01-03-2001 Council Agenda - Laserfiche WebLink

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MAYOR Michael L Fahey COUNCIL Beverly Scalze Jim LaValle Matt Anderson Rick Montour 515 Little Canada Road, Little Canada, MN 55117 -1600 ADMINISTRATOR (651) 766 -4029 / FAX: (651) 766 -4048 Joel R. Hanson Email: cityhall @ci.little- canada.mn.us MEMORANDUM TO: Mayor Fahey & Members of the City Council FROM: Joel Hanson, City Administrator DATE: December 27, 2000 RE: Frattalone Development Concept At our November Council Meeting, I was asked to provide some comparative tax calculations for various development types that could occur on Mr. Frattalone's land located on the south end of Blacktem Pond (see attached). You will note the range of values is from approximately 320 to $40 per square foot. The exception to this range is the Heritage Office Park Development on County Road D where the value approaches 375 per square foot. The concern in using these numbers in this analysis relates to the ability to develop that type of project on this site. The next sheet is a comparison between a 100,000 square foot building and the concept proposed by Mr. Frattalone. I used 330 per square foot for the office /warehouse building, as that seems to be the midpoint for the possible types of buildings. (That amount could be higher depending on the ratio of office to warehouse space to be constructed.) For the Frattalone concept, I used 370 per square foot for the office (CI Title Building is $60 while the County has told me other offices can be valued around 380.). $22.50 was used as the cost per square foot for the shop. (I related it to the industrial buildings in the area.). The results of this analysis indicate that a 100,000 office /warehouse building would generate substantially more taxes than the Frattalone concept. However, is that realistic to expect for this site? I called John Peterson, both of Colliers /Towle Real Estate to get his opinion. John Peterson indicated that the site has the greatest marketability for use by a contractor or trucking company as long as outdoor storage is allowed. He estimates the property value at 33.00 per square foot for this type of use. Peterson did not see the property as an ideal office /warehouse site. Given the size of the property, he indicated that an 80,000 to 100,000 square foot office /warehouse facility would need to be constructed, and he did not think the market would support that. He thought rather than one large building; it would be more likely that two to three office /warehouse Page 10