Building Needs Assessment Work Group Minutes

March 4, 2021 10:00 a.m.

Present

Corey Baumann          SCLS Delivery Services Coordinator

Nan Brien                    SCLS Board Trustee - late

Kerrie Goeden             SCLS HR & Finance Coordinator

Mark Ibach                  SCLS Consulting Services Coordinator

Jesse Stewart              SCLS Fleet Manager

Vicki Teal                     SCLS Technology Services Coordinator                                  

Kristi Williams             SCLS Board Trustee

Martha Van Pelt               SCLS Director

Guests:

Devin Flanigan                   Keller Inc. Project Manager

David Haug                         Lighthouse Commercial Real Estate

Rob Lindstrom             Keller Inc.        Architect - late

Call to Order at 10:04 by Kerrie Goeden

Approval of previous meeting minutes:  February 11, 2021

a. Motion by  M. Van Pelt to approve the minutes

b. Second by  M. Ibach

c. Approved

Reports:

· Board of Trustees meeting on 2/25/21 review and approvals granted – M. Van Pelt

o Board approved:

o  Approval of amendment to Lighthouse Commercial agreement

o Approve use of General/Delivery contingency for building project

o Approve new building budget of $ 5.5 million

o Approve authority to make offer on building site

o Approve applications to apply for $ 5 million in BCPL loans

· Board of Commissioners of Public Lands financing timeline update  - Kerrie

o K. Goeden talked to Rich Sneider, CIO, at BCPL about the loan and its timeline.

o We can get 1 or 2 loans depending on our timing and needs

o Loans up to $5 million do not require pre-approval process

o Debt ratio is the #1 factor in approving the loan and filling out an application; SCLS has no debt.

o 2 months for approval to go through BCPL.  Then we have up to 4 months to make the first draw on the loan.  Loan payment is once per year in March.  If we wait until after September 1, 2021 to use any money – the first loan payment would be March 2023

Discussion:  (with Keller)

SITE EVALUATION CRITERIA – D. Flanigan

o    Purchase price meets budget

o    Location and proximity to highway systems

o    Access to MUFN fiber network

o    Correct zoning

o    Parcel size and shape meets builder specifications

o    Excavation and site utility budget meets specifications

OFFER CONTINGENCIES

o    Approval of financing

o    Approval of zoning

o    Board of Trustees approval

o    Phase 1 Environmental

o    Approved soil borings

o    Wetland indicators

Review of Building Sites:

1901 – 1925 Wright Street Buildings.  Total price is $2.75 million   4.48 acres

1901 Wright St is a mix use building with 3,279 SF of office space, 4,660 SF lab space, and remaining is warehouse space with 16ft ceiling height at eaves and 14 ft drive in door at canopied load leveler dock. Original building built in 1978 with offices and labs updated.

1925 Wright was constructed in 2004 as addition with 24 ft ceiling height at eaves, one 14 ft drive in door and 3 docks with seals and load levelers.

D. Haug did a walk through. Rates it as a class B, “not bad”.  It has lots of lab space and would need reconfiguring for offices. It is 2 buildings. The purchase includes only one of the 2 warehouses that are connected by a walkway/tunnel (built 2004).  It is 42,000 sf with 24 foot ceiling height. This is what makes it list as a condo. The connector would be removed.  The 2^nd building (built 1978) included is on Wright St with offices, labs and a warehouse with a delivery door. It is 20,000sf.  Bell Laboratories owns the buildings.  They make rat poison. Only driveway entrance to property is from Wright St.

Discussion

D. Haug suggested selling the smaller building.  It would cost estimated $2 million to create 20,000 sf of office space in warehouse.  Devin would put on new roof and exterior.  Close to MATC which bodes well for MUFN connection. Has bus stop.

Concerns

Parking: seems limited, would have to add spaces

Delivery space, lacks ability to have drive through

Most of renovation would be the addition of offices – budget concerns with cost

Can we get/create access for delivery from Kinsman Blvd?

J. Stewart really wants drive-through delivery access for trucks

2702 Agriculture Drive

19,200 sf on 2.49 acres for $1,890,000

J. Stewart worked there for 5 years.  No warehouse, just offices and recording studio.  Has access from Agriculture Dr. and Dairy Drive.  Bus stop on Agriculture.

Concerns

Is there room to add warehouse?

Would City allow us to add warehouse?

Current building has cattails and watery ditch along Dairy Drive & Agriculture Dr.

5303 Fen Oak Drive $3,875,000

World Dairy Drive turns into Fen Oak when crossing Agriculture Dr.

33,495 sq. ft. office building; Fully furnished; 3.5 acre lot; 110 free surface parking spaces; Built in 2001; PUDSIP zoning.  1 story, bus stop on Agriculture Dr.

Discussion

Convert one wing into delivery space.

Concerns

How turnkey is it?

Swampy land?  - Pond out back

Will ceiling heights allow for conversion to delivery/warehouse?

Looks close to MUFN but need to verify.

Review of Property Sites:

East Metro Lots C & D        Gander Mt and Pinecone restaurant

Lot C is 5.86 acres for $1.5 million

Lot D is 3.79 acres for $900,000 (same as Shopko site)

Discussion

For same money, Shopko has more infrastructure in place and is close to MUFN.

Metro Lot C

Site Layout: Overall, this site will lay out well considering the size of the parcel.

Site Work: Should have a decent cut/fill ratio making it cost effective. 

Storm water: It is most likely drains into the retention pond adjacent to the parcel.

Sewer and Water: Stubs are shown on E Metro Rd. 2 possible locations for where stubs were located. 

Contingency to add: Storm water pond maintenance agreement. (This likely is planned in the offer since someone developed these sites)

Remove from list of possibilities

Metro Lot D

Site Layout: Site may have some challenges with roads all around it

Site Work: Should have a decent cut/fill ratio making it cost effective. 

Storm water: It is most likely drains into the retention pond adjacent to the parcel.

Sewer and Water: Stubs are shown on E Metro Rd.

Concern: Wetlands on site are present.

Contingency to add: Storm water pond maintenance agreement.

Remove from list of possibilities

2530 Agriculture Drive Lot 8    located at curve at Pflaum and Agriculture Drive

3.54 acres $525,000

Concerns

Curve makes it challenging.  Reduces opportunities on layout.  Squares and rectangles are best.  Site Work: Unique challenges with the roadway.

Planning commissions are very controlling and have lots of requirements for curved roads.  Plan Review: If the building is required to have a ‘particular façade requirement’ on the on front we will likely experience the requirement on 2 sides.

Need to do retention pond.  We will lose ½ acre to pond plus we will have to maintain pond.  Storm water pond would add $100,000 - $200,000

Difficulty getting out onto Agriculture Drive with trucks with medium and curve.

Where is MUFN? 

Discussion

Cheapest price.  We could ask for lower price equal to all necessary site remediation.

Sewer and Water: Should be readily available from Pflaum Rd.

Bus stop on Agriculture Dr.

2601 Shopko Drive

Bus stop, close to MUFN, bike path, gas station and car wash

Shopko site updates – Devin and David

The Shopko Site is “Site Specific Zoning”. Site Specific Zoning is typically when a particular site does not fit a ‘zoning’ code well enough. The text appears to be primarily a commercial specific zoning code. This would have been done 40+ years ago when the Shopko was originally built.

The conversation Devin had with Kevin Firchow at the City was positive, and he sounded optimistic this type of building could be an appropriate fit. Although, there will be some hoops we will need to jump through to get to where we’re going. The process will be broken down into different sections, see below.

Steps of the process

1)    Preliminary Plan Review

2)    Rezoning

3)    Urban Design Commission

4)    Planning Commission

5)    City Council

Estimated time of this entire process 6 – 12 months.  A change of zoning is required.  Alder is Syed Abbas District 12.

Site Layout: Overall, this site will lay out well.

Site Work: Likely going to have fill brought in. Asphalt can be grinded and reused for subgrade.

Storm water: It is most likely this parking lot drains to a detention pond behind the existing Shopko building.

Sewer and Water: Should be available from Shopko Dr.

      The Shopko is going to be the best value, and largest margin of safety. Devin would highly recommend soil borings for any site as a contingency

Concern

Contingency to add: Storm water pond maintenance agreement. (If the pond in the back of the Shopko is used for this surface area, it would be in SCLS best interest to make sure there is an agreement in place for all future maintenance.)

Private drive access and easements.  Need agreements for use and maintenance.

Discussion

In a general ballpark way Devin says for building on Shopko parcel

$600,000 - $700,000 cost for parcel would be great.

$700,000 - $800,000 could squeeze by

$800,000 - $900,000 would be over budget

If Mataas Partners could provide some of the site requirement (fiber, utilities) to offset costs would help.  D. Haug will need the cost of site requirement items from D. Flanigan before speaking with Mataas Partners. 

D. Haug will check on 4 properties/buildings suggested by N. Brien on Packers Ave near Ale Asylum.  Are they ground lease properties?

BNAW members will meet March 11, noon to 3 to tour sites:  Agriculture Drive, Fen Oak and Wright Street.  D. Flanigan will first verify if warehouses can be added to Agriculture and Fen Oak locations.

Homework: 

David and Devin will meet to outline site development costs for Shopko site to factor into a potential offer to purchase.

David will schedule site tours for 3/11/21.

Review spatial relationship plan for 4/1 – Sent via email after today’s meeting

Next Meeting Date:  3/11/2021 at 12:00 p.m.  Site tours

Adjournment at 12:07