CC WORKSESSION 12192002 - Laserfiche WebLink

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EHLERS & ASSOCIATES INC To: Mike Morrison—City Manager ® From: Stacie Kvilvang—Associate Financial Advisor LU Subject: Stonehouse Redevelopment Date: December 13, 2002 At the October 8, 2002 City Council work session, the Council directed staff and Ehlers to interview interested developers to ascertain their interest in redeveloping the above referenced site. Since that time, we have discussed the project with a couple of developers, one which showed an immediate interest in redeveloping the site. This developer, Amcon Construction, has extensive experience in redevelopment, new commercial, office and industrial development, as well as construction and construction management services. Staff relayed the following key points of the redevelopment to Amcon Construction: 1. The City would like to retain an 8,000-10,000 sq/ft municipal liquor store on the site 2. The City would like to have a new restaurant that would accommodate the existing pull tab establishment on site 3. The City would like to see an outdoor seating space accommodated by the restaurant 4. The City would need to relocate and reconstruct a new Fire Station, which the timing of this and the redevelopment would have to coincide or a phasing plan worked out; and 5. This intersection is the gateway to the community and therefore, the design of the site would need to reflect this status. Based upon these discussions, Amcon developed the enclosed proposal, dated December 13, 2002. Amcon is proposing to construct a 25,000 sq/ft retail center that would accommodate a restaurant, a new 8,000- 10,000 sq/ft municipal liquor store and additional retail space. Amcon currently partners with a sports bar/restaurant chain in some of their commercial developments. This restaurant would accommodate the current pull tab establishment. However, it should be noted that the City has been approached by a couple of other restaurateurs that have shown interest in developing a restaurant on site, both of which will also accommodate pull tabs. If selected to proceed with the development, Amcon would be required to contact the other two interested parties to develop the best fit for this site and the community. Since the City desire to maintain a municipal liquor store on site, Amcon has provided the City with several options: 1. Amcon would purchase the land from the City for $8.00 sq/ft ($400,000) and lease the liquor store space back to the City for a negotiated lease price. 2. The City would lease the property to Amcon, whom would complete the improvements and lease the space for a 30-year term'. The City would generate a steam of lease payments that