ECONOMIC DEVELOPMENT AUTHORITY - Erik Thorvig, Community Development Director
Title
APPROVE LETTER OF INTENT FOR EDA-OWNED SITE ON PHEASANT RIDGE DRIVE
Background
The Pheasant Ridge Business Park is located on Pheasant Ridge Drive, west of Lexington Avenue. The Blaine EDA has owned land in the business park since 1986. The EDA has sold portions of land to various businesses and still owns a 21.96-acre site as shown on the attached map.
In 2016, staff had a wetland delineation completed to determine whether the site could be developed. The delineation identified enough upland to accommodate an approximately 70,000 sf. building. This would require approximately 2.05 acres of wetland fill and an overall development area of 6.56 acres (outlined in blue on attached site plan). The property is currently zoned Planned Office District (POD).
The site has been for sale for approximately three years. A developer has shown interest in the site to construct a multi-tenant spec industrial building. Attached is information on a similar building the developer built in Coon Rapids. The developer has asked the Blaine EDA to enter into a Letter of Intent (LOI) to secure the site for up to 90 days to complete necessary due diligence and determine whether to proceed with a purchase agreement.
The site has significant development costs in order to make the site shovel ready for development due to soil corrections, fill, and wetland mitigation. Based on previous investigation, these costs exceed $1,000,000. If the site was shovel-ready, a market rate price for a 6.56-acre industrial site would be approximately $1.1-1.2mil. Because of the significant development costs, the sale price of the land would be less than $100,000. The LOI identifies a sale price of $45,000.
Staff will work with the developer to identify more precise development costs and determine a fair, market rate sale price which could be different than the price outlined in the LOI. A public hearing and formal action item to sell would be required by the EDA in the future.
Recommendation
Staff recommends approval of the attached Resolution. This type of project would bring new businesses and jobs to Blaine, along with making a property taxable that has been exempt since 1986.
Body
WHEREAS, the Blaine EDA has owned land in the Pheasant Ridge Business Park since 1986; and
WHEREAS, a 21.96-acre site has been identified as developable and has been for sale; and
WHEREAS, JSN Properties, LLC desires to enter into a Letter of Intent with the Blaine EDA for development of the property for an industrial building.
NOW THEREFORE, BE IT RESOLVED, that the Blaine Economic Development Authority hereby approves entering into a Letter of Intent with JSN Properties, LLC and hereby authorizes the executive director and president to enter into any necessary agreements to execute the Letter of Intent.
PASSED BY THE Blaine Economic Development Authority this 1st day of June, 2020.