HomeMy WebLinkAbout4.4 Request to Submit Letter of Intent (LOI) for 7470 East Point Douglas Road
TO: Economic Development Authority
FROM: Christine Costello, Acting Community & Economic Development Director
DATE: April 4, 2019
RE: 7470 East Point Douglas Road – Request to Submit a Letter of Intent (LOI)
Background
The property at 7470 East Point Douglas Road, which is located at the corner of Hefner Avenue
and East Point Douglas Road is vacant and listed for sale. The previous use at the site has
included a gas station and most recently the Village Transmission Shop, which closed the Fall
2018.
The Comprehensive Plan guides the property for commercial land use that would include retail,
service, and office uses. The site is zoned B-2, Retail Business. The purpose of the B-2 District
is to encourage retail sales and services by grouping businesses that minimize the influence on
surrounding residential neighborhoods. Automotive repair is not allowed in the B-2 District, and
the assumption is that at one time (1970-1960s) automotive repair was allowed so the
transmission shop has been operating as a legal non-conforming us. MN State Statute allows for
the replacement, restoration or improvement but not the expansion of the nonconforming right.
The right to continue to operate a legal nonconformity is lost if the use is discontinued for more
than one year. City staff was able to establish that the Village Transmission Shop discontinued
their use November 8, 2018. If an automotive use purchased the site before the November date
they would be allowed to operate under the legal non-conforming rights.
The City of Cottage Grove has been a participant in the Red Rock Corridor (Corridor) since in
began in 2016. The Corridor is a proposed 30-mile transitway, connecting the Twin Cities
southeastern suburbs to St. Paul and Minneapolis. The transitway would originate in Hastings
with two stops in Cottage Grove before continuing towards St. Paul and Minneapolis. Through
the Bus Rapid Transit (BRT) planning for the Corridor two BRT Stations areas were identified with
one of the stations near 7470 East Point Douglas Road. A small area plan was also developed
to demonstrate how a BRT Station could potentially stimulate economic development and
redevelopment. The site is listed as a development opportunity within the small area plan as well.
The small area plan is attached to this report.
Discussion
The property at 7470 East Point Douglas Road was constructed in 1963 and is on approximately
0.54 acres. The former Village Transmission Shop ceased operation in November 2018 and has
been vacant since that time. The site is currently for sale and listed for $319,900. A Phase I
Environmental Site Assessment (ESA) has been completed and due to its previous uses, that
included underground storage tanks (have been removed) it has been recommended by the
environmental testing company that additional subsurface investigation should be conducted to
determine the presence or absence of soil/groundwater contamination.
Economic Development Authority
April 4, 2019
Page 2 of 2
City staff is requesting the ability to submit a Letter of Intent (LOI) to purchase the property. The
opportunity for the City/EDA to land bank the site and make it available for development of a
commercial use that is permitted in the B-2 Zoning District may initiate redevelopment activities
in this is area. With the request to submit an LOI we would also look to negotiate a lower sales
price since there is additional environmental investigation work to be completed. The purchase
of the site would be paid for from the EDA Trust.
Recommendation
Authorize the EDA Executive Director to submit a Letter of Intent (LOI) to Remax Results
Commercial Group for the negotiation and purchase of 7470 East Point Douglas Road and begin
additional environmental investigation work.
Attachments
Offering Brochure
80th Street Small Area Plan
JANUARY 2018
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80 STREET
SMALL AREA PLANSMALL AREA PLAN
Prepared for: Prepared by:
Kimley-HornPerkins + Will
City of Cottage Grove
Michael Lamb Consulting, LLC. Tangible Consulting Services
Washington County
Table of Contents
Existing Conditions Analysis ............................................................................................................................................................
2
Overview of Conditions...............................................................................................................................................................
3
Highlights of Previous Plans and Studies....................................................................................................................................3
Small Area Observations .............................................................................................................................................................
4
Market Analysis ..............................................................................................................................................................................
4
Review of Socioeconomic Data ................................................................................................................................................... 4
Review of Existing Markets ......................................................................................................................................................... 5
Developer Interviews ..................................................................................................................................................................
6
Key Findings and Conclusions ..................................................................................................................................................... 6
Transit-Supportive Principles ..........................................................................................................................................................
7
Small Area Vision ............................................................................................................................................................................
7
Development Scenarios ..................................................................................................................................................................
8
School District Site ....................................................................................................................................................................
11
Mobility Improvements ................................................................................................................................................................
13
Priority Corridors ......................................................................................................................................................................
13
Implementation Strategies ...........................................................................................................................................................
13
General Strategies ....................................................................................................................................................................
14
Implementation Challenges ...................................................................................................................................................... 14
Overcoming Challenges ............................................................................................................................................................ 15
Site Specific Strategies: School District 833 Offices, 7362 East Point Douglas Road ................................................................ 15
Acknowledgments
CONSULTANT TEAM
PROJECT ADVISORY TEAM
Kimley-Horn
John Burbank, City of Cottage Grove
Michael Lamb Consulting, LLC
Lucy Galbraith, Metro Transit
Perkins + Will
Emily Jorgensen, Washington County
Tangible Consulting Services
Daniel Peña, Metropolitan Council
Will Schroeer, East Metro Strong
Nate Sparks, City of St. Paul Park
Scott Thompson, Metro Transit
Hally Turner, Washington County
Kevin Walsh, City of St. Paul Park
Corrin Wendell, Metropolitan Council
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Figure 1: 80th Street Small Area
The following small area plan was developed for the City of Cottage Grove with support from Washington County Regional
Railroad Authority. This planning process was an outcome of one of the recommendations from the Red Rock Corridor
Implementation Plan to work with cities along Highway 61 to update comprehensive plans with consideration given to
increasing population and employment density within the proposed station areas.
The goals for this small area planning process were to:
Support the comprehensive plan process
Support the character and vision of the community
Stimulate economic development and redevelopment
Improve connection through the community
Identify transit-supportive strategies to build potential ridership
Existing Conditions Analysis
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The existing conditions analysis provides an overview of the plans and studies that have been done to date in the 80 Street
small area and documents the existing urban landscape of the small area. This information provides the foundation upon which
the small area plan was built. While highlights of the existing conditions analysis are found in this plan, more detailed
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information can be found in the Cottage Grove & St. Paul Park Existing Conditions Memo posted on the Red Rock Corridor
website.
OVERVIEW OF CONDITIONS
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The 80Street small area includes a mix of residential and commercial uses, as well as some parkland in the northern part of
the small area. The area also includes some undeveloped parcels and vacant buildings. Senior housing is currently located in the
northwestern part of the small area, single-family housing is currently located in the southeast, and higher density housing is in
the northeast. The center of the small area is occupied by a variety of stand-alone businesses as well as a large shopping
development.
The 80th Street small area is fairly well-connected given its suburban context. The building pattern and elevations are related,
with little development existing in areas of steeper grade to the northwest of the small area. Parcel sizes in the area are medium
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to large, and traffic counts were approximately 17,500 vehicles per day along 80 Street in 2015.
HIGHLIGHTS OF PREVIOUS PLANS AND STUDIES
Plans and studies reviewed include steering committee minutes, a community survey, and two background reports for the 2040
comprehensive plan; the East Ravine Master Plan; omprehensive Housing Needs Assessment Update;
and the Red Rock Corridor Implementation Plan.
Washington County Comprehensive Housing Needs Assessment Update, 2017
ensive Housing Needs Assessment Update, produced by Maxfield Research and Consulting in
March 2017, projects housing demands for submarkets in Washington County from 2017-2030 and provides recommendations
on the amount and types of housing that need to be built to satisfy demand. The study also identifies areas for potential
housing development.
Cottage Grove Steering Committee Documents, 2016
Notes from the Cottage Grove Comprehensive Plan Steering Committee include a discussion of key opportunities and challenges
in the city as well as some of the priorities of those in leadership within the city.
Talk About Cottage Grove! Survey Results, 2016
This survey, conducted in the fall of 2016, was part of the 2040 comprehensive plan update and was used to gauge perceptions
of community strengths and opportunities and challenges around healthy living and food access in the city. The survey indicates
(among other things) that retail and employment should be areas of focus in the small area plan.
Cottage Grove 2040 Comprehensive Plan: Background Report, 2016
The Background Report prepared by Stantec for the City of Cottage Grove serves as an overview of historical and existing
conditions in the city. The report documents the small area demographic and land use changes and provides insight into how
the areas may continue to change in the future.
Cottage Grove Background Report: Market and Development Context, 2016
The Market and Development Context Report, prepared by Stantec and Tangible Consulting Services in 2016, outlines the
market and development context that will shape the future growth of Cottage Grove. This report provides a more in-depth look
at the economy and market dynamics of the city.
Red Rock Corridor Implementation Plan, 2016
High-level station area plans were developed as part of the Implementation Plan to help identify station area land uses that
could support improved transit ridership. The Cottage Grove Station Area Planning Report suggested increasing the mix of uses
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within the 80 Street small area.
East Ravine Master Plan, 2005
East Ravine is the latest section of the city to be open for urban development. A master plan was completed in 2005 that
describes land use designations, major roadway alignments, park and open space locations, and the types of utility extensions
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necessary to serve the area. Development occurring in East Ravine may impact the demand for certain types of elements in the
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80 Street small area.
SMALL AREA OBSERVATIONS
Accessibility
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Highway 61 and 80 Street are the prominent transportation features in the small area. Highway 61, though it connects the
small area to the remainder of the metropolitan area, is a barrier within the small area, since there are few places to cross it,
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and crossing freeways can be uncomfortable as a pedestrian. 80 Street is a major east-west arterial that connects the eastern
parts of Cottage Grove to Highway 61.
Local vehicular access to most sites within the small area is good, which is supportive of development. The roadways generally
accommodate a high volume of vehicle traffic for those traveling to or from the area by car. East Point Douglas Road and
Hardwood Avenue serve as frontage roads to improve accessibility within the commercial areas.
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While there are trails along East Point Douglas Road and 80 Street, access for bicyclists and pedestrians in the small area can
be a challenge, since the businesses in the area have large setbacks and there are not pedestrian connections from the street to
the door of the businesses in the small area. While the connections from the neighborhood to the south to the Hy-Vee and
Home Depot commercial area via Harkness Road and Hearthside Road are beneficial, these entrances lead people to the loading
area of the commercial area and the pedestrian infrastructure ends. Continued pedestrian infrastructure and a more welcoming
pedestrian entrance with wayfinding would improve the bicycle and pedestrian accessibility of this area.
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Additionally, while there are signalized pedestrian crossings on East Point Douglas Road south of 80 Street and at the
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intersection of East Point Douglas Road and 80 Street, they are not the most comfortable crossings due to the amount of
traffic and the width of the roadways.
Visibility
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Some of the parcels in the 80 Street small area are visible from Highway 61. This is one of the reasons why a retail district
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exists at this location. In this stretch of Highway 61, daily traffic volumes are 38,000 vehicles per day (2016 traffic count). 80
Street is an A-Minor Expander with 17,500 vehicles per day (2015 traffic count).
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The topography south of 80 Street, especially closer to Highway 61, tends to be flat, which provides maximum visibility from
the highway in both directions. This is the area where retail uses tend to be the most concentrated. Retail uses located along
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the north side of 80 Street have good visibility to and from 80 Street. However, they do not have good visibility to and from
Highway 61 due to the topography.
Neighborhood Amenities
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Oakwood Park and Hearthside Park are located in the 80 Street small area. The commercial core of the 80 Street small area
includes a variety of businesses that provide a range of goods and services that would be attractive for many types of
households to live nearby.
Market Analysis
Themarket analysis informs the planning process and provides stakeholders with data and analysis of the short- and long-term
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market trends that will shape and shift opportunities in the 80 Street small area. Important market factors related to
demographic trends, economic trends, real estate supply and condition, and the opinions of real estate experts were evaluated
and used to identify key findings and draw conclusions. While highlights of the market analysis are found in this plan, more
detailed information can be found in the Cottage Grove & St. Paul Park Small Area Plans Market Analysis Report posted on the
Red Rock Corridor website.
REVIEW OF SOCIOECONOMIC DATA
With substantial tracts of undeveloped land, Cottage Grove has grown at a consistent rate for decades. This pattern is expected
to continue into the foreseeable future in which the population will grow between 10 percent and 12 percent each decade
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through 2040. This will translate into approximately 3,800 to 4,800 new persons every decade. This amount of forecasted
growth will require new residential and commercial development to support this growth.
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The 80Street small area experienced a sharp increase in its median age between 2000 and 2010 (28.5 to 32.5), which was
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likely due to the construction of new senior housing. Despite this increase, the median age in the 80 Street small area remains
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relatively young and homeownership remains relatively high. The 80 Street small area also has a higher proportion of young
households, renters, and single-parent families than the 7-County Twin Cities Metropolitan Area.
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The 80Street small area has a 2015 median income of $79,500, which is relatively close to the Cottage Grove median, and is
somewhat counterintuitive to the fact that it has a higher proportion of young households, renters, and single-parent families,
all of which tend to have lower incomes. This is because median income, by definition, means half the number of households
above and half below. Thus, if the small area has a larger number of higher income households, this will mask the presence of
lower income households.
REVIEW OF EXISTING MARKETS
The current and foreseeable conditions of the housing, retail, and office markets in and near Cottage Grove were reviewed to
determine the ability of the current supply to meet market demand in each of these sectors.
Housing Market
Residential development in Cottage Grove has been dominated by single-family housing. Senior housing has also played a
growing role in residential development since 2007; however, there has been little non-senior multifamily development in the
last 20 years.
The Cottage Grove submarket (which includes the communities of Cottage Grove, St. Paul Park, Newport, and Grey Cloud Island
Township) has a calculated need of nearly 7,800 housing units through 2040. Over 63 percent, or roughly 4,900 of those units,
would be considered transit-supportive. While adding this housing, it will be important to provide a variety of housing styles at
various price points that appeal to a range of household types.
Retail Market
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The 80Street small area includes a strong complement of different retail and service-retail businesses (located primarily on the
strong traffic counts, good visibility, higher incomes, flexible building
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layouts, and a complementary mix of existing stores. Currently, the 80 Street small area has 34 retail properties with a
-Vee are the anchor businesses that serve to draw traffic into the district.
According to CoStar, an American commercial real estate information provider, vacancy remains high at 25 percent due to a
vacant former Home Depot store; however, plans to repurpose the vacant building are progressing and will likely result in a new
occupant in the near future. Average quoted rent for all available spaces in the district is currently just over $15 per square foot.
This is consistent with the average rent per square foot for South Washington County.
Constraints to future retail market include surrounding residential uses, steep slopes, poor access, and conserved land.
Significant retail opportunities will generally involve redevelopment of existing properties.
Office Market
While job growth in the Cottage Grove and St. Paul Park area has consistently outpaced that of the metropolitan area and the
United States over the last 15+ years, there are only 0.04 knowledge sector jobs for
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every household (jobs in the knowledge sector typically contain the most office-based jobs). The 80 Street small area has
roughly 140,000 square feet of office space spread across 13 properties. The vacancy rate is low at just over two percent.
Average quoted rent is $13.55 per square foot, below the South Washington County average lease rate. Much of the office
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space in the 80 Street district is integrated among retail properties.
Office demand in the Red Rock Corridor is closely related to the needs of the local household base. Therefore, it is assumed that
as the local household base in the Red Rock Corridor increases so will the demand for small office space. Currently, there is
approximately 21 square feet of office space in the corridor for every household in Cottage Grove and St. Paul Park. Assuming
the amount of office square feet per household will decline over time, and assuming a future household base of 20,600, this will
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translate into a need for roughly 350,000 total square feet of office space an excess demand for 48,000 square feet over the
next 25 years or so. In other words, this would be equivalent of three new small office buildings (16,000 square feet) every six to
eight years.
DEVELOPER INTERVIEWS
Five real estate professionals familiar with Cottage Grove and St. Paul Park were interviewed for their perspective on the market
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for housing, retail, and office uses both at a macro level as well as specifically within the 80 Street small area.
There was agreement among those interviewed that there is demand for affordable and senior housing, although interviewees
felt that public financial support would be required for affordable housing development.
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There was general agreement that the existing retail in the 80 Street small area has good anchors, which is contributing to an
overall healthy level of interest by retailers and should help the areas remain viable for retail into the foreseeable future. It was
stated that there is demand for one or more dining or entertainment destinations, which is hampered somewhat by the limited
amount of available and adequate sites.
Interviewees felt that the small areas of the Red Rock Corridor are not a market for office space, but that it might be possible in
the short-term to support pedestrian-oriented retail areas on a small scale.
KEY FINDINGS AND CONCLUSIONS
The following are key findings and conclusions regarding the short- and long-term market opportunities for transit-supportive
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development in the 80 Street small area.
Overall Factors Influencing Market Demand
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The 80Street small area is currently experiencing development momentum. Hy-Vee recently opened a new store on the site of
a former Rainbow Foods, and a development project is being planned for the vacant Home Depot property. Moreover, two
large senior housing developments are underway in the small area. This development energy is an indicator of not only the
strength of the overall market for different types of real estate but has raised the character of the small area to one with vitality
and optimism.
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Commercial expansion is limited, however, by the surrounding residential uses and the topographic change north of 80Street
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and further east along 80 Street in which steep slopes and poor visibility impact retail viability.
Short-Term (Less than Five Years)
Although the market for market rate rental housing is unproven in the Cottage Grove area, the current housing demand,
growing development momentum, potential for a walkable location, and possibility of a strategic redevelopment site suggest
that the development community may be in a position to test the market.
More households will drive demand for more neighborhood retail space. The redevelopment of the Home Depot space will
presumablysatisfy a large portion of the near-term demand if the uses are primarily focused on the local household base.
Calculated short-term demand for office space is limited; however, existing space is very tight with vacancy throughout the Red
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Rock Corridor extremely low. In the 80 Street small area, office users are heavily skewed toward the niche market of medical
office space and the opportunity exists to brand the area as a medical district, potentially increasing the demand for office
space.
Long-Term (More than Five Years)
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Long-term potential for housing in the 80 Street small area will be driven by strong demand. The central location, access to
retail amenities, medical offices, and transit enhancements will make this a desirable location for housing, resulting in its
likelihood of capturing a high proportion of future multifamily demand. The challenge will be whether land can be identified and
planned to easily accommodate future development.
Given the constraints on land needed for expansion, most new retail space will likely be the result of redevelopment, which may
yield new and improved spaces but not necessarily result in a net increase in additional retail space.
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Similar to the long-term prospects of retail space, land constraints will limit the ability to easily add office space. In addition,
based on the amount of household growth projected for Cottage Grove through 2040, it would not appear that even long-term
office demand would be sufficient to reach levels to justify redevelopment at significantly higher densities.
Transit-Supportive Principles
Based on the existing conditions and market analysis of the small area, as well as engagement with the public and stakeholders,
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the transit-supportive principles found in Table 1 were developed to guide the 80 Street small area.
Table 1: Transit-Supportive Principles for the 80th Street Small Area
Create a safe and inviting pedestrian network between destinations in the small area
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Increase pedestrian connections between the residential and commercial areas of the small area
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Prioritize pedestrian connections from streets to the doors of commercial developments
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Increase bicycle connections within the small area
Encourage parking to be organized secondary to the pedestrian environment
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Support shared parking agreements
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Encourage bicycle parking to be included with new developments
Increase the diversity of housing options in the small area through the support of market rate and
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affordable multifamily housing
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Encourage horizontal mixed-use developments within the small area
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Allow for densities of at least 40 units per acre within the small area (currently ranges from 1-4 to 24
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units per acre)
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Introduce pedestrian-scale lighting, wayfinding, plantings, and street furniture in the small area
Increase street connectivity as large sites redevelop
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Encourage pedestrian-oriented site designs
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Introduce public gathering spaces
Small Area Vision
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The following vision was written for the 80 Street small area based on public and stakeholder input:
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The vision for the 80 Street small area is to diversify land uses within this established retail district with
new commercial types and housing options. Current pedestrian and bicycle infrastructure will be
supplemented with improvements connecting bicyclists and pedestrians to the doors of residential and
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commercial developments. The 80 Street small area will be a vibrant place where people can comfortably
walk and bike from their homes to surrounding retail and recreational destinations.
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Development Scenarios
As part of the market analysis for the plan, the assessed property value per square foot was investigated for the parcels within
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the small area. This information is displayed for the 80 Street small area in Figure 2.
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Figure 2: Assessed Property Value per Square Foot by Parcel in the 80 Street Small Area
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The existing conditions and market analysis was used to identify potential opportunity areas within the 80 Street small area.
These areas are shown in Figure 3. The purpose of this analysis was to identify potential project areas that may be of interest to
developers in the near- to medium-term. It is important to note that the participation of existing property owners, through sale
of the property or some other form of collaboration, is a critical condition for any new development to proceed. This analysis
did not evaluate the views of existing property owners and does not imply that identified development opportunity sites will be
redeveloped or should be redeveloped. It does not take away or diminish the rights of property owners to keep ownership of
their properties or to sell their properties to whomever they choose. Talking to existing property owners would be an important
early step in further exploring the development potential of any of these sites.
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Figure 3: 80 Street Small Area Potential Opportunity Areas
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The potential opportunity areas were then further classified as areas likely to change and areas to possibly change. The areas
identified as likely to change are those that developers would likely be interested in first. These classifications are depicted in
Figure 4.
Figure 4: 80th Street Small Area Opportunity Area Classifications
The potential opportunity areas were further thought out into development scenarios to visualize how such developments
could look in the community, prThe development
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scenario created for the 80 Street small area is located on East Point Douglas Road at the South Washington School District 833
site between the Hy-Vee and Hillside Trail.
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SCHOOL DISTRICT SITE
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A likely candidate for redevelopment in the 80 Street small area is the school district property on East Point Douglas Road. This
site is located south of the Hy-Vee site and is shown to accommodate a range of commercial, retail, and residential uses (shown
in Figures 5 and 6). Full mixed-use buildings front onto East Point Douglas Road, and multifamily buildings are organized around
a prominent common green space. The development also includes townhouse and quadplex residential uses that provide
another housing choice in scale with the surrounding single-family neighborhood.
Site: 7.25 acres
Commercial/Retail: 17,800 square feet
Multifamily Units: 110
Townhouse Units: 16
Big House Units: 28
The gateway site into the neighborhood is shown (also in Figures 5 and 6) supporting two smaller mixed-use buildings that are
more in scale and character with the adjacent neighborhood. The buildings include ground floor commercial, service, or both
uses with rental units above.
Site: 1.45 acres
Commercial/Retail: 20,000 square feet
Multifamily Units: 50
Figure 5: Development Scenario Between Hy-Vee and Hillside Trail
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Figure 6: Rendering of the development scenario between Hy-Vee and Hillside Trail
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Mobility Improvements
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Mobility improvements within the 80 Street small area would be beneficial for those walking and bicycling throughout the
small area as well as for connections to the proposed Red Rock Corridor bus rapid transit (BRT) station. As indicated in Figure 7,
mobility improvements are identified throughout the small area.
Figure 7: Proposed Mobility Improvements within the St. Paul Park Small Area
PRIORITY CORRIDORS
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While there is fairly significant bicycle and pedestrian infrastructure throughout the small area, the neighborhood south of 80
Street currently has minimal connections to the north and south other than East Point Douglas Road. As redevelopment occurs
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near 80 Street, the connections from the neighborhood to the residential and retail area to the northwest will be increasingly
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important. Additionally, bicycles and pedestrians can currently only cross Highway 61 on the south side of 80 Street, and the
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sidewalk on the north side of 80 Street ends abruptly east of the bridge. When the 80 Street bridge over Highway 61 is
reconstructed, shared use paths should be included on both the north and south side of the bridge.
Implementation Strategies
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The 80Street small area presents opportunities for placemaking (creating a unique identify for the area) and development that
would increase the vibrancy of the area around the station, enhance its value to the community, and build population and
transit ridership. This section of the plan offers implementation strategies for proposed improvements to move this plan to
actionable change.
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The recommended implementation strategies build on research, analysis, and engagementincluding market research,
observations of development trends, interviews with developers, and discussions with the project steering committee and the
public.Site-specific recommendations also draw on the outcomes of the December 5, 2017 Implementation Workshop, which
gathered implementation leadership at the city and county levels to brainstorm how to implement development concepts for
Cottage Grove and St. Paul Park small areas.
GENERAL STRATEGIES
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Some general implementation strategies for encouraging transit-supportive development in the 80 Street small area are as
follows:
Financial Strategies
Create tax increment financing (TIF) districts as requested by developers for sites within the small area
Bond to help developers secure a low interest rate
Dedicate resources to help secure land for transit-supportive developments
Regulatory
Amend zoning or create zoning overlays that allow for mixed uses and at least 40 units per acre in the small area
Create or amend site plan regulations to require developers to construct pedestrian infrastructure from the door
of their building to the sidewalk or trail along the street
Require bicycle parking at new developments within the small area
Create design guidelines for the small area so that development and redevelopment maintains the character
desired by the community
Encourage parking to be oriented second to the pedestrian environment with the small area
Policy
Establish economic development as a priority and share this priority with other departments
Connect small area plans and economic development chapter of the comprehensive plans
Make transit-
comprehensive plan and specifically refer to the Red Rock Corridor and building ridership in the corridor
Review role of and potentially expand responsibilities for Economic Development Authority
Promotion
Identify advocates for transit-supportive developments and communicate consistently
Participate in a corridor-wide economic development strategy
Educate the public and city councils regarding transit-supportive development
Host developer panels to discuss development opportunities within the small area
Advertise potential development or redevelopment opportunities
Land Assembly
Support land acquisition for transit-supportive developments
Public Improvements
Fund enhanced streetscaping, public art, or community spaces within the small area
Maintain infrastructure to quality standards to entice continued and additional development
Create a consistent pedestrian network throughout the small area
IMPLEMENTATION CHALLENGES
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Our market and development research found market support for both retail and residential development in the 80 Street
small area. Nevertheless, development in the small area will face challenges, particularly where it entails redevelopment of
already developed property. Among them are the following:
{źƷĻ ğƭƭĻƒĬƌǤ͵ Acquiring property for redevelopment in the small area adds a cost premium compared with greenfield
development (building on undeveloped land). It also extends the development timeline and introduces holdout risks.
\[ğĭƉ ƚŅ ƦƩĻĭĻķĻƓƷƭ͵ The multifamily housing and retail formats as envisioned would be pioneering in the small area.That
introduces uncertainties for developers because there are not rent precedents that developers can use to estimate their
future rental income.
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tǒĬƌźĭ ƩƚƌĻ͵ While Cottage Grove has a history of taking action to attract development, implementing the 80 Street small
area plan will require new types of actions, with implications for staffing, financial planning, and communication.
OVERCOMING CHALLENGES
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The following are some approaches that may be used to pursue the development vision in the 80 Street small area:
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LƓƷƩƚķǒĭĻ ƓĻǞ ŷƚǒƭźƓŭ ğƓķ ƩĻƷğźƌ ğƷ ƷŷĻ ĭƚƩĻ ƚŅ ƷŷĻ ƭƒğƌƌğƩĻğ͵There are many benefits to redevelopment in the 80
Street small area at the South Washington County School District 833-owned property at the core of the small area. Being
largelyin public ownership, it presents fewer site assembly challenges than most of the other redevelopment sites. The
large size of the site means that it offers the opportunity to provide something new and special for Cottage Grovea high-
quality environment with transit-supportive forms of housing and retail and opportunities for placemaking and identity-
building. New housing and retail at the site will also build the market for subsequent transit-supportive projects and provide
rent comps to reduce developer uncertainties for future projects.
th
ağƩƉĻƷ ƷŷĻ ƚǒƷƌǤźƓŭ ƚƦƦƚƩƷǒƓźƷǤ ƭźƷĻƭ͵ The development sites north of 80 Street have an important role to play in
diversifying the and increasing the number of households that can support the c
businesses and transit service. However, developers tend to specialize in particular styles of development, with most
suburban housing developers focusing on lower density housing formats. To attract high quality multifamily housing
development to the outlying development sites, the City of Cottage Grove should plan on investing time and energy in
marketing the sites to the development community.
ağƉĻ ƦǒĬƌźĭ ƩĻğƌƒ źƒƦƩƚǝĻƒĻƓƷƭ͵ Every action that increases the comfort for pedestrians will improve the attractiveness
of the area for redevelopment. Implementing plan recommendations related to bicycle and pedestrian connectivity,
intersection improvements, and wayfinding (directional signage) will improve the attractiveness of the area to prospective
developers.
{ĻƷ ŷźŭŷ ķĻƭźŭƓ ƭƷğƓķğƩķƭ ŅƚƩ ƓĻǞ ķĻǝĻƌƚƦƒĻƓƷƭ͵ New development has a visual impact for a long time. It is important to
put high design standards in place to ensure that it benefits the community and sets a high bar for subsequent
development projects. The standards may differ for different subareas within the small area. Setting standards may entail
changes to the zoning code, map, or both and may be supplemented by the creation and adoption of development
objectives or design standards documents.
tƩĻƦğƩĻ Ʒƚ ƦƌğǤ ğ ŅźƓğƓĭźğƌ ƩƚƌĻ źƓ ƭǒƦƦƚƩƷźƓŭ ƓĻǞ ķĻǝĻƌƚƦƒĻƓƷ͵ Public financial support is expected to be required for
redevelopment projects in the small area. Some level of financial support may also be required for development of
undeveloped land, where proposed development types are pioneering for Cottage Grove. Specific steps that could be taken
to prepare for playing an appropriate development finance role include:
Evaluating the likely public sector costs for development through a pro forma analysis
Preparing a development finance toolkit in anticipation of development
Evaluating and deciding on a reasonable pace of public sector development and placemaking investment that can
be sustained over the next couple of decades
Adopting a communication strategy about development-related goals and the public sector actions that may be
required to attract and shape development. Cities need to invest in themselves over time, but public
understanding of that reality requires ongoing communication.
SITE SPECIFIC STRATEGIES: SCHOOL DISTRICT 833 OFFICES, 7362 EAST POINT DOUGLAS ROAD
A new mixed-use community is proposed for this site, with residential and retail elements. It would offer retail businesses that
have a more walkable character than what is already available in Cottage Grove. It would also provide housing options to
residents that are not currently available in the city.
New households would support nearby businesses and contribute to ridership for the future transit service. With high-quality
design, it can be visually attractive and establish a sense of positive momentum. It can also serve to attract subsequent
development and additional investment in the community. The proposed development of this site would increase the taxable
value of the property.
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{źƷĻ ĭŷğƩğĭƷĻƩźƭƷźĭƭ͵ The land area is around 308,000 square feet. The cumulative assessed value is approximately $5,200,000, or
$16.70 per square foot. The site comprises two parcels. Most of the site is owned by Washington County School District 833 and
used as the district headquarters. A smaller, privately owned commercial property is situated at the intersection of East Point
Douglas Road & Hillside Trail intersection. Each of the properties has a building on it.
The site is visible from Highway 61, in an area that is anchored by a strong set of retail businesses, including the new Hy-Vee
store. The freeway exposure is appreciated by some housing developers because it contributes to the marketing of a
development.
CƚǒƓķğƷźƚƓ ŅƚƩ ƭǒĭĭĻƭƭ͵ Site assembly is potentially simplified by public sector (school district) ownership of most of the site.
The large site allows for staging implementation over multiple phases and for building amenities into the development.
Proximity to the new Hy-Vee grocery store would be attractive for future households and retail businesses.
/ŷğƌƌĻƓŭĻƭ͵ Sanitary sewer capacity in this area is constrained and may need to be addressed in the future. Additionally, public
financial support is likely to be needed in order to attract development. Further, the views of nearby residents and business
owners are still unknown.
LƒƦƌĻƒĻƓƷğƷźƚƓ ƭƷƩğƷĻŭǤ͵ With an uncomplicated ownership pattern, there are two approaches to site assembly. The city could
take on site assembly for redevelopment, or the property could be marketed to and purchased by a developer partner directly.
One approach is to initially work to attract a developer to purchase the site. If, for timing or other reasons, there is a risk of
losing the property to a reuse or redevelopment that is not in the public interest, city site acquisition could serve as the
contingency plan.
Information development and communication with property owners are first steps. Property information should be assembled
and pursued, including appraisal of the market value of the two properties, title research, and assembling of what is known
about potential environmental contamination. A concept level financial analysis of the desired development concept can
provide a clearer sense of the public financial support that will be required. Workforce and senior housing may also be explored
for the alternative channels of development finance they might unlock and the community needs they may meet. Lines of
communication should be opened with the two property owners in order to understand their short- and long-term goals and
their potential willingness to sell or relocate.
Attracting developer interest comes next. If the city and school district decide that they have compatible goals, and when the
timing is right for the school district, they can work together to market the development opportunity to developers. A selected
developer should provide a concept plan for the entire site that is compatible with public goals and offer a more detailed
development plan for a first phase of the development. A first phase that includes some of the important site amenities will
make it easier to complete subsequent phases.
Readiness for development also entails:
Rezoning property, and otherwise establishing clear guidance for development, in support of plan goals
Doing additional community outreach, including with neighbors of the future development
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