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HomeMy WebLinkAbout5.1c NorthPoint Term SheetTerm Sheet This Term Sheet as of this 9th day of November, 2021 by and between NorthPoint Development (aka NP CG Logistics, LLC), (the “Developer”) and the Cottage Grove Economic Development Authority (the “EDA”) and is intended to set forth the general terms upon which the parties hereto are willing to enter into a TIF Agreement. 1. Developer: NP CG Logistics, LLC 4825 NW 41st Street, Suite 500 Riverside, MO 64150 Attn: Evan Fittsit 2. Property: PIDs: 28-027-21-22-0002 29-027-21-11-0001 29-027-21-11-0003 29-027-21-12-0001 29-027-21-14-0002 29-027-21-21-0001 3. Legal Description of Property: The West Half of the Northeast Quarter of Section 29, Township 27, Range 21, Washington County, Minnesota And The West Half of the East Half of the Northeast Quarter of Section 29, Township 27 North, Range 21 West, Washington County, Minnesota. And The Northeast Quarter of the Northwest Quarter of Section 29, Township 27 North, Range 21 West, Washington County, Minnesota. And The East half of the East half of the Northeast Quarter of Section 29, Township 27 North, Range 21 West City of Cottage Grove, Washington County, Minnesota. EXCEPT the South 330 feet. And The West three-eights (3/8) of the Northwest Quarter of Section 28, Township 27 North, Range 21 West, Washington County, Minnesota. EXCEPT that land conveyed to the City of Cottage Grove in Warranty Deed dated April 14, 2000, recorded May 26, 2000, as Document No. 3105702, described as follows: That part of the West three-eights (3/8) of the Northwest Quarter of Section 28, Township 27 North, Range 21 West, Washington County, Minnesota, described as follows: Beginning at the southwest corner of the said Northwest Quarter; thence North 00° 53’ 28” East, assumed bearing along the West line of the said Northwest Quarter, a distance of 2646.81 feet to the northwest corner of the said Northwest Quarter; thence South 89° 53’ 43” East, along the north line of the said Northwest Quarter, a distance of 983.14 feet to the northeast corner of the said West 3/8ths of the Northwest Quarter; thence South 00° 19’ 37” West along the east line of the said West 3/8ths of the Northwest Quarter a distance of 24.55 feet; thence South 89° 51’ 33” West a distance of 935.63 feet; thence South 01° 09’ 18” West a distance of 2618.39 feet to the south line of the said Northwest Quarter; thence North 89° 58’ 53” West, along said south line, a distance of 35.76 feet to the point of beginning. 4. Minimum Improvements: Construction of multiple buildings containing office / manufacturing and warehouse space totaling approximately 3,440,000 square feet as note below in the table: Phase Square Feet Phase I 1,294,000 Phase II 730,000 Phase III 677,600 Phase IV 739,000 * sq/ft of each phase are subject to change but shall not be less than 3.440 million sq/ft 5. Public Improvements: Construction of street, water, and sanitary improvements on 105th Street, Ideal Avenue between 100th and 105th Street, and 100th Street, as well as construction of a roundabout with connection to the proposed Hadley Avenue and infrastructure installation for a future signal light at the intersection of 100th Street and Jamaica Avenue. The Developer shall construct the Public Improvements by April 30, 2024, in accordance with plans and specifications approved by the City. The City may inspect the Public Improvements as the improvements are being constructed and the Developer will dedicate the Public Improvements to the City upon completion. 6. Construction Schedule: Commence construction of each Phase by the Commencement Date, and substantially complete construction of each Phase by the Completion Date as set forth below. For the purpose hereof, “Commence” shall mean beginning of physical improvement to the Property for the respective Phase, including demolition, remediation, excavation, or footings and in the case of Phase I, mass grading other physical site preparation work. “Complete” shall mean that the Minimum Improvements are sufficiently complete for the issuance of a Certificate of Occupancy. Phase Commencement Date Completion Date Phase I April 30, 2022 July 30, 2024 Phase II April 30, 2023 July 30, 2025 Phase III April 30, 2024 July 30, 2026 Phase IV April 30, 2025 July 30, 2027 9. TIF District: EDA and City will establish Economic Development TIF District 1-20 (Northpoint Industrial), which public hearing is scheduled before the City Council on December 15, 2021. The development will meet the requirements of MN Statutes 469.176 Subd. 7, in which 85% or more of the buildings are for qualified manufacturing and/or distribution and the owner or operator of each building will agree to pay 90% or more of the employees of the building at a rate equal to or greater than 160% of the federal minimum wage for individuals over the age of 20 in effect at the time of issuance of certificate of occupancy for each Phase. Developer acknowledges that a violation of the above limitations on use may cause the termination of the TIF District and Note. The Developer agrees to notify the EDA immediately if at any time prior to the Termination of the Note if more than 15 percent of the Minimum Improvements within a Phase are occupied by any use other than one or more of the above uses. 10. Jobs: The Minimum Improvements will include creation of at least one thousand eight hundred seventy (1,870) jobs, of which three hundred (300) full-time equivalent jobs shall exceed 200% of the State minimum wage in effect at time of Certificate of Occupancy for the individual Phase. 11. Reporting: The Developer agrees to annually report to the EDA meeting the wage and job goal requirements in Section 9 and 10 for the term of the TIF Note for all applicable Phased completed prior to termination of the TIF Note. 12. Public Assistance: Subject to all terms and conditions of the TIF Agreement, the EDA will reimburse the Developer with Tax Increment generated from the Minimum Improvements for up to a principal amount of $8,311,000 (Present Value) of Qualified Costs related to the Public Improvements. “Qualified Costs” shall mean Public Improvements in Section 5 above including associated design and engineering fees. Payments will be made through a TIF Note (the “Note”) issued on a pay-as-you-go basis assuming 90% of increment at the rate of 4% interest rate per annum. The Note will be issued upon completion of the Public Improvements and proof of expenditure related to the Qualified Costs. 13. Look Back: Upon completion of Phase I, the EDA will review the total development costs for Phase I and anticipated TDC for future Phases and to the extent the TDC is less than $294,825,839 and shown as an Appendix in the TIF Agreement, the EDA will reduce the amount due under the Note on a dollar-for-dollar basis. 14. Business Subsidy: The parties acknowledge that the EDA is providing a Business Subsidy in accordance with MN Statutes 116J.993 through 116J.995 and that the EDA held the required public hearing on November 9, 2021. 15. Fees: The City acknowledges the Developer made an escrow deposit of $10,000 for out-of-pocket expenses for legal and financial consultant services related to TIF district creation, drafting, negotiation and approval of the Development Agreement, analysis, and administrative fees associated with this transaction. This includes costs related to the above incurred to date as well as future expenditures. The Developer will be required to deposit additional funds if the initial deposit is fully drawn. The Developer shall pay all other normal and customary City fees and expenses for the approval and construction of the Minimum Improvements. 16. Taxes: Developer agrees for itself and its successors and assigns that prior to the end term of the Note it will not: (i) Cause a reduction in real property taxes paid (ii) Transfer the property or any Phases to an entity that would result in the Minimum Improvements being exempt from property taxes (iii) Will not seek tax exemption, deferral or abatement for the Minimum Improvements (iv) Will not seek or file any petition to reduce the market value or property taxes through the term of the Note 17. Miscellaneous: (i) No transfer of Property or Development Agreement without EDA consent which will not be unreasonable withheld.