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Planning Commission Regular Meeting Minutes March 17, 1998 • Page 5 1 Mr. Warner stated a 12.25% return of ownership is attractive. With the Robodyne relocation this 2 site will produce $3.50 per square foot and after five years Krause/Anderson may no longer be 3 the owner of the building. A retail use would be better for Krause/Anderson and for the 4 community. Mr. Warner again noted he would have moved forward with the retail development 5 if he could have secured a 4,000 square foot gas/convenience user. He had been convinced that 6 he could find a user due to the traffic on Highway 88 but there was no reception from the 7 operators. They were concerned with the speed limit, the limited curb cuts, and that there are no 8 traffic lights. 9 Chair Bergstrom noted this site is located in a TIF District and asked if TIF funds would help a 10 retail development. 11 Mr. Warner stated TIF funds may help but with the price structure and the cost of raw land, it 12 would be a challenge to secure tenants. The retail cost per square foot would be $12 to $14 plus 13 an overhead cost. There are not a lot of businesses that can support that amount without a strong 14 exposure. 15 Commissioner Gondorchin asked the status of the office park near this site. Ms. Moore-Sykes stated the office park is in a PUD or condo situation and is almost to full capacity. 18 Commissioner Horst stated he would refrain from discussion on this proposal as he owned a 19 business in the St. Anthony Village Shopping Center. 20 Mr. Warner stated Krause/Anderson had identified potential tenants of a retail center as a 21 Subway and sandwich shop at$14 per square foot, a coffee shop at $13 per square foot, a Mr. 22 Movies or a video store or deli user at$13 per square foot, a sporting goods store at$12 per 23 square foot, and an end cap gas station of 4,000 square feet at $18 per square foot. The building 24 cost was estimated at $65 per square foot for 4,000 square feet of structure and $55 for 15,000 25 square foot of structure. The land cost was estimated at $800,000 and soft costs of$1/4 million. 26 This would result in a net 12.25% return of ownership on the property. This does not include the 27 common cost of$4 per square foot. This would result in a $17 to $22 gross square foot rental 28 rate. 29 Chair Bergstrom noted an earlier comment that the arrangement with Robodyne could be on a 30 temporary basis. 31 Mr. Warner stated he had advised Mr. Alvite that one possibility would be that he be granted a 32 conditional use permit for five years and within that time the City could determine if this was a 33 satisfactory arrangement. Mr. Warner encouraged Commissioners to tour the Robodyne facility & and see firsthand the incredible work which is being done there.