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HomeMy WebLinkAboutEDA AGN 06-18-02CITY OF COLUMBIA HEIGHTS 590 40th Avenue N.E., Columbia Heights, MN 55421-3878 (763) 706-3600 TDD (763) 706-3692 Visit Our Website at: www. ci. columbia-heights, mn. us ECONOMIC DEVELOPMENT AUTHORITY June 18, 2002 EDA COMMISSIONMERS Robert W. Ruettimann Patricia Jindra Marlaine Szurck Juliennc Wyckoff Gary L. Peterson Bruce Nawrocki Bobby Williams The following is the Agenda for the regular meeting of the Columbia Heights Economic Development Authority (EDA) to be held at 6:30 p.m. on Tuesday, June 18, 2002, in the City Hall, Conference Room 1,590 40th Avenue N.E., Columbia Heights, MN 55421 The EDA does not discriminate on the basis of disability in the admission or access to, or treatment or employment in, its accommodation will be provided to allow individuals with disabilities to participate in all EDA services, programs, and activities. Auxiliary aids for handicapped persons are available upon request when the request is made at least 96 hours in advance. Please call the EDA Secretary at 706-3669 to make arrangements (TDD 706-2806) for deaf or hearing impaired only. CALL TO ORDER/ROLL CALL. PLEDGE OF ALLEGIANCE. CONSENT AGENDA.(These items are considered to be routine by the EDA Board of Commissioners and will be enacted as part of the Consent Agenda by one motion.) A. Move to adopt the consent agenda items as listed below: 1) Approval of Minutes. a.. The Regular Meeting of May, 2002. 2) Financial Report and Payment of Bills. a. Financial Statement for May, 2002. b. Payment of Bills for May, 2002. MOTION: Move to approve Resolution 2002-09, Resolution of the Columbia Heights Economic Development Authority (EDA) approving the financial statement for May, 2002 and approving pa ~yment of bills for the month of May, 2002. ITEMS FOR CONSIDERATION. 1. Request for Qualification Interviews 6:35- 7:05 p.m. 7:10- 7:40 p.m. 7:45- 8:15 p.m. 8:20- 8:50p.m. 8:50- 9:00p.m. 9:00- 9:30p.m. 9:35 - 10:05 p.m. 10:10 - 10:40 p.m. United Properties, Dale Glowa Welsh Companies, Robert C. Long Industrial Equities, LLP, John N. Allen Schafer Richardson, Kit Richardson Break Awsumb & Associates Inc, Gordon Awsumb Klodt Inc, Paul Klodt Bancor Group, David Newman ADJOURNMENT Walter R. Fehst, Executive Director H:~EDAAgenda2002\6-18-2002 The mission of the Columbia 9leitlhts Bconomic cDevelopment Authority is to provide financial and technical assistance and resources to residentia6 commercia6 and industrial interests to promote health, safety, welfare, economic development and redevelopment. THE CITY OF COLUMBIA HEIGHTS DOES NOT DISCRIMINATE ON THE BASIS OF DISABILITY IN EMPLOYMENT OR THE PROVISION OF SERVICES EQUAl OPPORTUNITY EMPLOYER COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) REGULAR MEETING MINUTES OF MAY 20, 2002 CALL TO ORDER - The Regular Meeting of the Columbia Heights Economic Development Authority (EDA) was called to order by President Ruettimann at 5:46 p.m., Monday, May 20, 2002, in the City Hall, Conference Room 1,590 40th Avenue NE, Columbia Heights, Minnesota. ROLL CALL Commission Members Present: Commission Members Absent: Staft Present: Robert Ruettimann, Patricia Jindra, Marlaine Szurek, Gary Peterson, Julienne Wyckoff, Bruce Nawrocki and Bobby Williams Walt Fehst, Executive Director Randy Schumacher, Acting Deputy Executive Director Cheryl Bakken, Secretary Mark Nagel, Housing Assistant CONSENT AGENDA Approval of Minutes Move to adopt the minutes of the April, 2002, regular meeting as presented in writing. Financial Report and Payment of Bills Move to approve Resolution 2002-08, Resolution of the Columbia Heights Economic Development Authority (EDA) approving the financial statements for April, 2002 and approving payment of bills for April, 2002. MOTION by Peterson, second by Szurek, to adopt the consent agenda items as listed. All ayes. Motion Carried. Nawrocki felt-that the meeting was called to start at 5:45p. m. without considering the 15 minute time difference that would have allowed him to be present at the start of the meeting. Ruettiman informed the Board that Bill Elrite, Finance Director, was not able to present the Fund Balance Review this month due to the Annual Audit, but will have the information available by the June meeting. ITEMS FOR CONSIDERATION Sullivan Lake Settlement Agreement Schumacher indicated the EDA created the Sullivan Lake Tax Increment Financing District, approved the financing plan on June 15, 1987 and received Tax Increment payments for the property taxes payable in 1997 in the amounts of $48,120.66 on July 7, 1997, $47,864.33 on December 2, 1997 and $1,678.46 on January 26, 1998. The State Auditor conducted an examination and audit of the District and issued a letter of non-compliance dated January 26, 2001, alleging the EDA's receipt of $97,663.45 in Tax Increment Payments after July 15, 1997, violated the statutory duration limits for an Economic Development District and is subject to repayment. The EDA responded to the State Auditors notice denying the EDA improperly Economic Development Authority Meeting Minutes May 20, 2002 Page 2 of 4 received $97,663.45. Anoka County brought an action against the EDA in the Anoka County District Court, siting the State Auditors findings and seeking repayment of the Tax Increment payments. Under Minnesota Statutes, the Court may abate all or part of any amount payable by the authority, if the action was taken in good faith and the payment would work an undue hardship on the municipality. The parties recognized the EDA relied in good faith on the counties distribution of Tax Increments from the Sullivan Lake District, and that the EDA has expended such distributions, under the assumption they were properly made. Anoka County wants to resolve the dispute to avoid the cost and delays associated with litigation. Therefore, staff recommended EDA approval of the settlement agreement, authorizing a payment in the amount of $1,678.46 to the County as a full, final and complete settlement, and this payment is made as a compromise of the disputed claim asserted against the EDA, and is not intended as an admission of wrong doing by the EDA. Szurek asked if the State Auditor wanted the total $97, 663.45. Fehst stated the letter received in the fall of last year did indicate that. Wyckoff asked who owns the district and will it be a dead district after this. Schumacher indicated that Rottlund owns the property and it will be a dead district. MOTION by Szurek, second by Jindra, to Approve the attached Settlement Agreement for Sullivan Lake Tax Increment Financing District; and furthermore, to authorize the President and Executive Director to sign the agreement and make the required payment to Anoka County. All ayes. Motion Carried. ADMINISTRATIVE REPORTS 2001 Audit Review Schumacher reported the Auditors report for Parkview Villa states that we have satisfied the following issues in the past year: 1)following the NSF policy consistent with the City; 2) the new software was implemented to provide the City with better financial information on billing and collecting rents; 3) new procedures were implemented for the coin operated laundry facilities; 4) a written agreement was signed between the EDA and the Hair Salon Beautician and a the proper licensing acquired; and 5) a Capital Replacement Plan was developed to identify financial needs. Ruettimann suggested the Auditors be made aware that the Audit for Parkview Villa should be addressed under the HRA in the future, as the administration of it was changed to the HRA in January of 2001 and also requested that Jindra and him receive a copy of the Audit. Schumacher will make sure the Finance Department addresses this issue for next year and staff will provide the copies of the audit to Ruettimann and Jindra. For the CDBG Program- The last three grants need to be finalized, which we processed the end of April. For CIAP- The Davis Bacon issue with Millar Elevator from 1999 needs to be finalized, which the EDA Board passed the final payment last month and a check has been issued to Millar. Economic Development AUthority Meeting Minutes May 20, 2002 Page 3 of 4 Schumacher indicated that staff should be commended for their efforts in resolving these issues. The Board extended their thanks to the Community Development Department staff Industrial Center Request for Qualifications $chumacher stated staff has received three RFQ's by the May 14~ deadline from IVelsh, United, and C.B. Richardson. John Allen and Awsumb and Associates, would still like to submit their RFQ 's, if the Board would be open to accepting them. Staff will review the RFQ 's prior to the EDA interviews being held. Each interview will be approximately 45 minutes in length. Ruettimann indicated, his experience with developers was that if they couldn't make the forty- five day lead time for bidding, they will most likely be late on the project. Nawrocki questioned if Awsumb has Industrial Development experience and maybe should not be considered because of the way he treated the business owners of the 49th and Central (Hilltop) strip mall unfairly. Ruettimann stated Awsumb was hired by the new owners of Walgreens to fill the units and should not be hem accountable for the short notices that the business owners received from previous mall owners. Peterson felt we should not exclude anyone at this point in the redevelopment process. Szurek suggested calling all of the remaining twenty developers that were sent RFQ's to let them know we are going to conduct interviews and verify if they are still interested in submitting their RFQ. Ruettimann requested staff contact all of the developers to find out their interest in submitting their RFQ and extend the deadline to Monday, June 10a at 4p.m. Schumacher will coordinate this process. - Rehab Incentive Program Schumacher indicated Columbia Heights has been approved for $50,000 in Rehab Incentive Program that the Resource Center has applied for. The Incentive Program will encourage Columbia Heights residents to fix up their home, as they will receive a 15% rebate if their income is up to $38,350; 12% rebate if their income is from $38,351 thru $54,400; and a 10% rebate is their income is between $54,401 and $88,205. The funds are on a first come, first serve basis and will be available sometime in July. LCDA Grant Application Schumacher indicated staff has applied for a Pure Planning Grant to be used for the Mady's area of Central Avenue in the amount of $25,000, which the City Council has reviewed and approved for submittal. Staff will know by July 25th if we will receive the funding. Economic Development Authority Meeting Minutes May 20, 2002 Page 4 of 4 Kmart Update Fehst indicated he recently spoke with Gerry Herringer and they are going to try to sell out their remaining lease on the property. McComb recommend Herringer look at the whole eleven plus acres and what can be done with it. The letter enclosed in the EDA packet outlines the steps to be taken in the next two months steps by Herringer. Mady's Block Redevelopment - Dunbar Proposal Schumacher indicated he and Fehst met with Frank Dunbar last week on the possible development in the Mady 's, Burger King, Rental Center block area. MaxfieM Research Inc. is working with Dunbar to provide information necessary for the development. They are recommending 17,080 sq ft of commercial development on Central, which includes 24, 000 sq fl on the 39tk street side for public use (City Hall or library possibly), a large parking area in the rear, possibly leaving Mady's Bowling Alley in the same spot, but upgrade the building, and 60 to 80 units of senior housing. The priority rating for admission to the market rate rental units couM be: 1) Columbia Heights residents first; 2) Columbia Heights families; and 3) residents that use to live in Columbia Heights, and would like to live her again. }Yyckoff felt the rental units should not be just for seniors, they should be open to any age group. Peterson requested staff check with Dunbar on the possibilities of opening the rental units to all age groups. }~ralt indicated there is a parking requirement that would have to be met if the units are opened to all age groups. St. Timoth¥'s Town-homes $chumacher stated Nedegaard has a purchase agreement with St. Tim's and will be coming up with a preliminary and a final plat for the P & Z and City Council review sometime in July. Resident, Mrs. Johnson, indicated she was at a meeting that was held between residents and Nedegaard, and reported that it went very well. OTHER BUSINESS Ruettimann indicated Pat Jindra was interested in being on the HRA Board and asked if any Board member would be interested in stepping down to allow her to fill the position. Wyckoff was very interested.. ADJOURNMENT President, Ruettimann, adjourned the meeting at 7:12 p.m. Respectfully submitted, Cheryl Bakken Recording Secretary H:\EDAminutes2002\5-20-2002 COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) Meeting of: June 18, 2002 AGENDA SECTION: Consent Agenda ORIGINATING EXECUTWE NO: DEPARTMENT: EDA DIRECTOR APPROVAL ITEM: Financial Report and Payment of Bills BY: Bob Streetar BY: DATE: June 10, 2002 BACKGROUND: The bound Financial Report for May 1, 2002 Check Listing (green sheets), and draft Resolution 2002-09 are attached for review. The enclosed Financial Report lists the Revenue Guideline (pink sheets), the Expenditure Guideline (yellow sheets), Expenditure Guideline with Detail (white sheets), and Balance Sheet (blue sheets), for each fund and department. The report covers the activity in the calendar (fiscal) year from January 1 through May 3 l, 2002. The Check History shows each fund with an expenditure history during the month of May, 2002. The total disbursements by fund are shown at the top of the listing. RECOMMENDATION: Staff will be available to answer specific questions. If the report is satisfactorily complete, we recommend the Board take affirmative action to receive the Financial Report and approve the payment of bills. RECOMMENDED MOTION: Move to approve Resolution 2002-09, Resolution of the Columbia Heights Economic Development Authority (EDA) approving the Financial Statement for May, 2002 and Payment of Bills for the month of May, 2002. EDA ACTION: ~: \Consent2OO2\May FinRep2002 EDA RESOLUTION 2002-09 RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) APPROVING THE FINANCIAL STATEMENT FOR MAY, 2002 AND PAYMENT OF BILLS FOR THE MONTH OF MAY, 2002. WHEREAS, the Columbia Heights Economic Development Authority (EDA) is required by Minnesota Statutes Section 469.096, Subd. 9, to prepare a detailed financial statement which shows all receipts and disbursements, their nature, the money on hand, the purposes to which the money on hand is to be applied, the EDA's credits and assets and its outstanding liabilities; and WHEREAS, said Statute also requires the EDA to examine the statement and treasurer's vouchers or bills and if correct, to approve them by resolution and enter the resolution in its records; and WHEREAS, the financial statement for the month of May, 2002 and the list of bills for the month of May, 2002 are attached hereto and made a part of this resolution; and WHEREAS, the EDA has examined the financial statement and the list of bills and finds them to be acceptable as to both form and accuracy. NOW,THEREFORE BE IT RESOLVED by the Board of Commissioners of the Columbia Heights Economic Development Authority that it has examined the attached financial statements and list of bills, which are attached hereto and made a part hereof, and they are found to be correct, as to form and content; and BE IT FURTHER RESOLVED the financial statements are acknowledged and received and the list of bills as presented in writing are approved for payment out of proper funds; and BE IT FURTHER RESOLVED this resolution and attachments are to be made a part of the permanent records of the Columbia Heights Economic Development Authority. Passed this ~ day of ,2002. MOTION BY: SECONDED BY: AYES: NAYS: Robert Ruettimann, President Attest by: Cheryl Bakken, Secretary H:\Resolutions2002X2002-09 COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) Meeting of: June 18, 2002 AGENDA SECTION: Items for Consideration ORIGINATING EXECUTIVE NO: DEPARTMENT: EDA DIRECTOR APPROVAL ITEM: Industrial Center Redevelopment- BY: Randy Schumacher BY: Development Company Selection DATE: June 12, 2002 BACKGROUND: In February of 2002, both the EDA Board and the City Council requested staff to obtain Request for Qualifications from experienced companies interested in working with the City to redevelop industrial properties. Staff received seven RFQ's, varying in areas of experience and background. Per the request of EDA President Ruettimann, staff has attached a brief summary outlining some of the strengths and concerns of each company. At the June 18, 2002 EDA Board meeting, all seven development companies will be present to make a 30 minute presentation and answer any questions the Board may have about their company. The primary purpose of obtaining these RFQ's is for the EDA Board to determine which company is best qualified to: 1) develop a complete Master Plan for the Industrial Center; and 2) determine the highest and best use of all properties involved. Staff has developed an evaluation form to assist the Board in the consistent review of all RFQ presentations. After the presentations have been completed, each Board member can total their points that they have awarded each proposal to determine who they feel is best suited for the project. After a Board consensus is determined, a recommendation can be made to the City Council for final approval. RECOMMENDI~D MOTION: Move to recommend to the Columbia Heights City Council the selection of as the preferred development team for master planning and determining the highest and best use for all properties in the industrial project area. In addition, authorize staff to develop a letter of understanding setting forth the scope of work, timelines and division of costs for City Council consideration. Attachments EDA ACTION: : \consent Form2002\Industrial Ctr Development Co. Selection United Properties, LLC 3500 West 80th Street, Suite 200 Bloomington, MN 55431 Contact: Dale Glowa, Senior Vice President 952-893-8828 Status of Application: RFQ Requirements Met Strengths: Most complete application submitted. Excellent, seasoned team on "in-fill" redevelopment projects that include elements of multi-family, commercial, and industrial. Financial capability is excellent, including a $25 million line of credit with Wells Fargo Bank. An additional enhancement to the team is the design experience of Pope and Associates. Concerns: The proposal indicates that the timing of this proposal fits neatly into their present schedule, but what about the future? Other than dommitment to this long-term project, there are no concerns. This team has the best qualifications to do the job for Columbia Heights. HSIndustrial Center,United Properties Staffrevicw 0 z ~ ~ ~ w w -- ~ ~ 0 ~ ~ w~~ Z ZZ Z Z Z Z Table of Contents A. Executive Summary B. Redevelopment Team Data C. Redevelopment Team Experience D. Financial Capability E. Design Experience Appendix AA Appendix BB Appendix CC Appendix DD Development Expertise Summary Brokerage Team Pope Associates Outlook UNITED PROPERTIES A. Executive Summary United Properties is pleased to present this proposal for real estate services to the City of Columbia Heights (City). We are very interested in partnering with the City to provide outstanding real estate solutions for the City's redevelopment objectives. We believe United Properties offers a unique opportunity for the City: United Properties is a Minnesota based firm with deep resources in all real estate disciplines including transactions, facilities, project and construction management; investment, advisory and development capabilities. Most importantly, these resources are all located in Minnesota and can be immediately deployed to the City's benefit. United Properties has a dedicated development group that focuses on office, industrial, retail, medical and multi-family uses. This team tracks market activity and understands the unique requirements of each market. United Properties operates in a team format with dedicated professionals serving each client. Leading each team is a Project Manager who has complete responsibility for service delivery and is accountable for all results. We act as your advocate in everything we do. United Properties' processes are well documented, thorough, and proven effective. Whether 1,000 square feet or 150,000 square feet, we will follow the same protocol to ensure a consistent approach and value-added results. · One team, one process, one outcome! We look forward to meeting with you and introducing our team! UNITED PROPERTIES :~ B. Redevelopment Team Data Question 1 Organization Form United Properties LLC 3500 West 80th Street, Suite 200 Minneapolis, MN 55431 952/831-1000 (Main) 952/893-8804 (Facsimile) Question 2 Contact Person and Availability Dale J. Glowa Senior Vice President United Properties/ONCOR International, LLC 3500 West 80t' Street, Suite 200 Minneapolis, MN 55431 952/893-8828 (Direct) 952/893-8804 (Facsimile) d.qlowa(~,uproperties.com IQuestion 3 Staff Members and Availability United Properties has approximately 450 employees, practicing a host of commercial real estate disciplines. We draw upon these resources as needed to perform. The marketing-team that we propose for this assignment is Todd Hanson, Jon Rausch, and Jason Sell. IQuestion 4 Developments underway, under consideration, or committed. There are six real estate developers at United Properties. We currently have three development projects underway in varying stages of completion. We currently have approximately twelve projects under consideration, but subject to client approval, or pre- leasing. The timing of this project is excellent. We are able to give it our primary attention. UNITED PROPERTIES Question 5 Names of consultants and their anticipated project involvement. Land Planner/Architect: Pope Associates Surveyor: Sunde Land Surveying Geotechnical Engineering: Braun Intertec Environmental Engineering: Braun Intertec Landscape Design: Ernst Associates Civil Engineering: Howard R. Green Associates Signage: Visual Communications Legal: Lindquist & Vennum LLP These are the consultants that we have frequently teamed with, but we are receptive to using others that may be preferred by the City. IQuestion 6 Redevelopment Team's approach to public/p~'ivate partnerships. We actually have significant experience at public/private partnerships. The best example is with Edina at Centennial Lakes. Our approach is to coordinate with the City to determine its goals and objectives for the redevelopment project, including: · Timing/Schedule · Land Planning · Desired Image · Uses · Investment · Fir~ancing/Economic Development · Budget · Infrastructure Requirements · Environmental Cleanup · Soil Correction · Marketing Plan · Action Plan · City Implementation Process · Reporting UNITED PROPERTIES C. Redevelopment Team Experience Question 1 Previous redevelopment experience, especially similar projects. Centennial Lakes, Edina, Minnesota United Properties purchased 100 acres, a former gravel pit, in 1987. A joint venture project with the City of Edina (Gordon Hughes, City Manager, 952/972- 8861) resulted in a "world-class" mixed-use project including 832,300 square feet office space, 210,000 square feet retail, 110,000 square feet medical office, General Cinema Theatre, 340 units of for-sale condominium and townhouse housing, surrounding a lake and park environment to which integrates the entire development. Golden Hills Office Center, Golden Valley, Minnesota United Properties purchased the Robert Hamilton Company building, relocated Hamilton to a new facility, and developed Golden Hills Office Center, a six-story commercial office building containing 192,000 square feet (Ms. Jeanne Andre, Assistant City Manager, 763,593-8000). GN ReSound Corporate Headquarters, Bloomington, Minnesota United Properties purchased an empty office/warehouse building formerly occupied by Seagate. We consummated a long-term lease with GN ReSound in 2000 for the 122,000 square foot one-story building, and redeveloped it into a "Class A" corporate headquarters office/tech building. (Henrik Neilson, Vice President Marketing at GN ReSound, 952/769-8460.) These are our most recent redevelopment experiences. Our architect, Pope Associates, has several other experiences that they have participated in. Question 2 Demonstrated ability to work with relocating existing businesses. As stated above, the Golden Hills Office Center is a good example of having first to move an existing company, Robert Hamilton Company. The economics involved in relocating existing businesses is a major challenge with most redevelopment assignments. The City usually provides financial assistance to make the transaction economically feasible. United Properties, the metro area's leading brokerage services company, has 50 professional commercial real estate brokers. These experts are routinely involved in assisting businesses with their relocation needs. UNITED PROPERTIES Question 3 Demonstrated ability to move from Concept Stage to construction completion within an established time frame. United Properties has developed 3.0 million square feet of new suburban commercial real estate since 1997, one of the leaders in the Twin Cities. We develop investment property for our own ownership, merchant build for third-party investor customers, such as St. Paul Companies, State Farm Insurance Company, and Teachers Insurance and Annuity Association, and build-to-suit for individual companies. Our market-based approach to real estate development creates high quality and value driven products that has proven to be a very successful formula. In addition, United Properties is known to be business park developers. We are experienced at buying land, land planning, designing and constructing streets and utilities, and marketing land for development. We work closely with cities to create progressive business park environments, that the community can be proud of. Some examples include: Mendota Heights Business Park- 120 Acres Parkers Lake Corporate Center, Plymouth, Minnesota - 225 Acres Eagle Point Business Park, Lake Elmo, Minnesota - 120 Acres Burnhaven, Burnsville, Minnesota - 1,300 Acres Centennial Lakes, Edina, Minnesota - 100 Acres Inver Grove Heights - 32 Acres Southbank, Phoenix, Arizona - 300 Acres Shenandoah Business Park, Shakopee, Minnesota - 112 Acres Minnetonka Corporate Center, Minnetonka, MN - 100 Acres Question 4 Experience in the redevelopment process, including land use revisions, utilities, highway, environmental and other regulatory permitting and review agencies. As stated above, United Properties is very experienced at land development of large business parks. We are particularly skilled at obtaining all of the necessary permits and entitlements. Given the size of our business parks, we typically have to address issues that impact the community surrounding our properties. We take control of all aspects including land planning, soil correction, environmental, grading and drainage, ponding, wetlands, infrastructure, technology, signage, and landscaping. We also create protective covenants to establish guidelines for all future development design and maintenance criteria. UNITED PROPERTIES :~ Question 5 Describe your ability to establish effective working relationships with the City and community. United Properties has been in business for 86 years, since 1916. We have worked in most cities in the metro area. It takes time to develop solid relationships with cities. We pride ourselves on doing what we promise. · Redevelopment projects like this require a close working relationship with teams of people at the City. We enjoy this experience very much, especially working together for successful results. The following are some references: Mendota Heights- Cari Lindberg, City Administrator, 651/452-1850 Shakopee - Michael Leek, Community Development Director, 952/445-3650 Edina - Gordon Hughes, City Manager, 952/927-8861 Plymouth - Ann Hurlburt, Community Development Director, 763/509-5401 Golden Valley - Jeanne Andre, Assistant City Manager, 763/593-8000 Bloomington - Bob Hawbaker, Senior Planner, 952/563-8922 Lake Elmo - Mary Kueffner, City Administrator, 651/777-5510 UNITED PROPERTIES :~ D. Financial Capability Question 1 Financial capability, including ability to secure project financing, secure construction bonds, finance pre-development activities, and work with a variety of finance professionals. We understand that financing is the essential element to real estate development. United Properties is a very well capitalized, privately owned company. We are owned by the Carl Pohlad family. However, in addition to such financial strength behind us, United Properties has a very significant balance sheet. Our banks are: Wells Fargo, Jim Basten, Assistant Vice President, 612/667-1346 US Bank, Mark Midtdahl, Vice President, 612/973-0602 We have a $25 million line of credit with Wells Fargo, which provides us working capital. For larger projects, we obtain construction loans from both banks. We have access to capital worldwide, which allows us to obtain the most favorable rates, terms and structures. We have several direct relationships with lenders and investors. But we also have as a resource, NorthMarq Capital, our sister company, one of the nation's largest commercial mortgage banking companies, to assist us with long-term permanent financing needs. Question 2 Financial planning capacity, including the ability to prepare project proformas and financing plans. Each land development project requires forecasting and budgeting to ensure successful financial results. We use ARGUS and Excel software programs. We develop detailed budgets for planning, design and engineering, improvement costs, marketing plans, and operating budgets. We tailor the financial reporting to meet your needs. Question 3 Demonstrated record of meeting project financial commitments. In essence, every project completed by United Properties is an example of this. This is our full-time business, which we take very seriously. A good specific example of a business park development is the Eagle Point Business Park in Lake Elmo, 120 acres. We are currently building roads, utilities, bridges, ponds, public area landscaping and monument signage, approximately $2 million in total (the City is building the streets and assessing the costs). Chuck Dillerud, City Planner- Lake Elmo, 651/777-5510 UNITED PROPERTIES E. Design Experience Question 1 Design capacity, as evidenced by completed projects of similar size. United Properties hires architectural, engineering and design consultants that are best suited for the task. For your project, we have asked Pope Associates, land planning and architectural services, to participate with us. This St. Paul firm is very experienced at industrial park development. Pope Associates has designed over 13 million square feet of commercial real estate, with projects ranging from under 1,000 square, feet to over 900,000 square feet. They have worked with developers on the development of office/showroom business centers such as the 8 building, 600,000 square foot Carlson Business Center in Plymouth and the 110 acre Office/industrial Park at Eagle Point Business Park in Lake Elmo. Redevelopments include over two dozen projects for the St. Paul Port Authority, mixed- use redevelopments such as Grand Place in St. Paul, a master plan for Lafayette Park in St. Paul, and a housing and retail redevelopment in Cottage Grove. Question 2 Design flexibility, as demonstrated by the ability to adapt to local design criteria. We are pleased to adapt to local design criteria, incorporating a variety of acceptable materials and design elements to create very positive business environments, yet economically feasible for the eventual business clients. We assist in creating meaningful protective covenants for the Business Park to ensure quality throughout. Pope Associates has been involved with numerous PUD and redevelopment projects where the design/development team has created the design guidelines for the overall development. While Pope Associates' projects always meet or exceed a municipalities' design guidelines, they are often called upon to go much further. This is evidenced by their work with the City of St. Paul, Grand Avenue Business Association, and the Grand Avenue Neighborhood Association to redevelop a parking lot into a retail and parking ramp development that "fit" into the historic character of the neighborhood. After many neighborhood design review meetings, several redesigns and other changes, the project team delivered a facility that is accepted by the neighborhood and that is financially successful for its owners. UNITED PROPERTIES Question 3 Creativity, as evidenced by previous experience of redevelopment team to meet special redevelopment challenges with a unique approach. The GN ReSound building is an excellent example of this. Formerly known as the Seagate building, we transformed this once obsolescent facility into a dramatic corporate headquarters. We dealt with asbestos mitigation, new roof, new HVAC, and a complete remodel of the interior space. If interested, a tour can be arranged. Pope has also been involved in the "re-use" of underutilized buildings. These projects provide challenges such as lot size when rezoning, physical limitations of the existing site and/or building, and the uncovering of environmental "concerns." Two recent redevelopment projects include the conversion of a 62,000 square foot industrial building into an "open" office environment with an "industrial" theme for Prometric in Edina. Goodwill/Easter Seals is moving into an old, 150,000 square foot industrial building for which Pope has designed a new facade and new interior. This is located at Fairview and University Avenues in St. Paul. UNITED PROPERTIES Dale J. Glowa Senior Vice President Development United Properties ° ONCOR International As senior vice president of Development, Dale Glowa is responsible for speculative investment properties and build-to-suit development services to meet a variety of office and industrial customer needs. These responsibilities include acquiring land, negotiating development agreements with cities, working with architects on design and planning issues, negotiating construction contracts and overseeing the financing and marketing. Dale also is an experienced business park developer in' which he is responsible for developing productive park environments through land planning, land improvements and soil correction, infrastructure design and construction, protective covenant establishment and marketing. Some of Dale's most recent business park success stories include Mendota Heights Business Park (210 acres); Parkers Lake Corporate Center, Plymouth, MN (50 acres); Eagle Point Business Park, Lake Elmo, MN (120 acres); and Shakopee Industrial Park (112 acres). Before joining United Properties, Dale was the director of Real Estate Investment for Travelers Insurance Company. - He is an active member in the National Association of Industrial and Office Properties {NAIOP) National Industrial Forum as well as the NAIOP Minnesota chapter. Dale is a graduate in finance from California State University - Long Beach. DeveLopment United Properties has long been recognized as one of the premier developers in the Twin Cities region. United Properties has extensive development expertise in office, industriaL, retail and multi-famiLy properties. We can assist you in meeting your com- mercial real estate needs, whether they are for a BuiLd-to-Suit requirement, Investment property, or coordinating the marketing and development of your business park. Build-To-Suit Our established BuiLd-to-Suit program mee~-s the specialized needs of our clients. We devel, op facilities for corpo- rate headquarters, research and deveL- opment, distribution, manufacturing and retail uses. consultants that is best suited for the project. We manage all. aspects of the development and provide you with a guaranteed maximum price for sale or [ease. Our services include site selec- tion, design and engineering, municipal approvals, construction management, marketing and financing. Investment Properties Some investors look to United Proper- ties to develop or redevelop and [ease muLti-tenant investment grade proper- ties for their portfolios. Our 80-year Our turnkey development services begin with a thorough understanding of your business and the specific needs you have to compete within your industry. Based on this information, we recommend the appropriate team of architects, contractors, engineers and track record as a successful building owner/investor aLLows us to offer a flex- ibte but disciplined approach to devet- opment that considers product design, current market conditions and future exit strategies. Our perspective offers you creative solutions to ensure that UNITED PROPERTIES ~0 eO your development project is completed on budget, on schedule and meets your investment criteria. In certain situations, we can even invest our own equity cap- ita[ alongside yours, if appropriate. Business Parks United Properties serves Land owner needs by providing comprehensive land development services and market- ing plans to sell or develop l,and. United Properties has developed over 1,000 acres of business parks throughout the Twin Cities and elsewhere. We master- plan both business and mixed-use envi- ronments to create productive work places and to enhance the value of the overall business park. Our approach to development l,ever- ages the many areas of specialization within United Properties, including Brokerage, Property Management, Construction Management, Investment Services, Asset Management and Corpo- rate Real Estate Services. Our disci- plined project management ensures rea[ performance -- every time. "After having United Properties develop two headquarters faciLi- ties, we know we can count on them for on-time, on-budget per- formance. United Properties takes care of the detail, s and eliminates development worries while keep- ing focused on our long-term strategic business objectives -- ensuring that the value of our property is enhanced." Richard B. Sba[Jer. Big Wheel Auto Stores President UNITED PROPERTIES ~w~o LLI Z ! UJZ Z I-- Z QUALITY OF PRODUCTS United Properties has a heritage of developing quality projects. These quality products include: Master Planned Business Parks Speculative Office and industrial Build-to-Suit Office and Industrial Re-development Multi-family Residential Grocery Anchored Retail United Properties is widely known for its Class A, suburban office development projects but has extensive experience with a wide array of properties. United has developed and/or is currently developing several large business parks with combined office and industrial uses, multifamily apartment projects, and grocery anchored retail properties. United's diverse developments over the past six years have also included redevelopment of a large downtown office building and parking ramp, redevelopment of an under-utilized, contaminated industrial site into a 220,000 square foot Class A office building, redevelopment of an obsolete warehouse into a corporate facility for GN Resound, and development of the corporate headquarters campus for BlueCross BlueShield. The quality of United Properties' developments is illustrated vividly at Centennial Lakes, a model 100-acre, $250 million mixed-use development representing 12 years of planning and development in Edina, Minnesota. Centennial Lakes consists of 900,000 square feet of Class A office space,-200,000 square feet of retail and restaurant, a ! 00,000 square foot medical office center, 346 residential units and an eight-screen movie theater. At the heart of this nationally recognized, master planned development is a 25-acre public park maintained and operated by the local municipality. Centennial Lakes, once a gravel mining operation, is a creative use of suburban infill land, which is a showcase for the City of Edina and a tangible representation of United Properties' commitment to quality. Examples of the various components of Centennial Lakes are shown in the photographs, which follow. QUALITY OF PRODUCTS (CONTINUED) CENTENNIAL LAKES United Properties named Centennial Lakes in honor of the City of Edina's 100t~ Anniversary, which coincided with the year United commenced development of the l O0-acre development. CENTENNIAL LAKES (CONTINUED) I~d~ ~L~ _ Arial view of completed Centennial Lakes lO0-acre mixed-use project. CENTENNIAL LAKES (CONTINUED) At the center of Centennial Lakes is a 25-acre public park owned and operated by the City of Edina and paid for through tax increment from the commercial development surrounding the park and lake. CENTENNIAL LAKES (CONTINUED) United Properties has completed 900.000 s.f. of Class A office space at Centennial Lakes in five phases. The office buildings received NAIOP's annual Award of Excellence in their category. CENTENNIAL LAKES (CONTINUED) I!1 Lil LI! il! i.M !! Office buildings designed by Smallwood. Re,/nold, Stewart, Stewart from Atlanta, Georgia. Office buildings front directly on a public oark with elaborate hardscape and landscaping. UNIT:.-'.) CENTENNIAL LAKES (CONTINUED) Typical interior lobby of Centennial Lakes office buildings. U ,~1 ] T E O CENTENNIAL LAKES (CONTINUED) Photograph of the public park amphitheater during an early evening concert. During the winter. the lO-acre manmade lake is used for/ce-skating. CENTENNIAL LAKES (CONTINUED) Included in the public park is an 18 hole putting course with bent grass greens that is operated for public use by the City of Edina. The golf course represents an excellent landscaping feature in Iront of the condominiums. U?I!TE g _L CENTENNIAL LAKES (CONTINUED) Row townhouses front on the South Park and were built mostly for the empty nester market. CENTENNIAL LAKES (CONTINUED) Village Homes at Centennial Lakes front on the golf course and park. United developed the residential component oI~ Centennial Lakes in a 50/50 joint venture with Laukka Development. a local residential specialist. Centennial Lakes includes 346 residential condominium units Iocused on moderate-income buyers. One of the City's goals at Centennial Lakes was to provide a moderate income-housing alternative in the state's richest suburb of Edina. This ',vas accomplish, ed through pa~ial use of tax increment to write down the cost of the units for qualified homebuyers. CENTENNIAL LAKES (CONTINUED) A view of SoL'th Park with a 100,000 s.f. Medical Office ~3uilding and 40,000 square foot eigr't- screen movie theater. The Medical Office Building site was sold to a local developer/doctor group. Landscape Architect for Centennial Lakes: BRW. !nc. Todd E. Hanson Vice President United Properties · ONCOR International Todd Hanson joined United Properties in 1997 and is a vice president and team leader specializing on the sale and leasing of industrial properties in the north, northeast, Minneapolis and St. Paul markets of the Twin Cities. Since 1998. Todd has received the Offshore Club award in recognition of his outstanding performance during the year. Before joining United Properties, Todd spent five years at Koll Real Estate Services (formerly The Shelard Group), where he was a senior associate. He also worked at R.L. Johnson Investment Company, a Twin Cities commercial real estate developer and owner, in marketing their six million square foot portfolio of industrial and commercial buildings throughout the Twin Cities. Todd is an active member of National Association of Industrial and Office Properties (NAIOP), Minnesota Commercial Association of Realtors (MNCAR) and is a candidate for the Certified Commercial Investment Membership (CCIIVl) program. He is a graduate of St. Cloud State University, where he earned a bachelor of science degree in business & marketing. Jonathon T. Rausch Senior Associate United Properties · ONCOR International Jon Rausch is a senior industrial associate who joined United Properties in March 1998. He has been a member of a successful East Metro leasing team and is responsible for leasing over 2 million square feet since joining the company. Jon's assignments have included both tenant and landlord representation assignments. Since joining United Properties, Jon has represented one of the largest and most complex industrial real estate transactions in the metropolitan area. In his tenure at United Properties, Jon has developed a solid base of clients who rely on his honest and innovative approach to produce results. Jori is a member of the National Association of Industrial and Office Properties (NAIOP) and was selected to be a presenter at its Annual Industrial Update in 2000. Due to his strong east side presence, Jori has been elected to the advisory board of the Metro East Development Partnership. After earning a bachelor of arts degree from Whitman College in Washin_gton, Jon earned a master's degree in business with a concentration in venture management from the University of St. Thomas. Jon enjoys outdoor activities, including mountain biking, fishing, hunting and Boundary Waters canoe trips. From 1985-1991 Jon was one of the top ranked alpine ski racers in the country for his age. Jon and his wife, Kelly, currently live in Minnetonka. Jason T. Sell Associate United Properties · ONCOR International Jason joined United Properties mid-2000 as an associate focusing on the sale and leasing of industrial properties in the Northeast, St. Paul and Minneapolis markets of the Twin Cities. His current institutional clients include American Realty Advisors and BetaWest. Before joining United Properties, Jason worked with Accountemps, a division of Robert Half Inc, where he sold and staffed temporary accounting professionals. Jason also worked in residential real estate for two years. Jason is an active member of the National Association of Industrial and Office Properties (NAIOP), and the Minnesota Commercial Association of Realtors (MNCAR). Z >- Z 0 °°®°oooooo ggg~ggo ~g~gg~oogggg~o~oogg~go~ 00~ 0~0 ~ 0~ ~ ~ ~ 0 0 LU Z Z Z w -~a.0 ~ 0 '5.~ _ _<On- ! FIRM PR OFILE Pope Associates Inc. was founded in 1974. The firm's stability and success is due, in large part, to the firm's ability to create successful, cJngoing working relationships with clients based on a commitment to provide, in each situ- ation, a unique blend of the highest quality personnel and professional service. Dedication to that commitment is confirmed by the long list of clients with whom we have completed multiple projects -- Carlson Real Estate, St. Paul Properties, Duke Realty Investments, Target Corporation, Ceridian, US Bank, Seagate Technology, St. Paul Technical College, and many others. We are proud of this history. Today, Pope Associates Inc. is one of the twenty-five largest architecture firms operating in Minnesota, and maintains registration in 35 other states. Our established specialization in corporate office, industrial, advanced technology, retail, educational, and housing project types, coupled with unparalleled expertise in team project delivery, continues to fuel our growth. One of Pope Ass~)ciates' principals takes ultimate responsibility for every project. The Principal in Charge directs the resources of the firm in the client's interest, remaining involved, available, and accountable throughout the design and construction processes. An experienced and skilled Project Manager is dedicated to each project, providing technical and administrative continuity from start to finish. Pope Associates maintains an in-house Architectural and Interior Design staff capable of providing a complete array of Design, Documentation, Budgeting, Scheduling and Project Coordination services. Civil, Structural, Mechanical, Electrical Engineering, and other needed services are provided through an established network of consulting relationships. We make the full range of these resources available to each of our clients, dictated only by the individual nature and requirements of each project. We are thankful for our past successes, and look forward to the future, enthusiastic at the prospect of new relationships and continuing service to our community. JON POPE, President We will establish trust-based relationships with clients in chosen markets and provide them with quality design solutions while consistently surprising and delighting them with our responsiveness, knowledge, thoroughness and professiona/isrn. ASSOCIATES KEY PERSONNEL ! ! Since founding Pope Associates Inc. with his father Bob, in 1974, Jon Pope has led his architectural firm to be one of the 25 largest i~ Minnesota. As President, Jon's focus within the firm continues to be site planning and business development. Jon holds licenses in Minnesota and 33 other states. One of two original employees, Dan Klecker has been an integral part of the firms operation since its inception. In addition to project management, Dan is responsible for the management of technical operations within the firm. Paul Holmes blends over 20 years of experience in design and construction to lead many of the firms education, office and advanced technology projects. Paul also oversees business development, IT, & HR activities. As an in-house team leader, Randy Peek is responsible for project budget- ing, scheduling, and management of the projects within his workgroup. Drawing upon 20 years of experience, Randy focuses his talents on indus- trial, office, education and institutional project types. Throughout his seventeen year career, Steve Doughty has applied his energy and creativity to a broad range of project types. Today, Steve focuses on serving corporate, medical, and retail clients. As Pope's Director of Design for more than 15 years, Mark Mednikov has made an indelible impression with many noteworthy projects. Mark's ar- tistic talents enable him to communicate design intent clearly to colleagues and clients. Skip Sorensen has been involved with the design of multi-housing projects throughout Minnesota for more than 30 years. As a Project Executive, Skip assists clients in developing senior co~ops, assisted living and market rate apartments, and condominium projects. Steve Irwin joined Pope Associates in 1985 and now leads an in-house team serving corporate office and education clients. Steve is responsible for budgeting, scheduling, and workgroup management. For more than 10 years, as an architect and a project manager, Gina Vozka has focused her career on interior architecture for corporate, retail, indus- trial, and education clients. JON R. POPE, AIA PRESIDENT PRINCIPAL DANIEL M. KLECKER, ~JA VICE PRESIDENT PRINCIPAL PAUL A. HOLMES VICE PRESIDENT PRINCIPAL RANDALL. PEEK, AIA PRINCIPAL STEVEN R. DOUGHTY PRINCIPAL MARK MEDNIKOV, DIRECTOR OF DESIGN SKIP SORENSEN, A~ PROJECT EXECUTIVE STEVEN C. IRWIN, PROJECT MANAGER GINA S. VOZKA, NCARB PROJECT MANAGER ASSOCIATES CLIENT REFERENCES We take pride in the long-term relationships we maintain with many of our clients. We encourage you to contact any or ali of the individuals listed be/ow in order to further acquaint yourself with our firm. UNITED PROPERTIES 3500 West 80th Street Minneapolis, MN 55431 Mr. Dale Glowa phone (952) 893-8828 CHESAPEAKE COMPANIES 11100 Wayzata Boulevard - Suite 766 Minnetonka, MN 55305-1544 Mr. Peter C. Carlson phone (952) 847-2446 DUKE REALTY TRUST 1600 Utica Avenue South St. Louis Park, MN 55416 Mr. Audie Tarpley phone (952) 543-2970 EXETER HOLDINGS, L.L.C. 1080 Montreal Ave., Suite 400 St. Paul, MN 55116 Mr. Jim Stolpestad phone (651) 690-1598 FRAUENSHUH COMPANIES 7101 West 78th Street, Suite 100 Bloomington, MN 55439 Mr. Richard Wicka phone (952) 829-3480 CARLSON REAL ESTATE MGMT Carlson Business Center 2 Carlson Parkway Plymouth, MN 55447 Mr. Matt Van Slooten phone (763) 404-5007 MCGOUGH DEVELOPMENT 2737 Fairview Ave. So. St. Paul, MN 55113 Mr. Tom McGough, Jr. phon~ (651)633-5050 KRAUS-ANDERSON 525 South 8th Street Minneapolis, MN 55404 Mr. Al Gerhardt phone (612) 332-7281 M. A. MORTENSON COMPANY 700 Meadow Lane No. Minneapolis, MN 55422 Mr. Mark Schmidt phone (763) 543-2100 ST. PAUL COMPANIES 385 Washington Street St. Paul, MN 55102 Mr. Mike Elnicky phone (651) 310-2065 LIBERTY PROPERTY TRUST 10400 Viking Drive, Suite 130 Eden Prairie, MN 55344 Mr. David Jellison phone (952) 947-1100 FIRST INDUSTRIAL REALTY TRUST 7615 Golden Triangle Drive Eden Prairie, MN 55344-3733 Mr. Chris Wilson phone (952) 943-2700 ASSOCIATES O F F I C E DEVELOPMENT Norman Pointe I Lifetouch, Inc. Uniprise (United Health) Riverknoll CLIENTS Control Data Corporation Duke Realty Investment Trust Federal Land Frauenshuh Companies Goodwill/Easter Seals Hillcrest Development Interstate Partners JLT Group Kraus-Anderson Layfayette Park Properties League of Minnesota Cities Lifetouch, Inc. LOGIS, Inc. Marvin Windows McGough Meritex / Space Center Metro Plains Development MN Institute of Public Health Riverway Corporation Tetra Rex Packaging Systems United Properties US Bank Wellington Management ASSOCIATES MANUFACTURING & INDUSTRIAL New Flyer Industries Aries Precision Skyline Displays Excelsior-Henderson CLIENTS Aries Precision AT&T Ben & Jerry's Homemade Best Buy Cannon Equipment Comtal Machine & Engineering Control Data Corporation EMC Corporation Excelsior-Henderson Foley United Ford Motor Company General Electric Honeywell Impressions J & B Wholesale Johnson Brothers Liquor Marvin Windows Materials Processing Corp. New Flyer Industries Northern States Power Northwest Airlines ParAide Pillsbury Plastics I nc. Polaris Rosemount Inc. Skyline Displays Smarte Carte Ternes Register Tetra Rex Packaging 3M Tursso Companies Wayne Transport ASSOCIATES Medtronic Perfusion Systems Celestica, Inc. Seagate Twin Cities Operations Center Innovex MEDICAL DEVICE & ADVANCED TECHNOLOGY CLIENTS Alliant Techsystems Avecor Cardiovascular Bioplasty Inc./Brennen Medical Celestica Datacard Entegris ev3/Microvena Guidant Corporation Hutchinson Technology Imation Innovex Medtronic Micron Technology MinnTech Molecular Genetics Osmonics Pace Laboratories Seagate Technologies Techne Corp. 3M Unisys Corporation Upsher-Smith Laboratories ,~ S S 0 CI AT-~ S OFFICE/WAREHOUSE OFFICE/SHOWROOM S Belae Brands, Inc. Plymouth Business Center - Phase VI Park 2000 CLIENTS Carlson Real Estate CB Commercial Chesapeake Companies CSM Corporation Duke Realty Investment Trust Federal Land First Industrial Realty Trust Hillcrest Development Interstate Partners Kraus-Anderson Liberty Property Trust McGough Development Mortenson Development Mount Properties Roseville Properties Ryan Companies Stahl Construction St. Paul Companies St. Paul Port Authority United Properties Wellington Management Welsh Companies Carlson Business Center ! ! ! ! Target Stores, Nationwide Timbercrest, Lakeville - Grand Place Retail/Parking Ramp, Saint Paul R E T A I L Over the last 28 years, Pope Associates has worked with the clients lined below, and others, on more than 300 retail projects. Pope's staff assists clients with feasibifity assesment, site planning, design, interiors, prototype roll-out, and remodeling/repositioning. CLIENTS Adolfson & Peterson *The Avalon Group 'Calhoun Square Associates *Carlson Real Estate *Chesapeake Companies D.J. Kranz *Equite Commercial Services *Exeter Realty *Federal Land *Frauenshuh Companies *H.J. Development *Kraus -Anderson Construction *Kraus-Anderson Development *Kraus-Anderson Realty *Robert Larsen Partners *McDonald's McGough Construction Metro Plains Development Metram Properties *MN-TX 'Motei 6 *Robert Muir Company *PDW Development *Roseville Properties Sentman Enterprises *Sherman Rutzick Associates *Stockman Hotels Corp. *Target *United Properties *Vantage Corporation *Wellington Management *Witcher Construction ~ Repeat Retail Clients HOUSING Over the last 28 years, Pope Associates has worked with the clients listed below, and others, on the development of more than 3,500 Housing units. Pope's staff assists clients with feasibility assesment, site planning and design for Hotels, Market Rate Apartments and Condominiums, Independent Living Apartments and Cooperatives, Assisted Living Facilities. Dewey Hill Condominiums, Edina Kent and Marshall Townhomes Park at City West, Eden Prairie Cardinal Pointe of Faribault - Independent Living, Faribault CLIENTS Anderson Development Inc. *Arkell Development ~Brutger Companines Inc. David Carlson Company *Citi Equity Group Clapp-Thomssen Company *Ron Clark Construction *Finger Enterprises *FML, Inc. Dominium Group Duffy Development *Ginkel Construction HSR Associates, Inc. *Kraus-Anderson Construction *Lang-Nelson LaRive Condominium Assoc. *McGough Construction 'MN-TX Parkford Companies 'A. Harold Peterson *Healey Ramme Rainbow Development Rek~tad Development Rixmann Company *Sentman Enterprises, Inc. *Sherman Rutzick Associates *Chuck Thompson Vaughan Properties Wellington Management Willow Run Partnership Wilson Management ~ Repeat Housing Clients ASSOCIATES r~ Z uJ TWIN CITIES COHHERClAL REAL ESTATE I JANUARY 2002 WWW.UPROPERTIES.COM/OUTLOOK Welcome to the January 2002 United Properties Outlook market study. Outlook ref[tects the combined knowledge of our on-the-ground brokers and the deep analytic capabilities of our research professionals. The result is the most detailed Twin Cities commercial real. estate market study available. Even though the slow economy of 2001 and the September 11 attacks did adversely impact business locally, we're optimistic about the future of the Twin Cities commercial real estate market. Due to the diversity of the regional economy coupled with the area's position as the Upper Midwest's predominant trade center, economic downturns in the Twin Cities generally tend to be shorter and [tess severe than in the country as a whole. Rea[ estate investors will want to keep a close watch for new opportunities in the Twin Cities in the year ahead. Be sure to look online at www. uproperties.corn for our complete Outlook' report, including in-depth coverage of each property type and submarket. Should you have more questions, our real estate profes- sionals are always available to respond. You may also contact me directly at bstofer@uproperties.com. We look forward to ~'erving your Twin Cities real. estate needs in the year ahead. Boyd B. Stofer President and Chief Executive Officer MORE ONLINE Look for this symbol throughout our report. It lets you knowwhen more information can be found online. www. uproperties.com/out[ook J www.u properties.co m/outlook · Outlook turns somber for Office and Industrial markets · Retail and Multi-family markets are stable, Multi-family ready to resume strong §rowth on economic rebo[ · 2oo2 looks to be a year of retrenchment for Office and Industrial markets; both need to recover from'"overlea: TWIN CITIES f4ARKET OVERVIEW SECOND HALF 2( The Twin Cities commercial rea[ estate market experienced the same tis vacancy rates, excess amount of sublease space and falling rents that vailed across the rest of the nation in 2001. Demand fell off sharply throughout the year in the Office and Industrial markets, compounding the worries of landlords who were already reeling from the effects of the poor economy on their tenants. Retail and multi-family demand stayed constant. Net absorption in the 69 million square foot Twin Cities office market was a positive 330,000 square feet, the lowest annual figure in more than a decade. On the industrial side, annual absorption was also at its lowest level in a decade at negative (4oz,ooo) square feet. Rental rates for both office and industrial markets were fiat to declining at year's end, with increasing concessions. For retailers, the picture was considerably brighter. Retail'properties were generally stable, with net absorption for the year at positive 1.4 million square feet. Landlords were achieving some rental rate growth for newer community, neighborhood and specialty center properties, although some older neighborhood centers saw rents decline. The Multi-family market remained the strongest of all Twin Cities property types, with a ~4% growth in the average monthly rent paid for an apartment over the year. New development activity is extremely strong in the apartment market. investment activity was slow throughout the year, as lenders and institutional investors alike grew significantly more cautious. Building owners were also reluctant to sell in an environment of declining property values. Overall, the condition of the Twin Cities ret estate-markets is perhaps best described as ha~ gone through a period ofadiustment, leading to period of retrenchment that will last well into 2o and perhaps beyond. Office and industrial prop~ owners will undoubtedly feel the pinch more acu~ than their peers in the retail and apartment mad ~n short, the boom period of the current Tw Cities commercial real estate development phase well past its peak, with the exception of the apar~ ment market. Or as Brookings Institute Economis Tony Downs explains, "We entered an overbuilt phase sometime late in 2ooo, and are definitely i that phase now at the end of 2ooz." But, he adds that the degree of overbuilding today is far less s! nificant than it was in the ~99o.91 era when offic~ vacancy rates reached 25% and more in downtow: Minneapolis. Recovery in the office and industrial market. will be complicated by the combined impact of ow leasing and substantial increases in both subleas and direct vacant space. These challenging circum stances result only in part from the rise in sublea.~ and direct space vacancies brought on by the curr~ economic conditions. A number of companies hart excess space not currently being used. When their growth resumes, they will need to first absorb the excess before going to the market for more space. This is a compounding effect on top of the increas, vacant and sublease spaces that the market must absorb on its road to recovery. The market has also seen a substantial increase in the number of single-tenant buildings for sale or lease as a result of both the poor economy and the fall-out from the bursting of the high-tech bubble. The net result is that even with a pickup in demand, the office and industrial markets will have to reabsorb this existing surplus of sublease and shadow space before vacancy rates begin to decline. At year-end, the marketwide Twin Cities office vacancy rate was 12.7%, and 15.2% with sublease space. For industrial properties, the metro area vacancy rate was z3.3% at year-end, and 16.5%, including sublease space. Retail properties showed a marketwide vacancy rate of 6.8% at year-end, while the metro vacancy rate for apartments was just 2%. Due to long construction timelines, new build- ings will continue to come online in the Twin Cities office market in 2oo2. Of particular concern to the downtown Minneapolis submarket is the addition of another 615,ooo square feet of office space sched- uled for the first half of 2oo2. Coupled with the previ- ously announced mid-year 20o2 return of some 675,ooo square feet of sublease space in several buildings in the downtown core, the increase in sup- ply will likely drive office vacancy rates higher in the Minneapolis central business ~istrict (CBD) to the ~6% to ~7% range - and ~B% to 2o% with sublease space - over the coming year. Vacancy rates may be at or near their peak for office properties in the Northeast, Northwest and St. Paul CBD submarkets, but further increases of a percentage point or two may occur in the West and Southwest submarkets before year-end 2002. In the Southwest, Best Buy Co. is consolidating its opera- tions at a new corporate headquarters in Richfield and will return some 8oo,ooo to 9oo,ooo square feet of office and warehouse space to the market the sec- ond half of the year. The Southwest submarket is already being affected by this coming burst of addi- tional space. In the West submarket, two new office proiects are scheduled to come online with an additional 323,ooo square feet of space the first half of the year. Meanwhile, Prudential Insurance Company's continu. lng consolidation will result in an additional 7o,ooo square feet of office sublease space being given back in the Prudential building in Plymouth, bringing the total amount of sublease space in the building up to ~4o,ooo square feet. Retail development continues to follow in hot pursuit of residential growth. Population growth is fastest in outer-ring su..burbs where developable land is still relatively abundant, such as Lakeville, Rose- mount, Maple Grove, Blaine, Coon Rapids, Shakopee, Chaska and Woodbu~. A significant percentage of the region's new residential development, both for sale and for rent, is occurring in these cities. Demand is also strong in these areas for new retail develop. ment, particularly for grocery-anchored community and neighborhood centers that provide the necessi. ties of daily life for young suburban families. Retail trend observers are also keeping a close eye locally on the impact of the fast-emerging super. store category on more traditional retailers, such as full-service grocery stores. The Twin Cities invasion of the SuperTargets, Sam's Clubs and Costcos remains intense, with more than a dozen such stores either planned or under construction in the area at year- end. With their average ~8o,ooo square foot floor plans, the superstores' bid is to be all things retail to all people, with discount prices to boot. They're mak- ing a strong run at proving the value of their concept in the Twin Cities market. A retail and residential revival is also unden~ay in the central cities of Minneapolis and St. Paul. Downtown Minneapolis is preparing for the fall 2oo2, first-phase opening of the 424,ooo square foot "Block E' retail and entertainment center. Target opened a 16o,ooo square foot store on the Nicollet Mall last fall, and a number of new restaurants and retail establishments have recently blossomed throughout the downtown core. Twin Citians are also VACANCY I~IN CITIES OFFICE. RETAIL & INDUSTRIAL MULTI-TENANT MARKET 8% 6% 2% 0% ~995 1996 ~997 ~998 ~999 2000 2oo~ (~/MORE ONLINE www. uproperties.com/outlook 3 returning to the city to live, sparking a boom in new apartment development in the downtown area. Downtown St. Paul is undergoing its own resi- dential resurgence, including a $17o million urban village proiect along the downtown waterfront that witl create 6oo new multi-family housing units - for sale and for rent - by 2004. Strong demand for apartment housing in the core cities has helped keep overall metro area vacan- cy rates down. However, there are signs of a soften- ing market, especially in the upper bracket. The rental market is being influenced both by the econo- my, which has caused demand to shrink, and lower interest rates, which make home ownership more affordable. Developers are lining up to help meet what is anticipated to be long-term growth in the Multi-family market. Marketwide more than lO,DOD new apartment units are either proposed, planned or under construction at year-end 2001. A modest recov- ery in the economy will likely bring a return to an inflationary or slightly above-inflationary rate of rental rate growth in this segment. The Outtook Looking ahead, there appears to be little optimism for im'provement in the office and industrial markets the first half 2oo2. Landlords of both types of properties will need to retrench while the market works through its current overleased con- dition. The Industrial market may begin to show some signs of recovery by mid-year, but the Office market is proiected to lag through 2002. The Office and Industrial markets both will see new vacancy in 2002, which will further weigh down the absorption numbers. Demand for necessity-driven retail will continue to grow, as will demand for well-located specialty cen- ters. However, some older neighborhood centers and regional mal~s may struggte to survive. The overall trends will be for new retail development to continue to follow population growth to the outer-ring suburbs, and for continuing redevelopment activity in the cen- tral cities. Pent-up demand for housing of all types will continue to spur growth in the apartment market. The region has attracted increased attention from both regional and national developers, as the Twin Cities remain one of the strongest multi-family mar- kets in the country. Investment a~ivity may return to a more nor- mai level in 2002, following a very slow 2001. Institu- tional investors will continue to exhibit strong demand for the highest-quality, grocery-anchored retaii centers, bulk warehouse buildings and apart- ments. Sellers may need to adjust their expectations downward in light of current economic conditions, if they wish to consummate a deal. Property owners that are not highly leveraged may remain reluctant sellers; however, owners with leveraged debt obliga- tions coming due in 2002 may have some painful decisions to make. Developers are shifting their attention away from speculative office and industrial projects to other property types, including office and industrial build-to-suit properties and apartment projects. Some developers are also beginning to look for new .land acquisitions, in preparation for the next market upturn. Owners of developable land may become more realistic on their pricing in the coming year if they feel pressure to sell. Good quality retaiHocations remain in high demand, however, and will command on aver- age $10 to $~5 per square foot for vacant land. Some vacant pad sites in the Arbor Lakes community center are finding buyers today at prices of $20 or more per square foot. www.uproperties.com/outiook For office and industrial tenants, market condi- tions have not been this favorable in several years. An expanding menu of attractive options, ranging from the direct and sublease multi-tenant markets to building ownership, is available to space users today. This window of opportunity should continue throughout 2002. On the whole, the Twin Cities economy today is in better shape than that of many other metropolitan areas around the country. Unemployment in the metro region was 3.3% in October, up from 2.5% one year earlier but still well below the national average of 5.4%. September 13 and its aftermath accelerated the downturn locally, but longer term the impact of the terrorist attacks is not expected to be especially negative on the Twin Cities economy. Long known as a corporate headquarters center, the Twin Cities boasts 15 names on the most recent Fortune.coo listing of the largest companies in America. In a recent Harvard Business School study of regional competitiveness - ranked on the basis of industry con- centrations, or clusters, in a particular region - the Twin Cities was rated among the top three metropolitan areas for medical devices, fiCth in transportation and logistics and sixth in financial services. The region also ranked among the top 20 metropolitan areas in a num- her of other industrial classifications, including pins- tics, publishing and printing, metal manufacturing, analytical instruments, distribution services and infor- marion technolo~. These are the engines of economic growth that will power the regional economy forward into the 21st century. 1~ JMORE IONLINE 9,000,000 8, OOO,0OO 7,OOO, O00 6,000,000 4,0OO,OOO 3,000,000 2,000,000 1,000,000 8,000,O00 6,O00.0OO U.I 5,000,000 4,0OO,000 3,000,000 2,000,000 l,OOO,O00 ABSORPTION TWIN CITIES OFFICE. RETAIL & INOUSTRIAL MULTI-TENANT MARKET 2995 ~996 ~997 1998 2999 2000 2OOl CONSTRUCTION TWIN CITIES OFFICE. RETAIL & INDUSTRIAL MULTI*TENANT MARKET 1995 2996 ~997:998 t999 zooo 2ool www. uproperties.co m/outlook [o~i~ ng . ic growth in 2002; olflce"a"h"d'T'ndustrlal markets may lag general · I]riving forces: regional :ted 6; wage and salary growth in Twin Citie~ outstrips national average ..... · · Twin Cities move back up in the rankings of Fortune 5oo company headquarters locations TWIN CITIES ECONOMY SECOND HALF 2001 Beth economic times I. ie ahead in 2002. after a year in which the Twin Citi~ economy marched into recession along with the rest of the natio Following several quarters of sharp cost- cutting, which shriveled demand for office and industrial space, Twin Cities companies are poised to spring back into growth ~ode at the first positive signs of economic recovery. As corporate America has done throughout the country, local companies have clipped back their inventories, held back on capital investment and trimmed excess staff. A quarter or two of sustained economic growth could make a world of difference to the regional economy and the real estate markets. However, many observers believe that the office and industrial mar- kets, as lagging economic indicators, will suffer con- tinuing softness through much of 2002. Wells Fargo Corporation Chief Economist Dr. Sung Won Sohn, based in the Twin Cities, foresees a mild recession ending early in 2o02. in his December lo, 2001 commentary', Dr. Sohn says, "This will be one of the mildest recessions during the post-war period ... The current recession should end early next year with the economy contracting about 1.0 percent- age point from the peak." And, he says, NThe ensuing recovery will be healthier than the 'iobless recovery' of the early 199os." Locally, the Twin Cities housing markets remained strong, as indicated by a 21% increase in new housing permits issued in 2ool and continuing Iow vacancy rates in the apartment market. Unem- ployment was up locally to 3.7% in October but still well below the national average of 5.4%. During the 199os, the Twin Cities' population grew by ~6.9% to just over 3 million - with a proiect- ed 7.2% increase in population to come between 2ool and 2oo6L Total state wages and salaries, the majori- ty of which are produced in the Twin Cities, grew by 90% - far exceeding the U.S. average of 74% over the same period~. Per-capita income in Minnesota soan to loth in the nation, while the state ranked in population based on the 2ooo census. Industry clustering plays a la~ Cities' continuing-ability to grow its population and per-capita income figures. In sectors such as medi~ devices, financial services and transportation and logistics, the Twin Cities has developed industry ters that drive regional growth, accordir al study conducted by the Institute for Strategy and Competitiveness at the Harvard Business School (HBS). Author and HBS Professor Michael Porter views these types of clusters - concentrations of companies, suppliers and service providers and associated institutions such as universities - as the core engines of growth for regional economies. In medical devices, the Twin Cities is ranked third on the HBS national cluster scale. The medical device industry employed 29,995 workers in the Twin Cities in 1999, according to the study, at an average annual wage of $41,5o5. In the financial services area, the Twin Cities ranked as the sixth largest industry cluster with 64,788 employees taking home an average of $64,149 annually. In transportation and logistics rankings, the Twin Cities placed fifth nationally with 51,742 jobs and aver per worker of $30,339. Other sectors of cluster strength in the Twin Cities included the plastics (ranked sixth nationally), publishing and printing (seventh ranked), metal manufacturing (ninth ranked), distribution services (eleventh ranked) and information technology (thir- teenth ranked). 6 www. uproperties.co m/o utiogki Fortune 500 companies continue to cluster their headquarters in the Twin Cities, as well. Fifteen Twin Cities firms made the 2ooz Fortune$oo' listing of the country's largest companies - up from the 23 compa- nies representing the Twin Cities on the 2ooo list. Two top local concerns of Twin Citians are also of great importance to the business community: traf- fic congestion and affordable housing. Something has to give on the housing front as the Twin Cities economy needs more people for the jobs it creates. ~n the 199os, the local economy added more than 25o,ooo jobs, but only about 3o,ooo rental unitsL Residents rank traffic congestion as their top quality of life concern. Although the issue is starting to attract more attention from the state legislature, there is little reason to believe that increased congestion is anything but inevitable. A projected $1-95 billion state budget shortfall for the next bien- nium further complicates the picture. As congestion builds over the next decade, it will significantly affect area transportation patterns and, consequently, real estate decisions. Of course, not all the traffic on local roads is locally generated. As the retail and entertainment hub of the Upper Midwest, the Twin Cities attracts a constant flow of visitors from t~roughout the sur- rounding five-state region. Shopping meccas like the Mall of America pull in visitors from around the world, as well. All this retail excitement adds up, making the Twin Cities loth nationally in 2ooo with total retail sales of $54 billion'. Unsurprisingly per- haps for a metro area that is home base for Target Corporation, the Twin Cities ranked 8th nationally in general merchandise store sales. Z DrSohn.com Web site ZO0~ Survey of Buying Po~r · 3 Minnesora Ecor, omic T~nds, Minne~ta Wo~ Fore Cantar ~sh ~nch Company ~ added) 2~1 SU~ o[ guying ~wer (~I MORE ONLINE NON-FARM EMPLOYMENTM NNEAPOLiS/ST. PAUL ,'BY INDUSTRY NOVEMBER 2001 Government ~3.46% Minin.~Construction o.o3'a 4.5t% Manufacturing Services 30-42% Trans. Comm. & Public Utilities 5.28% Trade z3.45% Fire 7.29% 4.0% 3-5% 3.0% 2-5% z.o% 1.o% 0.5% 0.0% MINNEAPOLIS/ST. PAUL NON-FARM EMPLOYMENT ANNUAL AVERADE X INCREASE IN JOBS 2994 t995 t996 ~997 t998 Source: Minnesota Department of Economic Securitg, Research & Sta£Jstic$ O~5ca ~999 2000 www. uproperties.com/outtook 7 ?~ demand and a dramatic increase in eapolis CBD; overall vacancy in 5% including sublease space from that of recent yea~s market; Minneapolis CBD still adding s~ · Landlords in select submarkets and buildings are strongly motivated to stimulate leasing activity with concessions and ~ effective rates WEST IRPORT METRO MARKET OVERVIEW SECOND HALF 2001 IMarketcon' ditions are generally more favorable for Twin Cities commercial office space users today than in the past 10 years. The slumping economy, accompanied b increasing Layoffs and corporate downsizing, continued to add to a decline il demand for Twin Cities commercial office space the second half of 2001. Most submarkets are at or near their projected peaks for vacancy rates. The one major exception is the Minneapolis CBD due to the recent and pending completion of several more Class A office towers. Vacancy rates in the Minneapolis CBD increased 2.6% over the past year to 12.8%. Class C properties in Min* neapolis posted a year-end vacancy rate of 16.5%. Metro area vacancy rates for all property class- es rose 2.z*/o from the mid-year level of ~o.6%, to a nine-year high of ~2.7% by year's end. Add in the bulge of sublease space, and the overall office mar. ket vacancy rate stood at ~5.2% at year-end, com- pared to the ~]-9% vacan,cy-with-sublease rate at year-end 20o0. Continuing economic uncertainties placed some additional questions on the timing of the office mar. ket recovery. Even so, quoted rental rates remained relatively sieady throughout 2ool. Net effective rates dropped among certain submarkets and specific buildings due to landlord concessions. Absorption of new office space was modestly positive for the year at 33o,~22 square feet; the second-half absorption number was a negative (]66,280) square feet. Outside the Minneapolis CBD, only a small number of new buildings came online during the second half of 2ool. Overall, just 2,o36,ooo square feet of new office space was added to the Twin Cities market last year, less than half the 2ooo total. The Minneapolis CBD, at z,o$9,ooo square feet, accounted for slightly more than half of the new supply. The Outl. ook Market conditions will contin- ue to favor tenants, although this will vary consider. ably from submarket to submarket and even between specific property classes and buildings. Subleases will be even more ora competitive factor in 2oo2. Companies with substantial amounts of excess space on their hands will become increas- ingly aggressive in seeking sublease users. Expect marketwide vacancy rates to top out at about ~4% byyear-end, with an overall top around ~6.5%, including sublease space. Suburban submar- kets, particularly the Northwest and Northeast, and the St. Paul CBD, will likely stabilize and begin to recover by mid-year. Recovery will take longer in the Minneapolis CBD, where vacancy rates are anticipated to hit the ]6% to 17% range by year-end, the South- west and the West. Due to the lag between the market slowdown and previously committed projects, some new construction will be delivered in 2oo2. New product additions will, i however, be modest compared to recent levels. With the exception of the Minneapolis CBD, where an addi- tional 615,ooo square feet of new multi-tenant office space will come online the first half of 2oo2, office con- struction will be at a near standstill for the year. The first half of the year looks to be a period of favorable leasing opportunities for tenants in most submarkets. Building operating costs will generally decrease as a result of the ]o% commercial property tax reduc- tion enacted in 2OOl. The number of appeals of prop- erty valuations for tax purposes is also anticipated to 8 www. uproperties.com/out[ook g $~2 -' $6 ! ° ° $4 NET OFFICE RENTAL RATES CLASS A--O CLASS B ~ CLASS :~985 1986 1987 :~988 ~,989 t99o 199! 1992 1993 1994 1995 1996 z997 1998 t999 2000 2oo~ 35% 30% 20% 10% 5% HISTORICAL OFFICE VACANCY RATEStOVERALL AND CLASS A OVERALL ~ CLASS A --O o% 1pBs 1986 ~987 Z988 ~989 ~990 t99~ ~992 ~993 ~-994 ~995 ~996 1997 Z998 ~999 2000 2001 OVERALL OFFICE ABSORPTION Z o.5 O,0 x985 1986 1987 1988 1989 199o t99! ).992 t993 1994. 1995 t996 ).997 t998 ~999 2000 2ool OFFICE DEFINITIONS Class A: GeneraUy 200,000 square feet or larger, constructed since ~98o, offering a host of business/support amenities and providing a strong and identifiable location and/or access. Class A properties in the CBDs are skyway-con. nected. In the smaller submarkets. Class A buildings may be defined as such because they are the highest-quality buildings in the area in terms of finish. location and amenities, although they may not fit the standard definition of Class A as far as square footage and age, for example. Class B: Older Class B buildings are sometimes renovated and in good locations. Newer Class B buildings are smaller in size, in non-prime locations and may include skyway tinkage if located in a CBD. Class C: Older, unrenovated buildings of any size in average to poor condition; may include skyway linkage. MORE ONUNE: Submarket charts and narrative for Northwest. South/Nrport, Southwest, West, Minneapolis CBO, Northeast and St. Paul CBD are available at www.upmperties.com/outlooic www. u properties.corn/outlook ? NAME AIRPORT/SOUTH Of THE NIVEN Total Airport/South of the River Under Construction SOUTHWEST OFF,CE P.O:ECTS U.... ' '-.' 'ION ~-5' ~:' .... " DEVELOPER LOCATION SQ. FT. STATUS NET RATE Total Southwest Under C~nstruction WEST wayzata Executive Park ' Dunbar 4 1'394 & 61eason Lk Rd, Wayzata · lo4,ooo 3 Buildings; 59% Preleased; ~ 4ol Carlson Parkway Carlson Companies 402 Carlson Parkway, Minnetonka ~ Completion: 1st Quarter 2002 · Total West Under Construction 219,000 0% Preleased; Completion: 2st Quarter ~ooz ~ NORTHWEST 323,000 ? Bell Tower Landcor ~ lo2 Broadway Street W, Osseo ~ Total_Northwest UnderConstruction 71,518 Completion: January~ooi NORT.R^ST ................................ ?s,S2~ $17.5o $14.oo Eagle Point Business United Properties Park Phase Ill Total Northeast Under Construction NE Quadrant of 1-94 & Inwood Ave, 32,000 Lake Elmo 57% Preleased; $13.5'0 Completion: June zoo~ ota[ St. Paul CBO Under Construction .... "~ '"' ~": ..... i.~'~; ............. :'~ ~ ?'"~' ............. .... ~ ...... ~5o Marque~e 535,000 Completion: ~st Qua~er ~oo~ Amer/~n ~press II American ~press 3rd Avenue South & ~oth Street 85o,ooo loo% American ~press NA River Parkway Place Ryan Companies ~th Ave. S. & W. River Pk~. 8o,ooo Completion: 2nd Qua~er ~oo~ 45% Pmleased $16.oo Total Minneapolis CBO Under Construction ~ Completion: ist Qua~er ~oo~ To~l O~ce Under Construction s,465,ooo s,8gs,528 OFFICE VACANCY AND ABSORPTION ~ DECEMBER 2001 SUBMARKET TOTAL # OF NRA VACANT BUILDINGS PERCENT SPACE VACANT Northwest -23 1,493,782 212,182 14.2% South/Airport 57 5'219'465 839,322 164%- Southwest ~48 23'532'629 1,728,946 12.7% West 76 7,994,157 841,o86 lo-5% Minneapolis CBD 93 15,194,739 ~,97o,888 11.8% Northeast __94 7,470498 814,434 20.9% St. Paul CBD Sz 8,531,98o 2,451,367 17.o% Total Market 543 69,436,950 8,848,:,25 so.7% PERCENT 2ND HALF 2001 VACANT 200~. ABSORPTION W/SUBLEASE 25.7% (13,332) (17,289) 28.5% (55,3o9) 40,007 16.6% (168,585) 6o,$79 14.o% (61,3o7) (8,963) ~3.7% 324,605 432:984 ~3.o% 44456 37,676 ~8'5% (236,5°8) (214,882) 15.2% (166,28o) 33o,112 increase in the future, as landlords plead for lower assessments based on reduced rental rates and their impact on property values. Long-term, one side effect of the September ~[ attacks may be in the form of higher building operating costs due to increased insurance rates and security. However, these effects are yet to be seen in the market and are likely to be offset in the short-term by reductions in rea[ estate taxes. ! 0 www.uproperties.corn/outlook · Absorption · Business conso|l, · The Northeast subm~rket emerges as a w°rking, cl~$s ller~'~vi~l~ the strong:est performance in themetro area" · Overall absorption creeps back to the positive side the second half of 2ool METRO MARKET OVERVIEW SECOND HALF 20011Therealestate industry needs a catalyst to recharge the industrial property marketplace. Demand fell off significantly, as companies turned cautious in the face of a slow- ing economy. The September 11 attacks completely halted momentum in the industrial market, further delaying the beginning of a real estate market recovery. For the first time since the early 199os, market fundamentals are very favorable for space users. Subleases continue to be brought onto the market, driving the overall vacancy rate up to 13.3% at year end, 16.5% with sublease space, compared to 11.4% vacancy and 14.2% vacancy-with.sublease rates at mid-year. Developers eased off new construction but still delivered 1 million square feet of new space to the market the second half of the year and 1.8 million square feet for the year overall. A mere 4oo,ooo square feet of new construction was underway at year-end, and developers will be reluctant to proceed on planned construction in 2oo2 without significant preleasing agreements. -- Second half absorption bounced back to the positive side at 234,628 square feet, compared to negative (636,760) square feet the first half of the year. Office warehouse and office showroom cate- gories recorded positive combined absorption of 633,000 square feet between July and December. Office showroom vacancies reached an eight-year high at ]z.8%, up from 8.8% one year ago, while office warehouse vacancy rate rose to 11.6% from 9.4% at year-end 2ooo. Negative absorption of /398,785) square feet and a ~6.2% vacancy rate in the 'bulk warehouse category reflected businesses' slash- ing inventories to control costs. A highly diverse tenant base helped the ~ ~rtheast grow its absorption numbers. With second half zool positive absorption of 416,ooo square feet and 511,ooo square fe~'t for the year, the Northeast stood out as a star performer in an otherwise disap- pointing year for industrial property owners. Steady incremental growth by its base of small- to mid-size, blue-collar-oriented tenants steered the Northeast toward a relatively modest 12.5% vacancy rate at year-end 2001 and the lowest vacancy-with-sublease space rate in the market at 14.2%, Corporate consolidation wreaked havoc on the Southwest and Northwest submarkets, which experi. enced significant increases in available sublease space and a corresponding rise in vacancy. In the Southwest, the year-end vacancy rate was 12.2% but 16.5% with subleases included; in the Northwest the vacancy rate hovered at 13.4% and ~7.7% with sub- lease space. Drooping demand and corporate cost- cutting pushed vacancies in the Southeast submarket to 16.3%, 19.1% including sublease space. Major transactions were few and far between. Tenants were more in command and in demand, but as a group they were so constrained by the economy that they couldn't fully capitalize on their position. ~Jtil[, the market's tenant-friendly environment will last well into the first half of 2oo2. The Outlook Poor economic conditions have laid waste to the growth plans of dozens of industrial space users throughout the Twin Cities, forcing many companies to sell or lease buildings for which they no longer have any use. Those buildings represent an MORE ONLINE: Submarket charts and narrative for Northeast. Northwest. Southeast, and Southwest are available at wv*v. upropertJes.com/outtook. INDUSTRIAL PROPERTY TYPES Bulk Warehouse: These facilities have 22 foot or more clear height ceilings and are generally located near major transportation corridors. Office/Warehouse: Facilities with z6-zo foot clear height ceilings. Office/Showroom: Buildings typically offer smaller bay sizes and heavier than normal finishes and landscaping. Typical clear height ceilings are 22-~6 feet. SOUTHWEST 'NORTHEAST" www. uproperties.corn/out[ook 11 ........ ""OUST.,AL NAME DEVELOPER : - ~'" LOCATION ' '=: STATUS' SQ. FT. NORTHEAST White Oak Phase I McGough Construction 19oo euerkle Rd. Company White Bear Lake 6o% Preleased; 78,ooo Total Northeast Completion Date: 1st Qtr., 2002 Under Construction 78,000 NORTHWEST ....................................... Fish Lake Caliber Fish Lk & 1-494, Business Center Maple Grove 20% Preleased; Total No~,~..-.i Completion Date: April 2002 Under Construction SOUTHEAST All Weather Roof Building Bridgerai~ LLC 2~o2 E 26th SE, 44% Preleased; 50,000 Minneapolis Completion Date: July 2002 Grand Oak VIII Equity Commercial 2770 Blue Water Rd, Services £agan o% Preleased; 4o,ooo Total Southeast Completion Date: March z002 Under Construction 90,000 SOUTHWEST ............... · [2th Ave Business Center Noble Shakopee Planned Completion Date: January 2oo2 ~23,oo0 Total Sou;hwe.~t Under Construction 123,ooo Total Industrial - Under Construction 403,000 ~,000.000 4,OOO,OOO 3.000.000 2,000,000 HISTORICAL ABSORPTION[TwiN CITIES INDUSTRIAL MARKET HISTORICAL CONSTRUCTiONIBy INOUSTR~RL PRODUCT TYPE OFFICE WAREHOUSE · BULK WAREHOUSE · OFF/CE SHOWROOM ~ O ~995 ~996 ~997 2998 ~999 ~000 2002 12 www.uproperties.com/outlook INDUSTRIAL VACANCY AND ABSORPTION -- DECEMBER 2001 SUBMARKET TOTAL # OF NRA VACANT PERCENT PERCENT 2ND HALF 200'[ BUILDINGS SPACE VACANT VACANT 200~[ ABSORPTION W/SUBLEASE ABSORPTION Bulk Warehouse 44 8,586.162 1,139,297 t3.3% t4J.% (112,436) (57,376) Office Showroom 54 3,641,ool 34o,I~5 9.3% lo.6% ~62.573 225,595 Office Warehouse 220 t6,448,682 2,092,228 12.7% t5.~% 366,5z3 343,382 Total 318 aS,675,84S 3.571,64o to.S% t~.~% 4~6,65o 5~,6o~  Bulk Warehouse 72 9,5t8,o55 L637,o42 t7.2% 24.5% (239,227) (t98.737) ~ O~ce Showroom 58 3,646,~64 383,759 m.5% ~.~ ~t,997 (~,46~)  O~ce Warehouse ~26 9,~42,597 958,782 ~o.5% 12.7% (3,465) (t25,31~) ~ T~I 256 22.3o6,816 2,979,583 t3.4% ~7.7% (230,695) ~36.5o9) Bulk Warehouse 2o 4,~5o,987 97o,549 23.4% 29'2% (z98,277) (~93.844) O~ce Showroom 43 2,969,782 586,574 ~9.8% 21.o% (~,oo6) (222.898) Office Warehouse too 6,77~,4o7 704,829 ~o.4% ~2.2% 48,853 4=,83o r~al ~63 s3,893,~76 Bulk Warehouse 3~ 3.975,467 497,3o3 ~2.5% 20.8% ~5~,~55 ~3~,958 O~ce Showroom 75 5.9~8,698 766.o42 [2.9% ~7-3%. ~76,77o (77,~76) O~ce Warehouse ~3o 9,3~.937 ~,o84,8o4 ~z.6% ~4.3% (~28,822) (257,094) Total 236 s9,2o6,~o2 ~,348,~49 t2.2% ~6.5% ~99,~o3 Bulk Warehouse ~67 26,23o,67z 4,244,~9t ~6.2% 2~.3% ~398,785) (3t7,999) Office Showroom 23o z6,~75,645 2,o76,49o t2.8% ~5.4% 35o,334 (86,94o) Office Warehouse 576 4~,675,623 4,84o,643 z~.6% ~3.9% 283,079 3,8o7 Total Market ~ 84,o8t,939 tt,~6t,32a ~3.3% t6.5% 23a,628 (4ot,~32) Continued [','om Page lz increasJn§ly viable alternative to leasing for compa- hies with strong balance sheets and predictable expansion plans, and they are a definite competitive factor to the multi-tenant market. The Southwest sub- market alone harbors more than 2.5 million square .Feet of vacant space in single-tenant JndustriaJ build- ings. The industrial market will be strongly challenged to absorb the surplus of single-user and sublease space over the next year and still show improvement in vacancy rates and absorption in the multi-tenant universe. 16% 14% Z a% z 2% O% HISTORICAL VACANCY TWIN CITIES INDUSTRIAL MARKET ~99¢ t995 1996 t997 ~998 ~999 2000 ~ooz www. uproperties.com/outlook 13 9% 8% 1% o% $16 RETAIL VACANCY ~995 ~996 ~997 ~998 ~999 2000 2DOt $~ $~o SS $2 $0 RETAIL RENTAL RATES t995 1996 1997 z998 ~999 7000 2DOt · Superstore/club store contenders race to claim new markets · Energized Minneapolis Central Business Oistrict poised [or 2oo2 Block E opening METRO MARKET OVERVIEW SECOND HALF 2001 I Expectations for a strong second half 2001 performance in the Twin Cities retail market were matched by marketplace realities. Following a mid-year hesitation, tenant demand for good quality retail, space recovered momentum across most property types. Leading the second half leasing pack were Community, Neighborhood and Regional centers, followed closely by the Minneapolis Central Business District (CBD). A handful of national retailers, reacting to the continuing economic slowdown at mid-year and the subsequent September ~ terrorist attacks, tabled most pending local expansion plans. Those plans will likely remain shelved until companies see a couple of consecutive quarters of sales growth. Absorption was strongly positive for the second half of 2om at positive L552,37o square feet, compared to negative (~52,5z7) the first half of the year. Year*end vacancy rates edged up to 6.8% versus the mid-year level of 5.5%. This was driven primarily by almost ~ mil- lion square feet of new construction that was delivered to the market the second half'of the year. Development interest remains strong in the Twin Cities market, especially among Community and Neighborhood centers· Developers are challenged to locate new sites to meet the demand. Within the 1-494/I-694 beltway, redevelopment is often the only option; otherwise developers increasingly look to the outer-ring suburbs for opportunities. Competition for new community center sites remains spirited among the key players in the super- store/club store category. At last count, seven new SuperTarget stores were either planned, under con- struction or recently opened in the metro area; Costco plans to build two more area stores, and at least two more Sam's Clubs are in the works. Target's ]60,ooo square foot new store opening in downtown Minneapolis keyed a second-half retail resurgence in the CBD. New development drove sec- ond half 2oo~ absorption to a positive z~4,00o square feet. Submarket vacancy rates rose to z2.3% at year-end versus a comparable ~0.5% rate at year- end zooo. The next big thing for the submarket is the fall 2oo2 opening of phase one of the new 424,0oo square foot Block E r~ail/entertainment complex. Neighborhood centers are proving their resilien. cy in tough economic times. Vacancies actually dipped slightly to 8.4% for the second half versus 9% at mid- year. Second half absorption was a positive 300,000 square feet, largely attributable to successful leasing activity in three new suburban centers. Business on Grand Avenue in St. Paul grew even grander with the opening of the new Grand Place spe- cialty retail center at Victoria and Grand Avenues. Even neighborhood activists initially opposed to the devel- opment now hail Grand Place as an attractive addition to the street. Specialty centers in general performed wel[ in 200z. Leasing problems at an east metro outlet mall drove up'the submarket vacancy rate to a year- end z0.4%, compared to ~.8% at year-end 2oo0. Site availability issues are significant barriers for develop- ers in the most desirable Twin Cities locations. Activity in downtown St. Paul was quiet through- out most of 20oz, even though the vacancy rate fell from 50.7% at year-end 2000 to 27.4% at year-end 200~. The continuing conversion of retail-to-office space took another ~20,000 square feet of space off the retail market during the year. The Outlook With almost ~-4 million square feet of new development scheduled to deliver in zoo2, the year ahead will be filled with challenges and opportunities for everyone involved in the Twin Cities retail marketplace. Retail interest remains high on both a local and national level. Another 4.3 million square feet of future development is planned for 2003 and beyond, in addition to a planned 5.6 million square foot, mixed-use expansion at Mall of America. 14 www.uproperties.com/outlook RETAIL VACANCY AND ABSORPTION -- DECEMBER 2001 SUBMARKET TOTAL # OF NRA VACANT PERCENT PERCENT ')ND HALF 2001 ~)UILDINGS SPACE VACANT VACANT ~1001., ABSORPTION W/SUBLEASE ABSORPTION Community io2 22,~.63,56o 1,361,953 64% 6.6% 562,928 639,899 Mirmeapolis CBD 13 ~,498,352 t84,334 12.3% t2.3% 214,482 21%o77 Neighborhood 225 12,828,57! 1,o74,646 8.4% 9.0% 3o1,132 2o8,179 Regional 9 11,285,734 531,~oo 4.7% 4.7% 555,924 4~,33o Specialty 16 t,375,2oo 142,983 ~o.4% zo.4% (44,179) (33,879) St. Paul CBD 8 3~.o,12o 84006 27.4.% 27.4% (37017) (44,753) Total Market 373 49,46s,537 3,379,922 6.8% 7.a% 1,552,37o 1,399,853 RETAIL PROJECTS UNDER CONSTRUCTION NAME CITY TENANTS STATUS SO.. FEET Riverdale Vii(age Phase II Coon Rapids Linen's N Things, 2nd Qtr. 2ooz 3oo,ooo Kohrs, Costco DEVELOPER Developer's Diversified Realty Block E Downtown Hard Rock Caf6, Phase t Completion: 424,123 McCaffery Minneapolis Crown Theatres, Fall 2002 Interests Gameworks Oelano Crossing Delano Cobom's Foods, zst Qtr. 2oo2 DO,ODD Oppidan Investment Shopping Center Snyder's Drug, Company McDonald's LinD Lakes Town Center Lind Lakes Super Target, I(ohl's Fall 2oo2 3OD,ODD Ryan Companies Arbor Lakes Phase Il Maple Grove Ann Taylor, Spring 2oo2 3o,ooo Opus Corporation/ Claddaugh's, CI Banks, Red Great Harvest The Shoppes of St. Anthony North Book store, Spring 2002 26,000 Hunt Gregory Minneapolis Caribou Coffee, Chipo[te, Grocer 5hakopee Crossings Shakopee Sam's Club, Wal-Mart Fall 2002 300,o00 Shakopee Phase I Crossings LP Total Under Cons/ruction t,47o,123 2,500,000 2.000.000 1o500,000 l. O00.O00 5oo,ooo o LSoo.ooo) HISTORICAL ABSORPTIONiTwlN CITIES RETAIL MARKET t995 1996 1997 t998 z999 2000 200! RETAIL PROPERTY TYPES Community Centers: These centers are greater than ~oo,ooo square feet and are built around a general merchandise store {such as a major tenant) in addi- tion to a supermarket or drug store. Limited small-shop space is occupied by a mix of service-oriented tenants and so,t-goods retailers. This classification also includes power centers, which are built around large-format category killers such as electronics, home improvement and sporting goods stores. Neighborhood Centers: Usually anchored by a grocery store and/or a drug store. This type of center fulfills the day-to-day needs of the surrounding neighborhood, is located at major street intersections and is 3o,ooo to ~oo,ooo square feet. Regional Centers: A major shopping area generally with two or more anchor department stores and a variety of addi- tional shops. These centers draw cus- tomers from a broad geographical area. Specialty Centers: These centers are unanchored and have theme or special- ty tenants with a different character than the other center types. These centers are not located in Central Business Districts (CBDs). Minneapolis or St. Paul CBO: Centers located in the CBD of Minneapolis or St. Paul This includes space located on skyways or street fronts. MORE ONUNE: Property type charts and narrative fl~r Community Centers, Neighborhood Centers, Regional Centers, Specialty Centers and Minneapolis and St. Paul CaDs are available at www. u propertles.com/outlook. www.uproperties.com/outlook 1 5 16 www. uproperties.comloutlook · If they plan it, will they buil~l it? so,ooo-plus units lurking in the new supply pipeline · Soft sailing': upper-end apartment sector turns a little mushy · Developers set compass to the northwest: Plymouth/Maple Grove/Rogers mini-boom · View from the top: market peak in rental rate growth in sight? METRO MARKET OVERVIEW SECOND HALF 2001 I Multi_family residential retained its claim as the strongest of the Twin Cities commercial prop- erty markets the second half of 2001. Fueled by continuing strong demand for apartments, most dramatically in the central cities of Minneapolis and St. Paul. metro area vacancies remained tight at 1.8Y, at year-end 2001. Minneapolis showed a 1.27, vacancy rate. with St. Paul at 1.3~'. Weakness in the economy may have signaled a near-term peak in the market at year-end, with clear signs of a softening of the market at the upper end as evidenced by a diminishing rate of growth in rental rates, increasing vacancies and more concessions. Year-end apartment rents averaged $816 a month, up 5% from mid-year's $776 and up ~4% from $716 at year-end 2ooo. If the market's white-hot growth rate of recent years is slowing, it is still strong enough to attract more development interest. More than ~o,ooo new apartments and 3,$oo senior rental units were in leaseup, under construction, planned or proposed at year-end. In the fast-growing .northwest suburbs alone, a virtual mini-apartment boom is underway with ~,$oo new multi-family units in the pipeline. How the market grapples with the increase in supply will be of enormous interest in the year ahead. Prospects for new apartment development in second-tier suburbs are better than they have been for some time. More favorable attitudes toward multi- family development opened the floodgate for a surge in planned apartment construction in cities that had previously resisted new projects, such as Eagan, Eden Prairie, Edina, Minnetonka and Plymouth. Development also continues to push into the outer suburbs, where strong growth in new develop. ment is underway in cities such as Shakopee, Chanhas- sen and Chaska to the southwest, Rogers and Maple Grove to the northwest, Lakeville, Savage and Apple Valley to the south and Woodbury to the east. Redevel. opment is also spurring solid multi-family growth in inner-rin§ suburbs like St. Louis Park and Richfield. Increasing the suppty of affordable housing remains a major concern throughout the metropolitan area, most acutely in Minneapolis and St. Paul. Significant property tax reform enacted by the 200~ Minnesota legislature gave developers a major incentive to initiate new projects, particularly in sub- urban cities with a relatively abundant supply of undeveloped land. With increasing supply comes the nagging concern of oversupply, especially as new product is delivered during a period of economic weakness. Multi-family remains the healthiest commercial prop. erty class in the Tw n Cities, however, with its Iow vacancy rate and strong demand - especially in the middle-income markets. The Outlook A respected national real estate report predicts the Twin Cities' apartment market 'should rebound quickly if the economic doWnturn is short-lived. Downtown residential offers the best long-term play," according to "Emerging Trends in Real Estate 2002," published by Lend Lease Real Estate Investments, Inc. and PriceWaterhouseCoopers LLR Development interest is widespread, as indi- cated by the mix of local, regional and national developers active in the market. Several major com- mercial property development companies also entered or plan to enter the market, including Opus Northwest, Ryan Companies, TOLD Company and United Companies, a further indication of the long- ' term potential of this market to deliver strong returns on investment. ~ Stc~tistical ~nformotion on the Twin Cities multi.family r~sidt, ntlol mork~t orovlcled by GVA Morquett~ Advisors. ldULTI-FAMILY PROJECTS PLANNED & UNDER CONSTRUCTION iCEMBER 2001 IE DEVELOPER Cfi7 UNITS S~ARIS The Legacy Hartford Group Apple Valley 278 Proposed to planning commission, '~ also 1.28 senior units : Hidden Ponds Burn/Development Apple Valley $~. Under construction; completion Winter 2002 Regatta Village Dominium Apple Valley 224 Approved; start Spring 2002 Arden South Apts Beacon Construction Arden Hills 30 Proposed ~ CloverleafApts Mainstreet Co Blaine 84 Approved; start Spring "002 I ~eelly Farms MOA Opus Bloomington 931. Proposed ~_.outhview Estates Sand Companies Bloomington 47 Proposed Champlin Shores Pathfinder Champlin ~33 Approved; start Spring 2002 Powers Ridge Apts Powers Ridge LLC Chanhassen zoo Under construction; first :oo units of 344, Points West Apts Wedman Foundation Chaska ]72 Under construction; four 43 unit buildings Glen Ponds Lawrence Wenzel Eagan 228 Under construction ~ Cedar Villas Shelter Corp Eagan ]38 Needs City Coundt approval i Unnamed Dominium Eden Prairie 1.9o Purchased land for 1.9o upstate units The Water Tower North American Properties Eden Prairie 21.2 Proposed Southwest Station North American Properties Eden Prairie 225 Proposed Uncoln Parc lack Brandt Eden Prairie ~86 Under construction; Summer 2002 completion Grandview Square Opus Edina ~72 Approved; Phase I (71 units) under construction The Plantation Erwin Stobee Hopkins 37 Under construction: completion Spring 2002 ! Victor Gardens Pratt Arnt Oakwood LLC Hugo :~? Proposed : Arbor Point Paul Schafer lover Grove Heights [26 Approved; start Spring 2oo2 Condor Corp lover Grove Heights 2o8 Preliminary approval; apartments and townhomes Kenwood Crossing Sylvester Brother Lumber Lakeville 252 Proposed Nbor Glen Longstreet LLD Maple Grove ~8o Under construction ~Birch Glen Specialty Dev Corp Maplewood 6o Under construction Dakota County HRA Mendota Heights 28 Under construction Central Apartments RS Eden & Alliance loc Minneapolis 61. Start Spring 2oo2; iow income efficiency Many Rivers AIHCDC Minneapolis 76 Start Spring 2ooz I. amoreaux Addition CCHi~' Minneapolis 3o Three story addition to existing building; Spring oz start Near North McCormack Baron & Assoc Minneapolis 232 Under construction; Phase I of 8o0 units City Apts at Loring Park Village Green Minneapolis 1.62 Under construction Hunt/Gregorf Minneapolis 3o Under construction: completion Fait 2oo2 Alliance Housing Minneapolis 26 Under construction; completion Spring 2oo2 Scott Bader Minnetonka [61. Approved: start Spring 2oo:z Ryan New Brighton 340 Proposed ~ Street Village Stoney Lake Properties New Brighton 1.OD Proposed Hadley Estates of MN Oakdale 1.6o Under construction Orono Ambers LLC Orono 62 Under construction Sand Companies Plymouth 31.8 Under construction Jpl Apts Plwnouth :)o1. Under construction North American Properties Plymouth 361. Approved; under construction Jeffery Gustafson Prior Lake 47 Approved; not started yet Lyndale Stuart Mgmt Co Richfield 2]0 Proposed ,andoah Apts Heritage Development Shakopee 292 Approved; not started yet Daniel 8rower Shakopee 48 Approved; not started yet ins Pines DMC Shakopee 52 Under construction EXCelsior & Grand Told Oevelopment St Louis Park 35o Under construction; part of mixed use development APARTMENT TYPES Class A: Generally includes properties that have been built in the last lo years and offer a full amenities package. Most complexes offer underground parking. Class B: Includes properties which are to to 2o years old and offer a competitive amenities package. Many complexes offer underground parking. Class C: Properties built ;n the ~96os and 197os. www.u properties.corn/out look 1 7 MULTI-FAMILY PROJECTS PLANNED & UNDER CONSTRUCTION (CONT.) DECEMBER 2001 RM4E DEYELOPER Cl]7 UNITS STkTUS Louisiana Oaks MSP Real Estate St Louis Park zoo Under construction; Phase II of a zoo unit complex Creekwood Townhomes Edina Development Corp St Louis Park 38 Under construction Unnamed West Suburban St Louis Park 88 Proposed market rate and Low income Unnamed Hartford Group St Louis Park 8o Proposed Sibley Court Sherman Associates St Paul 114 Phase I under construction. Phase II will be lz5 units Arbor Pond Jerry Frisch St Paul 4o Under construction Upper Landing Centex St Paul 32o Start Summer zooz; ~oo affordable, 220 market rates Westside Flats Sherman Associates St Paul 350 Start Spring 2002 Riverbtuffs Brighton St Paul 648 Start Spring 20o2 Gateway Village Christenson Corp St Paul 3ol Proposed Emerald Park Dominium St Paul 237 Start Spring 2oo2 Green Twigs villas Tim Nolde StiUwater 50 Under construction; completion soon City Walk Del American Woodbury 515 Proposed; part of mixed use development Westview Estates Goff Homes Woodbury 80 Under construction; completion soon Total Apartments to,Ba2 SENIOR MULTI=FAMILY PROJECTS PLANNED & UNDER CONSTRUCTION DECEMBER 2001 PLANE DEVELOPER CITY UNITS STAI1JS Pennock Place Twin Cities Christian Home Apple Valley lo6 Approved; has not started construction yet The Legacy Hartford Group Apple Valley t28 Proposed to planning commission Gray Oaks Gray Oaks inc Andover 13o Start Summer 2002 PeneLope 35 AHPE/Pene[ope 35 Inc Bloomington 4~ Under construction Regent at 8urnsvifie Hartford Group Burnsville t35 Start Spring 2002 Mill Pond Gables Pathfinders Champlin ~33 Proposed Crestview on 42nd Crestiew Corp Columbia Heights 5o Under construction Real Life Real Life Coon Rapids too Under construction Eden Shores Silver Crest Properties Eden Prairie 3z5 Start Spring 2oo2 Roiling Hills Jack Brandt Eden Prairie 139 Under construction Cameron Woods Wensco Farmington 8z Under construction Unnamed Dakota CPA Hastings 67 Approved; start Summer 2oo3 Unnamed _ Augustana Care Corp Hastings 80 Under construction Spring; 2002 completion Summerhouse Presbyterian Homes Inver Grove Heights 16o Under construction Arbor Lakes Common Common Bond Maple Grove 50 Under construction Chapel Wood Farr Development Maple Grove 26o Under construction Town Center Dakota CPA Mendota Heights 6o Start Spring 2002 Shingle Creek Sr Housing Common Bond MinneapoLis 75 Under construction Unnamed Orono Amber LLC Orono 6z Waiting for approval Plymouth Continuing Care Hartford Group Plymouth tzo Under construction Regent at Plymouth Hartford Group Plymouth 12o Under construction Croekside Living Eagle Creek Villa LLC Prior Lake 54 Under construction Crystal Care Crystal Care Prior Lake 6o Making changes, back to planning LakefTont PLaza R&K Sales Prior Lake 40 Proposed Unnamed Shalom Community Alliance St Louis Park 54 Under construction Marion Center Health East St Paul [~7 Under construction Parkway Place lorry Frisch St Paul 75 Start Spring zoo2 St Marys Franciscan Health Corem St Paul 71 Start Spring 2002 Seabury Episcopal Health St Paul 50 Under construction Iris Commons Addition Episcopal Health St Paul 20 Under construction The Arbors LaNel White Rear Lake 8o Under construction (Main St Village) Boulders Tycon Development White Bear Lake 85 Start Spring zooz (formerly Granite Hill) Total Senior Housing 3,t39 18 MORE ONLINE www.u properties.corn/out look credit is required by institutional investors more so than ever the money: Investment demand steady for quality apartments, bulk industrial, grocery-anchored retail Keeping their cool: property owners not pressured to sell; no repeat of the over-leveraged late '8os debacle Cold all year: investment transaction activity down significantly K METRO MARKET OVERVIEW SECOND HALF 2001 J Theecono- my was the story for the Twin Cities investment market over the second hal. f of 2001 and throughout the year. Genera[ economic weakness permeated into the rea[ estate market, unleashing more sublease space and driving up vacancies-- especialLy in the office and industriaL markets. Cautious investors - especially on the institution- al side - were increasingly carom about where they put their money. Only the highest quality properties drew their interest for the most part. More opportunistic local investors, flush with cash from the late 199os real estate boom, were ready to deal again - but the deals were slow to materialize nonetheless. With property values, as perceived by some would.be investors, being flat or even declining as much as lO% to 15% in some markets, owners were in no hurry to sell. Transaction activity slowed to such a negligible pace that the market was hard-pressed to determine what was really happening to property val- ues. For example, fewer than 23 transactions of $1 mil- lion or more occurred in the office market in compared to 63 such sales in 20o0. Only the still-hot apartment market saw steady transaction activity, with approximately 35 sales of a million dollars or more occurring in the second half of 2ooz and about 6o such transactions for the year. Twin Cities retail properties continued to perform giving owners little reason to sell assets whose equal to, or even superior to, what might elsewhere in the financial markets. Twin Cities real estate thus tracked national according to industry experts. "Most owners are distressed, benefiting from the option to reft- preads to healthy property fields," says the authoritative "Emerging Trends in Real 2oo2" publication from Lend Lease Real Estate ,nvestments, Inc. and PricewaterhouseCoopers LLR 'Cash-strapped investors forcing buildings onto the market at bargain pricing are few and far between, and delinquency rates.~ave stayed Iow." Overall, underwriters have grown more critical, looking for the highest quality properties in a select few categories. Good quality, credit-leased opportunities in the office, industrial and retail markets are in high demand. However, even grocery-anchored shopping centers are coming in for extra scrutiny from investors concerned about the strength of the grocer and trying to determine if there is a threat from big box discount retailers adding groceries to their offerings. The Outlook Motivated sellers were rare in 20m. That may change in 2002 if economic conditions improve and sellers of office, industrial and retail prop- erties turn more aggressive. In the apartment market, institutions may look at the Twin Cities with more caution, amid concerns over vacancy increases at the high end of the market, a slow- ing rate of growth in rental rates and a continuing increase in supply. Capitalization rates may be edging upward. With even moderate economic recovery in 2002, however, the market will again deliver rental growth at or slightly better than inflationary levels. Sustained economic recovery is the key to rekin- dling the investment market for the overall office and industrial sectors, as well. A slow return to near-normal transaction levels in these two markets is anticipated in 2002, with better recovery expected in 20o3 as the markets gradually absorb the available space - both in multi-tenant and single-tenant buildings - left behind by recession-battered companies. Good quality Twin Cities retail properties will continue to remain in high demand. MORE ONLINE: Property h, pe narrative and capy for Retail, Industrial Office and Aoartment are available at www,uproperties.com/outlook. RETAIL SALE PRICE PER SQUARE FOOT $90 S7o $60 $5o $4o $30 $2o $o www. uproperties.com/outlook 1 9 2O OFFICE SALE PRICE PER SQUARE FOOT $1%o S9o~ $?o S6o S4o 199% 1992 1993 1994 %995 ~996 ~997 %998 %999 2000 2ool APARTMENT SALE PRICE PER UNIT CLASS A · CLASS B · CLASS C O lOO.OOO ~ - 90,000 Z 80.000 iL 70,000 ua -- 60,000 m 50,000 40,000 Ua 30,000 20,000 - %993 1994 ~995 %996 ~997 %998 1999 8o 60 50 40 30 20 o INDUSTRIAL SALE PRICE PER SQUARE FOOT OFFICE SHOWROOM ·BULK WAREHOUSE ·OFFICE WAREHOUSE O WWW. U properties.corn/out look 2000 200% ! i i I I t ! 1 ! ! 1 ! ! ! ! ! DIRECTORY uarters Office Northland Executive Office Center 15oo West 8oth Street, Suite 2oo 3oils, MN 55431 ~52 83~-1ooo ;ate[lite Offices idwest Plaza 3ol Nicoltet Mall, Suite 1825 W MN 55402 339-61oo dormandale Lake Office Park Normandale Lake Blvd., Suite 320 Blooming.ton, MN 55437 ~52 921'2222 J.S. Bancorp Piper Jaffray Plaza Cedar Street, Suite 900 Paul, MN 55101. 223-5900 Services Eaton 952 893-8808 952 893-8838 ~ffice onja Breyfog.le 612 3o5-2144 Ducharme 61.2 3o5-21.o6 Brent Erickson 612 3o5-21.1o Gleason 952 893-8884 Slen Grussing. 651 734-2385 ellison 6,.2 3o5-21.15 }irn Jetland 952 893-8888 Kost 65/. 734-2384 McCarthy 952 893-759/. im Montez 612 3o5.21o7 )an Nechanicky 952 82o-8765 Olson 952 893-82/.4 Revoir 952 893-7586 Rohrer 61.2 3o5-21.o8 Ste[la 65/. 734-2383 'y 952 893-8833 ~m Tracy 952 921.2o2/. ~cob Wert 952 893.8283 952 893-8254 952 893-8255 Idustriai U 952 893-8202 ~ny DelDotto 952 893-8893 ~dd Erag'er 952 893-758/. Hanson 952 82o-8737 Hickok 952 893-8845 iruce Hoberman 952 82o-8775 ireg McMillan 952 837-8577 tson Meyer 952 82o-8735 Moe 952 893-8284 Rausch 952 893.8251. Sell 952 837-85/.5 Sims 952 893-8829 Torborg .. 952 893-7592 Yanta 952 82o-8734 Retail Jill Hag.en Klm Meyer Stefanie Meyer Tricia Pitchford Ned Rukavina Mike Scott Mike Sims 952 893-8234 952 837-8509 952 893-7599 952 820-8763 952 820-8738 952 893-8240 952 893-8288 Investment Services Brenda Arnold 952 893-8854 Eric Bjelland 952 893-8282 Cheri Holtzworth 952 837-8545 Scott Pollock 952 893-759o Matt Sonntag. 952 893-8885 Property Management Services Construction Management Services Bruce Palmer 952 893-882! John Healy 6/.2 3o5-2/.o3 Bruce McCulloch 952 893-758o Development Services Frank Dutke 952 893-88o6 Dale Glowa 952 893-8828 Georg.e Burkards 952 893-8836 Brian Carey 952 893-8846 Bruce Carlson 952 893-8887 Tony Kuech[e 952 893-8291 Mark Nelson 952 82o-8727 Keith Ulstad 952 893-821.o Corporate Real Estate Services Larry Pobuda 952 921.-2o36 Jeff Eaton 952 893-8808 952 893-8277 Dean Freeman 952 893-8837 Greg.ory Boderman 952 82o-8785 Brian Burg. 61.2 3o5-21.o5 David Bonn 952 82o-8762 Nancy Campbell 952 893-82o7 Steve Brown 952 837-85/.7 Kevin Connolly 952 893-884o Anne-Marie Cookson 952 893-8890 Dave Oabson 952 921.-2o53 Mike Fleetham 952 837-8520 Lisa Dong.oske 952 82o-8751. Sandy Joski 952 837-851.6 Gayle Dreon 763 59/.-6o92 Jeffrey LaFavre 952 893-8839 Zach Eliason 952 893-8226 612 3o5-21./.3 Theresa Elveru 952 921.-2o54 Nancy Miller 952 893-7537 John Erickson 952 837-8560 Peter Opitz 952 82o-8784 Austin Floyd 952 92/.-2o34 Gilbert Smith 952 837-85o7 Alex Hall 952 837-84o1. Amber Van Dyke 952 837-8518 Maureen Hall 952 893-8208 Jim Wadsworth 952 893-8289 Beth Holmg.ren 65/. 734-2388 Sonya Huber 952 837-8404 Facility Services Julie Hughes 952 893-8882 Jay Grooters 952 893-8232 Patrick Kriske 952 893-8889 Amy Arnost 651 662-21o1. Fred Atkinson 65/. 662-8361. Jennifer Lenhart 952 843-o344 Robert Loftus 952 82o-8753 Greg. Ault 952 893-8866 Denise McCormick 61.2 339-7o24 Sue Burton 617 21.9-241.2 Dennis Meadows 763 59/.-6o6o Randy Duss 71.5 726-52o8 Jim Heinz 61.2 624-5079 Ellen Morton 952 893-885/. Kelly Oertli 952 837-84o6 Pete Hillman 952 837-85o6 Kevin Johnson 41.5 832-59o4 Tony Rosell 952 82o-87/.9 Chris Smith 952 893-8265 Gary Knowlton 71.5 726-7277 Kurt Stenson 651. 734-2389 Mark Lichty 65/. 256-538o Andy Sundg.aard 651 734-238/. Laura Lindholm 952 893-8295 Ryan Tibbits 61.2 3o5-21.1.4 Lucy Mag.hrak 651. 683-3880 Bill Zimmerman 952 893-888o Dave Menz 952 893-8278 Will O'Connor 65o 933-5oo6 Asset Management Becky Schenk 952 837-8532 Frank Dutke 952 893-88o6 Amy Schroeder 61.2 625-8876 Brenda Arnold 952 893-8854 Rick Torrance 952 820-878/. John Breiting'er 952 893-8267 Scott Zimmer 651. 662-7955 Cheri Holtzworth 952 837-8545 Eva Stevens 952 837-858o Richard Student 952 893-7598 Information Services Maura Murphy Marc Akerlind Shannon Mavis Marketing Denise Loidolt Tanja Sayles 952 893-8203 952 837-8571 952 893-8239 952 893-7539 952 893-8292 www.uproperties.com/out[ook 21 Welsh Companies 401 North Robert Street, Suite 225 St. Paul, MN 55101 Contact: Bob Long, Development/Brokerage Services 651-665-1139 Status of Application: RFQ Requirements Met Strengths: Like United Properties, this team has experience in all aspects of the redevelopment process from multi-family to industrial. Their £mancial backing is excellent with ownership of architecture, construction, and development subsidiaries- they can implement any plan that is developed. Like United, they can meet the redevelopment needs of this project. Concerns: The company did not name all members of the team. Again, will Columbia Heights get maximum attention, as other projects .come on line? There really aren't any other concerns. This team has the experience to work with Columbia Heights. H:\Industrial Center\Welsh Companies Staffreview -- 0 o~ o~ o~ o~ ~ ~ m m ~ ~ ~ ~ ~ zm ) z zZ z z z z w mw w: J X XZ X X-- X-- 0 UJ > SPRING 2002 COMPANY OVERVIEW Dennis J. Doyle, czo Welsh Companies TABLE OF CONTENTS ABOUT WELSH · Mission Statement · Values · Fact Sheet · Management Portfolio · Location Map e SENIOR MANAGEMENT · Organizational Chart · Senior Management Profiles 3. DIVISION SUMMARIES 4. WELSH IN THE NEWS ABOUT WELSH · Mission Statement · Values · Fact Sheet · Management Portfolio · Location Map MISSION STATEMENT Through our shared values, we provide a com- plete range of exceptional real estate services that mutually benefit our customers, employees, share- holders, and community-resulting in long-term relationships. Our shared values are: · INTEGRITY · EXCELLENCE · TEAMWORK · MUTUAL PROFITABILITY WELSH VALUES INTEGRITY: ,Key Outcome: Trust and respect in all relationships EXCELLENCE: .Key Outconle: Consistent high quality and innovative results which benefit all TEAMWORK: .Key Outcome: Produce results that exceed individual contribu- tions by working together MUTUAL PROFITABILITY: Key Outcome: A financially successful organization which results in increased opportunity for all WELSH FACT SHEET HEADQUARTERS: Minneapolis, Minnesota OFFICES: Minneapolis / St. Paul, Minnesota Columbus, Ohio SERVICES PROVIDED: Property / Asset Management Commercial Leasing and Brokerage Tenant Representation Facility Management Corporate Real Estate Services Investment Property Sales and Acquisitiom General Contracting and Construction Mgm[ Architecture and Design Services Development Services Facility Technical Services REAL ESTATE AGENTS: Minneapolis / St. Paul 61 Columbus 15 Total 76 NUMBER OF-F_aMPLOYEES: Minneapolis / St. Paul 289 Columbus 41 Welsh Construction 35 Genesis Architecture 14 FadliTech 41 Welsh Capital 5 Welsh Development 5 Total 330 MANAGED PORTFOLIO: 22 Million Square Feet valued at $1.6 Billion, comprised of over 250 assets. TRANSACTION VOLUME: In excess of 1,000 brokerage transactions annually, representing approximately $800 million in total annual consideration. INVESTOR CLIENT BASE: Over 1,~00 commercial tenants and more than 65 investor owners, including: AEW Capital Management Allianz AMB Property Corp. Barclays Bank PLC BGK Equities, Inc. CaprisCapital Catellus Development Co. Devon Properties Glenborough Trust L & B Realty Advisors Ohio SEllS Opus Corporation Prindpal Capital Management Prudential Real Estate Investors RREEF Funds TA Associates UBS Realty Investors REPRESENTATIVE CORPORATE CLIENTS: Opus Group Emerson Electric Miller Johnson Lifetouch MJSK Target Corp. Ramsey County Govt. Ctr. Liebert Turner Development Co. US Bancorp REPRESENTATIVE CLIENT REPRESENTATION: Airborne Express Bed Bath & Beyond Chester Willcox, LLC Circuit City Computer Associates Digital River Fourth Shift Home Depot Starkey Labs US Bancorp Wells Fargo Winthrop & Weinstine MANAGEMENT PORTFOLIO OFFICE AND PROPERTY LOCATIONS ~)(,Office Loceticns with Prcpertie~ ICurrer~t De. elc~ment Projects 2. SENIOR MANAGEMENT * Organizational Chart · Senior Management Profiles 1 DENNIS J. DOYLE Chief Executive Officer Welsh Companies PROFESSIONAL RESPONSIBILITIES Dennis Doyle is a majority owner and co- founder of Welsh Companies, a leader in full- service commerda] rea]estate. Founded as Welsh Construction Corp. in 1977 by Dennis Doyle and his partner George Welsh (who retired in 1986), the partners drew upon their expertise in construction and management of commercial and industrial properties to create the full-service organization that exists today. BUILDING ON SUCCESS During the early years, the company developed and constructed buildings on a build-to-suit and speculative basis~ Under Dennis' guidance and leadership, today Welsh and its affiliates provide a complete menu of services for commercial and residential property owners and users. Jointly, these companies are involved in leasing and brokerage, client representation, property management, facility management, corporate rea] estate services, hrchitecture, construction, development, mortgage banking, facility services, and non-profit consulting services. Welsh is headquartered in the Twin Cities with re.l~ional offices in Minneapolis and Saint Paul, Minnesota, and Columbus, Ohio. The company is also actively involved with rea] estat,e~projects in Kansas City, KS; St. Louis, MO; Des Moines, IA and Milwaukee, WI. INDUSTRY LEADERSHIP Dennis is dedicated to improving both business and the surrounding community. He was twice a finalist for the Ernst & Young Merrill Lynch Entrepreneur of the Year Award, and received the 1990 Eden Prairie Chamber of Commerce Small Business Person of the Year Award. An active member of the National Association of Industrial and Office Pro~rties, Dennis is also involved with a variety of other organizations, including the following: Community involvement, Present Boards Board of Directors, Minnesota Teen Challenge Board of Advisors and President, Hope in the City Professional Involvement, Present Boards Board of Directors, American Church Mortgage Co. - RE1T Board of Directors, Rottlund Homes - NAS DAQ Board of Directors/Stockholder - Key Community Bank Board of Directors, Gresser Concrete Coramunity Involvement, Past Boards and Presidencies Board of Directors, Great Clips, Inc. Board of Directors, Grow Biz International, NAS DAQ Board of Directors, Athletes in Action Board of Directors, Church Metro Board of Directors/Past President, H.E.A.R.T. (Help Enable Addicts Receive Treatment) Board of Directors, The Children's Theater · JEAN V. KANE President and Chief Operating Officer Welshco, LLC eean has been an integral part of the success that Ish has enjoyed over the past 15 years. She is currently responsible for developing strategic initiatives and overseeing; acquisitions and dispositions, as well as d~y-to-day operations for Welsh and its affiliates: Welsh Minnesota, Welsh Ohio, Welsh Construction, Genesis Architecture, Welsh Development, WelshInvest, Welsh Capital, and FaciliTech. Under Jean's leadership, the company completes more than 2,000 transactions per year with nearly $800 million in consideration and manages a portfolio of 22 million square feet of commercial spaCe, with a market value of $1.1 billion. The company produces more than $45 million annually~n a¥chitectural and construction-related activities. BUILDING ON SUCCESS Familiar with all types of commercial real estate, Jean began her tenure with Welsh in the Property Management Division and was quickly promoted to Asset Management. Jean has held a variety of positions withih the Welsh orgamzation over her tenure. Her responsibilities have extended to business p ' g tities. She has been actively involved with the formation of new ventures as well. INDUSTRY LEADERSHIP Dedicated to an ongoing professionalism, Jean hihnvOlds the designations of Certified Commercial estment Member (CCIM) and Real Prope_rbd Administrator (RPA). Jean earned her Bachelor of Arts degree in Business at Gustavus Adolphus College. Jean is an active member of m~¥ professional organizations, indudin[, National Assodation of Industrial and Office'Properties (NAIOP), for which she currently serves as 1st Vice President of the local chapter, as well as a member of NAIOP's National Private Developer F_,orum; Young President's Organization (YPO); organization of Commercial Realtors (OCR); and Women in Real Estate (WIRE). In addition, Jean serves on the Adviso_ry Board of the Midwest Real Estate News and Commerdal Property News. · ROBERT J. ANGLESON President Welsh Companies Bob Angleson has spent his career in commercial real estate leasing, managing and developing sroperties across the country. That gives Welsh ompanies and our clients the benefit of Bob's wealfh of knowledge in all aspects of the industry. PROFESSIONAL RESPONSIBILITIES As President of Welsh Companies, Bob is responsible for guiding the Welsh team. In addition to managing the day-to-day operations of the Company, Bob spends much of his time .w. orkin, g to support and develop the expertise of his staff. : Along with directing all activities of the Company, Bob remains in constant communication with clients, assuring the highest level of responsiveness and professionalism." He provides the resources and support it takes to achieve the goals of the comp/my. BUILDING ON SUCCESS Bob mastered these leadership skills over the ast 22 years. He began in 1979 with Murdock evelopment Company as division manager for a 650,000 square fo~t project. In 1985 he went to work for Zepka, Goldberg, Inc. purchasing, leasing and managingcommercial properties along the East Coast from New York City to Miami. Bob then joined Oxford Development in Saint Paul where he oversaw the leasing and management of the Minnesota World Tiade Center and Town Square. From 198,9 to 1991, he was responsible for Zaidan Holding s property management portfolio. In 1991, Bob and partner Dick Zehring formed Zehring & An8leson, leasingand managin, g. over two million s q uare feet ot space m the Saint Paul area. The pair sold the company to Welsh Companies in 1994. INDUSTRY LEADERSHIP Maintaining a strong network and contin, aily keepin, g abreast of indus~ trends, Bob. is an active member of the National Assooation of Industrial and Office Properties and has been the Past President of the Buil-dingOwners and Managers Association local chapters in Akron, Ohio and Saint Paul, Minnesota. PRESENT AND PAST AFFILIATIONS · Chair, Saint Paul Downtown Council · Executive Committee, Saint Paul Chamber of Commerce · City Council Member, Hudson, WI · Mayor, Hudson, WI · Chairman, University of Wisconsin River Falls Foundation · Board of Directors, Saint Paul District Energy. · ROBERT B. POUNDS, SCSM Executive Vice President Welsh Companies Bob has over 16 years of real estate experience, 14 of which have been with Welsh Companies in a variety_ of roles. He is primarily responsible for Welsh's business development activities and takes the lead role with Welsh's strategic dients ensuring the client's goals and objectives are met. PROFESSIONAL RESPONSIBILITIES Bob, as part of a business development focus, verovides a Sales Manager role for many of lsh's brokerage areas, Sl~__cifically, office and retail leasing services as well as Welsh's investment services gr. oup. He plays an active role in Welsh's on-~omg service responsibilities to its customers. Bbb coordinates with other Welsh business unit leaders to select the right individuals to comprise the customer team. He coordinates the eff6rts of the team and helps the client measure Welsh's success. Bob leads Welsh's efforts to iden _tify strategic customers and the pursuit of the business opportunities related to those customers. This process allows Welsh Companies the opportunity to think strategically about its customers rather than focusing exclusively on the tasks at hand. Throughout his career, Bob has held many roles within the Welsh Companies organization. He began his career with Welsh Companies in the prope .rby management division managing retail assets fbr Welsti's la_rgest institutional investors. Subsequently_, Bob also managed the combined efforts of Welsh's retail focus allowing him an expanded role in working closely with our leasing professionals. He went on to manage the entire property management group and from there shift-ed to his current position as Sales Manager and business developer. INDUSTRY LEADERSHIP Bob has been active in a variety of reaI estate related trade organizations including the Minnesota Shopping Center Association (MSCA), the International Council of Shopping Centers (ICSC), National Association of Industrial and Office Properties (NAIOP), Building and Owners Management Association (BOMA) as well the Urban Land Institute (ULI). Bob holds the professional designation of Senior Certified Shopping Center Manager ("SCS. M"), a designation l~=~towed by the International Council of Shopping Centers. · WILLIAM R KRAKE /=resident Welsh Construction PROFESSIONAL RESPONSIBILITIES As the President of Welsh Construction, Bill Ir, rake manaKes operations in the Twin Cities and nationally. I-'te oversees a staff of 40 professionals and is responsible for the day-to-day operations so~th~ -~,m,,an,, Bill's vrimary role is to under.- ~e ~an~/ng nee'ds.of our, ,cus. tome_r_s, iT? to build and guide a strong team ame to prov services that deliver results. Bill's leadership and commitment to prodding quality services result in projec.ts that ar,,e c.o~- pletedon time, on budget. In crtarge ot yom external and internal business development, Bill makes sure that all di~nt needs are met. Currently, those clients indude Target Corporation, Bremer Bank, and Art Institute International. Bill oversees a highly skilled and dedicated staff induding project managers, superintendents, laborers and administrative support. Working with affiliate companies Genesis Architecture and Welsh Companies, Welsh Constm .ctio,.n pro. vi,des a full scope o~ services in all areas ot otnce, maus- trial, manufacturing, retail, multi-family and investment real estate. BUILDING ON SUCCESS Throughout his 17-year career in commercial con- struction, Bill has been responsible for the over- sight of major developments throughout the Upper Midwest. As President of CB Richard Ellis Construction, Bill negotiated and managed a four-phase, multi-million dollar project for .the Art Institute International of Minnesota m crown- town Minneapolis. Prior to CB Richard Ellis, Bill spent 12 years with Ryan Companies as a Project Manager and Division Manager. During his tenure, Bill di{.ect- ed a variety of projects, including the renovation of Toro Companies' world headquarters in Blooming, ton and the extensive re~ovafi~.o~ for ,_~ offices ofDorsey & Whitney law Iud. :. crmer pas dients include Wilson Learning, Cen&an Corporation and AT&T. Bill earned a degree in Construction Management from Mankato State University. · TOD S ELKINS Executive Vice President Genesis Architecture Genesis Architecture's Executive Vice President, Tod Elkins, has more than 17 years of yrOfessional architectural experience. He is high- motivated with an abundance of hands on experience inproject management, technology, mentoring and the management of professional staff, as well as outside vendors andcontractors. PROFESSIONAL RESPONSIBILITIES As Executive Vice President of Genesis AxchitecttLre, Tod is responsible for the day-to- day operations of the organization. Working closely with the President of Welsh Construction, Tod is instrumental in the strategic development of the company and in m_ aking sure that the services offered and quality of performance are consistently above th~ dients' expectations. Directing the activities of multi-faceted design teams, Tod coordinates schedules, omanizes development plans, and supervises tlqe execution of the assignment. BUILDING ON SUCCESS Tod was trained as an architect at the University of California, Berkeley and earned a Masters in Architecture from the University of Minnesota. He be. gan his professional career at Hale's Testing Laboratory in Hayward, California. Since then he has worked with Monterey Domes, Inc., in Walnut Creek, California; Russel & Scot Architects, Inc. in Cambridge, Massachusetts; Klick InterArch Design, Ltd. in St. Louis Park, Minnesota; and most recently, Cuningham Hamilton Quiter, EA. in Minneapolis'~ Minnesota. Throughout Tod's career, he has completed a considerable amount of work for a variety of school districts, induding additions, demolition and remodeling of classrooms, gymnasiums and media centers. INDUSTRY LEADERSHIP Tod is active in a number of industry organizations in order to maintain a strong network of peers and colleagues, as well as to stay abreast of the latest industry trends. · RANDY PAVEY Vice Presiden~ FaciliTech An experienced leader in the service and con- struction industry for more than 20 years, Randy Pavey is Vice President of FaciliTech, an affiliate of Welsh Companies. PROFESSIONAL RESPONSIBILITIES In his position, Randy manages the day-to-day operations which include recruitin~ and managing a staff of 54. These people ]~rovide a varie~ of services induding: electrical, vlumbing, carpentry_, .~enerkl maintenance, heating and afr conditioning and graphic design. Randy's foremost concern is the satisfaction of his clients. Randy remains in constant communication with clients assuring the highest level of responsiveness and quality service. BUILDING ON SUCCESS Randy's business strategy has built a productive, dedicated staff with unmatched initiative to provide the best quality in the construction market. Randy is a mange, r who clearly ,. understands the needs and expectations ot his clients, and is dedicated to providing customer satisfaction and building long-term relationships. Excellent relationships are the key to FaciliTech success with existing clients. Rafidy has helped foster relationships with Glenborough Properties, Best Buy, UnitedHealth Care, ArtesYn TechnoIogies, Buffets Incorporated, Scho_t-t Corporation, Trammell Crow Corporate 5ervi.ces, University of Minnesota, Mesaba Airlines and Welsh Companies. INDUSTRY LEADERSHIP Prior to joining FaciliTech in 1994, Randy spent six years working for United Operatio .ns and prior to that worked for nine years in the _ construction and service work industry. Randy is a member of Building Owners and Managers Association and Associated Builders and Contractors. · MICHAEL YOUNG, sloR Executive Vice President, Managing Director Welsh Companies PROFESSIONAL RESPONSIBILITIES Mike Young has ultimate responsibility for all r? o..f NAI Welsh's Ohio-based operations. ertecuve team builder, Mike has recruited and trained a first-chss group of sales and leasing.professio.n, als who consistently verf~o, rm above their client s expectations. NM Welsh s Erqpe _rty management operations in _the Columbus marl~et are aiso under Mike s direction. He places strong emphasis on tenant relations, communications with owners and timely finandal reporting. BUILDING ON SUCCESS Mike's strong relatio _n.ships in the business community both locally and nationally enable the company to capita~e on national opportunities. A multi-faceted background in both fiscal and management roles provides Mike with the abi/ity to lead client deveropment efforts, taking an active interest in each one. Whether a national institution, regional ,c, orp.o, rati .on o.r local .entrepreneur, Mike l~rovides me direction to see that they achieve their real estate goals. INDUSTRY LEADERSHIP An accomplished facilitator and creative problem solver, Mike has held leadershippositions in many organizations. He is Past President of both GVA Worldwide, and the Central Ohio NAIOP Chapter, Mike also maintains memberships in the Columbus Board of Realtors, the Industrial Development Research Council and the Ohio Assodation of Realtors. Actively involved in community affairs, Mike is a Marbum Academy 'trustee and sits on the Board of Directors of both The Buckeye Ranch and The Athletic Club of Columbus. Mike earned a Bachelor of Sdence in Business Administration and Economics from Xavier University, and a Masters of Science in Business Administration and Finance from California State University at Northridge. ~ 3. DIVISION SUMMARIES CLIENT REPRESENTATION SERVICES Welsh Companies has a team of specialists who represent tenants and buyers with their real estate needs. Our Client Representation Services division will work closely with you to determine your goals and requirements, and carefully match those needs with the most appropriate spaces or buildings available. GOOD RESEARCH MEANS GOOD RESULTS Based on your objectives and timeframe, we pre- pare an overall market survey as well as individ- ual property reports. Our research department maintains a database of more than 3,500 proper- ties. In addition, the database also tracks demo- graphic, economic and market trends relating to rental rates, sales comparables, property taxe-s and typical concession packages. The strength of this research tool often means we can uncover opportunities not apparent to others. REPRESENTING YOUR NEEDS Your Welsh client representative works on your behalf throughout the entire process of procuring suitable s~_ace for you. Having also worked as an owner s representative, our tenant specialists understand allof the issues and legalities from both sides of the transaction. They put that com- bined knowledge to work for you every step of the way by: · Selecting properties that fit your criteria · Touring buildings and obtaining space plans from preferred properties · Obtaining construction bids · Submitting request for proposal from property owner · Reviewing proposal and conducting lease/purchase analysis · Assisting in preparation of lease or pur chase agreement · Negotiating favorable terms BUT WE DON'I' STOP THERE After a contract is signed, we also assist with the construction phase. Your client representative participates throughout this process to ensure that ali details are met - even seeing you through moving day with valuable resources and contacts that can eliminate the hassle. THE BOTTOM LINE When you're looking for space, look no farther than the Client Representation Services division of Welsh Companies. We're on your side every step of the way ... and as your real estate require- ments grow and change in the future. · WELSH CONSTRUCTION Welsh Construction has been building and renovating space on behalf of institutional investors, indi¥idual property owners and ten- ants for more than 20 years. E_xperienced in all aspects of construction and real estate develop- ment, our high level of expertise gives us the abili~ to provide our clients with the knowledge and direction needed for successful real estate ventures. PROFESSIONAL STAFF FOR POWERFUL RESULTS The in-house professionals at Welsh Construction are_experienced in construction management and general contracting services for: · New projects · Build-to-suit = · Project renovation · Complete rehabilitation · Tenant improvements While we treat each project with the individual attention it deserves, we use a proven process which is critical to the success of every project. The Welsh Construction team delivers accurate sched .u~. g, estimating and on-site consiruction supervrslon to ensure that the client's needs are met every step of the way. TURNKEY SERVICE Our complete service for new construction or renovation projects takes the client from design and development to furniture and equipment procurement. Experienced professionals will act on the client's behalf to attend planning commis- sion reviews and obtain city and other municipal approvals for projects. Through our affiliate with Genesis Architecture and the whole family of resources available from Welsh Companies, we offer a uniquely broad range of services such as development, leasing and brokerage, tenant representation, site analy- sis, architectural design and space planning. BUILDING VALUE Whether starting from the ground up or renovat- ing existing space, Welsh Construction can maxi- ,mi~. e the value. of its clien_ ts' property. We'll help aetermme the t~est use of the land and the true cost for property improvements. We conduct facility .reviews to provide a true picture of the value ot existin$ f~dlities or those under consid- eration for urcnase Corn rehensive desi and .. ? .. p gn pncmg reviews determine the precise costs for a building or renovation project, always looking toward the project's future success ... both furic- tionally and firiancially. THE BOTI'OM LINE Our commitment to our clients: Complete, quali- fied construction services with their best interests at heart. We have the proven abilities to assess building and design decisions from all perspec- tives to ensure maximum value. · Today's savvy businesses are teaming up with multifaceted commercial real estate firms to max- imize their resources and gain additional expert- ise and efficiency. That's. why so many success- ful corporate, non-profit, andgovemment organ- izations depend on Welsh Companies' Corporate Real Estate ,Services Division. We work on behalf of our client's organization to seamlessly manage and support their real estate activities. A PROVEN PROCESS After evaluating a client's real estate needs and determining how they fit into the overall busi- ness lplan, our experienced team of professionals develop a real estate strategy to achieve estab- lished objectives. The Welsh Corporate Real Estate Services Division brings a full spectrum of services to each client, including: · Market analysis · Site selection · Strategic planning · Facility management · Financial analysis · Lease negotiation · Property acquisition and disposition · Architectural design · Construction · Move management CORPORATE REAL ESTATE SERVICES elsh Companies. full-service approach means we have both the internal resources and the out- side support necessary to meet your real estate objectives. SUCCESS STORIES Welsh Companies has served a wide variety of corporate clients over the years. Our assign- ments have ranged from assisting Lifetouch in acquiring land and constructing a new corporate headquarters facili~, to orchestrating the deliv- ery of corporate facility management services for Jostens locations across the United States. THE BOTTOM LINE Our ultimate goal is to ensure that our clients' real estate holdings deliver value to the overall balance sheet. It rs our understanding of how real estate should and does impact the bottom line that sets us apart. · WELSH DEVELOPMENT COMPANY Taking a property development project from paper to completion demands imagination, expertise and diligent follow-through. That's what you get from the Welsh Devei~opment Company. We provide a full range of develop- ment, project management and build-to-suit services for owners, tenants, investors and buyers. A FULL SERVICE SOLUTION The Welsh Difference: All the services needed, under one roof. By calling on the expertise of our in-house specialists in architecture, construc- tion, leasing, management and investment, the Welsh Deve-lopmen~ Company consistently man- ages successful development and redevelopment projects. FIRST THINGS FIRST: PROFESSIONAL SITE ANALYSIS We understand the critical importance of location in maximizing real estate objectives. Our experi- enced staff provides local, regional and national site selection services, paying special attention to: * Development costs · Land use · Environmental conditions · Access · Zoning · Identification of poten6~! local economic subsidies EXPERT SERVICE EVERY STEP OF THE WAY Count on Welsh market analysts to correlate issues of supply and demand, rental rates, tax and operating cost structures and space absorp- tion. As a market leader in the Twin Cities area, we also have a thorough knowledge of competi- tive projects planned or under construction. Finally, the client can look to Welsh to handle all regulatory and code compliance issues. We are the client's advocate at all administrative, regula- tory, municipal and government agency meet- ings and hearings, v _ Our staff ensures that everyproject clearly reflects the client's hopes andintentions-finan- cial expectations and short-term and long-term goals for the property. We assess, evaluate, rec- ommend, plan and supervise building design. Full project management services are also avail- able.-That means ~_e can engage qualified ven- dors on the client s behalf and monitor, supervise and report on their progress. Our clients find the elsh connection especially valuable for market- ing, leasing and sales activ{ties. THE BOTTOM LINE From project inception to grand opening, the Welsh team will remain accountable for budget, schedule and quality requirements. So the client can rest assure~ that then' project is handled smoothly from start to finish. · FACILITIES ASSESSMENT I 1 I FACILITIES ASSESSMENTS Facilities Assessments are recommended to evau_ ~i.~.~Sn~c.e. ffs~?ness, service lev. els, operational y, tarnng, processes ana vrocedures of an organization's Facilities Mana~emen* t-.._- ^- and Real Estate areas perform the assessm the client's site. Some of the questions the~u~t examines are: · How are facility operational budgets devel_ oped and performing? ° What maintenance services are performed by the on-site staff?. · What process is used for work management and tracking? · How are facilities expenses assigned to indi. vidual departments? · How well are= site facilities meeting the cor- poration's objectives? · How are operational data tracked to show response times and repair history? · Is there a plan to implement and monitor energy conservation measures? Before we perform the on-site assessment, we ~requ. est_the following information from the client ?.,...h~er understanding of the scope of the facilities: · Facilities department organization, staffing, job descriptions, salaries and benefit loads · Complete building financial performance detail for the last two years · Current service specifications · Preventative maintenance and service call history detail · Service delivery processes · Service contracts · Method of reassigning facilities costs to space · Building layouts · Current scope of services conducted by the facilities team · Energy consumption history · Summary of process of managing space, furniture and moves · Capital plan We will make recommendations for areas need- '_rog improvement or more up-to-date procedures for handling facilities management tasks. We will analyze the alignment of facility usage with business goals and report on ways to bri _~ge any gaps that are found. In addition we will bench; mark the client's facility with similar properties and report on: · Operating Expenses · Utility Usage · Staffing Levels · Work Processes · Fixed Expenses · Space Usage FACILITECH An affiliate of Welsh Companies, FaciliTech offers an extensive array of services to keep its clients' facilities running smoothly every day. To meet the expanding needs of the Twin Cities market, we provide operational support services for facilities of all sizes, types and Io~ations. Core services available from FaciliTech include: · General Maintenance - Radio-dispatched specialists on-call 24 hours a day to serve our clients · PIumbin~ - Maintenance and design/build services for all types of new and existing facilities · Electrical - Inst;~llation and repair of wiring and equipment for underground, indoor or outdoor projects · HVAC - Programming and monitoring of energy management systems and preventive maintenance of boilers,-rooftop units, fur- naces, unit heaters, chillers and cooling towers · Concrete - Installation, repair and replace- ment of all types of concrete · Si~a~e - Design, production and installation of interior and exterior custom signage from temporary banners to permanent monument signs THE COST-EFFECTWE ALTERNATIVE We can offer these services at economical rates because we match a client's specific service n,eeds to quality resources with the required level ot expertise. That eliminates unnecessarily high labor costs, saving money. And because FaciliTech manages the labor pool, administra- tive costs are reduced as well. Of course, our clients can count on our in-house resources for an immediate response to most requests. SUCCESS STORIES Clients like Welsh Companies, Seagate TMee~,ology, Steiner Development, Colorhouse, saba, Gmbb & Ellis, General Dynamics and the University of Minnesota have relied on FaciliTech for a variety of services. THE BO'ITOM LINE FaciliTech's client reali;,e the significant advan- ta$.es of having access to a team of professionals skilled in all areas of facility and maintenance services. By combining dedicated, in-house pro- fessionals at various sfcill levels, we are able to keep overhead costs down and provide fast turn- around for all service requirements. · FACILITIES MANAGEMENT SERVICES At Welsh Companies, we recognize that the way we manage our clients' facilities has a direct effect on the success of their organizations. We understand how to create, manage and maintain a productive and comfortable work environment, while assuring that facilities assets and opera- tional e~enses move the organization towards its objectives. EXPERIENCE IvlATTERS We are experienced at operating facilities in a manner that allows clients' employees to b.e more effective while simultaneously reducing operating expenses. Significant service improve- ments and cost reductions are delivered thkough managing the following: · Building M_aint~r~ance · Janitorial Services · Groundskeeping · Vendor Contract Management · Cost Reduction Programs · Financial Management · Upgrades and Renovations · Performance Reporting · Preventative Maintenance ° Utilities Usage Review · Space Planning · Move Management · Budgeting · Architecture · Purchasing · Code Compliance Review Clients may select to use all of these services, or to choose services individually to complement their in-house facilities staff. THE BOTFOM LINE Welsh's initiatives saved more than $45,000 in engine_ering and utility fees for a major govern- ment facility. Average pay back was two years, with someplro'ects l~avlng pay back. of less than one year. We also lowered operational expenses throu~,h purchasing a~reements that are negoti- ated t~r roughly l~frrffllion square feet that we manage. We currently_ serve the needs of more than 17,500 satisfied ~lient employees. It is our understanding of how the operatio.n, of a facility should and does impact the bottom line that sets us apart. Our goal is to provide our clients with the very best facilities manage, ment services available-~ssuring that our clierit's busi- ness operates efficiently and cost effectively. · GENESIS ARCHITECTURE ~ affiliate of Welsh Companies, Genesis Architecture provides comprehensive ~)t~d et ¢ s.tural, de. sign and space planning services. lgn Erofessionals never lose si2l~t of the ent s specific needs and exl~ectations, proac- tively developing creative solutions to meet chal- lenges. Genesis Architecture completed more than 400 projects in 1996, with annual billings of more than $1 million. We approach every project - large or small - with flioughtful consideration of o, ur. client's long-term and-short-term goals, aes~gn priorities and finandal requirements. SOLUTIONS-ORIENTED APPROACH To develop answers, first the right questions oUSt be asked: That's why we take the time up nt to get to know~ project's recluirements. From. there, we design a fimctional, aesthetica~_ pleasing space that effectively serves our client s needs today and into the future. Our detailed approx, ch even indudes selectin~ materials - n/ght down to the door knobs. ~e prepare com- plete d~uments fo.r ob .t?ir~_' g city approvals and for moving forwara with the physicfiI'construc- tion. SUPPORT EVERY STEP OF THE WAY When the bidding process begins, Genesis Architecture works closely with its client to pro- cure competitive pricing. We can even assist with interviewing and selecting contractors. Additional services include: · Preparing as-built documents and verification · Square footage calo~lations · Building code interpretation · Americans with Disabilities Act (ADA) assessments SUCCESS STORIES By using the latest advances in design technolo. ~, our staff keeps projects on track in a timely, cos.t-effedtive manner. For example, a memt~er of our design team recently accompa- nied a First Bank client in his car, using a laptop computer to solve a design problem en route from one project to another. In another situation, a client needed a 15,000 _square foot facility constructed in an almost impossible timeframe. By teaming up with other Welsh Companies' affiliates we were able to deliver the complete project on time and within budget. THE BOTYOM LINE Full service solutions with an emphasis on client service.., that's what makes Genesis Architecture the top choice for design and space planning services. · INDUSTRIAL LEASING AND BROKERAGE As the leader in the Twin Cities market, Welsh Companies' Industrial Leasing and Brokerage Division represents more owners and users than ~a~__y. other commercial .mai estate firm around. ~sr year alone, our industrial team completed more than 310 lease and sale transactions involv- ing more than 4.5 million square feet of industri- al space. elsh s leadership position has been built upon years of meeting and exceeding our clients' _e~xpect?,ti° ,ns~-o. ne proiect at a time. Today, our srrengm aha t~roacl coverage provide us with a ofpre a g cona ons. vvnemer it s available properties, current rental .rates.,..or p.ot,ential opportunities, we have access cl users alike. SUCCESS STORIES Because we have the tools to monitor on-going needs of more than 10,000 industrial tenants in the Twin Cities, owners such as Principal Financial Group, AMB, and State Farm know that their properties are exposed to everv prospective tenant in the marketp, lace. (n addi- tion, established rehtionships w~th the brokera e community allow us to effectively market eachg property. For industrial users, such as Starkey Laboratori and Manufa , .... es cturers Sennces Lmuted, our in- depth market knowledge means that they will .om to co aer maricet alternative that meets their parameters. FULL SERVICE SUPPORT With the strength of the Welsh Companies organ. ization behind them, our Industrial Leasing and  ro.k_erage speci .alists draw on a full range of in- ouse resources to meet their clients' ne~ds. They also consult with other brokerage rofes- S~o~,lsa~ Zetse~Un ~at are experienc~Vin retail, · anent pr_operties when the occa- sion arises. Welsh specialists are complemented even further by our comprehensive menu of ser- vices including property and facility mana e- ment, architecture, develovment, construc~n, building maintenance, anc] consulting services for all areas of commercial real estate. THE BO~ITOtvi LINE A recognized powerhouse, Welsh Companies' industrial brokers are unquestionably the best in the market: Our long-term relatio .ns~l~s with owners ancl tenants enable us to achieve opti_ mum results on behalf of our clients. · INVESTMENT PROPERTY SERVICES Creating value in commercial real estate requires diverse skills and experience from start to finish-acquiring a property_ in the most advan- tageous manner and later selling it at the highest pnce and most favorable terms. The Investment Property Services division of Welsh Companies meets, with tm. paralleled strength, the complete needs of our clients. We bring ~tecades of experi- ence to work for our clients in maximizing their valu..e, thro,ugh the successful acquisition and dis- pos~t~on ot investment properties. FOCUS ON CRITICAL FACTORS Success in property acquisition and disposition is founded on several key factors. Our team's track record, on behalf of a wide range of clients, demonstrates the highest level~ of achievement for: · Thorough knowledge of the investment market · Working relationships with active buyers and sellers ; Sophisticated capabilities in financial analysis Strong negotiation skills · Adept at the intricate process of successfully closing a property transaction From site inspection to closing, our clients can count on Welsh as a skilled and experienced resource. SUCCESS STORIES We have extensive experience in the sale and purchase of office and industrial buildings, busi- ness parks, apartment complexes, retail centers, owner/user facilities, net lease projects, build-to- suit and multi-leg exchanges. Institutions like State Farm, Bradley Real ~state and Prudential Insurance have trusted us with properties rang- ing from small al~artment complexes to major real estate portfolios. Regardless of size, we have the knowledge and connections to identify qua'i- fled buyers and dose on a sale as quickly as possible. s a buyer s representative, we are proactive in .c.anv.,ass. ing the market !,o_r a. cquisition opportuni- ues mat meet our client s objectives. For exam- le, we have actively represented Bradley Real state on its aggressive acquisition program in 10 Midwestern states. STAYING CONNECTED The Welsh team maintains close relationships .with potential buy.ers and sellers - from life .msur.ance companies and pension funds to local ..mve.s. to.rs.and regional concerns. We closely_ mon- itor me~ mv. estment s.trategies and acquisition parameters to ensure that we are always up to ~late with the latest developments. THE BOTTOM LINE With an eye for detail and a dedication to meet- ing the unique needs of each and eve~ client, the Investment Pro£ertv Services division of Welsh Companies ~s at hhe forefront of the industry. · NONPROFIT COMMERCIAL REAL ESTATE SERVICES This specialized division of Welsh Companies is dedicated to assisting ministries and nonprofit organizations with the development and growth o_f ~eir management Plans in relationship to the? real estate assets. Because nonl~rofits have .t~.que and specific requirements, Welsh pro- ~_cl?.s~custo ,mlz~ .strategic planning to ensure ar me neeas ot these organizations are met. MAXIMIZING GROWTH AND STABILITY The success of an oeganization is often propor- tionate to th_e level of expertise available to influ- ence growth and stability. When it comes to com- mer.ci~ real estate, We.lsh provides the expertise neeaecl to reach our client's potential. Ot~ staff of experts can help with: · Financing existing, and new site development · Existing facility improvement or expansion · Funding proposals · Resource development SERVICE THROUGHOUT THE COMMUNITY City governments in Minneapolis, Bloomington and Hudson have relied on Welsh for strategic plannin{~, architecture, construction and broker- age sennces. We have also served a wide range of area churches, induding Grace Church of v Edina, Oak Grove Lutheran, and Nativity Lutheran, all of which are located in the Minneapolis, Minnesota, area. WORKING TOGETHER FOR SUCCESS Whether an organization is in a start-up or tran. sition period, the Welsh team of consultants first works to ident~ our client's goals, needs, and reqturements. Then we use consensus-building techniques to systematically remove the barriers whi~ re.strict, internal growth, positioning the orgaruzanon for maximum restflts. Welsh has the resources in place to execute a suc- cessful, plan of action to meet our clients' goals and objectives. Our proven processes and cut- ting-e_age systems mean we can help to maxi- mize th~ use of our clients' real estate assets. THE BOTI'OM LINE With a staff of trained professionals to guide the client through a complex_p_ rocess, the Nonprofit Commercial Real Estate Division of Welsh Companies is a valuable resource for meeting an organization's ever-changing needs.. OFFICE LEASING AND BROKERAGE Welsh Companies' Office Leasing and Brokerage Division is a leader in the Twin Cities commerdal real estate market. Our emphasis on strong r. elationships and dear communication resulted in more than 325 completed office lease transactions last year alone. CREATING VALUE Our experienced staff of office specialists applies their in-depth market knowledge to provide innovative strategies that achieve the desired results for any tvve of office s ace W~ d ....... ' p . e work oseiy w~m c~ients to create marketing solutions tailored to th.eir objectives. Our depth of experi- ence, comprehensive database, sound market .~.s~._a~.,, .a~.d technological expertise enable us to ranuy klentify and target the most likely p.r. ospects, creating the'greatest value for our client. Welsh Companies recognizes the value of pro- riding timely, detailed research data and analysis and we believe it gives our clients the ed e in today's marketplace, g WE' CEMENT RELATIONSHIPS Welsh has historically served a diverse array of clients from large institutions such as Prudential, State Farm, AMB, and Opus to smaller, local entrepreneurial owners. At the heart of all client relati.onships is our commitment to dear and ongoing communication. Lease negotiations are often complex and tightly sched.ule~.. While our objective is to aggressively complete lease transactions to enhance ~he value of the client's property, we will not hesitate to advise the client to step back from a transaction if it does not advance previously established business and finandal goals. A FULL-SERVICE REAL ESTATE PROVIDER Welsh Companies epitomizes the full-service approach. We offer a wide range of services, fr:6m architecture and construction to brokerage and property management. Under the direction of a ~..ey account partner assigned to each project, our clients enjoy the benefits,,of a complete pool of resources and talent. Our one-stop" shop advantage makes any real estate vrocess-or combination of services-more e~dent for our client. THE BOTTOM LINE What keeps our clients coming back year after year? We believe it is our innovative approach, combined with a comprehensive understandine ,?f ~e unique processes involved in leasin~ and' vro~rage transactions. That's the Welsh ffiffer- e_rlce. · PROPERTY MANAGEMENT The Property Management Division of Welsh Companies manages one of the largest portfolios of commercial real estate in the Upper Midwest. But we know that size doesn't necessarily equate to performance. Our property managers understand how to suc- cessfully meet the goals and objectives of our owners. The majority of our portfolio is made up of individual property or small portfolio owners who have ex, angled their r~lationship with Welsh as a resuIt of our diligent property /e_a~,~agement and aggressive cost management. ve earned their I6yalty through a commit- ment to ]~reserving and enhancing the value of ea~ anti every property, maximizing cash flow ancl creating realvalue. Simultaneously, our property management team serves the needs of more than 2,000 tenants daily. Through regular communication and annual owner surveys, we constantly evaluate and improve our performance in every area. We lis- ten; we act~ And in doing so, we are constantly working to meet the long- and sho,,rt-term needs of both owner and tenant with an 'anything it takes" attitude. 'ppeay . y. elsh sro mana ement s stems and ro- managers see to it that each building is in the best possible condition, always reaffy to be viewed by a potential tenant or buyer. Routine systems keep buildings one step ahead of _t~piCal maintenance cycles, with built-in preventative measures to reduce costly repairs and capital expenditures. Comprehensive reporting ~astems, along with well thought out recommen- ations, pro,nde owners with timely and accu- rate information, making it easy for owner and manager to communicate dearly at all times, on all issues. We know that tenant satisfaction and retention are critical. With that in mind, we established one of the most aggressive and successful tenant retention programs in the Twin Cities. The suc- cess of tl~ program is measured by such tools as tenant surveys, analysis of renewal retention rates and feedback fi:om the tenants themselves. From the day a tenant moves into one of our buildings, we are committed to building a responsive relationship and delivering prompt anaconscientious service. _in_, this important area of roprty.e management, we ve ained an envi- able reputation for pleasing-and~eeping- tenants, not to mention owners. It is this exceptional service and attention to detail that has repeatedly earned our property managers national perfOrmance awards f?om clients like Archon Group, J.E. Robert Companies, and Pacific Mutual · RETAIL LEASING AND BROKERAGE L addition to a good location, a successful retail center requires the right merchants. Welsh Companies' retail specialists combine local and national relationships with a successful leasing strategy to achieve the ultimate tenant mix. Our client roster is deep and growing. We pro- vide services to national retailers such as Target, .Home Depot, Circuit City, The Men's Warehouse, ulta, and m~,y more. Tl~ese important relation- 3hips help Welsh Companies to become immedi- at.e.l)r, aw. are of !.easing opportunities taking place mttun the retail community, allowing us to react nstanfly with a strategic marketing plan that neets the client's objectives. That means long- :erin success. ~ STRONG REPUTATION ~ experienced retail leasing team is recognized is a leader in the Twin Cities market. In addition :o our extensive relationships in the retail indus- ry; our team brings a full understanding of ~ro ownershi and extensive market PeT p cnowledge to each and every assignment. re r~ults o_f our experience are evident oughout the market. We have handled prop- ~rty assi _~n~rnents from small neigl!borhood cen- ers to sub-regional malls on bel~lf of a variety !t owners. Ohr client roster includes national ~ _r~s_ such as Developer's Diversified Realty as ~ell as local powerhouse developers, Ryan -ompanies US, Opus Northwest, and Robert ,/uir.Company. Welsh is selected by these .romlnent companies for one reason--our innate bility to get the job done quickly and effectively. MORE RESOURCES, MORE SERVICE Welsh's retail team is equipped with the most current technology and training needed to stay a~pprised of changing demographics and trends. ~ ms enables them to develop and implement a merchandising plan that increases NOI and value for the owner. Our retail team is also acked by an internal marketing and research epartment that actively collects and packages noteworthy information for our clients. In addition, our retail leasing group also receives support from a wealth of affiliated business enti- ties that provide value added services such as construction management, architectural services, retail development services, debt and equity p~a. cement, and property management services. This means the Welsh retail team has access to the information and support services required by today's sophisticated owners. THE BOTI'OM LINE Our long-standing relationships with local and national retailers combined with our extensive ~te. rnal resources are what set us apart. Because ot this, we are able to develop and implement an effective leasing strategy that results ih a prof- itable retail project. · RESEARCH CAPABILITIES Welsh Companies' commitment to market research is demonstrated by our ongoing efforts to enhance the technology available to our staff. We believe that reliable, up-to-date information .~ives us the edge in today's marketplace and are, merefore, constantly evaluating new products and processes in order to offer the widest array of. resources possible. Our research capabilities allow us to provide our associates with accurate, up-to-date information at their desktop, thereby increasing their effectiveness to the ultimate ben- efit of our clients. Resources for obtaining property data include a proprietary database, the Organization of ~? _m~n_ erdal Realtors' property database on the world Wide Web, as w~ll as the NAI/Loopnet worldwide database of available properties. With our in-house database, we are able to main- tain a keen awareness of the market's position at all times. We have immediate access to the kinds of information necessary to serve our clients, whether it be available properties, current rental rates, vacancy trends, absorption levels, etc. As a service to our clients, our research staff pub- lishes market information in periodic Market .Updates. We also maintain an extensive data- se of m_ore than 35,000 prospective tenants in e Twin Cities from whi&h we are able to pro- duce targeted mailing lists for our brokerage group for use in their marketing efforts. Our privately developed system also allows us to maintain market comps on over 1,000 transac- tions annually, either ascertained from our own transactions or others. Our research staff has the ability to produce detailed demographic studies and we maintain a G.I.S. mapping component, which allows us to process aa_ta ge.ographically. This technology assists in identifying comparable properties and market trends. Wel~h also maintains on-line access to county tax record data, which provides us access to ownership information and associat- ed sale transactions. Not o~y do we rely on our own in-house research staff for the latest information on the commercial real estate market, but we have also formed an alliance with Mr. Paul Anton, Chief Economist, so that we are able to provide expert insight into prevailing trends within the loc~ economy. Paul Anton is a nationally-recognized, ~,eapolis-based economist offering over 25 years experience in local and national economic analysis, financial forecasting, industry analysis and government policy advising. . Simply stated, we know our strength is real estate., and we. reco~' e the inaportance of pro- v-tding our clients with the most comprehensive picture of the Twin Cities market possible. · 4. WELSH IN THE NEWS This article is reprinted from the February 2, 2001 Citygu~iness, Volume 18, Number 36, page 17. TOP 25_UST Commercial Real Estate Brokerage Firms Gmndv~ew Squire. K~/moud~ a<mneu Ctr.. 1916 )~n~n. ~ SS435 (tS2) 924-4G ~o~ ~ ~.cb~chirdelils.com n~. HN S~I ~612) 341-4444 ~b & Eib ~ lS Comu~n~ mnl~mn~ Imin~ Clln~a I~.~ri~:h~, Corpor~ Cir.. Co~or~19D9 Winlhoma. TCF Tower. Fosbef Tower. Minneapolis Arden I-illh Tech C:r. www.¢olltem~owlL¢om ~i. MN 5543S (952) 933-0042 '--~ ~a'-~"' ~ Supper Club, Amerk~ T~o ;981 ;r:--~.;.~..,.,L~ of.t""~'--."it,.~r,~l Inc. II Ai~raisd. IlasInI, sal~ O~jk '1~' ~ Lincoln Od. How~ G' SIIMtvre Sce~k. 197(, 0 H~hway 7 Ollilt 'OJ' S~ Co~l~d, ~m, Ind~ ~ ~ Lo~ L~ ~ fin SS416 (952) ~2-~11 a ~, ~ S53~ (9~) 93~76 -- t~ac ~mn~oa. ~ H~ SMm~ ~d I~us~ P~o~. ~N O~e ~ Minneapolis ~1~. MN 5S4~ (al2} 34~42~ MIn~n~ Co~fl~ C~. ~.eqa;~7~ommercttl.com L~ ~ MN ~416 (~S2) 543-2~ Po~ ~pn P;:a~ ~.dukerei~com dM V~. MN 5~26 ~63) 847-~ R~ W~ ~ ~.p~Mwis~com Reid Eltl~l CO. S Coflsul'inl. mlna$~ent, leuin~. Chr~cophw Howard CGi...~i-~'-.~l b ~t&l~ S MlnalemenL leuin& development, Jeffrey, L.~rson SSI21 (651} 6~6-0212 Tyl.~ Stre~ Project, 2~th Sr. Development. 17711 E'.ja~d. io Offk~ Ctr., ~rr O~k au~iaeu fg?l I~rk. Bdd~e Poinc Bmlnm Car. 27~ Distribution Car. www.jblcompanies.com Fridley 8usineu Car., Mlplewood 8u$lne~l C~'., Arboretum 8ulinms Park. Eut Eden & II. Rlve~iew _a-~_~=s Car. ~z~...~ MN 55391 (9S2) 473-$650 lee R-':r Corp. Wa)~zaca www, stelner d e velopm e~t. com ~minlton. MN 55431 (9S2) 317.2~OO PIN World Trade Ca',, Wells Fsrlo ~ 1991 Blvd. = 8oukwird Footnotes:. C~rk & A~socntes Inc. Note~ Hdtrs. = Headquarters I. Includes number of Ioc3J :icensed z~ 4. Currently u~der construction-- The SchOe~ Grou~. No. 25 o~ last This article is reprinted from the June 22, 2001 CityBusiness, The Business Journal, Commercial Real E~tate, page 40. 40 [ JUNE 22. 2001 ~ Commercial Property Management Firms P,m~lde Cafl~r (I .I 2 7JX)O~ ~k,~mll C~,_,~.. (S3 i.iX)q Sa~Caxeri210~'Enc°~F~r~27S'OOeh I 7 Comm. = Commercral Foocnote$: CitvB ness* The Business Journal T( E COMPANIES ~mnsr wte sham our Tlttt ~ U ~intetl from Ctzy~ "~'ap l O0 Pren~ Compant-- ~ Folu~ 1,~, lffumber 49, M~), 4, 2001, pab~ 15 t4rot~t 24. 10mmerc al Property News N¥~SIMENT, DEVEI. OPMENT, FINANCING, LEASING AND ASSET M~A~!_U. ENT JANUARY ! 6, ,ord Reactivates Investcorp Group Real Estate Team Aims to Acquire $700M This Year By Michelle Napoli Senior Associate Editor New York City--With a goal of closing lout $700 million worth of commercial .al estate investments in 2000, the real :tate group of Investcorp International tc. was off to a good start by the end of muary. That month saw closings on a 0-unit Class A Dallas apartment corn- ex, a 133,000-square-foot office building ith an undeveloped acre in Westlake :llage, Calif., and a Best Western hotel in mifica, Calif. Meanwhile, other deals ~re in the works, including the possible 'quisition of an office portfolio in orthern New Jersey. While this year's goals are the group's )st lofty in its five-year recent history, its yen professionals have kept active, build- ; recognition in the real estate industry c a name that is already equated with znership of major retail and industrial rporations. The real estate group chooses its'~nvest- rots carefully, focusing on properties at provide a combination of strong cash ,w and overall return prospects. That W, its largely Middle Eastern clients can ~ke the most of the favorable tax treat- ~nt available to them. "We're interested distributing ordinary income to the zestor," explained Ed Lord, Investcorp rtner & head of the real estate group. "We've tailored our real estate pro- ~m to really generate cash," echoed Savio Tung, an Investcorp partner who heads the company's North American operations and is a member of the compa- ny's management committee, as is Lord. Its return goals fall somewhere between those of opportunity funds and less risk-taking pension funds: It typical- ly achieves an 18 percent internal rate of return, according to John Fraser, co- head of investments for the real estate group along with fellow partner Jon Dra- cos. Returns above 20 percent, he said, are not easy to achieve while maintain- ing the risk levels that are acceptable to Investcorp, its partners and its clients. "If you look at how a fund operates, a lot of a fund's success determines whether it's going to be successful in fundraising in the future," Fraser said. "We are both a cash flow and an IRR buyer. Both impact our decisions." The paired goals make the Investcorp real estate group unlike a fund; its oper- ating structure does likewise. The team buys assets either singly or as part of a portfolio using the company's own bal- ance sheet, typically assembles them into multiple-property, sector-specific pools, then presents them to its clients for con- sideration. Each client can choose whether or not to take part in any of the investments. Investcorp keeps a portion of the investment on its balance sheet, its operating partnerships have their own stakes in the properties, and Investcorp real estate group managers take a person- al stake in them, sharing risk with their clients and partners and fo]lowing their parent company's overriding philosophy (company executives are expected to invest in the much larger corporate busi- ness). Maintaining a small staff has also allowed the Investcorp real estate group to be nimble. Like more typical funds, it achieves that by partnering with other companies to obtain product expertise and market knowledge. The idea is to find strong partners in each product sec- tor and market in which it has a pres- ence. "(Investcorp will) invest in and with a regional group that has a great deal of experience and history in a mar- ket ... and infuse them with enough capi- tal to go out and pursue deals," Fraser explained. Investcorp maintains control over the partnerships. "These are not pure joint ventures," Lord commented. "We have continued along those lines very much. (Nonetheless) the operating associate is very important to us." Added Dracos: "They're really the linchpin.' Partners do not seem to mind that strategy. Investcorp's sense of control still allows partner Pacifica Hotel Co. full participation and a role in mapping out the partnership's strategy, according to Dale Marquis, an owner & co-chair- man of Pacifica Real Estate Group and president of Pacifica Hotel Co. "They (still) let us do our thing." Pacifica began working with Invest- corp's real estate group in 1997. The pair has apparently been on a successful track ever since, targeting middle-market or boutique hotel properties on the West Coast's waterfront. The most recent buy, the Best West- ern Lighthouse purchased in January, was the 13th purchase they have made together. The 94-room limited-service property with restaurant and meeting/banquet rooms will require some renovations before being brought into the fold with the partnership's other Investcorp Focuses on Strong Cash Flow To Please Its Middle Eastern Investors Small Group with Key Operating Partners Permits Quick Decisions hotel properties so it can take advantage of cross marketing, bulk buying and other benefits. Investcorp owns a majori- ty interest in the hotel-focused partner- ship, which also manages another eight Pacifica properties in which Investcorp does not hold an ownership stake. Though it diverges somewhat from the Investcorp real estate group's focus on asset investment, as opposed to manage- ment, and while Investcorp in essence backed into the partnership, it does illus- trate well the team's strategy of sniffing out and working with solid operating partners. "We had not intended to be in hotels ... but the opportunity came up," Lord noted. "(The partnership was) a very precise play in a very good market." Investcorp's current partners range from private family-based companies to public REITs and include Crow Holdings, Insignia Financial Group Inc., Shelter Properties, Gumberg Asset Management, Ramco-Gershenson Properties Trust and Welsh Cos. in addition to Pacifica. The partnership with Crow Holdings has been one of its more active ones, and relation- ships with other Crow family affiliates have cropped up, too. "It's a very, I'd say, synergistic and symbiotic relationship," observed Fraser. The team plans ultimately to have 10 to 12 active operating partners and is currently searching out new potential mates while conducting repeat business through the successful partnerships that have already been formed, according to Dracos. It may also pursue more joint ventures with REITs, as is the case with Ramco-Gershenson, and anticipates investing more in companies, as it did with Welsh Cos. toward the end of last year. In that case, it purchased a signifi- cant but minority interest in the Bloom- ington, Minn.-based full-service real estate firm, giving it not only an acquisi- tion partner with management capabili- ties in the Midwest and Florida--two areas where the Investcorp team has been looking for more of a presence--but the opportunity to share in a portion of the fee earnings as well. In return for its partners' market expertise and management skills, Invest- corp provides institutional-quality capi- tal. For Welsh Cos., Investcorp is also providing funding so the operating com- pany can expand its capabilities. Partners compliment Investcorp's approach to working with them. "We found them to be good partners," said Marquis. "I think we have a good work- ing relationship." Partners also praise Investcorp's flexi- bility. "I think they're very smart in what they do .... I think that allows them to be very nimble and have less staff in New York," observed Tony Dona, a partner in Crow Holdings. Crow, on the other hand, has plenty of staff in place. The two, "together, work well," Dona added. "They've been very open and they really sit down and listen to what's going on in our markets," Dennis Doyle, CEO of Welsh Cos., testified. "They really do allow for creativity, they really do adjust to the market ... (and) they really do lis- ten to their partners." "We're very flexible about how we approach these different relationships," said Lord. "These are key to what we do, and working with these groups, not just (serving as) a money source ... boy, that's worth a great deal. "The accomplishment and the chal- lenge has been to build these relation- ships and to add some new (ones) from time to time," he added. The win-win partnership strategy was one of the first notions Lord settled on after he was brought on board at the end of 1994 to revive Investcorp's real estate group. The group had become fairly stag- nant following the late-'80s industry col- lapse, suffering, as did so many others, some tough hits as a result. Investcorp had been involved in a number of high- end speculative development projects at the time but stood by them and worked them out eventually, said Lord, without its clients being hurt financially. "The company stood up very strongly for its investments," he said. Despite the early '90s being a p~ of relative inactivity on the real e front for Investcorp, the company r considered exiting the industry alto er. Rather Investcorp believed real ~ was "still a viable business, (but) i~ hit a disastrous market and was in of a strategic change," according to Hence, the shift in strategy to loc' properties with existing cash flow. The bulk of Investcorp's focu. been and continues to be on corf investments--one of its most recer the $950 million purchase of Joster "Historically there have been two Investcorp businesses," Lord expl "Corporate investment, which is o~ ly the main business, and real ~ which has involved tess invested e Yet the company's first deal was: erty transaction, so Investcorp's r, real estate run deep. In the year lng its 1982 formation, Inve acquired a 50 percent interest ir ulife Plaza in Los Angeles. So while the real estate busin~ be small relative to the volume of porate counterpart, it has been important. "We recognized from t beginning ... that the real estate ment business is very much a co~. for Investcorp,' noted Tung, ~ been with Investcorp for 17 yea real estate investments, added Tn: good returns for its investor ci The thinking is: "Our custome that, (and) we have that expert we should do it." To revitalize that busines brought in Dracos about six after joining the company and F' months after that. The three h~ real estate backgrounds. Lord h: as director & CO0 for the I~ corporate officer at Mutual Life tce Co.; and managing director of ~itter Realty before. Dracos was ,f disposition and asset manage- ~nd executive committee member ~ncier George Soros' Quantum Fund before joining Investcorp, 11 as bringing experience from Lang Wootton Realty and Chemi- ank. Fraser brought his own ise from working at The O'Connor , Eastdil Realty and Aston Devel- :t Corp. e group's leadership expertise is not ,n their operating partners. "We d at a number of partners," said rd Smith, CFO of Ramco-Gershen- "What attracted us to them is re astute investors. They really stand real estate." .eir first task was to clean up what ned of Investcorp's real estate port- -consisting of about $300 million ~ of real estate, a mix of properties ng from New York-area condomini- Go Class A office space in Washing- D.C., to industrial property in Los lies as well as some developable They cleaned out what was left and essentially started from scratch, r~g a number of retail assets, then ~ office and eventually some multi- ly. The new real estate team's very purchase was of a half-dozen net- ~d grocery-based retail centers in the :on area. These, like many of the ts bought between 1995 and 1997, ~ since been sold. Yet today the real te group's portfolio is north of $1.2 [on and growing. And while some ~erties may be sold in 2000, Investcorp ~s much more focused on the in-vest- .t trail for the year. ['hough it made some European estments in the 1980s, Investcorp's ! estate group is now focused solely on continental United States. Active ~ss the office, industrial, multi-family, el and retail sectors, it buys proper- ~ spanning the country, although used in areas where in-house knowl- e and the operating partners' expert- lies. It prefers existing, well-tenanted properties but will look for value-added opportunities in properties that have good stories overall but need better man- agement, have an anchor space that needs retenanting, requires some renova- tions and such minor refurbishment. "If we're active and creative ... you'll see the operating income increase," said Dracos. It may also do development or redevelop- ment, Lord said, but only on a very selec- tive basis. An opportunistic buyer, Investcorp shifts its activity among markets or prop- erty types, and its work with its various partners, according to where its man- agers see the best opportunities. "First and foremost, I would call it opportunis- tic," said Dracos. "We've moved in and out of property types as we've seen oppor- tunities." With pricing back down to more realis- tic levels, the office sector has attracted the interest of Investcorp managers, and they would like to boost its presence there this year. They bought no office properties in 1999. Activity will focus mostly on suburban space and properties at $10 million and higher. In addition to the New Jersey portfolio under consideration, which has been valued at more than $170 million, the firm is looking at the possibility of acquiring more office property in partner- ship with Crow Holdings. The pair already undertook a successful $125 mil- lion round of office buys in 1996 but stopped when the sector began to look less promising. In addition, in January Investcorp completed its first non-hotel deal with Pacifica Real Estate Group, purchasing the Westlake Village office property. The company is also pursuing office opportunities in the Midwest and Florida, thanks to its new relationship with the Welsh Cos. The Investcorp-Welsh partner- ship closed on its in-st property, a 76,000- square-foot office/tech building in Eden Prairie, Minn., before 1999 was through. And the team plans to pursue more office and industrial opportunities in Welsh's markets in the months to come. Investcorp is excited about its newest partner. "They're a template company," said Fras- er, "(with) good presence in their markets, good relationships in their markets." With little prior investment activity in the industrial sector, Investcorp may begin to make a mark in that arena, too. "We've started to look," said Dracos. "I think we'll buy industrial in the next six to eight months .... We (have been) devel- oping an operating partnership--we did- n't think we had it previously." Invest- corp owns shares in Crow Holdings Industrial Trust, the private REIT that also represents the interests of the Crow family, and the two are exploring the pos- sibility of coinvesting. Hotel acquisitions could continue within the specific niche pursued thus far with Pacifica, though both parties say those opportunities have grown hard to come by. "We're always in the mar- ket,'' Fraser said. "I would say the vol- ume is determined by the specificity of our investment parameters." Retail, with a focus on neighborhood and community shopping centers larger than 90,000 square feet, continues to be an active area for Investcorp. In 1999, the real estate group partnered with Ramco- Gershenson and bought two properties-- one in Chester, N.J.; the other in Deer- field Beach, Fla.--totaling $31 million. The joint venture, three-quarters owned by Investcorp, will ultimately spend as much as $125 million, with the rest expected to be seeded this year. Investcorp has also been actively buy- ing retail properties with Crow Holdings and may well continue to do so. In December, the team closed on two proper- ties valued at more than $60 million, a 184,000-square-foot shopping center in Austin, Texas, and a 325,000-square-foot property in West Orange, N.J. Multi-family has been another active sector for Investeorp, which has seen a good risk/return ratio in the marketplace. The company has focused largely on newer product in the A, A-minus and to some extent B-plus classes, and has bought a dozen properties from Prince- ton, N.J., to Dallas. The real estate group hopes to make even more multi-family acquisitions in 2000 and reported actively working to establish more relationships with multi-family operators, particularly those that can make Midwestern purchas- es. The Gaston Yards Apartments proper- ty in Dallas was purchased in January in partnership with Shelter Properties, and the firm also has ties with multi-family experts at Insignia Financial Group Inc., Dracos noted. To make for a safer investment for the client, each property is underwritten individually, providing diversity and a blended risk and return within a pool of properties. "We like the accumulation of assets for a couple of reasons," explained Dracos. "There's a diversity geographi- cally ... and you can accumulate a pool and decide what kind of asset would fit into that well." That flexibility allows Investcorp, unlike many investors, to make decisions based on what is the best thing for its assets--and ultimately its clients--at any given time. "I think they have a more flexible strategy than a lot of equity investors," observed Marquis. Investcorp makes acquisitions with a medium-term, typically three-to-five-year holding period in mind, though it is never tied into a specific time period so it can have leeway to react to the marketplace. It will sell individual assets or groups of properties, and targets institutional investors and advisors as their ultimate purchasers. Lord has no plans to expand his group significantly, although he may add a few more professionals. And so, with the role of the operating partners grow- ing ever more important, it is no wonder Lord and his team have insisted all along on maintaining real control over the assets they buy and the partnerships they buy them in. But with a growing portfolio and ambitious plans for the year 2000, the Investcorp real estate group's biggest challenge may be keeping on top of it all, particularly when it comes to manag- ing the investments it has already made and those it plans to. The group has been focused on making investments, but in today's more stable real estate climate, managing the large and still-growing portfolio will take more of their time and attention than it has in the last several years. "Asset management is a new Investcorp business that we expect to grow significantly," Lord acknowledged. Reorinted wilh permission from COMMERCIAL PROPERI'Y NEWS, March 1, 2000 · ©2000 MILLER FREEMAN, [NC. All Rights Reserved I® The Business Journal Welsh gets new partner By Shannon Hahn staff reporter Dennis Doyle, who has been the sole owner and CEO of Bloomington- based Welsh Co., sold a significant minority position in his mai estate company last week to an international investment group based in the Middle East. Investcorp's New York office completed the purchase of less than 50 percent of the company's ownership, he said. A group D~nnis Doyle of at least I0 Welsh senior execatives also will have the opportunity to buy into the company. Doyle did not disclose a price. '°This recapitalization allows us to compete at what we think are the highest levels in the corporate real CEO sells minority stake to Middle East firm estate business. It allows us to invest in people, technology and systems, to be a winner in what is continuing to be a consolidating industry," Doyle said. Welsh will use the money to continue expanding into Midwestern and Florida markets, Doyle said. About three years ago, Welsh started expanding as a full-service real estate company, buying a number of companies. Welsh knew it would need access to more capital, and started looking for a way to raise it about a year ago. The Investcorp investment "allows us to have control at a local level, but gives us the necessary capital to finish off what we started," Doyle said, referring to Midwestem and Florida expansions. Welsh will continue to open one to two offices in those areas over the next five years, significanfly blanketing the Midwest, he said. The company now has expansion opportunities in Milwaukee, St. Louis and Kansas City. The fu-m has already entered those markets because of current client relationships, he said. "Good for Dennis," said Whimey Peyton, senior managing director of Bloomington-based CB Richard Ellis. If Doyle can expand his business, and borrow money at a good rate, or even a better rate by offering someone ownership, "that is prudent," Peyton added. Investcorp will have representation on Welsh's board of directors, said Jean Kane, executive vice president for Welsh Cos. The core business of Investcorp, which is headquartered in Bahrain, includes corporate and real estate investments in North America "Our partners invested in the company because they believed in our model and ability to expand our services. And that will not change," said Doyle, who continues as presidentand CEO. · This arn'cle is reprinted from CityBusiness, Volume 17, Number 24, November 12, 1999, pages I & 46. May 14, 2002 Mr. Randy Schumacher Acting Community Development Director City of Columbia Heights 590 40~ Avenue N.E. Columbia Heights, MN 55421 RE: INDUSTRAIL CENTER REDEVELOPMENT PROJECT Dear Randy: Welsh Companies is please to provide you with this Letter of Intent Proposal in response to the City of Columbia Heights' Request For Qualifications ("RFQ") issued April 9, 2002, for the City's "Industrial Center Redevelopment Project". Please find enclosed ten (10) copies of materials describing the Welsh Development Team, Welsh's redevelopment experience, financial capability, and design experience relating to industrial redevelopment projects as required by Sections3.1-3.4 of the City's RFQ. Due to the timing of the City's RFQ deadline and the need for further information about the parcels of land in the "Industrial Center Redevelopment Project" area, Welsh would like the opportunity to submit additional information and materials to supplement our RFQ response and proposal over the next few weeks prior to review by the City's Economic Development Authority. Welsh Companies would be pleased and honored to be selected by the City of Columbia Heights as a development partner on the City's "Industrial Center Redevelopment Project". We look forward to working with the City Staffand Economic Development Authority on this very exciting project. Sincerely, Robert C Long Development & Brokerage Services Cc: Dennis Doyle, CEO Dan Russ, Vice President Welsh Development 7807 Creekridge Circle, Minneapolis, MN 55439-2609 T££ 952.897.7700 FAX 952.842.7700 www. welshco, cora "Bob is somebody who appre- ciates the art of the deal and what it takes to get there. He has always been an entrepre- neurial spirit. He has been a good attorney for the city, and through his law practice, Bob knows a lot of people on t~. ,, public side of development. flyan Schroder Cottage Grove City. Administrator ROBERT C. LONG Development & Brokerage Services Welsh Companies Former St. Paul City Council Member and attorney; Bob Long recently joined Welsh Companies' Development and Brokerage Services Team working in the St. Paul East Metro Office. With six years on the St. Paul City Council and the past seven years as a partner at the law firm of Kennedy and Graven working on a wide variety of economic development, red'e- velo. pment and housingpiro'ects, Bob brings a wealth of knowledge from his public and private sector experience to every real estate transaction in whichhe is involved. PROFESSIONAL RESPONSIBILITIES Bob's backgr _ogmd as a City Council Member and attorney practicing in economic development has given him extensive experience in the develop- ment and redevelopment of industrial, commer- cial, and housing sites throughout Minnesota. Bob has been a registered bond counsel and practicing attorney in tax increment finance laws, which gives him broad knowledge about various financing options for redevelopment projects. BUILDING ON SUCCESS As a St. Paul City Council Member, Bob served as a Commissioner of the St. Paul Civic Center Authority, the Housing and Redevelopment Authority, and the St. Paul Port Authority. In that capacity, Bob was involved in many signifi- cant projects in the City of St. Paul induding the planning and financing of St. Paul's new River Centre, the Children's Museum, and helping to initiate the Port Authority's development of sev- eral new industrial parks. As City Attorney and legal counsel for several economic development authorities, housing redevelopment authorities and port authoritie~ througho-ut Minnesota, Bob was involved in a number of significant develop- ment and redevelopment projects. These indud- ed servin$ as bond counsel in the issuance of industrial revenue bonds for certain mantffactur- ing fadlities, serving as economic development counsel to HRA's in the creation of affordable homing developments, and servingas legal counselto Port Authorities in the redevelopment of river front and downtown areas of various Minnesota communities. INDUSTRY LEADERSHIP Bob is a past President of the League of Minnesota Cities and the Association of Metropolitan Municipalities, as well as past Vice President of the Ramsey County League of Local Governments. Bob has served on the boards of ntunerous community organizations, induding the Minneapolis-St. Paul Family Housing Fund Board and the Guadeloupe Area Project School Board. Prior to serving on the St. Paul City Council and joining Kennedy and Graven, Bob served as a Special Assistant Attorney General in the Minnesota Attorney_ General's Office and as a staff aide to former St. Paul Mayor George Laiimer. · never thought tw~ about maldn~ the commitment. He did a phenotne~al job of .Erovid'.mg us with market in. formation and putting us in contact with the constructidn and financin~ entities we needed to get ~he job d~ne. The commitment to ~ettii~!t the job done was coravletelv o-n Da-n's va'rt. He brought z"t on ~ime and on'budget.' Kevin Murphy Greenland Investment DAN G. RUSS Executive Vice President Welsh Development PROFESSIONAL RESPONSIBILITIES Since Dan Russ has been exposed to the real estate industry all of his life, he understands commerdal real estate ventures from every side of the equation. He brings a wealth of knowl- edge ancl expertise to every transaction he directs. Dan has extensive experience in all areas of development and investment opportunities, with an emphasis on suburban master plan develop- ment and industrial development. By utilizing Welsh's diverse in-house services including architecture, construction, leasing and manage- ment, Dan is able to assist clients in their overall real estate needs. In 1978, Dan became the first leasing agent for Welsh Companies. He was respons~le for the hiring and training of other agents, pre-leasing a variety of projects and development of new sites. He ~ acted as a liaison between the company and clients like Equitable, Prudential and Travelers. BUILDING ON SUCCESS From 1990-1995, Dan worked at Hoyt Properties, United Properties and The Ackerberg Group, focusing on the leasing of multi-tenant buildings throughout the Twin Cities area. Black'& Decker, Norwest Mortgage, Damark, International, Standard Register and Banta Corporation were all beneficiaries of Dan's talent and tenacity. Dan rejoined the Welsh team as an Executive Vice President in the Development Division in 1995. He provides his clients with a full range of develoEment, project management, consulting and braid-to-suit services fdr owners, tenants, investors and buyers. VLsualizing the opportuni- ty, facilitating the transaction anorensunng a pos- itive outcome are all abilities that come second nature to Dan. INDUSTRY LEADERSHIP Keeping dose track of industry trends and main- taining a network with other real estate profes- sionals, Dan has memberships in the National Association of Industrial and Office Properties, and the Greater Minneapolis Board of Realtors. He is currently a candiffate for the Cerl~ied Commercial Iflvestment Member designation. · Arden Hills Commerce Center and Arden Hills Lakeside Center I 1787, 1887 Gateway Blvd. Arden Hills, Minnesota Located near the intersection of Interstates 35W and 694 in Arden Hills, Minnesota, the Arden Hills Commerce Center and Arden Hills Lakeside Center I are premiere industrial developments situated on approximately 16.35 acres of prime development land with a total of 220,096 square feet quality office and warehouse/production space. Arden Hills Commerce Center and Lakeside Center I have been developed to accommodate all .types of usages .including office, research, development, distribution and light manufacturing-type operations. The project has been designed with long-term value, offering the latest in new building features to the sophisticated user in today's marketplace. Building Features: Arden Hills Commerce Center 1787 Gateway Boulevard, Arden Hills, MN · Minimum bay size of 14,880 square feet up to 104,532 square feet · 14 loading docks · 40' x 46' column spacing · Bay depths of 186 feet · Situated on 7.43 acres of land · Parking for 172 cars Arden Hills Lakeside Center I 1887 Gateway Boulevard, Arden Hills, MN · Minimum bay size of 16,160 square feet up to 115,564 square feet · 14 loading docks · 40' x 50' column spacing · Bay depths of 202 feet · Situated on 8.92 acres of land · Parking for 184 cars · Minimum clear height 24 feet for both buildings · Constructed of precast insulated concrete wal/panels · 6" reinforced concrete floor thickness · ESFR sprinkler system · Convenient access to 1-694 and 1-35W from Highway 96 ° Large parking and loading areas · Park-like setting · Office space built-to-suit Arden Hills Commerce Center Round Lake Court - __-y J ] ] = ='~b ............. ' ............ ~' .... 2 .................... L ~ ~: 562 : .... ~ .... Gateway Boulevard ~~._ ~ / / Arden Hills Lakeside Center I ! z ~ Ir. / ~ ~" ? 7~ Building Features A&B · 245 parking spaces allocated for both buildings. 3/1000 parking ratio. · Minimum tenant size of 12,800 square feet up to 76,249 square feet. · 40' x 40' column spacing. · 9' x 10' dock high doors. · Minimum ceiling height for both buildings is 24 ft. clear. · $" reinforced concrete floor thickness. · Offices will be custom designed and finished to suit individual tenant needs. ESFR sprinkler system. Convenient access to 1-35, !-435, and Highway K;-10. 7" concrete loading aprons with 180' of truck maneuverability. Landscaped grounds with lawn sprinkler system. Attractive full height tilt- up concrete construction. Close proximity to major service and retail amenities at 119th Street. BP-2 (Planned Business Park) zoning. Technology Features · Dual fiber routes entering the building in separate conduits. · Dual power feeds. · SONET Ring that offers "self-healing networks" which virtually eliminate service interruptions. · Designated "Fiber Park" by Southwestern Bell Telephone. · Fiber optic connections are available from multiple vendors. · T1 and T3 connections ready. College Boulevard Proposed Building E 36,000 Sq. Ft. City of Lenexa - Park For Lease [.ambert Pointe Business Centre III O IV 96,483 Sq. Ft. & 112,850 Sq. Ft. Divisible To 14,328 Sq. Ft. For Mom Information Contact: Jeffrey R. Hawley jl~awl~l,@cbl~.conl 314-889-1557 Timothy C. Convy tconl,y,~cbre, corn 314~S89-1562 George C. ConW 3 l-Nq89-1533 Build-To-Suit & Design Build Opportunities Available Visit our website at www. cbrichardellis, com/us/st_louis A WELSH COMPANY St. Louis, Minneapolis, Kansas City, Des Moines, Columbus. Milwaukee McDonnell Boulevard 0 CB Richard Ellis NAVIGATING A NEW WORLDs" For More Information Contact: Jeffrey R. Hawley Timothy C. Convy George C. Convy jhawley@cbre, corn tconvy@cbre, corn gconvy@cbre, corn (314)-889-1557 (314) 889-1562 (314) 889-1533 8112 Maryland.&venue · Suite 101 · St. Louis, MO 63105 Information contalneo ~erein has =eon obtained from the owner of the properb/or from other sources. The brokers da not guarantee the accuracy ot this ~nformadon. Owners .~nd bro,<ers make no representation as to ',he environmental or other condition ot the property and recommend the ourchaser investigate tully. BRAND NEW- Office/Warehouse/Distribution Divisible to 18,000 Square Feet · 24' Clear Ceilin~ Heights · Dock Height and Drive In Loading Doors · Office Space Built to Suit Located Just West of 1-94 & Ryan Rd. (Hwy 100) · Convenient to Both the Milwaukee and Chicago Markets I ll..,A ID COMPANIES For Further Information Call: Bill Langhoff, Mike Fardy or Scott Welsh 414.359.9500 10850 West Park Place · Suite 1000 · Milwaukee, WI 53224 · www. inlandcompanies.com BROKERAGE · PROPERTY MANAGEMENT · REAL ESTATE DEVELOPMENT · CONSTRUCTION June 5, 2002 Randy Schumacher Acting Community Development Director City of Columbia Heights 590 40~ Avenue NE Columbia Heights, MN 55421-3878 RE: Industrial Center Redevelopment Project Dear Randy: As requested by the City, this letter and attachments are intended to supplement Welsh Companies' response to the City's Request for Qualifications (RFQ) dated May 14, 2002. Section 3.1. Redevelopment Team Data 3.1.1. 3.1.2. 3.1.3. 3.1.4. Organizational form Included in original proposal Contact person and availability. Bob Long of Welsh Companies will be the coordinator of the Welsh Redevelopment Project Team and will be the primary contact person for the City. Staff members and availability The Welsh Redevelopment Project and Design Team will consist of the following individuals (resumes attached): · Dennis J. Doyle, Chief Executive Officer · Dan G. Russ, Executive Vice President Welsh Development (Lead Redevelopment Team member) · Tod S. Elkins, Executive Vice President, Genesis Architecture (Division of Welsh) · Lynn D. Sloat, AIA, Vice President, Genesis Architecture (Lead Architect) · Robert C. Long, Development & Brokerage Services (Primary contact for City on Project and Coordinator of Welsh Team) Names of consultants and their anticipated project involvement · Engineering: (Consulting Engineers have not yet been named and will be selected based on the nature of the development on the various parcels in the Redevelopment area.) · Environmental: Environmental Consultants have not yet been named and will be selected based on the nature of the development on the various parcels in the Redevelopment area.) 7807 Creekridge Circle, Minneapolis, MN 55439-2609 T~L 952.897.7700 FAX 952.842.7700 www. welshco.com Housing Partners: Welsh may bring in a Housing Developer (s) as part of the Team if some of the sites within the Redevelopment area are designated for housing. Any housing developers will be selected based on the nature of the housing development (i.e. senior housing) that is designated by the City. Section 3.2. Redevelopment Team Experience 3.2.1. Welsh Companies has done a variety of different redevelopment projects working in cooperation with cities throughout Minnesota and the Midwest. Information on three (3) of these projects in Minnesota were included in our RFQ original materials. · The Brooklyn Park Interstate Center 7700 68th Avenue North Brooklyn Park, MN · The Currell Centre 7616 Currell Boulevard Woodbury, MN · Arden Hills Commerce Center and Lakeside Center I 1787 and 1887 Gateway Boulevard Arden Hills, MN Please feel free to contact me at 651-665-1139 if you have questions or need further information. We look forward to meeting with you and the Economic Development Authority on June 18, 2002. Sincerely, Robert C. Long Development & Brokerage Services DENNIS J. DOYLE Chief Executive Officer Welsh Companies PROFESSIONAL RESPONSIBILITIES Dennis Doyle is a majority owner and co- founder of Welsh Companies, a leader in full- service commercial real estate. Founded as Welsh Construction Corp. in 1977 by Dennis Doyle and his partner George Welsh (who retired in 1986), the partners drew upon their expertise in construction and management of commercial and industrial properties to create the full-service organization that exists today. BUILDING ON SUCCESS During the early years, the company developed and constructed buildings on a build-to-suit and speculative basis. Under Dennis' guidance and leadership, today Welsh and its affiliates provide a complete menu of services for commercial and residential property owners and users. Jointly, these companies are involved in leasing and brokerage, client representation, property management, facility management, corporate real estate services, architecture, construction, development, mortgage banking, facility services, and non-profit consulting services. Welsh is headquartered in the Twin Cities with regional offices in Minneapolis and Saint Paul, Minnesota, and Columbus, Ohio. The company is also actively involved with real estate projects in Kansas City, KS; St. Louis, MO; Des Moines, IA and Milwaukee, WI. INDUSTRY LEADERSHIP Dennis is dedicated to improving both business and the surrounding community. He was twice a finalist for the Ernst & Young Merrill Lynch Entrepreneur of the Year Award, and received the 1990 Eden Prairie Chamber of Commerce Small Business Person of the Year Award. An active member of the National Association of Industrial and Office Properties, Dennis is also involved with a variety of other organizations, including the following: Community Involvement, present Boards Board of Directors, Minnesota Teen Challenge Board of Advisors and President, Hope in the City Professional Involvement, Present Boards Board of Directors, American Church Mortgage Co. - REIT Board of Directors, Rottlund Homes - NAS DAQ Board of Directors/Stockholder - Key Community Bank Board of Directors, Gresser Concrete Communitxl Involvement, Past Boards and Presidencies Board of l~irectors, Great Clips, Inc. Board of Directors, Grow Biz International, NAS DAQ Board of Directors, Athletes in Action Board of Directors, Church Metro Board of Directors/Past President, H.E.A.R.T. (Help Enable Addicts Receive Treatment) Board of Directors, The Children's Theater · "Our transaction required an inordinate amount of time, effort and ener~oI. Dan never thought l'dice about makifig the commitment. He did a phenomenal job of .t~viding us with market infoFra_ ation and puttin~g us in contact with the construction and financin, g entities we needed to get the job done. The commitm~, t to getting t, he job done was completel!l on Dan s part. He brought ~t on time and on budget.' Kevin Murphy Greenland Investment DAN G. RUSS Executive Vice President Welsh Development PROFESSIONAL RESPONSIBILITIES Since Dan Russ has been exposed to the real estate industry all of his life, he understands commercial real estate ventures from every side of the equation. He brings a wealth of knowl- edge and expertise to every transaction he directs. Dan has extensive experience in all areas of development and investment opportunities, with an emphasis on suburban master plan develop- ment find industrial development. By utilizing Welsh's diverse in-house services including architecture, construction, leasing and manage- ment, Dan is able to assist clients in their overall real estate needs. In 1978, Dan became the first leasing agent for Welsh Companies. He was responsible for the hiring and training of other agents, pre-leasing a variety of projects and development of new sites. He also acted as a liaison between the company and clients like Equitable, Prudential and Travelers. BUILDING ON SUCCESS From 1990-1995, Dan worked at Hoyt Properties, United Properties and The Ackerberg Group, focusing on the leasing of multi-tenant buildings throughout the Twin Cities area. Black & Decker, Norwest Mortgage, Damark, International, Standard Register and Banta Corporation were all beneficiaries of Dan's talent and tenacity. Dan rejoined the Welsh team as an Executive Vice President in the Development Division in 1995. He provides his clients with a full range of development, project management, consulting and build-to-suit services for owners, tenants, investors and buyers. Visualizing the opportuni- ty, facilitating the transaction andensuring a pos- itive outcome are all abilities that come second nature to Dan. INDUSTRY LEADERSHIP Keeping dose track of industry trends and main- taining a network with other real estate profes- sionals, Dan has memberships in the National Association of Industrial and Office Properties, and the Greater Minneapolis Board of Realtors. He is currently a candidate for the Certified Commercial Ihvestment Member designation. · TOD S ELKINS Executive Vice President Genesis Architecture Genesis Architecture's Executive Vice President, Tod Elkins, has more than 17 years of yrOfessional architectural experience. He is high- motivated with an abundance of hands on experience inpr0ject management, technology, mentoring andthe management ofprofessional staff, as well as outside vendors and contractors. PROFESSIONAL RESPONSIBILITIES As Executive Vice President of Genesis Architecture, Tod is responsible for the day-to- day operations of the organization. Working closely with the President of Welsh Construction, Tod is instrumental in the strategic development of the company and in making sure that the services offered and quality of performance are consistently above th~ clients' expectations. Directing the activities of multi-faceted design teams, Tod coordinates schedules, organizes development plans, and supervises the execution of the assignment. BUILDING ON SUCCESS Tod was trained as an architect at the University of California, Berkeley and earned a Masters in Architecture from the University of Minnesota. He began his professional career at Hale's Testing Laboratory in Hayward, California. Since then he has worked with Monterey Domes, Inc., in Walnut Creek, California; Russel & Scot Architects, Inc. in Cambridge, Massachusetts; Klick InterArch Design, Ltd. in St. Louis Park, Minnesota; and most recently, Cuningham Hamilton Quiter, EA. in Minneapolis, Minnesota. Throughout Tod's career, he has completed a consl"derable amount of work for a variety of school districts, including additions, demolition and remodeling of classrooms, gymnasiums and media centers. INDUSTRY LEADERSHIP Tod is active in a number of industry organizations in order to maintain a strong network of peers and colleagues, as well as to stay abreast of the latest industry trends. · LYNN D. SLOAT, AIA Vice President Genesis Architecture A creative, solution-oriented architect with vast experience in all phases of the design PArocess, Lynn Sloat is Vice President of Genesis rchitecture. This accomplished professional has more than 25 years' experience in all phases of the architectural and design fields, with spe- cial emphasis on corporate development. L __y~m was a founder of PMDesign, which eventually became Genesis Architecture. PROFESSIONAL RESPONSIBILITIES In his position, Lynn provides design services, creates construction documents, and oversees contract administration for a variety of corporate construction projects. He approaches every proj- ect, large or small, with thoughtful consideration of the client's goals, design expectations and financial requirements. In addition to third- party projects, Lynn alsg..Erovides arcNtectural consulting services to affiliate companies, Welsh Construction Corp. and Welsh Companies, rang- ing from space planning and interior design, to assisting clients through the entire design process. BUILDING ON SUCCESS A key member of the Genesis Architecture team, Lynn focuses much of his attention on major industrial projects being developed in the Midwest including St. Louis, Kansas City, Milwaukee, Lenexa, and the Twin Cities. Among Lynn's recentprojects are the design and devel- opment of Radio Drive, Town Centre Plaza, Currell Business Center, and Target Stores. INDUSTRY LEADERSHIP Lynn's innovative ideas and tremendous level of knowledge and expertise create design solutions that are in line with our clients' needs today, and into the future. Lynn is a registered licensed architect in nine states including Minnesota and Wisconsin, is nationally certified by the National Council of Registration Boards, and is a member of the American Institute of Architects. = "Bob is somebody who appre- ciates the art of the deal and what it takes to get there. He has always been an entrepre- neurial spirit. He has been a good attorney for the city, and through his law practice, Bob knows a lot of people on t~. , public side of development. Ryan Schroder Cottage Grove City Administrator ROBERT C. LONG Development & Brokerage Services Welsh Companies Former St. Paul City Council Member and attorney, Bob Long recently joined Welsh Companies' Development and Brokerage Services Team working in the St. Paul East Metro Office. With six years on the St. Paul City Council and the past seven years as a partner at the law. firm. of Kennedy and. Graven workin.~lg on a wide variety of econonuc development, rede- velopment and housing projects, I/ob brings a wealth of knowledge from his public and private sector experience to every real estate transaction in whichhe is involved. PROFESSIONAL RESPONSIBILITIES Bob's background as a City Cotmcil Member and attorney practicing in economic development has given him extensive experience in the develop- ment and redevelopment of industrial, commer- cial, and housing sites throughout Minnesota. Bob has been a registered bond counsel and practicing attorney in tax increment finance laws, which gives him broad knowledge about various financing options for redevelopment projects. BUILDING ON SUCCESS As a St. Paul City Council Member, BOb served as a Commissioner of the St. Paul Civic Center Authority, the Housing and Redevelopment Authority, and the St. Paul Port Authority. In that capadty, Bob was involved in many signifi- cant projects in the City of St. Paul including the planning and financing of St. Paul's new River Centre, the Children's Museum, and helping to initiate the Port Authority's development of sev- eral new industrial parks. As City Attorney and legal counsel for several economic development authorities, housing redevelopment authorities and port authorities throughout Minnesota, Bob was involved in a number of significant develop- ment and redevelopment projects. These indud- ed serving as bond counsel in the issuance of industrial revenue bonds for certain manufactur- ing facilities, serving as economic development counsel to HRA's in the creation of affordable housing developments, and serving as legal counsel to Port Authorities in the redevelopment of river front and downtown areas of various Minnesota communities. INDUSTRY LEADERSHIP Bob is a past President of the League of Minnesota Cities and the Association of Metropolitan Municipalities, as well as past Vice President of the Ramsey County League of Local Governments. Bob has served on the boards of numerous community organizations, including the Minneapolis-St. Paul Family Housing Fund Board and the Guadeloupe Area Project School Board. Prior to serving on the St. Paul City Council and joining Kennedy and Graven, Bob served as a Special Assistant Attorney General in the Minnesota Attorney General's Office and as a staff aide to former St. 'Paul Mayor George Latimer · Industrial Equities, LLP 321 First Avenue North Minneapolis, MN 55401 Contact: John Allen, Managing Partner 612-332-1122 Status of Application: RFQ Requirements Complete Strengths: Industrial portfolio of 3,000,000 square feet, including New Brighton, Crystal and Rosevill. Well established financing with Wells Fargo Bank and for long-term financing, Teacher Insurance and New York Life Insurance Company. Good working relationship with City and State agencies with extensive redevelopment experience is a real plus. Local market knowledge and track record are also strengths. Quality development is his hallmark. Concerns: Residential experience is mentioned, but appears to be single, rather than multi- family, residential. Lack of background information provided on Windsor Development, LLC. Appears to be the largest project attempted for th6 company- will it stretch their finances? Nothing submitted shows any commercial experience or experience with mixed-use projects. Small company with many projects underway- do they have staff to focus on the project? H:~Industrial CenterkIndustrial Equities LLP Staff review '-- 0 0 z ~ ~ ~ ~ z ~ ~ 0 ~m ~ ~ ~ ~ 0 Z ZZ Z Z Z _~ - _ _ x x~ x x- x- TEL 612 332 1122 INDUSTRIAL EQUITIES L.L.P. Development and Investments 321 First Avenue North, Minneapolis, Minnesota 55401 FAX 612 332 0241 June 10, 2002 Mr. Randy Schumacher Acting Community Development Dir. CITY OF COLUMBIA HEIGHTS 590 40th Avenue NE Columbia Heights MN 55421 REF: RFQ FOR INDUSTRIAL CENTER REDEVELOPMENT PROJECT Dear Randy: Enclosed please find ten (10) copies of required RFQ information requested. I trust we have been responsive to the ILFQ and remain available to supplement should Staff or City officials require further input. Sinjce4;, ely,,,-~' /? Managing Partner (612) 332-1122 - phone (612) 332-0241 - fax iallen~indus trialequities.com JNA/vccq/ 3.1 REDEVELOPMENT TEAM DATA 3.1.1 Organizational form Industrial Equities is a limited liability partnership, or alternatively a limited liability corporation, depending on the location and nature of the development project. It is a Minneapolis based company located at 321 First Avenue North, Minneapolis, MN 55121. Industrial Equities develops, invests and manages for its own portfolio and is not a merchant builder nor does it do third party management or construction. Industrial Equities industrial portfolio is almost 3 million square feet. Windsor Development LLC is a residential land development company that has developed over 700 residential lots, including Oak Hill, the Twin Cities builder Association's "Project of the Year" in 2002. 3.1.2 Contact person and availability John N. Allen is the Chief Executive Officer of Industrial Equities and Windsor Development. Mr. Allen has 21 years of experience in the real estate brokerage, investment, development and management field and is the sole owner and proprietor of Industrial Equities. 3.1.3 Staff members and availability J eft Salzbrun, Leasing and Development Donna Fialko, Controller DeeAnn Stinebaugh, Property Management Veronique Cheney, Administrative Sue Thompson, Construction Administration Richard Jeske, Financing Ron Bastyr, Windsor Development, Land Use Designer 3.1.4 Developments underway, under consideration or committed 1. Highpointe Business Center Phase 1, 670 East Travelers Trail, Bumsville, Minnesota (see attached site plan) is a 51,200 square foot, 18' clear office/warehouse facility constructed in 2001. Phase II is a 60,000 square foot office/warehouse facility scheduled for fall 2002 or spring 2003 construction. 2. Golden Valley Tech Center, 6305 & 6325 Sandburg Road, Golden Valley, Minnesota (see attached site plan). Phase II (constructed in 2001) is a 132,000 square foot, 24' clear office warehouse facility. Phase I (construction scheduled for 2002) is a 32,200 square foot, 14' clear office/showroom facility. 3. Blaine Industrial Center I1, 8802 West 35W Service Drive, Blaine, Minnesota (see attached site plan) is a 60,000 square foot, 24' clear office/warehouse building, the second of a two building project completed in January 2002. Lino Lakes Business Campus, is a new 100 acre industrial and business park development located on 35E/Exit 14/Otter Lake Road in Lino Lakes. Build to suit sites available now. 3.1.5 Names of consultants and their anticipated project involvement Architect Jeff Sybrant, Architects P.A. Phone: (763) 544-9998 4725 Olson Memorial Hwy. #200, Golden Valley, MN 55422 Structural Engineer: Louie Ho, Builders Consulting Group Phone: (763) 789-6696 2817 Anthony Lane S #201, Plymouth, MN 55418 Civil Engineer: Environmental: Legal: Residential Development: SchoeLl & Madson Phone: (952) 546-7601 10580 Wayzata Blvd. #1, Minnetonka, MN 55305 Dave Vieau, ERG Phone: (612) 33%4750 900 Second Ave. S., Minneapolis, lVlN 55402 Jeff Johnson, Barna Guzy & Steffen Phone: (763) 783-5120 200 Coon Rapids Blvd #400, Minneapolis, MN 55433 Ron Bastyr, Windsor Development Phone: (657) 738-4983 9145 Edinburgh Lane, Woodbury, MN 55125 3.2 3.1.6 Redevelopment team's approach to public/private partnerships Industrial Equities prides itself on its ability to formulate public/private partnerships that deliver the highest quality redevelopment properties that target the niche and the market of a particular location. Because Industrial Equities is not a merchant builder and does not build for mediate resale, it utilizes redevelopment money to create upscale projects with ample parking and gracious landscaping to preserve long-term tax base value. Additionally, because Industrial Equities owns and manages for its own portfolio, it retains a pride of ownership that is unlike many merchant builders who develop for resale and therefore will not make investments in long-term intrinsic value. Industrial Equities frequendy uses the additional tax increment financing dollars to upgrade facilities in the categories of brick, glass, parking, landscaping and overall aesthetics REDEVLOPMENT TEAM EXPERIENCE 3.2.1 previous redevelopment experience, especially similar projects New Brighton Industrial Center I-V, located at First Street & Fifth Avenue NW in New Brighton, is a five building, 194,503 square foot industrial campus constructed from 1998- 2001 (see attached site plan). This project was completed after the acquisition of muldple houses and businesses and despite contiguous proximity to a Federal Superfund site. The five building project was completed ahead of schedule, despite difficult challenges of buhed USWest optic lines that created considerable civil engineering problems. Crystal Business Center, located at 5500 Lakeland Avenue North in Crystal, is a 92,300 square foot, 24' clear office warehouse building constructed in 1999 (see attached site plan). This project replaced a restaurant, hotel and bar at a key Crystal interchange. Roseville Technology. Center, located at 2621 Fairview Avenue in Roseville, is a 42,000 square foot, 18' clear office/warehouse facility constructed in 1999. Industrial Equities redeveloped this solvent contaminated site in conjunction with a Met Council Grant. Lakeview Business Campus I-VI is a six building, 375,000 square foot, industrial park developed from 1995-2000. Business, homes and vacant under utilized land were assembled to create New Brighton's signature park. 3.3 3.2.2 Demonstrated ability to work with relocating existing businesses Industrial Equities 3 million square foot portfolio offers opportunity for relocation. Additionally, John N. Allen's 21 years of experience as an industrial real estate broker and the resulting marking knowledge and important contacts offer the potential to provide relocation assistance. 3.2.3 3.2.4 Demonstrated ability to move from concept stage to construction completion within an established time frame and Experience in redevelopment process, including land use revisions, utilities, highway, environmental and other regulatory permitting and review agencies Each of the listed issues are intricately involved in every residential or commercial project we do, regardless if it's a redevelopment or a new project. Accordingly, since Industrial Equities designs, approves and constructs exclusively for our portfolio, our team has a demonstrated track record of successfully managing each facet. 3.2.5 Describe your ability to establish effective working relationships with the City and community Below is a list of City officials that Industrial Equities has worked with on past projects. Feel free to contact them as references. 1. Ann Norris, City Manager, City of Crystal 2. I(evin Locke, Dir. Of Economic Development, City of New Brighton 3. Judy Tschumper, Economic Dev. Director, City of Burnsville 4. Dennis Welsh, Economic Development, City of Roseville FINANCIAL CAPABILITY 3.3.1 Financial capability, including ability to secure project financing, secure construction bonds, finance pre-development activities, and work with a variety of finance professionals and 3.3.2 Financial planning capacity, including the ability to prepare project proformas and _financing plans John N. Allen and Industrial Equities have a long term banking relationship with Wells Fargo Banks Real Estate Department (contact:. Jim Basten 612-667-1196). Industrial Equities acquires and develops utilizing its own capital, construction loans or e.,dsting credit lines. Industrial Equities also has significant long-term relationships with Teachers Insurance and Annuities and New York Life Insurance Company, who have provided permanent project financing for our projects. Industrial Equities, because of its extensive redevelopment background, also has comprehensive experience with tax increment financing. Because of the financial strength of Industrial Equities and its Principal, John N. ALlen, and regardless of market conditions or industry standard requirements for pre-leasing, Industrial Equities has always, on a totally speculative basis, proceeded with every development it has desired to do. 3.3.3 Demonstrated record of meeting project financial commitments Both Industrial Equities and John N. Allen have fulfKled every development agreement it has engaged in, generally over-achieving on valuations of each TIF district, and have impeccable credit histories. 3.4 DESIGN EXPERIENCE 3.4.1 Design capacity, as evidenced by completed projects of similar size and 3.4.2 Design flexibility, as demonstrated by the ability to adapt to local design criteria See attached list of completed projects, which represent an extensive list of new construction, historical renovation, redevelopment projects and land development that bridges product type, size and design. 3.4.3 Creativity, as evidenced by previous experience of redevelopment team to meet special redevelopment challenges with a unique approach The breadth and scope of our redevelopment experience demonstrates our understanding of how to balance site and city challenges with market demands. INDUSTRIAL EQUITIES PROPER'rY LISTING 321 BUILDING 4,000 sq. ft. office building 321 1ST AVENUE NORTH MINNEAPOLIS, MINNESOTA 55401 5301 BUll.DING 25,760 sq. ft. office/warehoue building 5301 EDINA INDUSTRIAL BLVD. EDINA, MINNESOTA 55436 615 BUILDING 39,027 sq. ft. office building 615 NORTH THIRD STREET MINNEAPOLIS, MINNESOTA 55401 8040 BUILDING 30,314 sq. ft. office/warehouse building 8040 OLD CEDAR ROAD BLOOMINGTON. MINNESOTA 55425 ANNEX BUILDING 935 BRADFORD STREET ST. PAUL. MINNESOTA 55114 BLAINE INDUSTRIAL CENTER I 91,980 sq. ft. office/warehouse building 8720 WEST 35W SERVICE DRIVE NE BLAINE, MINNESOTA 55449 BOONE PLAZA 124,068 office/showroom building 1000 BOONE AVENUE NORTH GOLDEN VALLEY, MINNESOTA 55427 BROOKLYN BLVD. 72,100 sq. ft. office/warehouse building 8301-8309 BROOKLYN BLVD. BROOKLYN PARK, MINNESOTA 55445 BURNSVILLE BUSINESS COMMONS 88,850 sq. ft. office/warehouse building 1800 EAST CLIFF ROAD BURNSVILLE, MINNESOTA 55337 BURNSVILLE SKYLINE BUS. CENTER 83,397 sq. ft. office/warehouse building 1200 EAST CLIFF ROAD BURNSVILLE, MINNESOTA 55337 CARLSON DRIVE 17~380 sq. ft. office/warehouse building 6358-6350 CARLSON DRIVE EDEN PRAIRIE, MINNESOTA 55344 CLIFF INVESTORS 18,069 sq. ft. office/warehouse building 1401-1411 EAST CLIFF ROAD BURNSVILLE. MINNESOTA 55337 CRYSTAL BUSINESS COMMONS 92,300 sq. ft. office/warehouse building 5500 LAKELAND AVENUE NORTH CRYSTAL, MN 55422 CROSSTOWN CIRCLE 73,881 sq. ft. office/warehouse building 10200 CROSSTOWN CIRCLE EDEN PRAIRIE. MINNESOTA 55344 EAGAN DISTRIBUTION CENTER 120,000 office/warehouse building 580 YANKEE DOODLE ROAD EAGAN, MN 55121 FLAGSHIP BUSINESS CAMPUS I 51,760 sq. ft. office/warehouse building 935 BLUE GENTIAN ROAD EAGAN, MINNESOTA 55121 FLAGSHIP BUSINESS CAMPUS II 96,880 sq. ft. office/warehouse building 915 BLUE GENTIAN ROAD EAGAN, MINNESOTA 55121 FLAGSHIP BUSINESS CAMPUS III 59,398 sq. ft. office/warehouse building 895 BLUE GENTIAN ROAD EAGAN, MINNESOTA 55121 FLAGSHIP BUSINESS CAMPUS IV 59,399 sq. ft. office/warehouse building 875 BLUE GENTIAN ROAD EAGAN, MINNESOTA 55121 ~TATE CORPORATE CENTRE 84,272 sq. ft. office/warehouse building S50-600 COUNTY ROAD D. NEW BRIGHTON, MINNESOTA 55112 LAKEVIEW BUSINESS CAMPUS I 92,430 sq. ft. office/warehouse building 601 LAKEVIEW POINT NEW BRIGHTON, MINNESOTA 55112 LAKEVIEW BUSINESS CAMPUS II 54,785 sq. ft. office/warehouse building 711 5TH STREET SW NEW BRIGHTON, MINNESOTA 55112 LAKEVIEW BUSINESS CAMPUS III 46,970 sq. ft. office/warehouse building 651 CAMPUS DRIVE NEW BRIGHTON, MINNESOTA 55112 LAKEVIEW BUSINESS CAMPUS IV 87,757 sq. ft. office/warehouse building 601 CAMPUS DRIVE NE'VV BRIGHTON, MINNESOTA 55112 LAKEVIEW BUSINESS CAMPUS V 16,000 sq. ft. office/warehouse building 639 CAMPUS DRIVE NEW BRIGHTON, MINNESOTA 55112 LAKEVIEW BUSINESS CAMPUS VI 48,000 sq. ft. office/warehouse building 575 OLD HIGHWAY 8 NEW BRIGHTON, MN 55112 MINNEAPOLIS RAIL DISTR. CENTER 118,000 sq. ft. office/warehouse building 1800 BROADWAY STREET NE MINNEAPOLIS, MN 55113 NEW BRIGHTON BUSINESS CENTER I 64,008 sq. ft. office/warehouse building 151 FIFTH AVENUE NW NEW BRIGHTON, MINNESOTA 55112 NEW BRIGHTON BUSINESS CENTER II 39,995 sq. ft. office/warehouse building 121 FIFTH AVENUE NW NEW BRIGHTON, MINNESOTA 55112 NEW BRIGHTON INDUSTRIAL CENTER IV 31,500 sq. ft. office/warehouse building 33 FIFTH AVENUE NW NEW BRIGHTON, MN 55112 ROSEVILLE TECHNOLOGY C~ 41,997 sq. ft. office/warehouse building 2621 FAIRVIEW AVENUE ROSEVILLE, MINNESOTA 55113 WASHINGTON DRIVE INVESTORS 24,194 sq. ft. office building 3459 WASHINGTON DRIVE EAGAN. MINNESOTA 55112 NEW BRIGHTON INDUSTRIAL CENTER III 35,900 sq. ft. office/warehouse building 99 FIFTH AVENUE NW NEW BRIGHTON, MN 55112 NEW BRIGHTON INDUSTRIAL CENTER V 23,100 sq. ft. office/warehouse building 21 FIFTH AVENUE NW NEW BRIGHTON, MN 55112 NORTH PARK BUSINESS CENTER 87,841 sq. ft. office/warehouse building 350 73RD AVENUE FRIDLEY, MINNESOTA 55432 SHINGLE CRRF. K PARKWAY 85,000 sq. ft. office/warehouse building 6801 SHINGLE CREEK PARKWAY BROOKLYN CENTER. MINNESOTA 55430 NEWLY CONSTRUCTION PROPERTIES BLAINE INDUSTRIAL CENTER II 60,000 sq. ft. office/warehouse building 8802 W. 35W SERVICE DRIVE BLAINE. MN 55449 GOLDEN VALT.Fy TECH CENTER II 1.t2,000 sq. ft. office w~rehouse building 6325 SANDBURG ROAD GOLDEN VALLEY. MN 55427 HIGHPOINTE BUSINESS CENTER I 51~00 sq. ft. office/warehouse building 670 EAST TRAVELERS TRAIL BURNSVILLE, MN 55337 PROPOSED DEVLEOPMENTS GOLDEN VALLEY TECH CENTER I 32,000 sq. ft. office/showroom building 6305 SANDBURG ROAD GOLDEN VALLEY, MN 55427 LIND LAKES INDUSTRIAL CENTER 100 Acres of build-to-suit sites OTTER TAIL ROAD LIND LAKES. MN HIGHI~OINT BUSINESS CENTER II 60,000 sq. ft. office/warehouse building 880 EAST TRAVELERS TRAIL BURNSVILLE. MN 55337 BURNSVILLE HIGPOINTE BUS. CENTER 670-680 East Travelers Trail, Burnsville, Minnesota SITE PLAN GOLDEN VALLEY TECHNOLOGY CENTER Sandburg Road & Douglas Drive, Golden Valley, Minnesota SITE PLAN BLAINE INDUSTRIAL CENTER II 1-35W Frontage Rd. & 85tu Ave, Blaine, Minnesota Site Plan ~§oo ooo oo --. 000000 CRYSTAL BUSINESS COMMONS 5500 Lakeland Avenue North, Crystal, Minnesota Site Plan \ xx ~x X X -) F.~I]Rvlr~f Avr~I~UI~ Schaffer-Richardson, Inc. Sherman Associates The Banks Building, Suite 500 615 1st Avenue N.E. Minneapolis, MN 55413 Contact: Kit Richardson, Principal 612-371-3000 Status of Application: RFQ Requirements Met Strengths: Joint venture means strong multi-family component to proposal- everything fi:om senior to high-quality rental and owner-occupied townhomes. Also, the team has 1.8 million square feet of commercial space under lease. Strong architectural/engineering, marketing, and environmental consultants add to the team. Good business acquisition and relocation experience. "In-fill" redevelopment focus and past projects matches the Columbia Heights project needs. Financial capability is more than adequate. In-house construction company. Concerns: Primarily limited experience in the redevelopment of industrial properties and the number of on-going projects. Would they have the focus and finances for this project, too? H:'dndustrial Ccnterk.gchaffer-Richardson Staffrevicw 0 ~ -- 0 Z ~ ~ ~ ~ w~ Z Zz Z Z Z z I.- Z 0 SCHAFERRICHARDSON INC Commercial Real Estate Services May 14, 2002 Mr. Randy Schumacher Acting Deputy Executive Director Economic Development Authority City of Columbia Heights 590 40th Avenue NE Columbia Heights, MN 55421 Dear Mr. Schumacher: SCHAFERRICHARDSON INC. and Sherman Associates are pleased to submit our qualifications as a joint venture development team for the Industrial Center Redevelopment Project. We believe the two companies, in this their second, residential joint venture project, bring very strong, but distinct and different strengths and experiences to the project. By combining our talents, back~ounds and skills we believe we will be able to form a productive partnership with the City of Columbia Heights in achieving its goals. We look forward to meeting with you, your staff and the Commissioners to answer any questions and to the opportunity of working with the City of Columbia Heights. Sincerely, Kit Richardson Principal KR/ms Enclosure I n ..~ e s ' m e n t · S a T e s & L e a :s i n g · .'vl a n a g e m e n ,~ · D e './ e I o p m e n ' The Banks Building · Suite 500 615 lstAvenue North East Minneapolis. Minnesota 552!3 Telephone: {612) 371-30C0 Fax: (612} 359-5858 E-Math ,vww. scnafericta:dson.com CITY OF COLUMBIA HEIGHTS INDUSTRIAL CENTER REDEVELOPMENT PROJECT REQUEST FOR QUALIFICATIONS SUBMITTED BY: A JOINT VENTURE TEAM SCHAFERRICHARDSON INC. SHERMAN ASSOCIATES, INC. May 14, 2002 3.1 Redevelopment Team Data 3.1.1 Organizational Form The developer will be a joint venture including SCHAFERRICHARDSON Real Estate Company and Sherman Associates. SCHAFERRICHARDSON is a Minnesota Corporation Sherman Associates, Inc. is a Minnesota Corporation 3.1.2 Contact Persons and Availability Kit Richardson SCHAFERRICHARDSON 615 First Ave. N.E. #500 Minneapolis, MN 55413 (612) 359-5841 George E. Sherman Sherman Associates, Inc. 1525 South Fourth Street #200 Minneapolis, MN 55454 (612) 332-3000 3.1.3 SCHAFERRICHARDSON has five full-time employees working on development projects, sales and leasing. SCHAFERRICHARDSON's affiliated construction company, SR Construction Services, Inc., employs ten full-time staff involved in new construction and redevelopment projects. Sherman Associates, Inc. has seven full-time employees working on development and redevelopment projects. Sherman Associates also as twenty-five additional employees managing and constructing quality housing throughout the Twin Cities area. 3.1.4 - Developments Underway, Under Consideration, or Committed SCHAFERRICHARDSON INC. * The Banks Building redevelopment - Minneapolis * Bassett Creek Business Center - Minneapolis * 4th Street Lofts - Minneapolis * North Loop Lofts - Minneapolis * Northwestern Building Loft Conversion - St. Paul * Farmers Market & Market Lofts - St. Paul * Cobblestone Court Shopping Center - Burnsville * 7th Street Apartments - Minneapolis * Red Wing Homes Site - Red Wing * Additional projects are under consideration but not under contract 3.2 3.1.5 3.1.6 Sherman Associates, Inc. * The Landings Town Homes - Minneapolis * The Essex on Park - St. Paul * Sibley Park Apartments - St. Paul * Capital Heights City Homes - St. Paul * Guardian Angels of Hastings - Hastings * LeSueur Meadows - LeSueur * The Dakota- St. Paul * Sibley Court Apartments - St. Paul * The shores Senior Apartments - Shoreview * Bottineau Commons Apartments - Minneapolis * Bottineau Lofts Apartments - Minneapolis * Vine Street Lofts - Des Moines * Falcon Heights Town Square - Falcon Heights * Various projects are currently under consideration Consultants The joint venture team will consider various consultants and currently anticipates using the following: Architects: Elness, Swenson & Graham Engineering/Survey Alliant Engineering Market Analysis Maxfield Associates Environmental Wenke Associates; Pinnacle Engineering Redevelopment Team's Approach to Public/Private Partnerships The joint venture development team looks forward to a partnership with the City of Columbia Heights. Sherman Associates, in particular, has a long and very successful history of working in partnership with public agencies and cities throughout Minnesota. EXPERIENCE 3.2.1 Previous Redevelopment Experience SCHAFERRICHARDSON controls approximately 1.8 million square feet of commercial space, much of which the company has developed or redeveloped, and controls land in Minneapolis on which approximately 500-600 residential units are being planned. The company has been developing in the Twin Cities market for almost seven years. Sherman Associates has twenty-six years of experience as a principal in developing affordable and mixed income housing. A detailed company resume is attached. 3.2.2 Demonstrated Ability to Work with Relocating Existing Businesses SCHAFERRICHARDSON's portfolio includes over 350 business tenants, many of which expand, contract or relocate on a constant basis. SCHAFERRICHARDSON is accustomed to dealing with all of the issues of business relocation on a daily basis, and employs two full-time leasing agents, and its own construction company, to assist those businesses. 3.2.3 3.2.4 Sherman Associates has redeveloped three commercial projects that incorporate existing local businesses. The process involved extensive negotiations with the local businesses to evaluate their desires and abilities to fit into the proposed redevelopment. The negotiating included discussions on acquisition or relocation benefits and negotiating new lease agreements. The process also involved having to buy their existing on-site and off-site facilities and designing new and improved operating facilities. Examples include: Kenwood Isles Camden Center Hawthorn Crossings YMCA & Allina Medical Center Camden Physicians US Bank, North Memorial Medical Center Demonstrated Ability to Move from Concept Stage to Construction Completion S CHAFERRICHARDSON has recently completed over $14 million dollars of projects in the past 18 months, most of which was handled in-house by its own staff and its owned affiliate, SR Construction. Sherman Associates has successfully completed over forty housing and commercial projects totaling over $350 million dollars. In addition, there are currently nine projects under construction totaling in excess of $100 million dollars. All of these projects successfully moved from concept stage to construction within a reasonable time frame. A very similar project known as, "The Shores Senior Apartments", is located in Shoreview, Minnesota. The City of Shoreview selected Sherman Associates, Inc. as the developer in February of 2001 and construction commenced eight months later on October 1, 2001. Experience in the Redevelopment Process Virtually all of SCHAFERRICHARDSON's redevelopment projects have been within the central cities, involving all levels of public review and approvals, as well as state review and approvals. Many of the projects have involved both the MPCA and the SHPO offices, and two projects required State and Federal review and approval. Substantially all of Sherman Associates' redevelopment projects have involved numerous regulatory agencies. We have direct contact with local, county, state and federal regulators and have experienced consultants. 3.2.5 Sherman Associates experience includes: Obtaining Minnesota's "first" Brownfield Closure on a housing project in 1988 Numerous permits approved with DNR on wetland-impacted projects Relocation and installation of existing city and county utilities Acquisition and relocation of railroad right-a-ways Acquisition, land swap and relocation of highway right way The investigation, action plan, and closure with MPCA on numerous railroad and gas station contaminated sites. Ability to Establish Effective Working Relationships with the City and Community SCHAFERRICHARDSON has in the past 6 ½ years successfully established a working relationship with staff and council members in Minneapolis and St. Paul. Virtually all of SCHAFERRICHARDSON's redevelopment activity has been privately funded. Sherman Associates is routinely asked to facilitate redevelopment due to our expertise and ability to work with neighbors, property owners and city officials and staff. The relationships most of[en start with informal introductions and time and again progress into long-lasting working relationships. The ability to work with complicated relationships is why Sherman Associates is asked back by the cities. These relationships involve: Planning and design process with neighborhoods and city officials Land acquisition from existing landowners Addressing relocation and incorporating of tenant Involving neighbors and neighborhoods with marketing and managing 3.3 FINANCIAL CAPABILITY 3.3.1 3.3.2 3.3.3 Financial Capability SCHAFERRICHARDSON has developed a portfolio of properties in the past 6½ years through private financing and partnership syndication, with projects ranging from $1 million dollars to $13 million dollars in size. Sherman Associates has substantial financial capability to secure project financing and equity. We routinely finance through equity and debt $5 to $50 million dollar projects. Financial Planning Capacity The joint venture team has a combined staff with extensive experience in banking, commercial mortgage lending and financial accounting. These skills and abilities, combined with twenty-five years of actual development experience, provide the capacity to prepare project proformas and financial plans that then lead to successful projects. Demonstrated Record of Meeting Project Financial Commitments SCHAFERRICHARDSON is able to forecast and track project costs due to its past experience in redevelopment and due to its ownership of an in-house construction company. Sherman Associates has very current information on development costs, construction costs, market rate rents, and mortgage underwriting. This current and real-life information allows us to demonstrate early on a project's feasibility. 3.4 DESIGN EXPERIENCE The joint venture team has chosen the design firm of Elness, Swenson and Graham to provide planning and architectural services for the project. Included in this submittal is material demonstrating the design capacity, flexibility and creativity of Elness, Swenson & Graham. The development team would appreciate the opportunity to review with the City of Columbia Heights, photos and slides of completed projects demonstrating design capacity and flexibility. All members of the development team routinely adapt plans to meet local design criteria. INTRODUCTION Elness Swenson Graham Architects Inc. OUR HISTORY Since the early 70's, Elness Swenson Graham has helped clients create environments for business and community. Beginning with the early days and along our journey to becoming the firm we are today, our commitment to excellence has remained consistent. We are proud of our national architectural practice and its over 70 talented staff members with projects that span across more than half of the fifty states. OUR SERVICE An award winning architecture, master planning and interior design team leads every project with Elness Swenson Graham. We create with clients in the following primary markets: · Hotels, Conference Centers, and Resorts · Corporate/Commercial Office Workplace Environments · Student Housing · Multi-Family Housing · Senior Housing We are known for our innovative architectural designs that envelope our clients' needs while meeting the technical requirements of each development. COMMITMENT TO QUALITY - · Creative architectural design · Exceptional service · Delivering design solutions that are consistently creative and cost-effective · Commitment to the quality of our people, processes and documents · Consistently working with clients to identify and solve their problems or challenges · Revitalizing urban neighborhoods through innovative site planning and urban design · Earning more than 60 local and national design awards TEAM PLAYERS Elness Swenson Graham is known as a company of team players who respect all participants in the development process. We encourage participation by clients, consultants and contractors and we utilize and appreciate their expertise. 24740~- 12 ,¢,l t~lttl'SS ~"tCCt~."0t~ (~r, dta,I .drchitect.~ [itc. MULTI-FAMILY RESIDENTIAL CAPABILITIES Elness Sxvenson Graham Architects Inc. MULTI-FAMILY RESIDENTIAL For more than three decades, Elness Swenson Graham has been a leader in multi- family residential design with a track record of constructing over 30,000 dwelling units. We have worked with private developers as well as numerous public agencies and housing authorities to create: · Multi-family housing · Student housing · Senior housing Whether the design is single-story, Iow-rise, mid-rise or high-rise, we take the lead in understanding the trends that are shaping the future in this industry. STUDENT RESIDENTIAL The design leadership in student residential environments at Elness Swenson Graham is responsive to the needs of students. We do our homework and identify the key trends in student residential life. We have created over 5,000 beds of student housing and we've worked for public and private universities and colleges, and for-profit and non-profit organizations. When it comes to student residential, we are recognized for our design leadership in all aspects, including campus planning, architectural design and project delivery. Our innovation is evident in our; · Student Apartments · Residence Halls · Dormitories (both new and renovated construction) excel when it comes to: We · Creating a living-learning community · Designing architecture that is supportive of campus and urban design goals · Focusing on quality building construction at the best value · Meeting the financial criteria of each individual campus or location RESIDENTIAL MASTER PLANNING The diverse blend of knowledge and skill of the Elness Swenson Graham team is a perfect fit for large, environmentally complex development projects. We understand land development issues, so we create master plans that utilize the natural features of MULTI-FAMILY RESIDENTIAL CAPABILITIES Page 2 the land while preserving its intrinsic character. Balance is important, so we work to: · Protect habitats · Emphasize indigenous or natural features · Lay out appropriate utilities and transportation systems · Design physical improvements on the land · Secure necessary agency approvals SENIOR HOUSING Elness Swenson Graham believes seniors are a vital part of our communities and residential housing environments need to reflect that vitality. We havea reputation as innovators in senior living environment design. To date, we have completed over 5,000 units of senior housing. Through architectural design, Elness Swenson Graham can help you create an environment compatible with your mission, program and resident needs. We have focused on senior housing for close to 20 years. Our philosophy on the creation of "home" applies to every building whether it's active adult or housing with services. It all boils down to integrating the image and function of the building with the needs and comfort of the residents. RESIDENTIAL DESIGN EXPERIENCE Elness Sxvenson Graham Architects Inc. MARKET RATE RENTAL APARTMENTS The Oaks (90 units) Richfield, MN (New Construction) Lowry Building (80 units) St. Paul, MN (Renovation) Promenade Oaks (283 units) Eagan, MN (New Construction) The Conservatory (318 units) Minnetonka, MN (New Construction) Farnam 1600 (71 units) Omaha, NE (Renovation) LeMay Lake (282 units) Eagan, MN (New Construction) Oakland Square (31 units) Minneapolis, MN (Renovation) Greenhaven (153 units) Burnsville, MN (New Construction) 412 Ridgewood (4 units) Minneapolis, MN (Renovation) St. Anthony Place (21 units) Minneapolis, MN (Renovation) Calhoun Beach Club (56 units) Minneapolis, MN (Renovation) DeForest at Laurel Village (75 units) Minneapolis, MN (New Construction) The Pines (26 units) Eagan, MN (New Construction) Austin Courtyard II (75 units) Austin, MN (New Construction) Rochester HRA (45 units) Rochester, MN (New Construction) Austin Courtyard (78 units) Austin, MN (New Construction) Stratford Oaks Design (328 units) Eagan, MN (New Construction) Multi-Use Redevelopment M.P. (366 units) Columbia Heights, MN (Renovation) Coachman Trails (152 units) Plymouth, MN (New Construction) Millplace Mixed-Use M.P. (196 units) Minneapolis, MN (Renovation) College Hill I & I! (10 units) St. Paul, MN (New Construction) Hampshire Hills (120 units) Bloomington, MN (New Construction) White Bear Lake Apts. (120 units) White Bear Lake, MN (New Construction) Riverwalk Residential (170 units) Minneapolis, MN (Renovation) Cinnamon Ridge(48 units) Keystone, CO (New Construction) Winterset (63 units) Keystone, CO (New Construction) RESIDENTIAL DESIGN EXPERIENCE Page 2 AFFORDABLE RENTAL APARTMENTS MARKET RATE RENTAL TOWNHOMES Gates of Carlson Park (435 units) Minnetonka, MN (New Construction) Trinity Block Design (60 units) Minneapolis, MN (Renovation) Devonshire Gates (498 units) Bloomington, MN (New Construction) Chasewood Village (398 units) Minnetonka, MN (New Construction) Winterpoint Design (93 units) · Breckenridge, CO (New Construction) Illinois Center M.P. (2,600 units) Chicago, IL (New Construction) Southwind (320 units) Burnsville, MN (New Construction) Riverside Plaza (1,301 units) Minneapolis, MN (Renovation) Lakeview Commons (64 units) Plymouth, MN (New Construction) Cecil Newman Plaza & Courts (130 units) Minneapolis, MN (Renovation) Maryland House (79 units) Minneapolis, MN (Renovation) St. Anthony Gates (30 units) Minneapolis, MN (Renovation) Elliot Park II (25 units) Minneapolis, MN (Renovation) Grasslands Housing (24 units) Coon Rapids, MN (New Construction) Slater Square (160 units) Minneapolis, MN (Renovation) LaSalle Court (61 units) Minneapolis, MN (Renovation) Osage Hotel Conversion Design (38 units) Arkansas City, KS (Renovation) Elms, Roselle, Adams Bldgs. (226 units) Minneapolis, MN (Renovation) The Gilbertson & Firehall (39 units) Devils Lake, ND (Renovation) Elliot Court (57 units) Minneapolis, MN (Renovation) Van Cleeve Court (7 units) Minneapolis, MN (New Construction) Pelican Point II (96 units) Mound, MN (New Construction) The Pines (26 units) Eagan, MN (New Construction) Harriet Square (24 units) Minneapolis, MN (New Construction) St. Francis Woods (218 units) Eagan, MN (New Construction) Londonderry (40 units) Edina, MN (New Construction) Town Oaks (112 units) Edina, MN (New Construction) Towndale (57 units) Minneapolis, MN (New Construction) AFFORDABLE RENTAL · TOWNHOMES Trinity Block (20 units) Minneapolis, MN (New Construction) Greenway Townhomes (13 units) Minneapolis, MN (New Construction) Rollins Court (10 units) Minneapolis, MN (New Construction) Ouisconsin Court (12 units) Minneapolis, MN (Renovation) The Vinings (224 units) Woodbury, MN (New Construction) RESIDENTIAL DESIGN EXPERIENCE Page 3 Manor Homes of Normandale Bloomington, MN (New Construction) Manor Homes of Edina Edina, MN (New Construction) Fairway Woods Eden Prairie, MN (New Construction) Lakewood Village (16 units) Cable, WI (New Construction) Shelter Highview Commons (96 units) Savage, MN (New Construction) St. Paul Infill (20 units) St. Paul, MN (New Construction) Columbine Road (32 units) Eden Prairie, MN (New Construction) Jefferson Square (50 units) Northfield, MN (New Construction) Cedar Riverside Block 40 Rehab (21 units) Minneapolis, MN (New Construction) Oakdale Square (31 units) Minneapolis, MN (New Construction) Minnehaha Court (24 units) St. Paul, MN (New Construction) Cedar East/Riverside Park Infill (39 units) Minneapolis, MN (Renovation) Shelter Rochester (90 units) Rochester, MN (New Construction) Columbia Heights Townhomes (20 units) Columbia Heights, MN (New Construction) Lewiston Family Townhomes (12 units) Lewiston, MN (New Construction) Minnetonka Mills (30 units) Minnetonka, MN (New Construction) Dakota Square Apartments (55 units) Aberdeen, SD (New Construction) 1500 Perkins Creek (48 units) Windom, MN (New Construction) Alexandria Townhomes (40 units) Alexandria, MN (New Construction) Hillside Terrace Townhomes (14 units) Long Lake, MN (New Construction) RESIDENTIAL DESIGN EXPERIENCE ?.~g¢ 4 OWNER OCCUPIED C OND OMINIUMS OWNER OCCUPIED TOXVNHOMES Cedar East/Riverside Park Rehab (26 units) Minneapolis, MN (New Construction) Camber Hill Townhomes (44 units) South St. Paul, MN (New Construction) Prairie Oaks (16 units) Minneapolis, MN (New Construction) Elliot Park II (25 units) Minneapolis, MN (Renovation) College Drive (30 units) Brainerd, MN (New Construction) Eastgate Townhomes (46 units) Montevideo, MN (New Construction) Lakeview Commons (64 units) Eden Prairie, MN (New Construction) Bradley Terrace (30 units) St. Paul, MN (New Construction) Cedar Riverside Block 40 Infill (11 units) Minneapolis, MN (New Construction) Sun Rise Estate (46 units) Jackson, MN (New Construction) Sheridan Place (7 units) Minneapolis, MN (New Construction) Burnsville Family Townhomes (22 units) Burnsville, MN (New Construction) Duluth Ramsey (40 units) St. Paul, MN (New Construction) Gorman-Fitchburg (78 units) Fitchburg, WI (New Construction) East Bank Village Condominiums and Brownstones (96 units) Minneapolis, MN (New Construction) Harrington House Condominiums Wayzata, MN (New Construction) Park Tower Condominiums (27 units) St. Paul, MN (New Construction) Summit Townhomes (8 units) St. Paul, MN (New Construction) Normandale Terrace (48 units) Bloomington, MN (New Construction) St. Albans Bay Villas (24 units) Excelsior, MN (New Construction) Widsten Townhomes (45 units) Wayzata, MN (New Construction) Coventry at Centennial Lakes (98 units) Edina, MN (New Construction) East Bank Village Townhomes (48 units) Minneapolis, MN (New Construction) Lake Phalen Townhomes (46 units) St. Paul, MN (New Construction) RESIDENTIAL DESIGN EXPERIENCE Page 5 SINGLE RESIDENT OCCUPANCY (SRO) Elliot IV (226 units) Minneapolis, MN (Renovation) LaSalle Court (61 units) Minneapolis, MN (Renovation) Elliot Court (57 units) Minneapolis, MN (New Construction) Burl Manor (38 units) Minneapolis, MN (New Construction) Slater Square (160 units) Minneapolis, MN (Renovation) MULTI-FAMILY RESIDENTIAL RF~F:ERENCES Elness Swenson Graham Architects Inc. HEALEY RAMME Mr. Peter Ramme, Owner Healey Ramme Company 10601 Smetana Road, Suite 122 Minnetonka, MN 55343 (612) 931-2220 HUNTGREGORY Mr. Dan Hunt Mr. Arnie Gregory HuntGregory 129 North 2"" Street, Suite 100 Minneapolis, Minnesota 55401 (612) 630-2448 SHELTER CORPORATION Mr. Jay Jensen, Senior Vice President Ms. Lynn Carlson Schell, President Shelter Corporation 900 Second Avenue South, Suite 880 Minneapolis, Minnesota 55402 (612) 341-7800 TOLD DEVELOPMENT Mr. Gary Dreher Mr. Bob Cunningham TOLD Development Company 6385 Old Shady Oak Road, Suite 120 Eden Prairie, Minnesota 55344 (952) 278-0114 CENTEX Mr. Roger Fraley, Project Manager Centex Multi-Family Company 3100 McKinnon Street, Suite 370 Dallas, Texas 75201 (214) 981-6227 MULTI-FAMILY RESIDENTIAL ~NCES Page 2 OPUS Mr. Tom Lund Opus Architects and Engineers 10350 Bren Road West Minnetonka, Minnesota 55343 (952) 656-4444 CORNERSTONE GROUP Ms. Colleen Carey Cornerstone Group 1088 Lincoln Avenue St. Paul, MN 55105 (612) 222-2988 LAUKKA JARVIS Mr. Peter Jarvis Laukka Jarvis Inc. 3300 Edinborough Way, Suite 201 Edina, MN 55435 (612) 896-1971 DAKOTA COUNTY HRA Mr. Mark Ulfers, Director Dakota County HRA 2496 145'h Street West Rosemount, MN 55068 (612) 423-4800 AUSTIN HRA Mr. Kermit Mahan, Director Austin HRA 200 First Avenue NE Austin, MN 55912 (507) 433-1866 RESIDENTIAL DESIGN AWARDS Elness Sxvenson Graham Architects Inc. BOULEVARD GARDENS Minnetonka, Minnesota 1997 MADACS Property Excellence Award: Affordable Senior Housing Minnesota Multi Housing Association BUR1 MANOR Minneapolis, Minnesota 1987 Award Committee on Urban Environment COLUMBINE ROAD Eden Prairie, Minnesota 1998 MADACS Best Signage On-Site Minnesota Multi Housing Association 1997 MADACS Best Landscape Design Minnesota Multi Housing Association DINNAKEN RESIDENCE Minneapolis, Minnesota 1990 Achievement Award Minnesota Masonry Institute EDINA PARK PLAZA Edina, Minnesota 1988 Achievement Award Minnesota Masonry Institute ELDER HOMESTEAD Minnetonka, Minnesota 1992 National Seniors' Housing Gold Seal Award NC©SH/NAHB HARRIET SQUARE Minneapolis, Minnesota 1986 Honor Award Minnesota Society, American Institute of Architects JEFFERSON SQUARE Minneapolis, Minnesota 1981 Honor Award Minnesota Society, American Institute of Architects MINNESOTA MASONIC HOME Bloomington, Minnesota 1995 National Gold Seal Award for Design Excellence National Council on Seniors' Housing; NAHB MINNETONKA MILLS Minnetonka, Minnesota 1998 MADACS Property Excellence Award: Best New Development Minnesota Multi Housing Association OAKWOODS OF EAGAN Eagan, Minnesota 1993 National Honorable Mention The Best of Seniors' Housing Award; National Council of Seniors' Housing Ehu:~s .c, wens,m Craham Architects hw. RESIDENTIAL DESIGN AWARDS Page 2 PIONEER MANOR White Bear Lake, Minnesota 1995 National Silver Seal Award for Design Excellence National Council on Seniors' Housing; NAHB PI,YMOUTH TOWNE SQUARE 1717 mouth, Minnesota 1996 National Honorable Mention National Council on Seniors' Housing; NAHB PRAIRIE OAKS Minneapolis, Minnesota 1985 Honor Award Minnesota Society, American Institute of Architects REMICK RIDGE Windom, Minnesota 1997-98 National Citation Award Design for Aging Review; AIA / AASHA 1997 National Gold Seal Award for Design Excellence National Council on Seniors' Housing; NAHB ROSEWOOD ESTATE Roseville, Minnesota 1992 National Citation Award Design for Aging Review; AIA / AAHA THE FOUNTAINS Melbourne, Florida TIMBERTON Plymouth, Minnesota 1988 Aurora Merit Award Southeast Builders Conference; Best Life Care Housing of the Year 1985 Reggie Award Minneapolis Builders Association TOWN OAKS TOWNHOMES Minneapolis, Minnesota 1975 National Award for Excellence Design and Environment VILLAGE OF ALAMEDA Albuquerque, Ne~v Mexico 1997-98 National Design Award Design for Aging Review; AIA / AAHSA WALKER ELDER SUITES Edina, Minnesota 1993 National Architectural Design Award Contemporary Long Term Care Magazine 24100- 10 ~X E]IIC$$ ~Wetl~Ot! (?,raham ,4 rchitects [l~c. EXCELSIOR & GRAND St. Louis Park, Minnesota COURT AVENUE NEIGHBORHOOD Des Moines. Iowa The Vine Street Community is a residential redevelopment in Des Moines Iowa which contains structured parking, apartment fiats and owner occupied townhomes and condominiums. The Vine Street Community is part of an overall City of urban design redevelopment initiative for the Des Moines River Front and the Court Avenue Neighborhood. Construction for the project will commence in the spring of 2002 with completion in 2003. RIVERBLUI:F NEIGI-IBORI-IOOD -WEST 7TH STI~I~.ET St. Paul, Minnesota The vision for the Riverbluff community is a vibrant, pedestrian and transit oriented traditional neighborhood. Emphasis will be place on the creation of a strong public realm made up of key layers including streets and blocks, and green and blue amenities. The master plans include approximately 739 new residential dwelling units and 23,000 sf of neighborhood retail and commercial space. The majority of the neighborhood will be made of owner occupied single family homes, townhomes, single level flats and lofts. The Riverbluff will connect the new and existing neighborhoods to the river through a series of green streets, parks and scenic outlook points. The proximity to downtown St. Paul, Highland Park and Interstate 35E make it an excellent location. :/ /// / / /" ,/ Key Master Plan Design Layers - Streets and Blocks - Green Structure - Blue $¢ructure Land Use/Residential M~ Phasing/(Phase I Definftion) Architectural Character Stuoies Utility Systems Traffic Transit Soil Conditions NEAR NORTHSIDE Minneapolis, Minnesota Aerial Plan Courtesy of Urban Design Associates RICHFIELD URBAN VILLAGE Richfield, Minnesota RICHFIELD URBAN VILLAGE I~ichfield, Minnesota CENTENNIAL LAKES Edina, Minnesota THE VILLAGE AT SAINT ANTHONY FALLS DEVELOPMENT Minneapolis, Minnesota THE COVENTRY TOWNHOMES Edina, Minnesota HENNEPIN AVENUE DEVELOPMENT Minneapolis, Minnesota TRINITY PARK APARTMENTS AUGSBURG RO'W'HOUSES Minneapolis, Minnesota LAKE PHALEN TOWNHOMES Saint Paul, Minnesota The Lake Phalen project consists of twenty- nine units of for-sale townhomes. The town- homes are part of an area redevelopment plan for the City of Saint Paul. The units consist of 22 tuck-under style townhomes with front porches and entries to maintain the character of the existing neighborhood. Seven units are one level flats that open up to newly created we created wetland amenity and an existing wooded area. 4.0 REFERENCES SCHAFERRICHARDSON INC. City of St. Paul Contact: Bob Schrier ~ 651-266-6684 A1 Carlson ~ 651-266-6616 City of Minneapolis Contact: Paul Ostrow ~ 612-673-2201 3. Excel Bank Contact: Dan Poppe @ 952-836-3032 SHERMAN ASSOCIATES 1. City of Shoreview Contact: Tom Simmonson @ 651-266-6565 Project: the Shores Senior Apartments 2. City of St. Paul Contact: A1 Carlson ~ 6'51-266-6616 Project: Sibley Park 3. City of Minneapolis Contact: Jerry Boardman ~ 612-673-5095 Project: Various RESUME OF SCHAFERRICHARDSON INC. SCHAFERRICHARDSON is a real estate development company specializing in urban projects which add value and character to the various communities in which it is active. Concentrating primarily on commercial redevelopment and the rehabilitation of older, inner-city properties, SCHAFERRICHARDSON has control of over 20 properties containing over 1.8 million square feet. Recently SCHAFERRICHARDSON has moved into the housing market, forming a joint venture with Sherman Associates to convert an existing historic commercial structure into for-sale housing units, while constructing new apartments above a year-round Farmer's Market in St. Paul. In addition, SCHAFERRICHARDSON controls a number of parcels of land in the North Loop/Warehouse District of Minneapolis where approximately 500-600 residential units could be developed. SCHAFERRICHARDSON is wholly owned by Brad Schafer and Kit Richardson. Mr. Schafer spent over ten years at Griffin Real Estate Company as an investment broker; prior to that, he was employed by Merrill Lynch. Mr. Richardson, a Registered Architect, spent over eight years at Griffin Real Estate Company as an investment broker prior to forming SCHAFERRICHARDSON. Mr. Richardson worked for Ralph Rapson & Associates for a number of years before forming his own architectural firm in Minneapolis. RESUME OF SHERMAN ASSOCIATES, INC. Sherman Associates specializes in the design, construction and financing of quality housing and commercial properties in Minnesota, and the adjoining four state area. Sherman Associates has developed and rehabilitated over 4,000 multi-family and single-family homes and over 2 million square feet of commercial property. These developments include a diversified range of luxurious single- family homes, million dollar plus townhouses, and over a variety of low and moderate income, quality tax credit housing units. The experience also includes construction of new retail commercial buildings and office warehouse facilities. With over twenty-three years of development and construction experience, we are able to offer a diverse range of services in the single family, multi-family and commercial markets. They encompass: * Development Services * Financial Analysis/Feasibility * Site Analysis * Marketing Programs/Feasibility * Architectural Design * Design Build Services * Construction * Equity and Debt Funding * Federal, State Housing Programs * Property Management Services Awsumb and Associates, Inc. 3989 Central Avenue N.E., Suite 200 Columbia Heights, MN 55421 Contact: Gordon S. Awsumb, President 763-781-6352 Status of Application: RFQ Requirements Met Strengths: The team assembled has a proven track record in small urban redevelopment projects involving multi-family residential, commercial/office, and industrial components. A plan is offered for partial redevelopment of the site, but is incomplete with no supporting data. They state that they are likely to use tenants of the Business Incubator to fill the industrial space. Located in Columbia Heights, the team would be motivated to work with the EDA. Concerns: It would be the company's largest project triggering concerns about management and financial capacity to carry out the project, particularly if they add other projects to do in the future. While they know the market, do they have the experience to pull together all of the needed elements, particularly state agencies, relocation, and planning with the community. H:~lndustrial Center~Awsumb & Associates Staff review "-- 0 ~ X X X X 0 z ~  ~ 0 0 z z z z INDUSTRIAL CENTER REDEVELOPMENT PROJECT 'AN IMMEDIATE OPPORTUNITY TO ACCOMMODATE AN EXISTING BIOMEDICAL MANUFACTURING COMPANY' AND THE POTENTIAL FOR DOZENS OF PARKSIDE HOUSING UNIT TYPES DEVELOPMENT TEAM AWSUMB & ASSOCIATES, INC. GORDON S. AWSUMB, PRESIDENT 3989 CENTRAL AVE. N. E. SUITE 200 COLUMBIA HEIGHTS, MN 55421 Office: 763-781-6352 Fax: 763-781-8044 Cellular: 612-961-8971 gordon@awsumbassociates.com awsumbassociates.com SHEA, INC. MIKE KRAFT, ARCHITECT BUTLER SQUARE, SUITE 650C MINNEAPOLIS, MN 55403 Office: 612-349-2217 Fax: 612-349-2930 e-mail: mikek@shealink.com GENESIS BUSINESS CENTERS, INC. HARLAN T. JACOBS, PRESIDENT 3989 CENTRAL AVE. N.E., SUITE 650 COLUMBIA HEIGHTS, MN 55421 763-782-8576 e-mail: HarlanJacobs @ genesiscenters.com May, 2002 INDEX DEVELOPMENT TEAM DEVELOMENT/DESIGN APPROACH EXPERIENCE/CAPABILITIES MAP OF INDUSTRIAL AREA/DRAWINGS OF TOWNHOUSES/ INDUSTRIAL BUILDING DISCUSSION OF REDEVELOPMENT CONCEPT AND PHASES AWSUMB & ASSOCIATES PROJECTS AND RELEVANT EXPERIENCE GENESIS BUSINESS CENTERS SHEA, INC. SECTION I SECTION II SECTION IH SECTION IV SECTION V SECTION VI SECTION VII 2 SECTION I DEVELOPMENT TEAM/INFORMATION Our primary team consists of Awsumb & Associates, Inc. as developer, Genesis Business Centers, Inc. as industrial tenant recruiter, and Shea Architects, Inc. as architect and consultant. If we are selected, our aff'diated team members will include, Mr. Roger Jensen, Executive Director of the Anoka County Development Partnership, Dave Forsythe and Don Ronnigan, realtors with Edina Realty Northeast Minneapolis. Awsumb and Associates, Inc. has a proven track record in urban redevelopment that includes the following successful private-public partnerships in real estate ventures: e The Holland Neighborhood Association, the Minneapolis Community Development Agency, and the Minneapolis Neighborhood Revitalization Program awarded Awsumb & Associates, Inc. the development rights for the townhouse site at 24th and Jackson Streets in Northeast Minneapolis, in 2001. This is the first phase of a collaborative effort at urban in-ifil housing in the Holland and other Minneapolis neighborhoods. An extensive design development process with neighborhood input, has led to a prototype housing product that fits the character of the neighborhoods. The units will be constructed at an affordable price range using union labor. Construction of a model that will be available in late July, is underway. (See attached Section V) Awsumb & Associates, Inc., in 1999 and 2000, was selected as redeveloper through an RFP process for two projects in Downtown Robbinsdale, Minnesota. The properties reached 100% occupancy last year. Tenants included are, a f'me dining restaurant, professional offices and service retailers. (See Section V) As par~ of the acquisition and syndication of the Columbia Heights Business Center in 199(~, Awsumb & Associates, Inc. collaborated with Genesis Business Centers, the Anoka County Economic Development Partnership, and the City of Columbia Heights, Minnesota, to raise the occupancy rate from 30% to 90%. Many high-tech and bio-medical businesses are located in Columbia Heights Business Center as a result of this joint effort. The City has helped in many ways, such as assistance in Financing security camera enhancements in the municipal parking ramp, and providing excellent police response. SECTION I continued In 1994, Awsumb & Associates, Inc. successfully collaborated with then St. Paul, Minnesota Mayor Norm Coleman and the SL Paul Port Authority to renovate an industrial building for BMC Industries. BMC, a mainstay St. Paul employer, was poised to leave its out-dated facilities because of huge capital investment requirements, union negotiations difficulties, and the perception of an unfriendly business climate. This public-private effort succeeded in making possible a Department of Trade and Economic Development package that assisted BMC Industries in updating its facilities. As Property owners, we pledged further private investment that resulted in the Port Authority's agreement to provide further low cost f'mancing to BMC. Our collaborative effort saved hundreds of jobs in SL Paul (See attached article in Section V). Awsumb & Associates, Inc., in 1993, was selected as redeveloper for the defunct regional mall in Downtown Mankato, Minnesota. After a difficult seven-year redevelopment process and more than $3,000,000 in private capital infusion, the entire Downtown core of Mankato has I~een transformed into a vibrant office and entertainment sector. (See Section V) Gordon Awsumb, president of Awsumb & Associates, Inc., has 27 years of experience in all aspects of real estate development. Currently, we employ 30 people in two offices, one in Columbia Heights, and the other in Mankato. Our staff includes marketing, construction and maintenance personnel. Harlan T. Jacobs, president of Genesis Business Centers, Inc., and the Anoka County Economic Development Partnership were responsible for recruiting 14 new companies to the Columbia Heights Business Center. Many new high- paying jobs were created. Genesis and ACEDP have also collaborated to create a fully leased industrial incubator building in Elk River, Minnesota. Harlan Jacobs-is a consultant to dozens of economic development entities, including organizations in Switzerland, Sweden, and Israel. (See Section VI) Shea Architects, Inc. has worked on most of Awsumb & Associates, Inc. development efforts. Shea Architects, Inc., a national firm based in Minneapolis, has extensive experience in all aspects of urban redevelopment. Their most recent high-pro£de project in Minneapolis, was the redevelopment of the Milwaukee Railroad Depot into a complex of restaurants, ice skating rink, and hotel. Mike Kraft, Shea's senior team architect, has worked on aH projects mentioned above. (See Section VII) 4 SECTION I continued AFFILIATED TEAM IV[EMBERS Edina Realty's Northeast Minneapolis office has teamed with Awsumb & Associates, Inc. to market the new Holland Neighborhood townhouses. Don Ronnigan and Dave Forsythe of Edina Realty, will provide market research and marketing for the residential component of our proposed redevelopment in Columbia Heights. Anoka County Economic Development Partnership and Genesis Business Centers have jointly developed the business incubators in Columbia Heights and in Elk River. Roger Jensen, Executive Director of the ACEDP, has expressed the Partnership's desire to work with our team in facilitating an industrial business incubator building, if we are chosen as the developer. .- 5 SECTION II DEVELOPMENT/DESIGN APPROA CH/EXPERIF~NCE/CAPABILITIES Our approach to redevelopment has been to give something back for the public incentives given to us to make redevelopment projects viable. In Mankato, Robbinsdale, and the Holland Neighborhood, the public sector participated in a share of the profits generated by the projects. We are proposing a similar approach to the redevelopment of the Columbia Heights Industrial redevelopment area. This public-private partnership allows the community to capture and re-leverage its investment. It also gives the community an incentive to examine the design and development trade-offs as the private sector does. Our team has a proven record of f'mancing very difficult redevelopment projects. These are all seasoned-proven properties after redevelopment. Our success is due to investment in market research, accurate projections and proformas, and focused marketing. Our collaborative development and design approach has won the development rights to numerous public competitive processes. Our ability to work effectively with Cities has allowed us to: a. Convert a functionally obsolete regional retail mall in downtown Mankato with ground-water pollution issues into a stable, successful property. bo Convert under-utilized surface parking lots in the northeast Minneapolis Holland neighborhood into a townhouse project that fits the neighborhood's historic character. c. Convert a dilapidated municipal liquor store into a fine-dining restaurant. d. Convert a run-down used furniture store into a renovated office/service complex. Reposiflon an economically obsolete multi-story manufacturing plant in downtown St. Paul, into a modern high-tech processing facility for BMC Industries, Inc. We have been able to overcome all of the development challenges involved with a long-term perspective, tenacity and team effort. uJ Cf) I' ~ s ld NOSIClV~I i Holland Neighborhood Townhomes I I Holland Neighborhood Townhomes SECTION IV DISCUSSION OF REDEVE~LOPMENT CONCEPT AND PHASE£ Although you requested only qualifications, we wanted to present some preliminary ideas for redevelopment, as well. To that end, attached in Section IH, is a map of the Columbia Heights industrial redevelopment area. Phased development of underutilized land is shown for office/warehouse facilities and housing. Two phases of single and two story townhouses, totaling 69 units, are shown to the north of a realigned 39th Avenue. This realignment would take small portion of the large front lawn of the Schaeffer-Richardson Warehouse facility on 39th Avenue. However, use of the vacated 39th Street and taken land, allows for construction of 44 units fronting Huset Park. The truck trailer parking lot at the intersection of 39th Avenue and Jefferson Streets, would be a viable site for residential rental apartment units. These would act as a buffer between the industrial area and the single family townhouse area. We see these areas as the first phase of residential redevelopment, because the cost of acquiring raw land without buildings would likely allow a more viable economic acquisition basis. The proposed Phase 1 of office warehouse flex space, is at the intersection of University and 37th. On the surface, the property will be easier to assemble, economically, because of the under-utilization of the site. Under the ground, it probably becomes a more difficult redevelopment effort. For pollution issues we propose working with Peder Larson Consulting, LLC. Mr. Larsen is the former head of the Minnesota Pollution Control Agency under Governor Arne Carlson. Since he started his consulting business, he has helped expedite closure letters for us and many other developers. Mr. Larson can interpret the pollution concerns and economic issues from the regulatory and private sector perspectives. Phase 2 of the industrial area should, probably, be approached on a negotiated incentive basis with the current owner of the property. Many tough design and economic issues need to be addressed with this property. Unfortunately, if they are not solved, the feasibility of the housing and office-industrial development becomes tenuous. A viable market plan for the property needs to be in place in order to implement Phase 1 of the residential and office-warehouse development With success in bringing to market the first phases, we see the relocation of the existing industrial buildings along Hnset Park between Jefferson and Jackson Streets, becoming more economically possible. Some could, perhaps, be relocated to the Phase 1 office and industrial parcel. An established market for the housing will allow more value to be assigned to those parcels of land, as well. The site at the northwest corner of 39m and Jackson, is large enough to accommodate a multi-story condominium project This is a proven concept in Columbia Heights, and should be a success as part of the Phase 2 concept SECTION IV~ continued The reality of this redevelopment opportunity is that much of the demand for housing, as identified in the City's February 1998 Life Cycle Housing Study, can be developed surrounding Huset Park. The park is a tremendous amenity to already have in place. Awsumb & Associates, Inc. and Shea Architects, Inc. have developed prototype single and two level townhouses with classic period design. These units range from 1400 to 2200 square feet. They are affordable to build with union labor, and can be marketed to sell for $170,000 to $200,000. Elevations and floor plans of these prototypes are in Section HI. Also in Section IH, is a rendering of the facade of an office-warehouse flex building. We propose using brick on the facade to complement the objective of creating a gateway to the City of Columbia Heights. We have identified four potential tenants f6r up 30,000 square feet of Phase 1 of the office flex building. One of these tenants is a bio-medical manufacturer. In 1998, the Columbia Heights Business Center could no longer accommodate several tenants' assembly and distribution growth. When NT International and Visual Circuits relocated to the River Road Business Center in Fridley, Columbia Heights lost dozens of high-wage jobs, and 24,000 square feet of potential tenancy in its office-industrial park. Let's not lose the present opportunities. Genesis Business Centers and the Anoka County Economic Development Partnership can help f'dl the office-industrial park in Columbia Heights with dynamic new companies. The City of Columbia Heights has laid the groundwork for redevelopment, including, through its Downtown Master Plan. This document contains great concepts that can be adapted to the market realities of land acquisition, public resources, and private market economic forces. That adaptation is the area of expertise that we can .bring to the redevelopment project at hand. Columbia Heights has tremendous redevelopment opportunities. Our team is excited about the great potential. We are already heavily invested in Columbia Heights, and therefore, very motivated to work for the continued success of the community. Thank you for the opportunity to submit this proposal. Gordon Awsumb President AWSU1TID ff~ Associates ~ L. urrem rroj¢ct~ AWSUMB & ASSOCIATES Current Projects Mankato Place Revitalizing the Downtown Core: A Study in Successful Public-Private Cooperation Click to read more Robbinsdale Shops A New Retail Gateway He/ps Recreate An Historic Suburban "Main Street" Click to read more Columbia Heights Business Center Venture with Genesis Business Centers and Anoka County Development Fund Creates Fertile High Tech £ncubator Click to read more http://www, awsumbassociates.com/current.hlxnl 5/28/02 Awsumb & Associates- Current Projects Page 2 of 2 Shoreham Yards Minneapolis Imaginative Conversion of Historic Railroad Shops to High-Tech Office Space Click to read more Home I Current Projects / Construction Division / Property Management and Brokerage 3989 Central Ave. N.E., Suite 200 · Minneapolis, MN 55421 Phone (763) 781-6352 · Fax (763) 781-8044 2084 Mankato Place · Mankato, MN 56001 Phone 625-1400 Fax 625-9371 http://www.awsumbassociates.com/current.html 5/28/02 SAI~ PAU~ P~)NEGR PR.F~S BUSINESS D DAVE BEAL Minds unite to save mainstay employer Lders from organi,~d labor hnve handed the doors open at one of SL Paul's · oldest factories, the plant in Lowertewn. Now the accords they worked out are pumping new life into the ptant, part of BMC Xndustr~. The complicated agreements saved. 170 jobs, led the company to lease the property for five years with options for another I0, mdnd could generate up to $2.6 million in new investment. "It took the effort and dedication of a ~reat number of individuals to forge this solutinn,' says Joim Gburek, vice ~ mint businesses in trouble, we were having problems being ~Fne basic t~i,,g is, we're still in business mdmi trying to w,k, a So of it," adds Jim Stemms, & 3Z-year plant employee who is president of Local SA of Union. Things w~ren~ headed that way two yeats ago. BMC, losing money at its St. Paul plant, was thinking seriously of outlined the company's problems in St. Paul to Gordou Awsmmb, general property. Gbur~ md Paul Burke, CEO at BMC, talked to Norm Culeman, tbon Funning foF lnayor. atop his agendL So did Aws~smh md the St. Paul Port Authority. Efforts began to cat the company's leasing corn md its , more favorable union contract. The Port Autbority initiated negotiations that led to an improved lease. BMC had been hinting much more space than it needed at t~e si~ md it wanted dates into a single agreement. The company won a ,~ngle lease, at a more competitive rate, for about 30 percent less space ann it had been leasing. won from cotmty officials a property tax cut to about $75,000 annually from roughly $150,000. Nad the plant closed, the property likely would have produced very little property taxes. The Port Authority and a bondholder are putting $750,000 into the overall property, helping BM(: and other tenants. The state has a~reed to provide BMC with a forgivable loan of up to $375,000, ff BMC invests up to $1.5 mi!ltoll at the plant. The Port also is providing a $19,000 ~nmt to help the comlimny consolidate a small operation m Maplewood with a handful of jobs into the St. Paul plant. The company exercised its option on the new lease at the last minute, after the local narrowly OK'd a tht~y~ contract fre~ng wages and easing work rules. The workers, whose average age is 48, averted layoffs or a shutdown. "if the vote had gone tile other way, I don~t know what would have happened," says Gburek. Iowa was offering BMC up- front payments of about $2 million to Gburek says the plant must do more levels. Gains h-om ~ sales, an 9000 quality des~net~ md a new management information system could help dose that gap yet this year. BMC's plant, but tl~ place is no minimum*waso operatioo. It's been a mainstay ~n.ntoyer in tim city for 87 years. ~ 117 workers in its bargntning unit get paid .upto to $13 an hour, plus good benefits, make precision metal- large circuit boards. is awake and tsln~g in St. PauL" DM Beal Is senior business ecIItor. His column appears Sundays, Mondays and Fridays. Genesis Incubator Program Columbia Heights The Anoka County Economic Development Partnership in Collaboration with Genesis Business Centers, Ltd. and the Anoka Sherburne County Capital Fund announces the Expansion of the Columbia Heights Business Incubator Program. This expansion was made possible in large part by a grant from the McKnight Foundation according to Roger Jensen, the Executive Director of the Anoka County Economic Development Partnership (ACEDP) and the President of the Anoka Sherbume County Capital Fund. He also acknowledged the able assistance of the Columbia Heights EDA and the Anoka County Board of Commissioners in helping to estab- lish this program. He also cited the importance of the Urban Initiative Fund in helping to provide loans to those incubator companies that have qualified for that program. Roger Jensen Genesis Business Centers, Ltd. is the Manager of this incubator Fadlity. Its focus is to select the best and the brightest of the emerginH high tech businesses including start-ups and then help them to locate in this Facility. In the past, many suc- cessful local companies including Comedicus, Excorp Medical, Knowledge Frontiers, Med Link Medical, NT International, SurV'waLink, Traddng Technologies and Visual Circuits were part of the Genesis Program. Genesis Business Center Columbia Heights The unique private sector/public sec- tor collaboration that exists between the Anoka County Partnership and Genesis helps to make the incubator program companies successful. First and foremost, the incubator companies may receive an equity investment from the Capital Fund that can be matched by a loan from the Urban Initiative Fund. Then the rent that would otherwise be due for a one ),ear period is bartered for equity in the incubator company. This helps to conserve cash that can best be used for patents, prototypes, and market- ing programs. Genesis was founded by Harlan Jacobs in 1993. His background as the CFO for FilmTec Corporation which was acquired by Dow Chemical for $75 million in 1985 gave him good expe- rience in taidng start-cps to success. This experience helps Genesis to provide coaching and mentoring services to its incubator companies. Further, Genesis, through its role in co-founding The Minnesota PHvate Investor Enterprise, helps to make introductions to business angels that can help get these start up companies funded quickly. The Genesis Program is designed Harlan Jacobs with the high-cech entrepreneur in mind. If you are a founder, officer or director of a high-tech, start up company: you should learn about the benefits of ge~n§ your business started at the Genesis Business Center in Columbia Heights. For more information about Genesis, please contac: Harlan T. Jacobs, President Genesis Business Centers, Ltd. 3989 Central Ave. Columbia Heights, Mn 55421 Tel 612 782 8576 Fax 612 782 8578 email:TedGenesis~aol.com For information on the Anoka Sherbume County Capital Fund or the ACEDP contac: Roger Jensen, Executive Director Tel 612 786 0869 Fax 612 786 9051 BUSINESS CENTERS. LTD 46 VERTURES MAY t997 Robbinsdale Retail Development Whittier Neighborhood Grain Belt Landing Miiwaukae Road Depot Ci~/ of Centerviile Development Guidelines Grand Marais Conceptual Development Plan treet building setback along 26tt ~,'$~:', ".= sEWAKD PLACE ,?,, '...-? u ~.. ,? ,, ~ x , -- B ",'-e DeSt~u~tdtn~ -~ ~mieCt, out,t ~ ~_-- ~~~ m ~ ~-,: .... - " Ward Pla " ' ig G tine )-~ '~ -~ =':~- "~ '. Des n u/de s Klodt Incorporated 50 Groveland Terrace, Suite A Minneapolis, MN 55403-1100 Contact: Paul Klodt, President 612-374-1770 Status of Application: RFQ Requirements Met Strengths: Has experience in mixed-use development projects of the size of the Industrial Center Redevelopment Project. Well-established company with holdings in multi-family, hotel, commercial, and industrial projects. Good relationships and understanding of the development process with experience in major cities. Concerns: No current projects listed, or underway, on the list provided, so should have ability to finance- need more information on finances. Little information provided on the design team that would be used on the project. Small company- do they have the staff to commit to this large-scale project? H:~Industrial Center~Klodt Staff'review z 0 z ~ ~ ~ ~ w w - ~ ~ 0 ~ ~ w~ Z Zz Z Z Z x X~ x x-- X-- d Z KLODT INCORPORATED DEVELOPERS, CONTRACTORS 50 GROVELAND TERRACE, SUITE A MINNEAPOLIS, MINNESOTA 55403-1100 Phone: 612/374-1770 Fax: 612/374-1814 June 10, 2002 Industrial Center Redevelopment Center Redevelopment Project City of Columbia Heights 590 - 40th Avenue NE Columbia Heights, MN 55421 Attention: Randy Schumacher Acting Community Development Director Ladies and Gentlemen: Enclosed are ten (10) copies of our proposal in response to the Request for Qualifications relative to the Industrial Center Redevelopment Project. We appreciate the opportunity to introduce ourselves to the City of Columbia Heights and demonstrate our ability and our desire to participate in the revitalization of the city. Please contact us if you have any questions relative to our submission. Yours very truly, KLODT INCORPORATED Paul Klodt President Enclosure REDEVELOPMENT TEAM DATA In 1924, Frantz Klodt began his career as a homebuilder in Minneapolis. His son, Paul, joined his father in the family business in 1952. Klodt Incorporated was established as a Minnesota corporation in 1961. It is the parent company of many other corporations, partnerships and limited liability companies which operate under its umbrella. Paul Klodt, president and chief executive officer, has been a hands-on operator of his company since its inception. A profile of the company, which is, in effect, a profile of Paul Klodt, is enclosed, as are resumes of five of his key personnel. Paul and his employees office five days a week at 50 Groveland Terrace, Suite A, Minneapolis, Minnesota 55403. Their direct telephone numbers are as follows: Paul Klodt John Bell Lois Bredahl (contact) Paula Foley Stewart Rosen Gary Olsson 612-374-8280 612-374-8282 612-374-8283 612-374-8284 612-374-8288 612-374-8294 Facsimile 612-374-1848 The company has recently completed construction of The Metro, a mixed-use property at 9th and Marquette in downtown Minneapolis. We are currently leasing the apartments and retail space in the project. Under consideration, we have two multi family projects - one along the Hiawatha rail corddor at 46th Street and another in downtown Minneapolis at 5th Street and 2nd Avenue. The consultants we would most likely use for the development are: Architects: WCL Associates, Inc. 1433 Utica Avenue South, Suite 162 Minneapolis, MN 55416 612-541-9969 Engineers: Hanuschak Consultants Incorporated 28 Edmonton Street Winnipeg, Manitoba, Canada R3C1P7 2O4-956-2200 Financing: Heitman Financial Group 4750 IDS Center 80 South 8a Street Minneapolis, MN 55402 612-332-1603 Legal: Accounting: Contractor: Hanbery, Neumeyer & Carney, PA 3725 Multifoods Tower Minneapolis, MN 55402 612-340-9350 RMS McGladrey, Inc, 800 Marquette Avenue, Suite 1300 West Minneapolis, MN 55402 612-376-9505 Klodt Incorporated It is contemplated that the subject project will be privately developed, financed, owned and operated. REDEVELOPMENT TEAM EXPERIENCE As described in the Profile of Klodt Incorporated, our company has extensive experience in the field of development and redevelopment, having successfully completed nearly 100 projects in our forty year history. (Our list of projects is attached.) The project most similar to the Columbia Heights project would be our development in the Beltline Business Park in St. Louis Park. In the 1980s, we purchased fifty acres of railroad property on which we developed close to 400,000 square feet of commercial and industrial projects and over 400 apartment units. We worked with the neighborhood groups to obtain their approval; with the City regarding rezoning, variances and utilities; with the environmental groups regarding the polluted soil and water; and with the · tenants of the buildings. We obtained private financing for every individual property. As part of our property management expertise, we are constantly working with relocating and up-sizing tenants in our properties. Since we do all the tenant improvement construction ourselves, we are in an excellent position to adhere to the necessary time frame. All construction loans have deadlines for the completion of construction, and we have never failed to meet the deadline. With nearly 100 projects completed in sixteen different communities, we have had the opportunity to develop expertise in progressing through the land use permitting processes in various localities. We have often worked on in-fill sites where pollution issues needed to be addressed. We have developed sites where neighborhood concerns needed to be considered. The fact that we have developed the large number of projects that we have, demonstrates our ability to get things done. KLODT INCORPORATED DEVELOPERS, CONTRACTORS 50 GROVEl_AND TERRACE, SUITE A MINNEAPOLIS, MINNESOTA 55403-1100 Phone: 612/374-1770 Fax: 612/374-1814 PROFILE of KLODT INCORPORATED Klodt Incorporated was established in 1924 in Minneapolis, Minnesota, as a commercial and residential developer/builder. Paul Klodt joined the firm in 1952. As owner and chief executive officer, he has developed homes, apartments, and commercial and industrial projects. In the first 15 years of his career, he built approximately 2,650 apartment units in the metropolitan area. The total is now well over 4,000. Following industry trends in the late 1970's, he developed several townhouse and condominium complexes - Morningside Townhomes in Minneapolis; Clearsprings Townhomes in Minnetonka; and three of the area's most prestigious condominiums - Wayzata Place in Wayzata, and 3220 West Calhoun Parkway and Calhoun Gardens in Minneapolis. In additior~, he built shopping centers - SpringGate Shopping Center in Golden Valley; Yorktown Mall and Brandon Square in Edina; Diamondhead Mall in Burnsville; Morningside Shoppes in Minneapolis; and Park Place Plaza in St. Louis Park. The Sheraton Park Place Hotel in St. Louis Park, a 300 room luxury hotel with two restaurants and banquet facilities for 1,000, was developed by Klodt and opened in April 1982 under his ownership and management. The hotel was given a "Fo'ur Star Award" in 1983. He also developed, constructed, owned, and managed two all-suite hotel properties - the Hotel Luxeford Suites in Houston (1985) and Minneapolis (1986). Klodt began building office/showroom complexes - Summer Business Center and Hennepin Business Center in Minneapolis; Roseville Business Commons in Roseville; Park Glen West and East Business Centers in St. Louis Park; and PROFILE KLODT INCORPORATED Page 2 Metro 94 Business Center in St. Paul. He also constructed many "user" buildings such as freestanding restaurants and industrial buildings. More recent projects include the twelve story, 102 unit Kenwood Gables Apartments on Lowry Hill and the 23 story, 416 unit RiverWest Apartments on the Mississippi River, both in downtown Minneapolis; the five screen, 800 seat Lagoon Cinema in the vibrant Uptown area of Minneapolis; two, 100 room Holiday Inn Express Hotel & Suites properties, one in the rapidly growing suburb of Woodbury and one in downtown Minneapolis, a block from the Convention Center; and a 124 unit apartment community, Inglewood Trails in St. Louis Park. He recently completed development of The Metro, a mixed-use facility at 9th .~nd Marquette containing 112 units of housing, a 550 stall parking ramp and street level retail. He has headed an organization that has developed and built over 11 million square feet of residential and commercial space. His firm has personnel experienced in all phases of the development, construction, and management business. Paul Klodt is a past director of the Minneapolis Builders Association, the Minneapolis Housing Institute, the Minnesota Multi Housing Association, and the National Association of Home Builders. PROJECTS DEVELOPED AND CONSTRUCTED BY PAUL KLODT LOCATION # UNITS YEA~ APARTMENTS 1 3018 Pillsbury Avenue, Minneapolis 11 1960 2 3020 Pillsbury Avenue, Minneapolis 11 1961 3 3350-42nd Avenue South, Minneapolis 11 1962 4 3408 Grand Avenue South, Minneapolis 11 1962 5 3414 Grand Avenue South, Minneapolis 11 1962 6 3319 Pleasant Avenue, Minneapolis 23 1962 7 8420 Fremont Avenue South, Minneapolis 29 1962 8 4121 West 50th Street, Edina 9 1962 9 821 Douglas Avenue, Minneapolis 21 1963 10 2706 Humboldt Avenue South, Minneapolis 12 1963 11 3215-21st Avenus South, Minneapolis 11 1963 12 3013 Grand Avenue South, Minneapolis 17 1963 13 1901 Emerson Avenue South, Minneapolis 32 1964 14 4400 Upton Avenue South, M/nnespolis 32 1964 15 2700 West 44th Street, Minneapolis 63 1965 16 311 Kenwood Parkway, Minneapolis 39 1965 17 3845 Bryant Avenue South, Minneapolis 23 1966 18 4530 West 38th Street, St. Louis Park 72 1966 19 48/50/52 Groveland Terrace, Minneapolis 160 1967 20 3910 Aldrich Avenue South, Minneapolis 23 1967 21 3445 Harriet Avenue South, Minneapolis 17 1967 22 1770 Bryant Avenue South, Minneapolis 70 1968 23 2435 Pillsbury Avenue South, Minneapolis 40 1968 24 1117-7th Avenue SE, Minneapolis 10 1968 25 310-Sth Street SE, Minneapolis 18 1969 26 1001-12th Avenue SE, MinneapoLis 12 1969 27 2300 East Franklin Avenue, Minneapolis 182 1969 28 2400 Intorlachen Road, Spring Park 123 1969 29 1901 Minnehaha Avenue, Minneapolis 88 1969 30 924-17th Avenue SE, Minneapolis 11 1969 31 2186 Scudder Avenue, St. Paul 11 1969 32 4440 Beard Avenue South, Minneapolis 60 1969 33 1276 Wilson Avenue, St. Paul 102 1970 34 26 Arthur Avenue SE, Minneapolis 12 1970 35 4101 Parklawn Avenue, Edina 120 1971 36 1313 Como Avenue SE, Minneapolis 13 1971 37 2220 East Frankl/n Avenue, Minneapolis 237 1971 38 2800 West 44th Street, Minneapolis 56 1971 39 7320-50 Gallagher Drive, Edina 600 1971-2 40 333-8th Street SE, Minneapolis 60 1971-2 41 3540 Hennepin Avenue, Minneapolis 70 1972 42 3535 Bryant Avenue South, Minneapolis 107 1974 43 1400 Dakota Avenue South, St. Louis Park 30 1983 44 7700 Cahfll Road, Edina (Ponds of Edina) 65 1986 45 10551-10641 Greenbrier Road, Minnetonka 192 1986 46 4401 - 4501 Park Glen Road. St. Louis Park 290 1986 47 Walden Woods, St. Louis Park 108 1987 48 Kenwood Gables, Minneapolis 102 1988 49 RiverWeet Apartments, Minneapolis 416 1988 50 3200 Inglewood Avenue South, St. Louis Park (Inglewood Trails) 124 1999 51 90 South 9th Street, Minneapolis (The Metro) 112 2000-1 CONDOMINIUM AND TOWNHOMES I 3033 East Calhoun Parkway, Minneapolis 9 1973 2 4111-23 France Avenue South, Minneapolis 7 1978 3 Ciearsprings Townhomee, Minnetonka 53 1978-9 4 Wayzata Place. Wayata 40 1978-9 5 3220 West Calhoun Parkway, Minneapolis 13 1979-80 6 3150 West Calhoun Parkway, Minneapolis 32 1981 7 7700-7742 Pondwood Drive, Edina 24 1986-7 HOTELS 1 Sheraton Park Place Hotel, St. Louis Park 300 rms 1981-2 SUMMARY OF EXPERIENCE AND RESPONSIBILITIES JOHN R. BELL John Bell joined Klodt Incorporated in 1984. He received his Bachelor of Science Degree in Civil-Structural Engineering from the Institute of Technology of the University of Minnesota in 1973. Past projects in his career at Klodt Incorporated include: Hotel Luxeford, 235-suite hotel in downtown Minneapolis; RiverWest Apartments, 416-unit property in downtown Minneapolis; The Metro, a mixed-use development in downtown Minneapolis; numerous wood frame apartment projects and high-tech office/warehouse developments and a countless number of vaded tenant build-outs. Experience includes: Contact with governmental agencies, architects, engineer, brokers, end users And subcontractors. He was previously employed by Cemy Associates Architectural and Engineering and Rosewood Corporation. John is a life-long resident of Minneapolis, married with two children and an active community member. SUMMARY OF EXPERIENCE AND RESPONSIBILITIES LOIS M. BREDAHL Lois Bredahl joined Klodt Incorporated in 1972. Since that time, she has been involved in most aspects of the real estate development, construction and management as pertains to the company. During his career with Klodt Incorporated, she has performed in the following capacities: Closed in excess of 50 commercial construction loans and permanent loans totaling over 200 million dollars, including participation in lender negotiations, document review and comment; assembly of documentation and attendance at closings. Supervision of residential and commercial property managers, as well as hands-on experience in both fields, including establishment of rents, hiring and supervision of personnel, planning and implementation of advertising and leasing programs, lease form development and prospective tenant negotiations, tenant relations and maintenance decisions. Participated in the sale of commercial and multi family projects, including negotiations with buyers, document preparation and/or review, assembly of documentation and attendance at closings. Prepared and made presentations to vadous city councils and planning commissions regarding proposed developments within the cities, including rezonings, variances, conditional use permits and' liquor licenses. Closed over 100 residential townhouse and condominium loans and acted as company liaison to condominium homeowners' associations. Developed budgets and proformas for existing and proposed projects. Negotiated with city assessors regarding real estate tax abatements. Acted as office administrator. Currently an officer of all Klodt-related entities, she is also a licensed Minnesota real estate broker and closer, a member of the Minneapolis Area Association of Realtors and a member of the Minnesota Multi Housing Association. PAUIA FOLEY, CSM, RPA 10070 KAHLER AVENUE, NE MONTICELLO, MN 55362 (763) 295-5082 (HOME)-(612) 374-8284 (WORK) PROFESSIONAL EXPERIENCE KLODT INCORPORATED (1997*Present) Minneapolis, Minnesota. Vice President, Admlnlatratlon- Responsibilities include management of human resources, supervision of residential property managers, management of company property and liability insurance policies. GENERAL GROVlrrH MANAGEMENT, INC. (1981-1996) Minneapolis, Minnesota. Held the following positions within the organization: Regional Management Assistant (10/g3-7/96) Corporate Headquarters Newly created position to assist Senior Vice President in overall management of portfolio. Position includes financial analysis of monthly operating statements, budget and forecast review for all properties in the ' portfolio, interface with Property Managers regarding day-to-day operational issues and communication with owner representatives. Achievements: · Created position where there was no established job description. · Successfully coordinated the budget process for 26 malls. Owner representative indicated it was the best budget process ever. · Selected as team leader for the roll out of a leasing contact software package to 75 malls. Required interfacing with MIS department, senior management executives and property managers. Project was completed on time and was completed in addition to all other job responsibilities. General Manager (6/90-10/93) Knollwood Mall Associate Center Manager (2/89-6/90) Southdale Assistant Center Manager (1987.1989) Rosedale In these managerial capacites, responsibilities included: · Overall management of the shopping center including leasing, operations, marketing and accounting. · Planning quarterly forecasts and annual budgets (income statements and cash flow analysis). · Extensive. interface with tenants to insure problems were addressed and satisfaction was achieved. · Directing capital budgets and major repairs, expansion and remodeling programs. · Supervising and directing a support staff in the management office and within operations. · Maintain quality reporting and information for management. Achievements: · At Knollwood, leased over 4,000 square feet of new space and negotiated over 17,000 square feet of renewal leases. · Exceeded budgeted net operating income all three years at Knollwood. PAULA FOLEY PAGE TWO PROFESSIONAL EXPERIENCE (Continued) · Promoted to General Manager within eight months after General Growth acquired The Center Companies. · Selected to be Acting Center Manager for Rosedale (7/88-1/89) with total management responsibility for that facility. · Trained and supervised staff in collection of receivables which resulted in a 75% reduction of outstanding receivables. Assistant Portfolio Manager (1986-1987) Reported directly to the company's Asset Manager. Personal accountabilities in this assignment involved 1.9 million square feet and assets of $116 million. Additional responsibilities included: · Coordination of quarterly appraisal reports and property reviews to insure value objectives were achieved. · Responsible for completion of SEC reports for public and private partnerships. · Involved in due diligence process concerning property acquisitions including interface with appraisal tirms, engineering firms, law firms and title companies. · Created the position based on performance and achievements. · Managed up to 22 properties with assets of $116 million. · Contributed to value enhancements which led to a broadening of responsibilites and opportunities. · Reduced outstanding receivables by 60% Prior experience includes various supervisory and administrative positions. EDUCATION Bachelor of Arts (198t) Bemidji State University, Bemidji, Minnesota. Graduated Cum Laqjde in Psychology. Continuing education: · Minnesota Real Estate License; passed Minnesota Broker exam · Real Property Administrator designation, Building Owners and Managers Association · Certified Shopping Center Manager designation, International Council of Shopping Centers AFFILIATIONS International Council of Shopping Centers Minnesota Shopping Center Association Stewart Rosen~ CPA, MBA Work Experience: Klodt Incorporated Controller October 1999 to Present Insure the accurate accounting for various rental properties, hotel properties and construction projects. Design Access and Timberline applications which facilitate job cost and construction draws. Manage cash. File payroll taxes. Direct accounting activities for 12 different companies. Manage audits. Manage staff of 3. Maintain banking and lender relationships. Manage the IT function. Marketing Specialists (Eden Prairie, MN) Controller/Senior Accountant Manager of Information Systems May 1986 to October 1999 A $10 million closely held organization that services fortune 500 companies as an independent marketing and sales representative company. Responsibilities include planning and forecasting, development and production of financial reporting, management of accounting, finance, administration and information technology. Supervised a staff of up to 13 people and provided training and assistance on various cgmputer sof~vare and business processes. Also included due diligence responsibility to facilitate a smooth merge when the company was sold. Numed Corporation (Eden Prairie, MN) Accountant May 1983 to April 1986 An entrepreneurial company which manufactured and marketed a fiber product to nursing homes. Responsibilities included all financial statement preparation, forecasts, budgets, and projections as well as product runs, cost accounting and payroll administration. Education: University of St Thomas (St. Paul, MN) MBA May 1990 University Of Minnesota BSB - Accounting June 1982 Minnesota School of Business Certificate- Computer Programming June 1983 CPA - Passed the Uniform Certified Public Accountant Examination (5/87) Communi~ Involvement: Member- Minnetonka Symphony Orchestra since 1991 Treasurer- Music Association of Minnetonka 2000 Garth (Gary) Olsson Director of Property Management Klodt, Inc. Gary has been with Klodt, Inc. for the past three years, bringing with him an extensive background in property management including budgeting, operations, construction, employee recruitment and supervision and marketing skills. He also has the proven ability to negotiate permanent tenant leases with local, regional, and national retailers. With over thirty two years of experience to include owning his own business and general manager of super regional shopping centers, Gary brings the leadership and expertise in management, leasing, and development that has benefited Klodt, Inc. Gary has a Minnesota Real Estate License and is a member of Minnesota Shopping Centers Association and International Council of Shopping Centers. He attended the University of North Dakota, Men's Retail Association Institute of Business and is a four year veteran of the United States Navy. The Bancor Group, Inc. 1521 94th Lane NE Minneapolis, MN 55449 Contact: David Newman, President Arboreturn Development, LLC 763-792-8974 Status of Application: RFQ Requirements Met Strengths: The team assembled has experience in top quality single-family residential development. The financial resources appear to be solid. They have clear, sensitivity to environmental and ecological concerns, as well as good land use planning through DSU, and a genuine desire to work with Columbia Heights. Concerns: As noted in their own RFQ letter, they have no experience with mixed-use developments, or multi-family/commercial/industrial projects. Redevelopment of"in fill" areas, such as Columbia Heights, would also be a concern, too. Experience with projects of this size would also be a question mark, as well as the team they would work with on the possible commercial/industrial side of the project. With two major residential projects underway, do they have the staff and finances to focus on the EDA's project? H:~Industrial Center~Bancor Staff review '-- 0 0 0 0 Z The Bancor Group, Inc. June 7,2002 Mr. Randy Schumacher Acting Community Development Director City of Columbia Heights 590 - 40t~ Avenue NE Columbia Heights, MN 55421 Bancor Re: Industrial Center Redevelopment Center Redevelopment Project Dear Mr. Schumacher: On behalf of Arboretum Development, LLC., I respectfully submit our response to your request for qualifications. We are a residential development company that was formed as a result of some of the top people in our industry deciding that we wanted to work together and benefit from each of our respective experiences and knowledge. Consequently while Arboretum Development, LLC., is a relatively new company, the experience of its principals is considerable. The principals/owners are: 1) VKO Enterprises. Mr. Vance Opperman is the principal of VKO Enterprises, Inc. As you are probably aware; Mr. Opperman is a well know local attorney, businessman and former CEO of West Publishing Company. He has been involved in financing a number of successful publishing, technology and real estate enterprises. 2) The Bancor Group, Inc. The Bancor Group has been in existence for approximately 10 years and primarily engages in the development of residential communities for homebuyers and homebuilders. Bancor has in addition partnered with commercial developers on selected development projects. The Bancor Group is the managing partner of Arboretum Development and currently has under its management the development of approximately $100,000,000 in finished lots. David Newman is the President of The Bancor Group and is an attorney. Mr. Newman was previously engaged in the practice of law and at that time represented a variety of homebuilders, civil engineers and residential developers. He also represented the cities of Fridley and Zimmerman. The Bancor Group has facilitated several complicated development projects that have included multiple partners and environmental challenges. Paul Robinson, development manager at Bancor, was previously the Medina City Administrator. He provides a direct understanding of the local government process as well as the private development process. Mr. Newman and Mr. Robinson would be the primary contacts for this project. 1521 94th Lane N.E. Minneapolis, Minnesota 55449 phone 763 -92-8974 r]tx "63 -'t)2-8976 Plum Investment Company Peter Pflaum, President and C.E.O. of Plum Investment, was one of the founders of Lundgren Bros. and was its President/CEO/Principal Founder until the company was sold in 1999. As part of the strategy for growing the company Peter assumed responsibility for selecting and developing the communities in which Lundgren Bros. built. Consequently, Peter has over 30 years experience in developing residential communities and has been personally involved in the development of over 120 neighborhoods in the Twin Cities. He is recognized by his peers, both locally and nationally, as one of the preeminent developers of residential neighborhoods. Arboretum Development and all of the above team members are currently developing two major communities in the Twin Cities. The first one is Wild Meadows, which is a 350-acre residential conservation subdivision. Currently, we are selling lots in the first phase of this community. In designing Wild Meadows we employed several innovative approaches in order to create a community that was ecologically and environmentally sensitive to the site and it's surroundings. As part of this design we have incorporated an innovative approach to the treatment of storm water. The Metropolitan Council has provided us with a $75,000 grant to assist in monitori.ng the effectiveness of this storm water treatment system and if successful to help fund an educational 15rogram that will explain the benefits of the system. Even though we broke ground on this site less than a year ago, both the Northstar Chapter of the Sierra Club and the Minnesota Land Trust have featured techniques and principals we followed in planning and creating this community, as a model for other cities and developers. In planning this neighborhood the developer worked closely with the very well respected regional planning firm of Dahlgren, Shardlow and Uban. The principals in Arboretum Development are also currently planning and developing a 230-acre community in Woodbury. This neighborhood is currently in the planning stage. When developed it also will incorporate many of the environmental and ecological principals followed in Wild Meadows. This Woodbury community will contain a wide variety of housing styles and price ranges with a specific emphasis on integrating neighborhoods and creating for each resident a sense of place. In designing this neighborhood the developer has retained the services of Looney Ricks Kiss, a nationally recognized planning firm. Without hesitation we believe that as the lead developer Arboretum Development, LLC., provides one of the strongest combinations of talent, experience, knowledge and financial resources. We believe that the strengths that Arboretum Development offers to the city of Columbia Heights are as follows: Local knowledge. We bring a significant amount of local knowledge, contact, experience, and involvement. Plum Investment, VKO Enterprises and the Bancor Group are all locally based and do most, if not all of their business in this market. We have a strong commitment, not only from a financial standpoint but also from a community interest standpoint, to ensure that this site is developed in a manner that best benefits Columbia Heights and this region. 2) Experience. The principal owners representing each part of our development team have been personally involved in planning and creating a number of successful neighborhoods in the Twin Cities metropolitan area. Many of these neighborhoods have created strong community statements that reflect the values of the communities in which they are located. Our team also has significant experience is developing positive effective working relationships and partnerships with cities and other stakeholders. 3) Financial strength. It is important for the City to be confident that the lead developer chosen has the financial strength to complete a project of this scope. The financial strength of our team members is widely known and speaks for itself. 4) Environmental Awareness. While this is a newly emerging area in development, our team has considerable experience in addressing the types of environmentally sensitive issues that will probably be encountered with this type of site. 5) Coordination of complicated projects. Ensuring the success of any development project relies on the lead developer's ability to coordinate and manage a very complicated and dynamic process. Our team has successfully managed a number of complicated projects throughout the Twin Cities. 6) Working with existing constituents . Any project that takes place in and around existing businesses and residents requires an open and consistent dialogue with those stakeholders the project will affect. We have also worked on a number of infill projects where working with the existing residents and stakeholders was vital to the success of the project. We believe this will be true for this project as well. We bring this experience and awareness to this project While we are excited about this opportunity, we struggled in preparing this response because we are unsure of the City's vision for this site. As I am sure you noted from our backgrounds, we are primarily a residential development company, although we have d~ times teamed with commercial developers. If the City's vision for this site is for it to have a major residential component, then we believe we are extremely qualified to serve the City in achieving it's vision. On the other hand if the City does not see this site as having a major residential component then we believe there are other parties that are better qualified to work with the City. I also recognize that we have not provided all of the information that the City has requested. This also is due to our uncertainty about this City's vision for this site. We know that a number of consultants will need to be added to our team in order for this redevelopment to be successful. However, it has been our experience that it is better to select these consultants after we have learned more about the City's vision for this site. We know that the necessary consultants themselves have areas of strength and that after the City's vision for the site is better clarified, then in consultation with city staff we can begin to select the balance of the development team that best meets ours and the City's needs. We look forward to the opportunity to meet with the council, commissions, and its staff in order to further explain the knowledge and expertise that Arboretum Development, LLC., has to offer. President Cc: Mr. Peter Pflaum Mr. Jerry Paquin Dear Reader: WELCOME TO THE WORLD-OF CONSERVATION DESIGN Conservation design is the process of developing a particular parcel of' land in a manner that respects the site's natural and cultural features. To protect a property's key features, conservation developments generally preserve a large portion of the tmet in common open space, setting it aside as a community amenity. This Conservation Design Case Study is part of a larger Conservation Design Portfolio that was developed by the Minnesota Land Trust and University of Minnesota's Center for Urban and Regional Affairs and Design Institute. It was created in response to growing concerns over impacts from land development on Minnesota's natural resources. The Portfolio showcases new residential developments that were specifically designed to minimize impacts on the land and water resources that sui'round them and to positively contribute to the character of the greater community. The material contained in this Case Study and the larger Portfolio is copyrighted. The full Conservation Design Portfolio is available in PDF format online at ww~v. mnland.org. Funding for the project was provided by the Minnesota Legislature, 1999 Minnesota Laws, Ch. 231, Sec. 16, Subd. 8e as recommended by the Legislative Commission on Minnesota Resources from the Minnesota Environmental Trust Fund; the McKnight Foundation through the Bluffiands Alliance and The University of Minnesota's Design Institute. THE MINNESOTA LAND TRUST:. PRESERVING PRIVATE LANDS FOR THEPUBLIC GOOD The Minnesota Land Trust (MLT) is a private nonprofit organization dedicated to permanently protecting land and water resources that def'me Minnesota communities and enrich our quality of life. We do this through conservation easements, land acquisition and conservation planning and design. How YOU CAN HELP As a nonprofit organization, the Minnesota Land Trust depends on donations from individuals, corporations and foundations to do its work. Your membership contribution makes you a part of every land project, and will allow us to meet the growing need for private land protection. Please join us in protecting Minnesota's land and water resources by becoming a member today. A gif~ envelope has been included for your convenience. Thank you for your interest in conservation design and the Minnesota Land Trust. Feel free to call us at (651) 647-9590. Sincerely, Jane Prohaska Executive Director 2356 University Ave. W., Suite 400 · St. Paul, MN 55114 o (651) 647-9590 · (651) 647-9769 fax rnnland(~rnnland.orcj · vvww. mnland.org I I I 0 pooB Xel!O~l W I L D M E A D 0 W S elevates the practice of ecological restoration within a development project to a new level. It demonstrates that a development can actually improve environmental quality if significant parts of a previously degraded site are placed in open space and restored to more natural conditions. Not only will the restored prairies and woodlands add beauty to the development; they will also serve substantial stormwater management functions. Ecology and infrastructure will be truly married in this development. PROJECT OBJECTIVES Wild Meadows is located in Medina, Minn., just west of Plymouth and Maple Grove on Highway 101. The site's hills, woods and views, as well as its location, made it attractive to realtors and developers. However, residents and the city council were concerned about too much development altering the character of Medina and damaging the integrity of the site. Conservation design - or perhaps more accurately "restoration design"- provided a means to preserve the existing natural features, and restore them to a higher quality. This goal of improving the landscape's ecological functions is to be partially financed by the sales of 150 clustered homes, and annual homeowners association dues. The design of Wild Meadows was inspired in part by other successful conservation developments including Prairie Crossing, an award-winning development outside of Chicago. The project is specifically based on the following goals: · Environmental prote_ction and enhancement through ecological restoration · Creating a unique sense of place · Aesthetic design and high-quality construction · Economic viability SPECI F I'CATi ON 5 SITE SIZE: 345 acres NUMBER OF UNITS: · 150 single family homes LOT SIZES: 0.5 - 1.7 acres '"'OPEN 'SPACE: 200 acres (58%) '~' WASTE TREATMENT: City 'Sewer WATER: City water -TRAILS: Extensive trails throughout the project NATURAL FEATURES: More than' 200 acres of restored prairies and WOodlands All lots will have access to restored natural areas protected by a conservation easement. This not only benefits the residents of the development; the project will also provide Medina with a unique neighborhood with multiple public benefits. Drained and degraded wetlands will be restored into wet meadows and used for an alternative stormwater management system. Forest systems will be managed to introduce more light, reestablish ground cover and regenerate aaks, which are undergoing significant decline. The eroding shore of the pond will also be stabilized. All of these improvements should help create the habitat conditions for the increased presence of wildlife and reintroduction of other native species. LOT LAYOUT Nearly every lot in the development has a view of open space from the rear and many also have open space in front, in a central green or planted cul-de-sac island. In addition to the substantial restoration in the open space, most homeowners will have restored buffer areas at the rear of their lots as well, thereby extending the ecological benefits of the overall project. STORMWATER TREATMENT TRAIN Stormwater runoff will be treated in a linked series of swales, wetlands and ponds that are part of the ecological restoration. The goals of the Stormwater Treatment Train (devel- oped by Applied Ecological Services) are to: restore natural hydrologic functions of the site, improve water quality, enhance groundwater recharge and cut infrastructure costs. The Minnesota Center for Envirom mental Advocacy, the Metropolitan Council and the development team are collaborating on a five-year monitoring study to document the changes in runoff quantity and quality. LANDSCAPING While most of the site will be restored with ecological function in mind, areas of formal landscaping will help complement the natural aesthetic, including the turnaround greens, roadway intersections, and a more highly designed prairie garden. In addition, several mowed areas will provide opportunities for active recreation. ARCHITECTURE The homes will have a high attention to detail and will create a unique, upscale sense of place. The designs will include such elements as front porches and less obtrusive garages. A~(w~k courtesy Res~o~3~on Development Inc. ,] Not to scale FOREST RESTORATION This 50-acre woodland, a remnant of the maple-basswood "Big Woods" ecosystem, will be improved through selective thinning and the removal of invasive species like European buckthorn. The site's woodlands will provide important ecological and visual buffers to adjacent land uses. WETLAND RESTORATIONS The pond shorelines and other wetland areas will be stabilized and restored with native vegetation. In addition, prairie vegetation adapted to we~ter conditions will be planted in lower areas of the site. These restoration areas are an important component of the Stormwater Treatment Train. PRAIRIE RESTORATION Careful analysis of soils, topography, vegetation and hydrology allows ecologists to decide which plant communities to restore in which areas. On the higher uplands, prairie species adapted to drier conditions will be planted, including wildflowers, like those in this photograph. The mesic prairie type will also be restored on the site. It is one of the rarest types still found in Minnesota, because it grew on the rich, moist soils well suited to farming. PUBLIC VIEWS In order to temper the visual impact of this tract from Highway 101, the development will be pushed back from the roadway and screening vegetation will be planted. In addition, from many areas of the open space, all of the houses will be hidden from view. DEVELOPMENT PROCESS At the time that the developers proposed purchasing the land, the city of Medina had imposed a moratorium on development in certain sections of town, including this one. Developer David Newman and his team worked with a committee of planning commission and council members over a number of months to come to an agreement on how the site should ultimately be developed. To address this issue, Steve Apfelbaum of Applied Ecological Services was invited to visit Medina. Apfelbaum, an ecological restoration and development expert from Brodhead, Wis., was able to create a compelling One of the goals of the Wild Meadows vision of homes clustered Jn an team is to preserve and restore some of ecologically functioning landscape, the natural areas in Medina. The developers became champions of the concept and added Applied Ecological Services to the design team in order to create a lastiag legacy, while simultaneously creating a marketable development. When c~mplete, a part-time ecologist will help residents recognize what is on the land, assist in maintaining the natural areas and foster a sense of community through activities like nature walks, maple sugaring and prairie burns. Resident fees will cover the cost of the ecologist and the maintenance of the natural areas. A conservation easement will eventually cover the primary preserved areas of the site. Wild Meadow's overall success will be based on several long-term factors, including: the quality of the restoration, the restored areas' effectiveness in treating stormwater runoff, the residents' perception of the natural areas and the eventual land uses surrounding the site (e.g.; how this site connects to other natural areas within Medina). While no one can predict the futbre - especially in regards to ecological functions - the city and the developers have gone to great lengths to address these issues in their agreements, thereby helping to ensure the project's future viability. PROJECT STATUS Ground was broken in May 2001, initiating both development and restoration of phase one. Initial market response has been very favor- able, largely due to the demand for high-end homes in the area and the quality of the project. Lot prices range from $90,000 to $490,000. PROJECT PARTNERS Restoration Development (a team assembled for this project, consisting of the Bancor Group, Lundgren Bros. and VKO Enterprises) Applied Ecological Services Dahlgran, Shardlow and Uban Minnesota Land Trust LeGran Homes Conservation Design Portfolio, Case Study 7 Minnesota Land Trust and the University of Minnesota Parkview Villa Housing Complex 965 N.E. 40* Avenue, Columbia Heights, MN 55421 DATE: TO: June 10, 2002 tmon,,. ?.:?..~~800 Fax (763)788-3978 :' ';--,'! /'. :[/ dON I0 2002 ;:'[ !,''" '- m ~? Bob Streetar; Community Development Director Shirley Barnes; Chief Executive Officer; Crest View Corporation Commissioners; Columbia Heights HRA Board of Directors; Crest View FROM: Anita Kottsick, Housing Adminstrator May/June Management Report for Parkview Villa & 4607 Tyler PHYSICAL PLANT: Elevator #2 (North) was replaced with a new telephone. The elevator company has not notified me whether the old telephone was covered under warranty. We have a new technician ( this is our 4th as Schindler has been changing their routes since they bought out Millar). Hopefully, we will have the same technician for a while now. Parkview Villa annual apartment inspections took place May 24th . All apartments passed inspections and several work orders were generated for minor repairs. The garage was thoroughly cleaned by the caretakers last week and the parking lot is in the process this week of being cleaned and painted by the Maintenance Coordinator. Last month the North building had 3 separate leaks show up in one day. It was found that 2 leaks were from a pinhole in the copper pipes and the 3rd leak was from a toilet. The Maintenance Coordinator was able to fix 2 of the leaks himself and for the 3rd leak a plumber was called in for repair. These leaks are very hard to find as the water follows the spancrete -not necessarily in a straight line down. Therefore, several apartments have small damage to bathroom walls that are in the process of being repaired. The motor for fan on one of the air conditioning units in Community Room B is not working properly. It is being repaired this week. On May 20th a transformer went out on 39th and Central. When power was restored an elevator technician was called out to reset the small elevator in the north building, which does not mn off the generator. OCCUPANCY: NORTH BUILDING No vacancies SOUTH BUILDING No vacancies Waiting list totals are as follows: Parkview Villa North 23 CH Residents 18 Non-residents 4607 Tyler 3 CH Residents 6 Non-residents Parkview Villa South 26 CH Resident 13 Non residents MISC: For informational purposes the Parkview Villa calendar, the Administrator's monthly update to residents, and the so~vare report on the annual inspection of South apartments is attached. Equal Housing Opportunity Agency EQUAL flOUIIING OPPORTUNITY Owned by the City of Columbia Heights HRA Managed by Crest View Management Services Hello, I hope everyone has a good month! RESIDENT COUNCIL NEWS The next Resident Council meeting will be held on Monday, June 10th, at 7:00pm in Community Room B. ALL RESIDENTS ARE WELCOME! HOUSING AND REDEVELOPMENT AUTHORITY The next HRA meeting will be held Tuesday, July 16, 6:30pm in Community Room B immediately followed by the EDA meeting. The HRA will now have planned meetings on a quarterly basis. All those interested are welcome to come. LASAGNA DINNER There will be a lasagna dinner on June 5 to celebrate both Mother's and Father's Day. EVERYONE IS INVITED! ! ! Sign up was May 21 = . &22"~. PETS Remember that there is a designated pet elevator located by the front entrance. All pet owners must use this elevator when taking their pet to and from the building. Pets should be walked over to the park area and cleaned up after. Also pet owners must be aware that barking dogs must be controlled. If your dog barks when you leave your apartment you must make other arrangements for your dog while you are out of your apartment. APARTMENT DOORS Please try to hold your apartment door when entering or exitin, g, with the warm weather and windows open the doors slam very easy. PARKING AREAS We will be posting notices for the cleaning of the parking lot and for the cleaning of the garage during this month please watch the bulletin board by the elevator for these notices. This year we will also be painting the parking lot. NEW FURNISHINGS The furniture in the library and the benches throughout the building will be replaced with new furniture as soon as all of the research and comparisons are completed to ensure that we are getting long lasting, attractive and comfortable furniture. At the May Resident Council meeting I asked for volunteers to help decide which furnishing would be most appropriate. Once this research is completed I will then bring back the recommendations to the Resident Council to discuss. SEVERE WEATHER It's the time of year when we may be getting stormy weather so I thought I would remind everyone what they should be doing to ensure their safety. A tornado watch means that there is a chance of dangerous winds-maybe a tornado. Be alert and stay informed of changing weather conditions. A tornado warning means that a tornado has been seen. A 3-5 minute steady siren usually signals a tornado spotting. Stay away from windows, doom, and outside walls. Protect your head. If time permits go quickly to the parking garage or go into your bathroom and close the door. Due to the time it may take to get to the garage through the stairwell it may make the most sense to go into your bathroom with your radio and close the door. CAPITOL IMPROVEMENTS At the last HRA the board approved a consulting firm to develop a comprehensive capitol improvements plan. They will recommend a long term plan to cover any necessary improvements. As decisions are made on improvements I will share the information with you. COMMON AREA WINDOWS Please do not open up the common area windows while the heat is on or the air conditioning is on as this is a waste of energy. I have noticed that several of the windows in the North elevator lobbies are open quite often. I realize that there are times when fresh air is needed in these areas for a short period of time. But by all means if you open a window please be sure that you close it. PARKVIEW VILLA RESIDENT COUNCIL MEETING MINUTES JUNE 10, 2002 The meeting was called to order at 7:00 p.m. Anita gave her Management Report: · The air conditioners have been fixed · A new phone installed in the entry & elevator · Bill Gault fixed the generators · The three leaks in apartments were fixed and will be painted from the power outage on May 20th. · Anita will be leaving in September sometime to manage the new Crest View Senior Assisted building on 42nd and Central. She will let residents know the name of the new administrator as soon as she finds out. · Anita will be going on vacation June 24th thrtl July 5th. · The birdbath will be fixed · She will be working on the middle entrance sidewalk repair bids are being sent out · Reviewed what she puts on the HRA Monthly Report · Thanked residents for informing her when lease violations and pet policy violations have taken place. · Explained to them because o£privacy issues she can't share the results of such violations but wanted to assure them that they are investigated, discussed, and addressed with violators. John Super gave the Welcome Report and introduced Vera Johnson as a new resident. Billy Sheldon gave the Sunshine Report. $5.00 and a get well cards were sent to Helen Myhre, Cellia Rothbauer, Helen Winter, Shirley Pearson, Marg Bohn and Kay Grant. Leo gave minutes from May 13, 2002 meeting. Jackie Ovshak gave the Treasurers Report. Marion Johnson gave entertainment report. The Parkview Villa picnic will be held on Saturday July 6, at 5 p.m. A $3.00 deposit is required. Sign up for the picnic will be Monday, June 17th and Tuesday, Jm3~e 18 between 10 and 11 am. Dorothy Keller said we still have Cookbooks for $4.00 each available. Bill Cross, President ask for volunteers for Bazaar in September. They need someone to solicit for gifts from merchants and a chairman for inside work. Renee volunteered for inside chairman and Mary Lee volunteered for the outside chairman. Sharon Shandler will make signs to put up and flyers to put on windows around town for the Bazaar to be held on September 28th. Bill thanked the residents for making the quilts. The $5.00 drawings went to Bill Cross, Leo Mullenmaster, Dorothy Gillett and Ruth Bords. MOTION by Helen Smith, second by Marion Johnson, to adjourn at 7:55 p.m. All ayes. Motion Carried. Respectfully Submitted, Leo Mollenmaster Resident Council Secretary 2002