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515 Little Canada Road, Little Canada, MN 55117-1600 <br />(651) 766 -4029 / FAX: (651) 766 -4048 <br />www.ci.little-canadaann.us <br />MEMORANDUM <br />TO: Mayor Blesener and Members of the City Council <br />FROM: Joel Hanson, City Administrator <br />DATE: May 9, 2008 <br />RE: Abdo Markethouse Proposal <br />Highway 36 /Rice Street Properties <br />MAYOR <br />13111 13lesener <br />COCGVCIL <br />Rick Montour <br />Barbara Allan <br />John Keis <br />Michael McGraw <br />ADMINISTRATOR <br />Joel R. Manson <br />Attached is a Letter we received from Paul Abdo in response to our recent decision to not enter <br />into an exclusive development arrangement for the property at Highway 36 & Rice Street. In a <br />conversation I had with Mr. Abdo, he stated he was not interested in spending the time and <br />money to properly market the site without have an exclusive agreement. He noted that putting <br />together a development proposal that we will find acceptable will be challenging in this <br />economic environment and he didn't feel it was prudent to do so when it was possible another <br />developer could snatch the site out from under him. <br />Other parties have expressed interest in the site, but they have not provided any specific ideas at <br />this point in time. Therefore, the Council will have to provide direction as to the process you are <br />most comfortable with. <br />The options I see are: <br />• Enter into an exclusive agreement with Mr. Abdo and see what he can put together in the <br />next six months. (If we choose this option, we will need to be clear on a number of terms <br />and conditions with our agreement dealing with issues such as interim timelines, pricing, <br />and development goals.) <br />• Market the site with signage and other contacts and see what interest is generated in the <br />site. (This will likely result in Mr. Abdo dropping out from the process and we may not <br />see any activity or the type of development we want given the economic downturn that <br />seems to have depressed interest.) <br />• Passively market the site as in the option above with the idea of waiting out the economic <br />downturn. If something we like comes along in the meantime, we can move forward. <br />We could do another REP when business activity picks up in hopes that more <br />development options will lead to a better project. (There are no guarantees we will get a <br />"better" development proposal with an improved economy and we will also incur an <br />"opportunity cost" of the money we have invested in the site.) <br />cc: Paul Abdo, Abdo Markethouse <br />1 <br />