HomeMy WebLinkAbout2011-08-09 PACKET 04.A.•:z,
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To: Economic Development Authority
From: Ryan R. Schroeder, City Administrator
Date: August 5, 2011
Subject: Development Update
Wheels for Travel:
The EDA acquired this property at 6043 Point Douglas Road in December 2010 and
concurrently entered a purchase agreement with the South Washington Watershed District
(SWWD). The closing with the SWWD is expected to occur by mid August with the tenant
vacating the property by August 22, 2011. The SWWD intended use for the property is as a
storm retention facility. The EDA interest in the property was the ongoing effort to remove non-
conforming uses from the Highway 61 frontage. The SWWD is reimbursing the EDA for its
costs of acquisition and relocation.
Ribbon Cuttings:
The EDA staff has scheduled ribbon cuttings for the White Pines Senior Housing project and
the El Sol Mercado. Both will occur on Friday, August 12 with the former scheduled for 10AM
and the latter at 12 Noon.
Blair Building Carpet Court:
The Certificate of Occupancy has been issued for the building at 8601 West Point Douglas
Road. The permit for the remodel of the former Cottage Grove Fitness Center was issued in
2007 for this 15,000 square foot building. The Carpet Center warehouse and showroom
opened in August 2010 and the fitness center will open on August 6. The 2200 square foot
liquidation center is anticipated to realize a fall 2011 opening.
PSCH:
The Public Safety / City Hall project (PSCH) continues to move forward toward construction.
Council authorized entering the bid stage on June 24. A mandatory pre -bid meeting was
hosted on August 3. Thirteen prospective bidders attended (bids are not anticipated to be
received from all attendees). Bids are scheduled to be received on August 18, interviews on
September 1 and bid award on September 21.
We have enclosed a spreadsheet that denotes the final square footage of the project to be bid,
which is 66,657 square feet of habitable space. This compares to the current City Hall at
24,148 square feet. While this project is designed as a terminal project (of sufficient size to
meet the needs of the community to full development) it is interested to note how the project
scope relates to the 2006 Space Needs Study. Within that study, the Hay -Dobbs Architects
projected that to meet our needs for 2010 we should build a facility ranging from 49,304 and
63,202 square feet. It is also important to note that the lower project size assumed off site
archiving, restricted office sizing, and limited enclosed squad parking. The larger project size
assumed a build out using traditional programming for storage, parking and office allocations.
The designed PSCH is 3,455 SF larger than the Traditional space planning allocation
projected to meet our 2010 needs.
Community Center Task Force:
The task force met on July 26 and by consensus made a recommendation to delay a voter
referendum question beyond November 2011 as has been anticipated. In a joint meeting of
the EDA, Planning Commission, and Council on August 3, 2011 by consensus that group
concurred with the task force recommendation. Staff has been working with the YMCA to this
point toward completion of a 52,767 square foot $14 million building with the intent that the Y
and the City would cost share the capital expense with the Y responsible for the operating
expense.
Home Depot Repositioning:
Staff has been working with Stonehenge development toward repositioning the vacant 10 acre,
96,000 SF +/- Home Depot property. Stonehenge has an LO1 with the Home Depot owners
and also with LA Fitness as a 45,000 SF anchor for the property (see enclosed ICSC article on
the company). We are anticipating a discussion with the EDA at this meeting at least at the
level of concept deal points with the goal of EDA action at the September meeting toward a
2012 construction schedule. It should be noted that the former Hollywood Video store is not
part of the Home Depot project although repurposing that property is also actively being
pursued by the property ownership.
Building Permit Update:
With four new home permits in July we have now hit 28 YTD. This is at a current pace of 50
new homes by year end which compares to 2010 of 45 single family homes plus the 44 unit
White Pines second addition. Average permit value is at 291,374 which is up significantly from
2009 and 2010 and at the same unit value of 2008 (good news!). Commercial permitting
continues to be limited to minor remodeling and systems projects (i.e. HVAC et al).
ICHOR Building Sale:
As the EDA is aware, ICHOR, in the business park, went through bankruptcy and vacated their
building on Hemingway Avenue. It is currently bank owned but has a purchase agreement on
the property at $1,650,000. Closing on the real estate is currently scheduled for August 11.
Summary of Space Needs Square Footage Allocations projected
for 2010 compared to the 2011 Wold Designed PSCH Project
Note: the 'limited" column includes the assumption for off -site storage
and archiving, restricted office spaces (which start at 36 and 48 SF)
and enclosed police parking significantly below benchmarked levels;
the traditional allocations includes on -site archiving, office spaces
which are somewhat larger and parking at benchmarked levels.
2006 Space
2006 Space
Needs
Needs
Limited
Traditional
Wold
Existing
Storage /parking
Programming
Design
Use
City Hall
for 2010
for 2010
for 2011
Police
8,376
17,901
18,322
26,741
Fire
NA
3,155
2,553
included
PD /FD Shared
NA
4,005
4,827
included
PS /GG Shared
NA
included
included
2,598
Gen Govt
9,292
14,881
19,225
8,822
Public Space
included
included
included
7,624
Total Office /Public
17,668
39,942
44,927
45,785
Mechanical
included
included
included
2,608
Police Parking
6,480
9,362
18,275
18,264
Total Sq. Ft.
24,148
49,304
63,202
66,657
Note: the 'limited" column includes the assumption for off -site storage
and archiving, restricted office spaces (which start at 36 and 48 SF)
and enclosed police parking significantly below benchmarked levels;
the traditional allocations includes on -site archiving, office spaces
which are somewhat larger and parking at benchmarked levels.
lee ,
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al
R i° A 4 L 9
LA FITNESS AIMS TO OPEN 50 NEW CLUBS PER YEAR
By Misty Milioto Reagin
ITNESS CENTERS ARE STRONG AND
fit tenants for many types of shopping centers, and one need not strain
to understand why. For starters, they repeatedly draw customers to the
shopping center, several tunes per week. Further, those customers pay
their membership dues in advance, which means they typically have
additional pocket money to spend at
neighboring stores. Then, roo, by boost-
ing sales for co- tenants, fitness centers
help landlords raise rents. LA Fitness is
one such tenant, and the privately held
drain is certainly on its game.
Established in Covina, Cali£, in
1984, LA Fitness offers state- of-the -art
equipment, basketball and racquetball
courts, a swimming pool, saunas, group
fitness rooms, indoor cychr.g and even
babysitting services. Most of the clubs
also contain a juice bar, under a separate
license agreement with the operator.
LA Fitness now owns some 370
sports clubs across 34 U.S. and Canada
markets. Of those, roughly 200 were
rolled out within the pest five years or so.
Many of these new units occupy space
vacated by the likes of Circuit City,
Kmart and Mervyn. LA Fitness plans
to open about 50 clubs per year, says Bill
Horner, the company's chief real estate
officer. Current plans include expanding
into Buffalo and Rochester, N.Y.; Jack-
sonville, Fla.; and California's Bay Area.
T 0 D A Y
"LA Fitness has been fiscally in a
solid position to take on such growth,
and there has been greater acceptance
Of health clubs in shopping centers,"
Horner said. "Additionally, we have a
sufficient number of clubs in which to
train and from which to pull talented
people to cake care of the members at
the new clubs."
The company remodels about 18
clubs per year. 'Remodels consist of, at
a minimum, new paint, carpet, graph-
ics and equipment and can go as far
as all new showers and locker rooms
— which drives the investment up to
ahout $500,000," he said. "We also re-
fresh about another 15 clubs per year,
which consists of a general spruce -up,
new graphics, paint couch -ups and par-
tial replacement of equipment "
LA Fitness likes regional, community
or neighborhood center spaces measuring
A U 6 tJ 5 r 2 0 1 1 I 9 C T 9 9
20 6 C T I AUGUST 2 0 1 1
between 35,000 and 60,000 square feet.
In dense urban areas the company will
consider opening 25,000- square -foot,
fitness -only units — that is, minus the
ball courts and swimming pool. LA Fit-
ness also tends to choose areas with a
minimum population of 60,000 within
Busy days and times
for a fitness center
are very different
from those of the
typical retailer,
and this difference
can affect parking
requirements.
a three -mile radius — generally afflu-
ent, educated residents. "We look for
good traffic flow, plenty of parking and
easy access," Homer said.
Busy days and times for a fitness
center are very different from those of
the typical retailer, and this difference
can affect parking requirements. The
busy times for LA Fitness are Monday,
Tuesday, Wednesday and Thursday
evenings at about 6 p.m., according to
Horner. This can actually be a plus for
the co- tenants. "I don't know of a sin-
gle retailer that doesn't need increased
traffic during those times," Horner
said.
LA Fitness does have a great eye for
real estate, according to Chris Weilm-
inster, senior vice president of leasing
at Federal Realty Investment Trust.
Weilminster should know, because
Federal Realty has five shopping centers
that are home to an LA Fitness club,
plus an additional two stated to open
by September 2012. "They are very ore-
Kendall Mall, Miami, EL & Weston Lakes Plaza, Weston, FL
www.creacom 888.488.CREC
ative in redoing spaces to add amenities
like pools and sports courts," Weilmul-
ster said. "They don't let existing space
deter there fiam going into a center."
Another landlord, Allison Lynch,
vice president of asset management at
Watt Cos., agrees rhat LA Fitness is a
fantastic tenant to have. Her company
has 40 retail centers, two o{ 'which house
LA Fitness. At Palo Woods Shopping
Center, in Harbor City, Calif., LA Fit-
nets took over half of a space u rinerly
occupied by Kmart. LA Fitness anchors
the other center — Alicia Towne Plaza,
in Mission Viclu Calif. in a former
Mervyns space. "I'm impressed that
they're re a retailer that (mows their busi-
ness well," she said. "They execute, and
their team is available as a real parn'rer
in the transaction."
It seems that landlords are the
ones seeking out LA Fitness to occupy
their centers. "The Mervyns locations
in California are a great example,"
Horner said. "They were built before
'he Ng tox world and the power cen-
ter lineups. They had great locations
in community-type centers, but there
aren't that many tenants that need
that type of location. So, landlords are
seeking us out." scr
For leasing, call (949) 255 -7200.
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City of Cottage Grove
Residential Building Permit History
Year
Permits
1990
313
1991
270
1992
417
1993
373
1994
425
1995
392
1996
321
1997
213
1998
220
1999
186
2000
145
2001
182
2002
296
2003
284
2004
308
2005
265
2006
185
2007
67
2008
89 Proj
2009
66
2010
89
2011
28 YTD
2012
•01 We
111 •�•
1 1 •m•
2020 Proj.
50 2030 Proj.
70
22,935
30,582
34,589
44,000
53,000
census
census
14WI I
Met C.
Met C.
3idential Construction Since 1970
wage 219
)tal 3205
450
400
350
300
250
200
150
100
50
0
Note: Unit counts do not include
157 unit Norris Square or 84 unit
White Pines senior housing
70 -79: Ave of 235 /year
80 -89: Ave of 182 /year
90 -99: Ave of 308 /year
00 -99: Ave of 189 /year
Total of 223.5 /year
nployment data from www.economagic.com
1 4 7 1013161922252831343740
Single/
Attached
Peak
ar
Residential
City;
Nat'l
Units Recession
Unemploy.
Unem I
p.
1970
162 Start 12/69 End 11/70
6A
1971
356
1972
248
1973
220 Start 11173
1974
213
1975
189 End 3/75
9.00%
1976
209
1977
250
1978
255
1979
251
1980
202 Start 1/80 End 7/80
7.80 %
1981
116 Start 7/81
1982
46 End 11/82
10.80 %I
1983
77
II
1984
150
1985
100
1986
196
1987
273
1988
404
1989
251
L
1990
329 Start 7190
3.50%
1991
270 End 3191
4.50%
7.80%
1992
410
4.30%
1993
373
3.60%
1994
406
2.70%
1995
382
2.60%
1996
300
2.60%
1997
205
2.10%
1998
218
1.90%
1999
184
1.80%
2000
145
2.40%
2001
182 Start 3/01; End 11/01
.
3.0{3%
6.30
2002
296
3.70%
2003
284
4.10%
2004
308
4.00%
2005
265
3.50%
2006
185
3.50%
2007
67 Start 12/07
3.90%
2008
89 continue
4.90%
2009
66 End 6/09
7.50%
110.20
2010
45
6.10%
i11 YTD
28 May -11
5.90%
9.20%
wage 219
)tal 3205
450
400
350
300
250
200
150
100
50
0
Note: Unit counts do not include
157 unit Norris Square or 84 unit
White Pines senior housing
70 -79: Ave of 235 /year
80 -89: Ave of 182 /year
90 -99: Ave of 308 /year
00 -99: Ave of 189 /year
Total of 223.5 /year
nployment data from www.economagic.com
1 4 7 1013161922252831343740