03-10-26 City Council Workshop Packet

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8 Development Opportunities on City-Owned Land | Lake Elmo, Minnesota recreational opportunities. A network of trails runs close to the study area, and the City’s 2040 comprehensive plan notes that citywide greenways should eventually connect to the site. At the time of the study, the City was also considering opportunities to build a large sports complex one mile east of the site on 77 acres of land it had recently purchased. Development trends. The residential market in Lake Elmo is strong. During the initial panel briefing, City staff noted that Lake Elmo is seeing approximately 250 homes added to the community annually. As of October 2025, the City’s housing development pipeline had 157 single-family homes, 391 townhomes, and several apartment buildings (combined total of 554 rental units) proposed. The school district is racing to meet the anticipated demand for space and is in the process of building new facilities to increase its capacity from 500 to 1,100 students. (The City noted that there were only two commercial projects in the pipeline at the time of the study.) Area zoning. The study site is zoned as Business Park on the City’s 2040 Future Land Use map, which also notes a small section of commercial use near the Public Works site. A strip of proposed parkland would buffer Parcel 3 on the east, and a small strip of residential uses was envisioned for the northernmost boundary of this same parcel. Utilities and infrastructure. Utilities and transportation access points are of particular note for the entire study site. Water is available across the study area, and a water Insights into Lake Elmo • Small-town feel, rural, open, and green • City is safe and friendly • Historic perceptions around development receptivity • Elected leadership and City staff are striving to get to “Yes” and solutions • Downtown is great; local retailers appreciated • Strong residential pipeline; commercial pipeline is quiet • Want to remain different from neighboring communities (no big box) • Residents generally commute to work outside the community • Mixed-use is missing from the city • Few (no) entry-level housing options • No central community gathering space • Parks are great but becoming a City chore • Limited staff capacity for growing list of tasks • Would like to see sustainability and resilience elevated • Make sure the community is kept informed on any plans • “You hit that intersection and the lights go off. You’re in Lake Elmo.” Insights into the Study Site • Site is owned outright by the City (no debt) • It is a gateway to the rest of the city • Topography will require significant grading What the Panel Heard The panel interviewed leaders and staff from the City, County, and State agencies, developers, industry experts, business owners, nonprofit organizations, and residents who shared this feedback: • Rail line separates P1 and P2 • Sewer in place on P1; sewer to P2 needs to go under rail lines; P3 would go under 34th Street • Southern site (P1) has significant grade drop and watershed constraints • Public Works is consuming the area’s premiere commercial corner on P3 • Existing residential around P3 needs consideration Broker Notes • Need to know constraints, City requirements (zoning, utilities, due diligence, access, special uses/trails/City buildings) • Need to know process and timeline for approvals; speedy to market • Retail across the intersection in Oakdale has struggled • Access points will be important • Good roadway connectivity via Interstate 694 and County and local roadway networks • Heavy industrial could work on the southern parcels • Office only makes sense with tenant in hand as a build-to-suit project • Keep options open and don’t divide the site until the first major user for each parcel is known • Help brokers get familiar with the site after the City makes infrastructure improvement decisions, land use plan updates, and determines zoning