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Mike Momson 63 Stonehouse Redevelopment February 4, 2003 Page 2 4. If the Public Facilities Task Force recommended that the City construct a new Fire Station/Public Works Facility, the City would need to relocate the existing Fire Station, which the timing of this and the redevelopment would have to coincide or a phasing plan worked out 5. This intersection is the gateway to the community and therefore, the design of the site would need to reflect this status; and 6. If possible, the City would like the redevelopment to generate some form of financial contribution to the development of a new Fire Station Based upon these discussions, Amcon submitted a proposal to Ehlers in December 2002. Their proposal is to construct 26,000 sq/ft of retail in two buildings. One building would be located on the northern portion of the property, at the intersection of County Road 88 and Kenzie Terrace. This building would accommodate a 6,000-sq/ft restaurant and its placement on the site will be contingent on the County deeding the needed additional Right-of-Way to the City. It should be noted that Amcon currently partners with a sports bar/restaurant chain in some of their commercial developments. This restaurant is interested in locating on this site and will accommodate the current pull-tab establishment and the exiting Stonehouse Restaurant staff can apply for jobs at the new restaurant. Ehlers did inform Amcon that the City had been approached by a couple of other restaurateurs that have shown interest in developing a restaurant on the site, both of which will also accommodate pull tabs. Amcon has met with one of the interested restaurateurs and is corresponding with the other. If selected to proceed with the development, Amcon will make the determination which restaurant will be most financially feasible for the site, while meeting the community's needs. The second retail building, consisting of 20,000 sq/ft, will be located on the southern portion of the site where the existing strip center is located. It is anticipated that the new 8,000-10,000 sq/ft municipal liquor store would be located on the end cap fronting along County Road 88 and the remaining 10,000 sq/ft of retail space will span over to Kenzie Terrace. Since the City desires to maintain a municipal liquor store on site, Amcon has provided the City with several options: 1. City Sells the Land: Amcon would purchase the land from the City and lease the liquor store space back to the City for a negotiated lease price. The City could utilize the proceeds to pay for a new Fire Station, or for lease/tenant improvements for the Liquor Store. In addition, the property will become taxable and generate funds to the City's General Fund. 2. Land Lease: The City would continue to own the property, Amcon would pay for and construct the improvements, the City would lease space from them and Amcon would pay the City for a land lease (long-term land lease would be required). The City would generate a steam of lease payments that could be utilized for the Liquor Store improvements/lease payments or to assist in paying for the new Fire Station. In addition, the property will become taxable and generate funds to the City's General Fund.