned all of the salient facts and whether all of our assumptions are accurate, we have completed in depth research and have incorporated each of these identified constraints into this proposal. For instance, our research indicates that an existing sanitary sewer line runs along the west and north property lines within an easement. Homes cannot be constructed within this easement. Therefore, we have provided the space necessary to allow the adjacent lots to be buildable. In other words, we believe that our site plan is "real". Our proposal consists of the following plans: Site B — Single family homes (see attached example elevations) Being proximate to existing single family homes to the north and east leads to a desire to maintain continuity in terms of adjacent land uses. We propose to build homes from our Pinnacle Series, which includes 50'-60' wide homes on 85' wide lots. The adjacent Eastview Elementary School and associated open space to the west is an attractive amenity for single family homebuyers with young We Build Consumer Inspired Homes and Communities to Make Lives Better AdnkK pulte children. We envision potentially constructing a trail connection to the school district property, if permitted by the City and the School District. Over half of these sites will also back up to the greenway and existing trees, which are highly desirable amenities for this demographic when looking for new homes. Our proposal includes a rezone of Site B from RS -2 to RS -3, resulting in lots of similar size to the existing development directly to the east (Rose Creek). Site D — Age targeted single level living detached townhomes (see attached example elevations) The wetland complex between Sites B and D also provides a natural barrier and transition area to a change in land use. Nearby amenities such as the Lifetime Fitness and trail system are very attractive to the active adult market. By "active adult," we are referring to the 55+ market, however, it is not uncommon for younger couples and families to purchase these homes. In addition, close proximity to the police station provides a comfortable level of security for this safety -conscious demographic. We propose to rezone Site D from RS -3 to RST -2 in order to best serve the desires of the active adult market. In addition to the amenities discussed above, this segment of the market is not interested in maintaining large lawns. Therefore, smaller yards will be desired as well as a professionally managed homeowners association to maintain lawns and landscape and provides for snow clearing for the homeowners. Project Goals The City has a number of goals related to development of Sites B and D. Following is a brief summary of the City goals listed in the Request for Proposals and a description of how our project approach addresses these goals. 1. "Standards consistent with the RS -2 and RS -3 Single Family residential development zoning" — Our proposal does not propose zoning that is identical to that outlined in the Request for Proposals. However, we believe that our proposal and project approach does a better job of satisfying the other City goals and better addresses the current housing needs of existing Lakeville residents. "Creative development desikn and housin z ssbyles " — Sites B and D have a number of limiting physical constraints. They are small, narrow, and are affected by adjacent wetlands and streams. Our project approach is to utilize these constraints/attributes to create two separate and unique neighborhoods serving two different demographic groups within Lakeville, without proposing any impacts to the surrounding wetlands. From both a market place and physical constraint standpoint, we are proposing "what the land wants to be." We believe this is the definition of creative development design. We Build Consumer Inspired Homes and Communities to Make Lives Better I= - The two neighborhoods will offer distinctly different housing products to meet current, real needs in the community. Site B will offer primarily two-story single family homes for move up buyers, likely for families who are looking for the ideal home and community to move them forward in life with well selected floor plans and options to meet their needs. We propose to have a wide variety of floor plans, elevations, and exterior upgrades to be available. Site D will offer single -story living options for the active adult buyer segment, which are buyers who want to live life to the fullest and enjoy affordable living with homes of enduring quality. This product will also offer a wide variety of floor plans, elevations, and upgrades. 3. "Increased residential opportunities and choice of housing products. " — By providing two separate housing products on two small sites, we are maximizing the residential opportunities and choice of housing products for residents of Lakeville. 4. "A development pattern complementary to the surrounding neighborhoods and the City of Lakeville. " — Our proposed housing products maximize the use of the surrounding amenities and is complimentary to the existing adjacent uses. The proposed single family homes (with values in the $400's) will blend into the neighborhood to the north and east and is immediately adjacent to an elementary school, which will serve the families in these homes. The active adult age targeted homes (values in the $300's) will be immediately adjacent to wetlands to the north, east and south, which is an amenity for this buyer segment. Although there are single family homes further to the north and east, the wetland serves as a natural buffer between these communities. The land uses and product types proposed in our project approach are entirely complementary to the surrounding land uses. By choosing the housing products that best fit this location, the use of surrounding resources (school, open space, Lifetime Fitness, police station, and trail system) will be most efficiently utilized. We Build Consumer Inspired Homes and Communities to Make Lives Better