01-09-2024 EDC Agenda PacketA.5:30 P.M. - CALL TO ORDER
B.APPROVAL OF AGENDA
Commissioners may add or delete items at this time.
C.APPROVAL OF MINUTES
C.1 Approve Economic Development Commission Minutes of December 12, 2023.
D.VISITOR PRESENTATIONS
E.DISCUSSION / GENERAL BUSINESS ITEMS
E.1 West 78th Street Renewal and Renovation TIF District Application - Roers
F.DIRECTOR'S REPORT
G.ADJOURNMENT
AGENDA
CHANHASSEN ECONOMIC DEVELOPMENT COMMISSION
TUESDAY, JANUARY 9, 2024
FOUNTAIN CONFERENCE ROOM, 7700 MARKET BOULEVARD
1
Economic Development Commission Item
January 9, 2024
Subject Approve Economic Development Commission Minutes of December 12, 2023.
Section APPROVAL OF MINUTES Item No: C.1
Prepared By Amy Weidman, Admin Support Specialist File No:
SUMMARY
BACKGROUND
DISCUSSION
RECOMMENDATION
Staff recommends that the Economic Development Commission approve the December 12, 2023
Commission minutes.
ATTACHMENTS
EDC Minutes dated December 12, 2023
2
CHANHASSEN ECONOMIC
DEVELOPMENT COMMISSION
REGULAR MEETING
DECEMBER 12, 2023
Chair Anderson called the meeting to order at 5:30 p.m.
MEMBERS PRESENT: Chair Eric Anderson, Vice Chair Duke Zurek, Chris Freeman, Stacy
Goff, Cohen Lee
MEMBERS ABSENT: Luke Bame
STAFF PRESENT: Samantha DiMaggio, Economic Development Manager
PUBLIC PRESENT: None.
Commissioner Zurek moved, and Commissioner Goff seconded to approve the agenda. All
voted in favor and the motion carried unanimously with a vote of 5 to 0.
APPROVAL OF MINUTES:
APPROVE ECONOMIC DEVELOPMENT COMMISSION MINUTES DATED
NOVEMBER 14, 2023
Commissioner Goff moved, and Commissioner Freeman seconded to approve the Minutes of
the Economic Development Commission meeting dated November 14, 2023, as presented. All
voted in favor and the motion carried unanimously with a vote of 5 to 0.
DISCUSSION/GENERAL BUSINESS ITEMS:
1. Tax Increment Financing- Public
Economic Development Manager, Samantha DiMaggio, had a follow-up discussion with the EDC on
Tax Increment Financing (TIF). They discussed the best ways to educate the public about TIF and
how it works.
ADJOURNMENT:
Commissioner Zurek moved, and Commissioner Lee seconded to adjourn the meeting. All
voted in favor and the motion carried unanimously with a vote of 5 to 0. The Economic
Development Commission meeting was adjourned at 6:00 p.m.
Submitted by Samantha DiMaggio
Economic Development Manager
3
Economic Development Commission Item
January 9, 2024
Subject West 78th Street Renewal and Renovation TIF District Application - Roers
Section DISCUSSION / GENERAL BUSINESS ITEMS Item No: E.1
Prepared By Sam DiMaggio, Economic Development Manager File No:
SUMMARY
Roers is requesting the establishment of a Renewal and Renovation Tax Increment Financing (TIF)
District to assist with the redevelopment of the Chanhassen Cinema and the County Inn & Suites. The
Chanhassen Cinema has been vacant since April 2023 and the hotel which has a lot of deferred
maintenance but is still in operation at this time. LHB has completed an analysis of both buildings,
which is attached for review, and they meet the statutory requirements for the Renewal and Renovation
District.
Roers is proposing to construct two new vertical mixed-use buildings. Each building would include
both residential and commercial space as well as underground parking. The total redevelopment is
estimated to cost $134.6 million. The developer is showing a financing gap of $6.2 million which is
why they are requesting TIF assistance. The funds generated from the TIF District will be used to pay
for demolition and site work, including stormwater, utilities, and the extension of Laredo Drive. State
statute establishes these expenses as eligible to be paid for through TIF.
This would be a "pay-as-you-go" TIF, which means that the taxes would be paid by the
owner/developer and would be rebated once it is determined that the expenditures are valid and the
goals of the project are met. Pay-as-you-go financing relies on the private developer or property owner
to initially finance the costs of the TIF improvements. A development agreement between the authority
and the developer then provides the developer will be repaid as tax increments are collected. This form
of TIF structuring removes financial risk to the city.
Ehlers, the city's financial consultant, will present their findings to the EDC and the developer will also
attend the meeting to answer any questions.
BACKGROUND
A Renewal and Renovation District would be established to assist with redeveloping sites that contain
substandard buildings and buildings that require substantial renovation and clearance. A renovation and
renewal TIF district has a maximum term of 16 years of increment.
4
DISCUSSION
RECOMMENDATION
Motion to recommend that the City Council, acting as the Economic Development Authority, approve
the request to establish a renewal and renovation TIF district and enter into a development contract for
TIF assistance with the applicant.
ATTACHMENTS
West 78th Street Renewal & Renovation TIF Report LHB
Business Subsidy Application - Roers
Property Aerial
5
REPORT OF INSPECTION PROCEDURES AND RESULTS
FOR
DETERMINING QUALIFICATIONS
OF A
TAX INCREMENT FINANCING DISTRICT
WEST 78TH STREET
RENEWAL AND RENOVATION TIF DISTRICT
Prepared for
CITY OF CHANHASSEN, MINNESOTA
DECEMBER 1, 2023
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LHB Project No. 230558.00 Page 1 of 12 Final Report
Table of Contents
Part 1 – Executive Summary ....................................................................................................................... 2
Purpose of Evaluation ............................................................................................................................................... 2
Scope of Work ........................................................................................................................................................... 3
Conclusion ................................................................................................................................................................ 3
Part 2 – Minnesota Statute 469.174, Subdivision 10a Requirements ...................................................... 3
A. Coverage Test .................................................................................................................................................. 4
B. Condition of Buildings Test ............................................................................................................................... 4
C. Distribution of Substandard Buildings ............................................................................................................... 5
Part 3 – Procedures Followed .................................................................................................................... 6
Part 4 – Findings .......................................................................................................................................... 6
A. Coverage Test .................................................................................................................................................. 6
B. Condition of Building Test .................................................................................................................................. 8
1. Building Inspection .................................................................................................................................. 8
2. Replacement Cost .................................................................................................................................. 8
3. Code Deficiencies ................................................................................................................................... 8
4. System Condition Deficiencies ............................................................................................................... 9
C. Distribution of Substandard Structures ........................................................................................................... 10
Part 5 - Team Credentials .......................................................................................................................... 12
APPENDIX A Property Condition Assessment Summary Sheet
APPENDIX B Building Code and Condition Deficiencies Reports
APPENDIX C Property Condition Assessment
Building Replacement Cost Reports
Code Deficiency Cost Reports
Photographs
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LHB Project No. 230558.00 Page 2 of 12 Final Report
Part 1: Executive Summary
Purpose of the Evaluation
LHB was hired by the City of Chanhassen to inspect and evaluate the properties within a Tax Increment Financing
Renewal and Renovation District (“TIF District”) proposed to be established by the City. The proposed TIF District is
bounded by West 78th Street, Market Boulevard, and Market Street (see Diagram 1). The purpose of LHB’s work is
to determine whether the proposed TIF District meets the statutory requirements for coverage, and whether two (2)
buildings on six (6) parcels located within the proposed TIF District, meet the qualifications required for a Renewal
and Renovation District.
Diagram 1: Proposed TIF District
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LHB Project No. 230558.00 Page 3 of 12 Final Report
Scope of Work
The proposed TIF District consists of six (6) parcels with two (2) buildings.
Both buildings in the proposed TIF District received interior and exterior inspections. The Chanhassen Cinema
building was determined substandard. The Hotel building did not meet the qualifications to be determined
“structurally substandard”, but a full building report was still completed showing significant structural and code
deficiencies coming up just short of the 15 percent code deficiency requirement. Building code and Condition
Deficiency reports for both buildings are in Appendix B.
Conclusion
After inspecting and evaluating the properties within the proposed TIF District and applying current statutory criteria
for a Renewal and Renovation District under Minnesota Statutes, Section 469.174, Subdivision 10a, it is our
professional opinion that the proposed TIF District qualifies as a Renewal and Renovation District because:
The proposed TIF District has a coverage calculation of 100 percent which is above the 70 percent
requirement.
50 percent of the buildings are structurally substandard which is above the 20 percent requirement.
100 percent of the other buildings require substantial renovation or clearance which is above the 30
percent requirement.
The substandard buildings are reasonably distributed.
The remainder of this report describes our process and findings in detail.
Part 2: Minnesota Statute 469.174, Subdivision 10a
Requirements
The properties were inspected in accordance with the following requirements under Minnesota Statutes, Section
469.174, Subdivision 10(c), which states:
Interior Inspection
“The municipality may not make such determination [that the building is structurally substandard] without an
interior inspection of the property...”
Exterior Inspection and Other Means
“An interior inspection of the property is not required, if the municipality finds that
(1) the municipality or authority is unable to gain access to the property after using its best efforts to obtain
permission from the party that owns or controls the property; and
(2) the evidence otherwise supports a reasonable conclusion that the building is structurally substandard.”
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Documentation
“Written documentation of the findings and reasons why an interior inspection was not conducted must be made and
retained under section 469.175, subdivision 3(1).”
Qualification Requirements
Minnesota Statutes, Section 469.174, Subdivision 10 (a) (1) requires two tests for occupied parcels:
A. COVERAGE TEST
1. Minnesota Statutes, Section 469.174, Subdivision 10 (a) (1) states:
…“parcels consisting of 70 percent of the area of the district are occupied by buildings, streets, utilities, or
paved or gravel parking lots”
The coverage required by the parcel to be considered occupied is defined under Minnesota Statutes,
Section 469.174, Subdivision 10(e), which states:“For purposes of this subdivision, a parcel is not occupied
by buildings, streets, utilities, or paved or gravel parking lots unless 15 percent of the area of the parcel
contains building, streets, utilities, or paved or gravel parking lots, or other similar structures.”
B. CONDITION OF BUILDINGS TEST
1. Minnesota Statutes, Section 469.174, Subdivision 10(a) states:
…“20 percent of the buildings are structurally substandard; and 30 percent of the other buildings require
substantial renovation or clearance to remove existing conditions such as: inadequate street layout,
incompatible uses or land use relationships, overcrowding of buildings on the land, excessive dwelling unit
density, obsolete buildings not suitable for improvement or conversion, or other identified hazards to the
health, safety, and general well-being of the community.”
Structurally substandard is defined under Minnesota Statues, Section 469.174, Subdivision 10(b), “For
purposes of this subdivision, ‘structurally substandard’ shall mean containing defects in structural elements
or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection
including adequate egress, layout and condition of interior partitions, or similar factors, which defects or
deficiencies are of sufficient total significance to justify substantial renovation or clearance.”
a. We do not count energy code deficiencies toward the thresholds required by Minnesota Statutes,
Section 469.174, Subdivision 10(b) defined as “structurally substandard”, due to concerns
expressed by the State of Minnesota Court of Appeals in the Walser Auto Sales, Inc. vs. City of
Richfield case filed November 13, 2001.
2. Buildings are not eligible to be considered structurally substandard unless they meet certain additional
criteria, as set forth in Subdivision 10(c) which states:
“A building is not structurally substandard if it follows the building code applicable to new buildings or could
be modified to satisfy the building code at a cost of less than 15 percent of the cost of constructing a new
structure of the same square footage and type on the site. The municipality may find that a building is not
disqualified as structurally substandard under the preceding sentence based on reasonably available
evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or
structural repairs, or other similar reliable evidence.”
“Items of evidence that support such a conclusion [that the building is not disqualified] include recent fire or
police inspections, on-site property appraisals or housing inspections, exterior evidence of deterioration, or
other similar reliable evidence.”
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i. LHB counts energy code deficiencies toward the 15 percent code threshold required by Minnesota
Statutes, Section 469.174, Subdivision 10(c) for the following reasons:
1) The Minnesota energy code is one of ten building code areas highlighted by the Minnesota
Department of Labor and Industry website where minimum construction standards are
required by law.
2) Chapter 13 of the 2015 Minnesota Building Code states, “Buildings shall be designed and
constructed in accordance with the International Energy Conservation Code.” Further more,
Minnesota Rules, Chapter 1305.0021 Subpart 9 states, “References to the International
Energy Conservation Code in this code mean the Minnesota Energy Code…”
3) Chapter 11 of the 2015 Minnesota Residential Code incorporates Minnesota Rules, Chapters,
1322 and 1323 Minnesota Energy Code.
4) The Senior Building Code Representative for the Construction Codes and Licensing Division
of the Minnesota Department of Labor and Industry confirmed that the Minnesota Energy
Code is being enforced throughout the State of Minnesota.
5) In a January 2002 report to the Minnesota Legislature, the Management Analysis Division of
the Minnesota Department of Administration confirmed that the construction cost of new
buildings complying with the Minnesota Energy Code is higher than buildings built prior to the
enactment of the code.
6) Proper TIF analysis requires a comparison between the replacement value of a new building
built under current code standards with the repairs that would be necessary to bring the
existing building up to current code standards. For an equal comparison to be made, all
applicable code chapters should be applied to both scenarios. Since current construction
estimating software automatically applies the construction cost of complying with the
Minnesota Energy Code, energy code deficiencies should also be identified in the existing
structures.
C. DISTRIBUTION OF SUBSTANDARD BUILDINGS
1. Minnesota Statutes, Section 469.174, Subdivision 10a. (a) (2), states that the conditions described
above must be “reasonably distributed throughout the geographic area of the district”.
2. Our interpretation of the distribution requirement is that the substandard buildings and other buildings
requiring substantial renovation or clearance must be reasonably distributed throughout the district as
compared to the location of all buildings in the district. For example, if all the buildings in a district are
located on one half of the area of the district, with the other half occupied by parking lots (meeting the
required 70 percent coverage for the district), we would evaluate the distribution of the substandard
buildings and buildings requiring substantial renovation or clearance compared with only the half of the
district where the buildings are located. If all the buildings in a district are located evenly throughout the
entire area of the district, the substandard buildings and buildings requiring substantial renovation or
clearance must be reasonably distributed throughout the entire area of the district. We believe this is
consistent with the opinion expressed by the State of Minnesota Court of Appeals in the Walser Auto
Sales, Inc. vs. City of Richfield case filed November 13, 2001.
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Part 3: Procedures Followed
LHB was able to schedule interior and exterior inspections for two (2) buildings in the proposed TIF District on July
27, 2023. The Chanhassen Cinema building (570 Market Street, Parcel A in Diagram 2) received an on-site interior
and exterior inspection and was determined substandard. The Hotel building (575 and 591 78th Street West, Parcels
B, C, and E in Diagram 2) including the former High Timber Lodge addition, had visible water issues but did not
appear to have enough condition deficiencies during the initial inspection to be considered “structurally substandard”.
However, the Hotel building did exhibit existing conditions warranting renovation or clearance as defined by
Minnesota Statutes Subd. 10a. (1) (iii) in which it requires substantial renovation or clearance to remove existing
conditions of incompatible land use relationships and obsolete buildings not suitable for improvement or conversion.
Part 4: Findings
A. COVERAGE TEST
1. The total square foot area of each parcel in the proposed TIF District was obtained from City records, GIS
mapping and site verification.
2. The total square foot area of buildings and site improvements on the parcels in the proposed TIF District was
obtained from City records, GIS mapping and site verification.
3. The percentage of coverage for each parcel in the proposed TIF District was computed to determine if the 15
percent minimum requirement was met. The total square footage of parcels meeting the 15 percent
requirement was divided into the total square footage of the entire district to determine if the 70 percent
requirement was met.
FINDING:
The proposed TIF District met the coverage test under Minnesota Statutes, Section 469.174, Subdivision 10(e),
which resulted in parcels consisting of 100 percent of the area of the proposed TIF District being occupied by
buildings, streets, utilities or paved drives or parking lots (see Diagram 2). This exceeds the 70 percent area
coverage requirement for the proposed TIF District under Minnesota Statutes, Section 469.174, Subdivision 10a
(a)(1).
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Diagram 2: Coverage
Shaded area denotes parcels more than 15 percent occupied by buildings,
streets, utilities or paved or gravel parking lots or other similar structures.
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B. Condition Of Building Test
1. BUILDING INSPECTION
The first step in the evaluation process is the building inspection. After an initial walk-thru, the inspector
makes a judgement whether a building “appears” to have enough defects or deficiencies of sufficient
total significance to justify substantial renovation or clearance. If it does, the inspector documents with
notes and photographs code and non-code deficiencies in the building.
2. REPLACEMENT COST
The second step in evaluating a building to determine if it is substandard to a degree requiring substantial
renovation or clearance is to determine its replacement cost. This is the cost of constructing a new
structure of the same square footage and type on site. Replacement costs were researched using R.S.
Means Cost Works square foot models for 2023.
A replacement cost was calculated by first establishing building use (office, retail, residential, etc.), building
construction type (wood, concrete, masonry, etc.), and building size to obtain the appropriate median
replacement cost, which factors in the costs of construction in Chanhassen, Minnesota.
Replacement cost includes labor, materials, and the contractor’s overhead and profit. Replacement costs
do not include architectural fees, legal fees or other “soft” costs not directly related to construction activities.
Replacement cost for each building that was inspected is tabulated in Appendix A.
3. CODE DEFICIENCIES
The next step in evaluating a building is to determine what code deficiencies exist with respect to such
building. Code deficiencies are those conditions for a building which are not in compliance with current
building codes applicable to new buildings in the State of Minnesota.
Minnesota Statutes, Section 469.174, Subdivision 10(c), specifically provides that a building cannot be
considered structurally substandard if its code deficiencies are not at least 15 percent of the replacement
cost of the building. As a result, it was necessary to determine the extent of code deficiencies for each
building in the proposed TIF District.
The evaluation was made by reviewing all available information with respect to such buildings contained
in City Building Inspection records and making interior and exterior inspections of the buildings. LHB
utilizes the current Minnesota State Building Code as the official code for our evaluations. The Minnesota
State Building Code is a series of provisional codes written specifically for Minnesota only requirements,
adoption of several international codes, and amendments to the adopted international codes.
After identifying the code deficiencies in each building, we used R.S. Means Cost Works 2023; Unit and
Assembly Costs to determine the cost of correcting the identified deficiencies. We were than able to
compare the correction costs with the replacement cost of each building to determine if the costs for
correcting code deficiencies exceed the required 15 percent threshold.
FINDING:
One (1) out of Two (2) buildings (50 percent) in the proposed TIF District contained code deficiencies
exceeding the 15 percent threshold required by Minnesota Statutes, Section 469.174, Subdivision 10(c).
Complete Building Code and Condition Deficiency Reports for the building that was inspected in the
proposed TIF District can be found in Appendix B of this report.
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LHB Project No. 230558.00 Page 9 of 12 Final Report
4. SYSTEM CONDITION DEFICIENCIES
If a building meets the minimum code deficiency threshold under Minnesota Statutes, Section 469.174,
Subdivision 10(c), then for such building to be “structurally substandard” under Minnesota Statutes,
Section 469.174, Subdivision 10(b), the building’s defects, or deficiencies should be of sufficient total
significance to justify “substantial renovation or clearance.” Based on this definition, LHB re-evaluated
each of the buildings that met the code deficiency threshold under Minnesota Statutes, Section 469.174,
Subdivision 10(c), to determine if the total deficiencies warranted “substantial renovation or clearance”
based on the criteria we outlined above.
System condition deficiencies are a measurement of defects or substantial deterioration in site elements,
structure, exterior envelope, mechanical and electrical components, fire protection and emergency
systems, interior partitions, ceilings, floors, and doors.
The evaluation of system condition deficiencies was made by reviewing all available information contained
in City records and making interior and exterior inspections of the buildings. LHB only identified system
condition deficiencies that were visible upon our inspection of the building or contained in City records.
We did not consider the amount of “service life” used up for a particular component unless it was an
obvious part of that component’s deficiencies.
After identifying the system condition deficiencies in each building, we used our professional judgment to
determine if the list of defects or deficiencies are of sufficient total significance to justify “substantial
renovation or clearance.”
FINDING:
In our professional opinion, one (1) of the two (2) buildings (50 percent) in the proposed TIF District is
structurally substandard to a degree requiring substantial renovation or clearance, because of defects in
structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation,
fire protection including adequate egress, layout and condition of interior partitions, or similar factors which
defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance. This
exceeds the 20 percent requirement of Subdivision 10a. (a) (1) (ii).
SUBDIVISION 10a. (a) (1) (iii)
Subdivision 10a. (a) (1) (iii) requires that at least 30 percent of the other buildings (i.e., all buildings
excluding the 20 percent minimum standard) meet the Subdivision 10a (1), clause (iii) test in which the
“other” buildings require substantial renovation or clearance to remove existing conditions such as:
inadequate street layout, incompatible uses or land use relationships, overcrowding of buildings on the
land, excessive dwelling unit density, obsolete buildings not suitable for improvement or conversion, or
other identified hazards to the health, safety, and general well-being of the community.
FINDING:
One (1) out of the one (1) remaining buildings (100 percent) in the proposed Renewal and Renovation
District exhibits existing conditions warranting renovation or clearance as defined by Minnesota Statutes
Subd. 10a. (1) (iii), described as follows:
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PARCEL B, C, and E:
In 2023 the City of Chanhassen began a visioning process for the future of Downtown Chanhassen, which is
typically referred to as the areas surrounding West 78th Street between Powers Boulevard and Great Plains
Boulevard.
The downtown plan, generated from the visioning process, showed a desire for a more walkable,
pedestrian-scale downtown with buildings near the streets and parking tucked to the rear, side, or
underground. The continued addition of housing opportunities within the downtown is also seen as a priority
to increase the number of people within the downtown area at all times of the day to promote a healthy
business climate. Over time, West 78th Street will be transformed into more of a traditional 'main street' with
on-street parking opportunities, contiguous sidewalks, and opportunities to eat, shop, and recreate.
The new civic campus currently being planned by the city will consist of a new city hall, senior city, and city
park. The city park will include a splash pad, and an outdoor performance center and winter ice skating to
serve as a draw attracting the public to downtown Chanhassen year-round. The new city hall will be located
at the intersection of Market Boulevard and West 78th Street and will set the tone for building placement for
future downtown developments and redevelopment projects.
The City has a vision for this area that is a departure from the suburban Hotel model. Concurrent with the
City plans changing for this area, the Hotel ownership group is faced with water penetration issues on the
exterior skin of the hotel that if not addressed, will lead to serious consequences. The building has been
well-maintained to this point, but will become more difficult to maintain and costly to fix. LHB inspectors
found code deficiencies totaling 14.4% of the replacement value of the building. While this is slightly short
of what is required to be labeled a “substandard” building by MN TIF Statutes, it is a significant issue for the
owners and will impact the viability of this building into the future.
The Hotel building as configured is obsolete in terms of current urban standards, and is situated in a large
surface parking lot, contrary to the planning vision for this area. While this parcel would naturally be
grandfathered into the new land use/zoning, major additions, or improvements to the structure incompatible
with the new planning goals would not likely be approved, leading to a disincentive for reinvestment and
ultimately blight conditions.
C. Distribution Of Substandard Structures
Much of this report has focused on the condition of individual buildings as they relate to requirements identified
by Minnesota Statutes, Section 469.174, Subdivision 10 and 10a. It is also important to look at the distribution
of substandard buildings throughout the geographic area of the proposed TIF District.
FINDING:
Buildings meeting the requirements of Minnesota Statutes, Section 469.174, Subdivision 10 and 10a are
reasonably distributed compared to all parcels that contain buildings.
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Diagram 3: Distribution of Substandard Structures
Yellow: parcels with buildings.
Orange: Structurally Substandard Building
Blue: Other Conditions warranting renovation or clearance (Subd. 10a. (1) (iii)
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Part 5: Team Credentials
Michael A. Fischer, AIA, LEED AP - Project Principal/TIF Analyst
Michael has 34 years of experience as project principal, project manager, project designer and project architect on
planning, urban design, educational, commercial, and governmental projects. He has become an expert on Tax
Increment Finance District analysis assisting over 100 cities with strategic planning for TIF Districts. He is an
Architectural Principal at LHB and currently leads the Minneapolis office.
Michael completed a two-year Bush Fellowship, studying at MIT and Harvard in 1999, earning master’s degrees in
City Planning and Real Estate Development from MIT. He has served on more than 50 committees, boards, and
community task forces, including a term as a City Council President, Chair of a Metropolitan Planning Organization,
and Chair of the Edina Planning Commission. Most recently, he served as a member of the Edina city council and
Secretary of the Edina HRA. Michael has also managed and designed several award-winning architectural projects
and was one of four architects in the Country to receive the AIA Young Architects Citation in 1997.
Phil Fisher – Inspector
For 35 years, Phil Fisher worked in the field of Building Operations in Minnesota including White Bear Lake Area
Schools. At the University of Minnesota, he earned his Bachelor of Science in Industrial Technology. He is a
Certified Playground Safety Inspector, Certified Plant Engineer, and is trained in Minnesota Enterprise Real
Properties (MERP) Facility Condition Assessment (FCA). His FCA training was recently applied to the Minnesota
Department of Natural Resources Facilities Condition Assessment project involving over 2,000 buildings.
Appendices
APPENDIX A Property Condition Assessment Summary Sheet
APPENDIX B Building Code and Condition Deficiencies Reports
APPENDIX C Property Condition Assessment
Building Replacement Cost Reports
Code Deficiency Cost Reports
Photographs
18
APPENDIX A
Property Condition Assessment Summary Sheet
19
West 78th Street Renewal and Renovation TIF District Property Condition Assessment Summary SheetTIF Map No.PID # Property AddressImproved or VacantSurvey Method UsedSite Area(S.F.)Coverage Area of Improvements(S.F.)Coverage Percent of ImprovementsCoverageQuantity(S.F.)No. of BuildingsBuildingReplacementCost15% of Replacement CostBuilding Code DeficienciesNo. of Buildings Exceeding 15% CriteriaNo. of buildings determined substandardMeets Subd. 10a. (1) (iii) RequirementsA252830010 570 Market Street Improved Interior/Exterior 39,640 37,658 95.0% 39,640 1 $3,792,114 $568,817 $964,004 1 1 1B251180010 575 West 78th Street Improved Interior/Exterior 23,958 22,520 94.0% 23,958 See Parcel E Note 1C251180020 575 West 78th Street Improved Interior/Exterior 23,086 23,086 100.0% 23,086 See Parcel E Note 1D251190040 N/A Vacant Exterior 1,307 1,307 100.0% 1,307E251190010 591 West 78th Street Improved Interior/Exterior 50,094 47,088 94.0% 50,094 1 $16,449,055 $2,467,358 $2,370,924 0 0 1F251190030 N/A Vacant Exterior 38,332 34,499 90.0% 38,332TOTALS 176,417 176,417 2 1 1 2100.0%Note 1: One continuous building covers Parcels B, C, and EThe Parcel E line contains the full building information 50.0%50.0%M:\23Proj\230558\300 Design\Reports\Final Report\[230558 West 78th Street TIF Summary Sheet.xlsx]Property InfoPercent of other buildings meeting Subd. 10a. (1) (iii) Requirements 100.0%Total Coverage Percent:Percent of buildings exceeding 15 percent code deficiency threshold: Percent of buildings determined substandard: Chanhassen, MinnesotaWest 78th Street Renewal and Renovation TIF DistrictLHB Project Number 230558.00Page 1 of 1Property Condition Assessment Summary Sheet20
APPENDIX B
Building Code and Condition Deficiencies Reports
21
West 78th Street TIF District Page 1 of 3 Building Report
LHB Project No. 230558.00 Parcel A – 570 Market St, Chanhassen, MN 55317
West 78th Street Renewal and Renovation TIF District
Building Code, Condition Deficiency and Context Analysis Report
Parcel A Chanhassen Cinema
Address: 570 Market Street, Chanhassen, Minnesota 55317
Parcel ID: 252830010
Inspection Date(s) & Time(s): July 27, 2023 10am
Inspection Type: Interior and Exterior
Summary of Deficiencies: It is our professional opinion that this building is Substandard because:
- Substantial renovation is required to correct Conditions found.
- Building Code deficiencies total more than 15% of replacement cost, NOT
including energy code deficiencies.
Estimated Replacement Cost: $3,792,114
Estimated Cost to Correct Building Code Deficiencies: $964,004
Percentage of Replacement Cost for Building Code Deficiencies: 25.4%
DEFECTS IN STRUCTURAL ELEMENTS
1. Exterior masonry walls are failing, allowing for water intrusion which is contrary to code.
2. Steel lintels should be protected from rusting per code.
3. Masonry foundation walls are failing allowing for water intrusion which is contrary to code.
COMBINATION OF DEFICIENCIES
1. Essential Utilities and Facilities
a. There is no code required accessible parking.
b. There is no code compliant accessible route into the building.
c. There is no code required accessible route to all levels of the building.
2. Light and Ventilation
a. The lighting system does not comply with code.
b. The HVAC system does not comply with code.
3. Fire Protection/Adequate Egress
a. Natural gas meter should be protected per code.
b. Interior stairs do not comply with code.
c. Damaged flooring material is creating an impediment to emergency egress which is contrary to code.
d. The emergency notification system does not comply with code.
e. Flammable material is improperly stored which is contrary to code.
f. Exterior stairs are damaged creating an impediment to emergency egress which is contrary to code.
22
West 78th Street TIF District Page 2 of 3 Building Report
LHB Project No. 230558.00 Parcel A – 570 Market St, Chanhassen, MN 55317
4. Layout and Condition of Interior Partitions/Materials
a. The ceiling tile is damaged or missing and should be replaced.
b. Mold is present though out the building.
c. Interior walls should be repaired and repainted.
5. Exterior Construction
a. Exterior walls should be repainted.
b. Hollow metal doors are failing and should be replaced.
c. Steel railings are rusting and should be repaired or replaced.
d. The roofing material has failed, allowing for water intrusion which is contrary to code.
e. Exterior caulking has failed, allowing for water intrusion which is contrary to code.
DESCRIPTION OF CODE DEFICIENCIES
1. Exterior masonry wall should be repaired or replaced to prevent water intrusion per code.
2. Steel lintels should be protected from rusting per code.
3. Failing masonry foundation walls should be repaired and or replaced to comply with structural integrity per code.
4. Code required accessible parking should be created.
5. A code required accessible route into the building should be created.
6. A code required accessible route to all levels of the building should be created.
7. A code-compliant lighting system should be installed.
8. A code-compliant HVAC system should be installed.
9. The natural gas meter should be protected, per code.
10. Interior stairs should be modified to comply with code.
11. Damaged flooring material should be replaced to create a code required unimpeded means for emergency egress.
12. The emergency notification system should be replaced to comply with code.
13. Flammable material should be stored in a code approved container.
14. Damaged exterior stairs should be repaired to create a code required unimpeded means for emergency egress.
15. Failed roofing material should be replaced to prevent water intrusion per code.
16. Failed exterior joint caulking should be removed and replaced to prevent water intrusion per code.
OVERVIEW OF DEFICIENCIES
This building has been vacant for several years and is showing severe signs of exterior structural system failure. The exterior
concrete masonry units are failing, allowing for water intrusion which is contrary to code. There is no code required accessible
parking. The existing accessible ramp does not meet current code. Steel lintels should be protected from rusting to comply
with code. A code required accessible route to all levels of the building should be created. The interior stairs do not comply
with code. Interior walls should be repaired and repainted. Damaged or missing ceiling tile should be replaced. There is
mold throughout the building. The interior flooring is damaged creating an impediment to emergency egress which is contrary
to code. The lighting system does not comply with code. The HVAC system does not comply with code. The natural gas
meter should be protected per code. The emergency notification system does not comply with code. The exterior concrete
stairs are damaged creating an impediment to emergency egress which is contrary to code. Failed roofing material should be
replaced to prevent water intrusion per code. Failed exterior joint caulking should be replaced to prevent water intrusion per
code.
23
West 78th Street TIF District Page 3 of 3 Building Report
LHB Project No. 230558.00 Parcel A – 570 Market St, Chanhassen, MN 55317
ENERGY CODE DEFICIENCIES
In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code.
These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining
whether or not the building is substandard.
M:\23Proj\230558\300 Design\Reports\Building Reports\A - 570 Market St Building Report Redevelopment District.docx
24
West 78th Street TIF District Page 1 of 3 Building Report
LHB Project No. 230558.00 Parcel E – 591 W 78th St, Chanhassen, MN 55317
West 78th Street Renewal and Renovation TIF District
Building Code, Condition Deficiency and Context Analysis Report
Parcel E Country Inn and Suites
Address: 591 West 78th Street, Chanhassen, Minnesota 55317
Parcel ID: 251190010
Inspection Date(s) & Time(s): July 27, 2023 9am
Inspection Type: Interior and Exterior
Summary of Deficiencies: It is our professional opinion that this building IS NOT Substandard because:
- Substantial renovation IS NOT required to correct Conditions found.
- Building Code deficiencies DO NOT total more than 15% of replacement
cost, NOT including energy code deficiencies.
Estimated Replacement Cost: $16,449,055
Estimated Cost to Correct Building Code Deficiencies: $2,370,924
Percentage of Replacement Cost for Building Code Deficiencies: 14.4%
DEFECTS IN STRUCTURAL ELEMENTS
1. Steel lintels should be protected from rusting per code.
COMBINATION OF DEFICIENCIES
1. Essential Utilities and Facilities
a. No deficiencies observed.
2. Light and Ventilation
a. The lighting system does not comply with code.
b. The HVAC system does not comply with code.
3. Fire Protection/Adequate Egress
a. Floor tile is damaged creating an impediment to emergency egress which is contrary to code.
b. Thresholds do not comply with code for maximum height.
c. Smoke gaskets on fire rated doors are damaged and will not comply with code.
d. Personal hand railings on the exterior are not properly secured and should be repaired.
e. Stairs do not comply with code.
f. Electrical panels do not have the code required 36-inch clear space.
g. The entrance canopy does not have a code required sprinkler system.
h. Exterior sidewalks are damaged creating an impediment to emergency egress which is contrary to code.
25
West 78th Street TIF District Page 2 of 3 Building Report
LHB Project No. 230558.00 Parcel E – 591 W 78th St, Chanhassen, MN 55317
i. Exterior stairs are damaged creating an impediment to emergency egress which is contrary to code.
j. Staff reports that the building sprinkler system is failing, allowing for water intrusion which is contrary to code.
k. Staff reports that the building emergency notification system is failing, which requires replacement per code.
l. Staff reports that the smoke detectors are failing and should be replaced per code.
4. Layout and Condition of Interior Partitions/Materials
a. The ceiling tile is damaged or missing and should be replaced.
b. Interior walls should be repaired and repainted.
c. The carpet is stained and should be cleaned and or replaced.
d. Mold is present within the building.
e. Ceramic wall tiles are damaged and should be replaced.
f. Ceilings are stained from water damage and should be repaired and repainted.
5. Exterior Construction
a. Areas of the exterior walls are compromised, allowing for water intrusion which is contrary to code.
b. Exterior control joint caulking is failing, allowing for water intrusion which is contrary to code.
c. Exterior wood surfaces should be repainted.
d. Staff reports that windows are failing, allowing for water intrusion which is contrary to code.
e. Staff reports that the roofing material is failing, allowing for water intrusion which is contrary to code.
DESCRIPTION OF CODE DEFICIENCIES
1. Steel lintels should be protected from rusting per code.
2. The lighting system does not comply with code.
3. The HVAC system does not comply with code.
4. Damaged floor tile should be repaired/replaced to create an unimpeded means for emergency egress per code.
5. Thresholds should be modified to comply with code.
6. Smoke gaskets on fire rated doors do not comply with code.
7. Loose hand railings should be properly secured per code.
8. The stairs should be modified to comply with code.
9. A code required 36-inch clear space in front of all electrical panels should be maintained.
10. The entrance canopy does not have a code required sprinkler system.
11. Exterior sidewalks should be repaired to create a code required unimpeded means for emergency egress.
12. Repair existing sprinkler system to comply with code.
13. Install a code compliant emergency notification system.
14. Install code compliant smoke detectors.
15. Repair exterior walls to prevent water intrusion per code.
16. Remove and replace failed exterior caulking to prevent water intrusion per code.
17. Replace existing windows that are failing to prevent water intrusion per code.
18. Replace failing roofing system to prevent water intrusion per code.
26
West 78th Street TIF District Page 3 of 3 Building Report
LHB Project No. 230558.00 Parcel E – 591 W 78th St, Chanhassen, MN 55317
OVERVIEW OF DEFICIENCIES
This building is currently being operated as a hotel. Steel lintels should be protected from rusting per code. The lighting and
HVAC systems do not comply with code. Sidewalks, exterior stairs, and interior floor tile are damaged creating an impediment
to emergency egress which is contrary to code. Thresholds should be modified to comply with code. Damaged smoke
gaskets on fire rated doors should be repaired to comply with code. Loose hand railing should be properly secured per code.
Items in corridors that are obstructing emergency egress should be removed per code. Interior stairs should be modified to
comply with code. The entrance canopy should have a code required sprinkler system installed. The building sprinkler
system should be repaired to comply with code. A code compliant emergency notification system and smoke detectors should
be installed. Repair exterior walls to prevent water intrusion per code. Replace failing window system to prevent water
intrusion per code. The failing roofing system should be replaced to prevent water intrusion per code.
ENERGY CODE DEFICIENCIES
In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code.
These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining
whether the building is substandard.
M:\23Proj\230558\300 Design\Reports\Building Reports\E - 591 W 78th St Building Report Redevelopment District.docx
27
APPENDIX C
Property Condition Assessments
Building Replacement Cost Reports
Code Deficiency Cost Reports
Photographs
28
Replacement Cost Report
Square Foot Cost Estimate Report Date:8/24/2023
Estimate Name:570 Market Street
Building Type:Movie Theater with Concrete Block / Steel Joists
Location:CHANHASSEN, MN
Story Count:1
Story Height (L.F.):20.00
Floor Area (S.F.):22400
Labor Type:OPN
Basement Included:No
Data Release:Year 2023 Quarter 3
Cost Per Square Foot:$169.29
Building Cost:$3,792,114.90
Quantity % of Total Cost Per S.F. Cost
A Substructure 8.26% $12.15 $272,208.46
A1010 Standard Foundations $4.63 $103,717.00
A10101051560 Foundation wall, CIP, 4' wall height, direct chute, .148 CY/LF, 7.2 PLF,
12" thick
650 $2.93 $65,615.23
A10101102700 Strip footing, concrete, reinforced, load 11.1 KLF, soil bearing capacity
6 KSF, 12" deep x 24" wide
650 $1.62 $36,269.68
A10102107200 Spread footings, 3000 PSI concrete, load 50K, soil bearing capacity 6
KSF, 3' ‐ 0" square x 12" deep
7.47 $0.08 $1,832.09
A1030 Slab on Grade $7.13 $159,768.90
A10301202240 Slab on grade, 4" thick, non industrial, reinforced 22400 $7.13 $159,768.90
A2010 Basement Excavation $0.39 $8,722.56
A20101104560 Excavate and fill, 10,000 SF, 4' deep, sand, gravel, or common earth,
on site storage
22400 $0.39 $8,722.56
B Shell 27.42% $40.37 $904,200.80
B1010 Floor Construction $1.41 $31,600.53
B10102461250 Floor, concrete, slab form, open web bar joist @ 2' OC, on bearing
wall, 25' span, 22.5" deep, 100 PSF superimposed load, 145 PSF total
load
2250 $1.41 $31,600.53
B1020 Roof Construction $13.06 $292,524.29
B10201206500 Roof, steel joists, joist girder, 1.5" 22 ga metal deck, on
columns/bearing wall, 60'x50' bay, 40 PSF superimposed load, 71"
deep, 65 PSF total load
22400 $12.36 $276,950.02
B10201206550 Roof, steel joists, joist girder, 1.5" 22 ga metal deck, on
columns/bearing wall, 60'x50' bay, 40 PSF superimposed load, 71"
deep, 65 PSF total load, add for column
22400 $0.70 $15,574.27
B2010 Exterior Walls $7.13 $159,736.20
B20101116280 Concrete block (CMU) wall, regular weight, 75% solid, 8 x 8 x 16, 4500
PSI, reinforced, vertical #5@32", grouted
10400 $7.13 $159,736.20
B2020 Exterior Windows $8.31 $186,139.98
B20202101250 Aluminum flush tube frame, for 1/4"glass, 1‐3/4"x4", 5'x20' opening,
three intermediate horizontals
2600 $3.31 $74,149.92
B20202201400 Glazing panel, insulating, 1" thick units, 2 lites, 1/4" float glass, clear 2600 $5.00 $111,990.06
B2030 Exterior Doors $2.20 $49,237.16
B20301106950 Door, aluminum & glass, with transom, narrow stile, double door,
hardware, 6'‐0" x 10'‐0" opening
1.87 $0.75 $16,703.82
B20302203450 Door, steel 18 gauge, hollow metal, 1 door with frame, no label, 3'‐0"
x 7'‐0" opening
9.33 $1.45 $32,533.34
B3010 Roof Coverings $8.26 $184,962.64
B30101051400 Roofing, asphalt flood coat, gravel, base sheet, 3 plies 15# asphalt felt,
mopped
22400 $4.04 $90,497.34
B30103203090 Insulation, rigid, roof deck, composite with 2" EPS, 1" perlite 22400 $2.72 $60,943.90
B30104201400 Roof edges, aluminum, duranodic, .050" thick, 6" face 650 $1.16 $25,976.18
B30106305100 Gravel stop, aluminum, extruded, 4", mill finish, .050" thick 650 $0.34 $7,545.22
West 78th Street Renewal and Renovation TIF District
Costs are derived from a building model with basic components.
Scope differences and market conditions can cause costs to vary significantly.
West 78th Street TIF District
LHB Project No. 230558.00 Page 1 of 3
Replacement Cost Report
Parcel A - 570 Market St, Chanhassen, MN 55317
29
C Interiors 19.33% $28.45 $637,264.72
C1010 Partitions $4.23 $94,785.78
C10101045500 Concrete block (CMU) partition, light weight, hollow, 6" thick, no
finish
8960 $4.23 $94,785.78
C1020 Interior Doors $1.57 $35,214.61
C10201022600 Door, single leaf, kd steel frame, hollow metal, commercial quality,
flush, 3'‐0" x 7'‐0" x 1‐3/8"
31.77 $1.57 $35,214.61
C1030 Fittings $0.52 $11,586.22
C10301100460 Toilet partitions, cubicles, ceiling hung, stainless steel 4 $0.45 $10,041.60
C10305100130 Directory boards, outdoor, 36" x 36" 1 $0.07 $1,544.62
C2010 Stair Construction $3.04 $67,992.96
C20101100760 Stairs, steel, pan tread for conc in‐fill, picket rail,20 risers w/ landing 3.73 $3.04 $67,992.96
C3010 Wall Finishes $3.47 $77,820.26
C30102202000 2 coats paint on masonry with block filler 10400 $1.78 $39,929.14
C30102300320 Painting, masonry or concrete, latex, brushwork, primer & 2 coats 17920 $1.69 $37,891.12
C3020 Floor Finishes $6.76 $151,341.98
C30204100160 Carpet, tufted, nylon, roll goods, 12' wide, 36 oz 21280 $5.17 $115,731.07
C30204100220 Carpet, padding, add to above, 2.7 density 21280 $1.12 $25,003.36
C30204101720 Tile, ceramic natural clay 1120 $0.47 $10,607.55
C3030 Ceiling Finishes $8.86 $198,522.91
C30302107400 Acoustic ceilings, 3/4"mineral fiber, 12" x 12" tile, concealed 2" bar &
channel grid, suspended support
22400 $8.86 $198,522.91
D Services 34.67% $51.03 $1,143,116.52
D1010 Elevators and Lifts $3.80 $85,088.40
D10101102200 Hydraulic, passenger elevator, 3000 lb, 2 floors, 100 FPM 1 $3.80 $85,088.40
D2010 Plumbing Fixtures $14.23 $318,717.14
D20101102080 Water closet, vitreous china, bowl only with flush valve, wall hung 50.77 $9.21 $206,203.20
D20102102000 Urinal, vitreous china, wall hung 9.52 $0.73 $16,358.64
D20103101600 Lavatory w/trim, vanity top, PE on CI, 19" x 16" oval 19.04 $1.50 $33,523.54
D20104404300 Service sink w/trim, PE on CI,wall hung w/rim guard, 22" x 18" 3.17 $0.93 $20,940.59
D20108201880 Water cooler, electric, wall hung, dual height, 14.3 GPH 9.52 $1.86 $41,691.17
D2020 Domestic Water Distribution $0.39 $8,705.74
D20202202260 Gas fired water heater, residential, 100< F rise, 30 gal tank, 32 GPH 1.7 $0.39 $8,705.74
D2040 Rain Water Drainage $0.86 $19,213.44
D20402102120 Roof drain, DWV PVC, 5" diam, 10' high 3.4 $0.48 $10,797.89
D20402102160 Roof drain, DWV PVC, 5" diam, for each additional foot add 128 $0.38 $8,415.55
D3050 Terminal & Package Units $12.35 $276,713.92
D30501504440 Rooftop, single zone, air conditioner, schools and colleges, 10,000 SF,
38.33 ton
22400 $12.35 $276,713.92
D4010 Sprinklers $5.78 $129,527.46
D40104100620 Wet pipe sprinkler systems, steel, light hazard, 1 floor, 10,000 SF 22400 $4.76 $106,541.79
D40104100700 Wet pipe sprinkler systems, steel, light hazard, each additional floor,
2000 SF
4480 $1.03 $22,985.67
D4020 Standpipes $1.47 $32,951.80
D40203101540 Wet standpipe risers, class III, steel, black, sch 40, 4" diam pipe, 1
floor
1.87 $1.19 $26,671.40
D40203101560 Wet standpipe risers, class III, steel, black, sch 40, 4" diam pipe,
additional floors
1.87 $0.28 $6,280.40
D5010 Electrical Service/Distribution $1.16 $25,993.87
D50101200320 Overhead service installation, includes breakers, metering, 20' conduit
& wire, 3 phase, 4 wire, 120/208 V, 400 A
1 $0.33 $7,303.53
D50102300320 Feeder installation 600 V, including RGS conduit and XHHW wire, 400
A
100 $0.56 $12,525.40
D50102400200 Switchgear installation, incl switchboard, panels & circuit breaker,
120/208 V, 3 phase, 400 A
0.5 $0.28 $6,164.94
D5020 Lighting and Branch Wiring $8.70 $194,855.37
D50201100200 Receptacles incl plate, box, conduit, wire, 2.5 per 1000 SF, .3 watts
per SF
22400 $2.29 $51,381.12
D50201350200 Miscellaneous power, to .5 watts 22400 $0.18 $4,110.40
D50201400240 Central air conditioning power, 3 watts 22400 $0.78 $17,412.42
D50202100500 Fluorescent fixtures recess mounted in ceiling, 0.8 watt per SF, 20 FC,
5 fixtures @32 watt per 1000 SF
22400 $3.87 $86,720.26
D50202901000 Daylight dimming control system, 10 fixtures per 1000 SF 11200 $1.57 $35,231.17
West 78th Street TIF District
LHB Project No. 230558.00 Page 2 of 3
Replacement Cost Report
Parcel A - 570 Market St, Chanhassen, MN 55317
30
D5030 Communications and Security $2.12 $47,558.54
D50309100220 Communication and alarm systems, includes outlets, boxes, conduit
and wire, sound systems, 12 outlets
0.28 $0.33 $7,299.94
D50309100452 Communication and alarm systems, fire detection, addressable, 25
detectors, includes outlets, boxes, conduit and wire
1.12 $1.19 $26,752.10
D50309100462 Fire alarm command center, addressable with voice, excl. wire &
conduit
1 $0.60 $13,506.50
D5090 Other Electrical Systems $0.17 $3,790.84
D50902100200 Generator sets, w/battery, charger, muffler and transfer switch,
gas/gasoline operated, 3 phase, 4 wire, 277/480 V, 7.5 kW
2.63 $0.17 $3,790.84
E Equipment & Furnishings 10.33% $15.21 $340,700.72
E1020 Institutional Equipment $4.26 $95,405.60
E10203100210 Architectural equipment, movie equipment film transport, including
platters & autownd, econ
1 $0.34 $7,512.00
E10203100220 Architectural equipment, movie equipment lamphouses, including
rectifiers, xenon, 1000W
1 $0.46 $10,386.56
E10203100240 Architectural equipment, movie equipment, projector mechanisms,
35 mm, economy
1 $0.66 $14,880.00
E10203200090 Architectural equipment, movie equipment projection screens, rigid in
wall, acrylic, 1/4" thick
1600 $2.80 $62,627.04
E1090 Other Equipment $0.00 $0.00
E2010 Fixed Furnishings $10.95 $245,295.12
E20105100110 Architectural equipment, movie equipment seating, painted steel,
upholstered, economy
560 $10.95 $245,295.12
F Special Construction 0.00% $0.00 $0.00
G Building Sitework 0.00% $0.00 $0.00
100% $147.21 $3,297,491.22
15.0% $22.08 $494,623.68
0.0% $0.00 $0.00
0.0% $0.00 $0.00
Total Building Cost $169.29 $3,792,114.90
Contractor Fees (General Conditions,Overhead,Profit)
Architectural Fees
SubTotal
User Fees
West 78th Street TIF District
LHB Project No. 230558.00 Page 3 of 3
Replacement Cost Report
Parcel A - 570 Market St, Chanhassen, MN 55317
31
Code Deficiency Cost Report
Parcel A - 570 Market Street, Chanhassen, Minnesota 55317 Building Name or Type
Parcel ID 252830010 Chanhassen Cinema
Code Related Cost Items Unit Cost Units Unit Quantity Total
Accessibility Items
Parking
Create code required accessible parking 500.00$ Lump 1 500.00$
Accessible Route
Install a code approved accessible route into the building 1.00$ Lump 50,000 50,000.00$
Install a code approved accessible route to all levels of the building 3.80$ SF 22,400 85,120.00$
Structural Elements
Exterior Masonry Walls
Repair failing masonry walls to prevent water intrusion per code 5.00$ SF 22,400 112,000.00$
Steel Lintels
Protect steel lintels from rusting per code 500.00$ Lump 1 500.00$
Masonry Foundation
Repair failing masonry foundation to prevent water intrusion per code 1.62$ SF 22,400 36,288.00$
Exiting
Stairs
Modify interior stairs to comply with code 2.00$ SF 22,400 44,800.00$
Repair damaged exterior stairs to create a code compliant means for
emergency egress 2,500.00$ Lump 1 2,500.00$
Flooring Material
Repair/replace damaged flooring material to create a code required
unimpeded means for emergency egress 6.29$ SF 10,000 62,900.00$
Emergency Notification System
Install a code compliant emergency notification system 0.60$ SF 22,400 13,440.00$
Fire Protection
Natural Gas Meter
Protect natural gas meter per code 1,500.00$ Lump 1 1,500.00$
Flammable Material
Store flammable material per code 500.00$ Lump 1 500.00$
Exterior Construction
Caulking
Remove and replace failed caulking to prevent water intrusion per code 0.25$ SF 22,400 5,600.00$
Roof Construction
West 78th Street Renewal and Renovation TIF District
West 78th Street TIF District
LHB Project No. 230558.00 Page 1 of 2
Code Deficiency Cost Report
Parcel A - 570 Market St, Chanhassen, MN 55317 32
Code Related Cost Items Unit Cost Units Unit Quantity Total
Roofing Material
Replace failed roofing material to prevent water intrusion per code 8.26$ SF 22,400 185,024.00$
Mechanical - Electrical
Mechancial
Install a code compliant HVAC system 12.35$ SF 22,400 276,640.00$
Electrical
Install a code compliant lighting system 3.87$ SF 22,400 86,688.00$
Total Code Improvements 964,000$
West 78th Street TIF District
LHB Project No. 230558.00 Page 2 of 2
Code Deficiency Cost Report
Parcel A - 570 Market St, Chanhassen, MN 55317 33
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Square Foot Cost Estimate Report Date:8/24/2023
Estimate Name:591 West 78th Street
Building Type:Motel, 2‐3 Story with Brick Veneer / Wood Frame
Location:CHANHASSEN, MN
Story Count:3
Story Height (L.F.):9.00
Floor Area (S.F.):84267
Labor Type:OPN
Basement Included:No
Data Release:Year 2023 Quarter 3
Cost Per Square Foot:$195.20
Building Cost:$16,449,055.28
Quantity % of Total Cost Per S.F. Cost
A Substructure 3.15% $5.34 $450,258.01
A1010 Standard Foundations $2.84 $238,974.23
A10101051560 Foundation wall, CIP, 4' wall height, direct chute, .148 CY/LF, 7.2 PLF,
12" thick
1400 $1.68 $141,325.10
A10101102700 Strip footing, concrete, reinforced, load 11.1 KLF, soil bearing capacity
6 KSF, 12" deep x 24" wide
1750 $1.16 $97,649.13
A1030 Slab on Grade $2.38 $200,345.92
A10301202240 Slab on grade, 4" thick, non industrial, reinforced 28089 $2.38 $200,345.92
A2010 Basement Excavation $0.13 $10,937.86
A20101104560 Excavate and fill, 10,000 SF, 4' deep, sand, gravel, or common earth,
on site storage
28089 $0.13 $10,937.86
B Shell 25.06% $42.54 $3,584,918.37
B1010 Floor Construction $4.78 $402,614.24
B10102613750 Floor, wood joist, 2 x 12 @16" O.C., 1/2" CDX subfloor 56178 $4.78 $402,614.24
B1020 Roof Construction $3.87 $325,863.86
B10201027200 Wood roof, truss, 4/12 slope, 24" O.C., 44' to 60' span 28089 $3.87 $325,863.86
B2010 Exterior Walls $12.43 $1,047,147.22
B20101291400 Brick veneer wall, standard face, 2x6 studs @ 16" back‐up, running
bond
32130 $12.43 $1,047,147.22
B2020 Exterior Windows $7.36 $620,218.62
B20201066850 Windows, aluminum, sliding, insulated glass, 5' x 3'378 $7.36 $620,218.62
B2030 Exterior Doors $11.92 $1,004,408.35
B20301106950 Door, aluminum & glass, with transom, narrow stile, double door,
hardware, 6'‐0" x 10'‐0" opening
3.44 $0.37 $30,778.01
B20301107300 Door, aluminum & glass, with transom, bronze finish, hardware, 3'‐0"
x 10'‐0" opening
13.76 $0.74 $62,465.58
B20302203450 Door, steel 18 gauge, hollow metal, 1 door with frame, no label, 3'‐0"
x 7'‐0" opening
261.4 $10.81 $911,164.76
B3010 Roof Coverings $2.19 $184,666.08
B30101401100 Asphalt roofing, strip shingles, inorganic, Class A, 4" slope, 210‐235
lbs/SQ
29493.45 $0.91 $77,026.57
B30103203090 Insulation, rigid, roof deck, composite with 2" EPS, 1" perlite 29493.45 $0.95 $80,243.12
B30104300040 Flashing, aluminum, no backing sides, .019" 1400 $0.20 $17,252.37
B30106100050 Gutters, box, aluminum, .027" thick, 5", enameled finish 700 $0.09 $7,262.56
B30106200100 Downspout, aluminum, rectangular, 2" x 3", embossed mill finish,
.020" thick
464.33 $0.03 $2,881.46
C Interiors 31.86% $54.09 $4,557,592.81
C1010 Partitions $22.41 $1,888,513.85
C10101045020 Concrete block (CMU) partition, light weight, hollow, 4" thick, gyp
plaster, 2 sides
96305.14 $20.11 $1,694,682.56
C10107101001 1/2" fire rated gypsum board, taped & finished, painted on metal
furring
32130 $2.30 $193,831.29
C1020 Interior Doors $11.33 $954,984.67
C10201022510 Door, single leaf, wood frame, 3'‐0" x 7'‐0" x 1‐3/8", birch, hollow core 1203.81 $11.33 $954,984.67
West 78th Street Renewal and Renovation TIF District
Replacement Cost Report
Costs are derived from a building model with basic components.
Scope differences and market conditions can cause costs to vary significantly.
West 78th Street TIF District
LHB Project No. 230558.00 Page 1 of 3
Replacement Cost Report
Parcel E - 591 W 78th St, Chanhassen, MN 55317
46
C2010 Stair Construction $3.73 $314,304.90
C20101100740 Stairs, steel, pan tread for conc in‐fill, picket rail,16 risers w/ landing 20.64 $3.73 $314,304.90
C3010 Wall Finishes $4.00 $337,482.89
C30102300140 Painting, interior on plaster and drywall, walls & ceilings, roller work,
primer & 2 coats
173349.26 $1.99 $167,481.39
C30102301940 Ceramic tile, thin set, 4‐1/4" x 4‐1/4" 19261.03 $2.02 $170,001.50
C3020 Floor Finishes $7.04 $593,416.26
C30204100160 Carpet, tufted, nylon, roll goods, 12' wide, 36 oz 71626.95 $4.62 $389,542.45
C30204100220 Carpet, padding, add to above, 2.7 density 71626.95 $1.00 $84,159.52
C30204101720 Tile, ceramic natural clay 12640.05 $1.42 $119,714.29
C3030 Ceiling Finishes $5.56 $468,890.24
C30301104800 Gypsum board ceilings, 1/2" fire rated gypsum board, painted and
textured finish,1" x 3" wood, 16" OC furring, wood support
84267 $5.56 $468,890.24
D Services 38.68% $65.65 $5,531,937.93
D1010 Elevators and Lifts $5.17 $435,816.54
D10101109150 Hydraulic passenger elevator, 4000 lb., 3 floor, 9' story height, 125
FPM
3.44 $5.17 $435,816.54
D2010 Plumbing Fixtures $33.11 $2,790,382.20
D20101101880 Water closet, vitreous china, tank type, wall hung, close coupled 2
piece
298.03 $11.05 $931,395.98
D20102102000 Urinal, vitreous china, wall hung 3.13 $0.06 $5,378.28
D20103101560 Lavatory w/trim, vanity top, PE on CI, 20" x 18" 298.03 $7.22 $608,771.03
D20104101800 Kitchen sink w/trim, countertop, PE on CI, 32" x 21" double bowl 6.24 $0.16 $13,470.83
D20104404300 Service sink w/trim, PE on CI,wall hung w/rim guard, 22" x 18" 8.51 $0.67 $56,174.58
D20105102080 Bathtub, recessed, PE on CI, mat bottom, 5' long 295.11 $13.70 $1,154,604.08
D20107101840 Shower, stall, fiberglass 1 piece, three walls, 36" square 3.13 $0.08 $6,880.50
D20108201880 Water cooler, electric, wall hung, dual height, 14.3 GPH 3.13 $0.16 $13,706.92
D2020 Domestic Water Distribution $0.71 $59,849.08
D20202502140 Gas fired water heater, commercial, 100< F rise, 300 MBH input, 278
GPH
3.63 $0.71 $59,849.08
D3050 Terminal & Package Units $8.84 $745,171.58
D30502700220 3/4 ton, thru wall, heating. & cooling units 180.57 $8.84 $745,171.58
D4010 Sprinklers $4.09 $344,737.73
D40104100620 Wet pipe sprinkler systems, steel, light hazard, 1 floor, 10,000 SF 28650.78 $1.62 $136,272.56
D40104100740 Wet pipe sprinkler systems, steel, light hazard, each additional floor,
10,000 SF
55616.22 $2.47 $208,465.17
D4020 Standpipes $0.42 $34,986.89
D40203101540 Wet standpipe risers, class III, steel, black, sch 40, 4" diam pipe, 1
floor
1.72 $0.29 $24,572.00
D40203101560 Wet standpipe risers, class III, steel, black, sch 40, 4" diam pipe,
additional floors
3.1 $0.12 $10,414.89
D5010 Electrical Service/Distribution $1.26 $106,297.94
D50101200400 Overhead service installation, includes breakers, metering, 20' conduit
& wire, 3 phase, 4 wire, 120/208 V, 800 A
1.25 $0.29 $24,291.38
D50102300400 Feeder installation 600 V, including RGS conduit and XHHW wire, 800
A
200 $0.71 $59,604.60
D50102400280 Switchgear installation, incl switchboard, panels & circuit breaker,
120/208 V, 3 phase, 800 A
1.2 $0.27 $22,401.96
D5020 Lighting and Branch Wiring $9.78 $823,984.42
D50201100560 Receptacles incl plate, box, conduit, wire, 10 per 1000 SF, 1.2 W per
SF, with transformer
84267 $4.60 $387,550.67
D50201300360 Wall switches, 5.0 per 1000 SF 84267 $1.51 $127,576.03
D50201350200 Miscellaneous power, to .5 watts 84267 $0.18 $15,463.00
D50201452080 Motor installation, three phase, 460 V, 15 HP motor size 2 $0.07 $5,796.50
D50202100200 Fluorescent fixtures recess mounted in ceiling, 1 watt per SF, 20 FC, 5
fixtures @40 watts per 1000 SF
84267 $3.41 $287,598.22
D5030 Communications and Security $2.14 $180,209.44
D50309100456 Communication and alarm systems, fire detection, addressable, 100
detectors, includes outlets, boxes, conduit and wire
1.81 $1.86 $156,981.84
D50309100462 Fire alarm command center, addressable with voice, excl. wire &
conduit
1.72 $0.28 $23,227.60
D5090 Other Electrical Systems $0.12 $10,502.11
D50902100200 Generator sets, w/battery, charger, muffler and transfer switch,
gas/gasoline operated, 3 phase, 4 wire, 277/480 V, 7.5 kW
7.29 $0.12 $10,502.11
West 78th Street TIF District
LHB Project No. 230558.00 Page 2 of 3
Replacement Cost Report
Parcel E - 591 W 78 th St, Chanhassen, MN 55317
47
E Equipment & Furnishings 0.16% $0.28 $23,527.21
E1010 Commercial Equipment $0.28 $23,527.21
E10106100110 Architectural equipment, laundry equipment dryers, gas fired, com,
30 lb capacity, single
3.44 $0.09 $7,264.78
E10106100170 Architectural equipment, laundry equipment, washers, commercial,
coin operated, deluxe
3.44 $0.19 $16,262.43
E1090 Other Equipment $0.00 $0.00
F Special Construction 0.00% $0.00 $0.00
G Building Sitework 1.09% $1.84 $155,292.00
G2040 Site Development $1.84 $155,292.00
G20409204600 Swimming pool, motel class, concrete sides, tile finish, 28' x 60' 1 $1.84 $155,292.00
100% $169.74 $14,303,526.33
15.0% $25.46 $2,145,528.95
0.0% $0.00 $0.00
0.0% $0.00 $0.00
Total Building Cost $195.20 $16,449,055.28
Contractor Fees (General Conditions,Overhead,Profit)
Architectural Fees
SubTotal
User Fees
West 78th Street TIF District
LHB Project No. 230558.00 Page 3 of 3
Replacement Cost Report
Parcel E - 591 W 78 th St, Chanhassen, MN 55317
48
Code Deficiency Cost Report
Parcel E - 591 West 78th Street, Chanhassen, Minnesota 55317 Building Name or Type
Parcel ID 251190010 Country Inn and Suites
Code Related Cost Items Unit Cost Units Unit Quantity Total
Accessibility Items
*No Deficiencies Observed*-$
Structural Elements
Steel Lintels
Protect steel lintels from rusting per code 1,000.00$ Lump 1 1,000.00$
Exiting
Concrete Sidewalks
Repair damaged concrete sidewalks to create an unimpeded means
for emergency egress per code 3,500.00$ Lump 1 3,500.00$
Concrete Stairs
Repair damaged concrete stairs to create an unimpeded means for
emergency egress per code 1,500.00$ Lump 1 1,500.00$
Floor Tile
Repair damaged floor tile to create an unimpeded means for
emergency egress 1,000.00$ Lump 1 1,000.00$
Handrails
Repair loose handrails to create an unimpeded means for emergency
egress 500.00$ Lump 1 500.00$
Interior Stairs
Modify stairs to comply with code 0.73$ SF 84,267 61,514.91$
Emergency Notification System
Install a code compliant emergency notification system 0.28$ SF 84,267 23,594.76$
Fire Protection
Circuit Breaker Boxes
Maintain a code required 36-inch clear space in front of electrical circuit
boxes 250.00$ Lump 1 250.00$
Entrance Canopy
Install a code required sprinkler in entrance canopy 4.09$ SF 1,400 5,726.00$
Building Sprinkler System
Repair existing sprinkler system to comply with code 2.25$ SF 84,267 189,600.75$
Smoke Detectors
Install code compliant smoke detectors 1.86$ SF 84,267 156,736.62$
Fire Doors
Replace damaged smoke gaskets on fire rated doors 500.00$ Lump 1 500.00$
West 78th Street Renewal and Renovation TIF District
West 78th Street TIF District
LHB Project No. 230558.00 Page 1 of 2
Code Deficiency Cost Report
Parcel E - 591 W 78th St, Chanhassen, MN 55317 49
Code Related Cost Items Unit Cost Units Unit Quantity Total
Exterior Construction
Exterior Walls
Repair failing exterior walls to prevent water intrusion per code 1.00$ SF 84,267 84,267.00$
Exterior Caulking
Replace failed caulking to prevent water intrusion per code 0.05$ SF 84,267 4,213.35$
Windows
Replaced failed windows to prevent water intrusion per code 7.36$ SF 84,267 620,205.12$
Roof Construction
Roofing Material
Replace failed roofing material to prevent water intrusion per code 2.19$ SF 84,267 184,544.73$
Mechanical - Electrical
Mechanical
Install a code compliant HVAC system 8.84$ SF 84,267 744,920.28$
Electrical
Install a code compliant lighting system 3.41$ SF 84,267 287,350.47$
Total Code Improvements 2,370,924$
West 78th Street TIF District
LHB Project No. 230558.00 Page 2 of 2
Code Deficiency Cost Report
Parcel E - 591 W 78th St, Chanhassen, MN 55317 50
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West 78th Street Renewal and Renovation TIF District | Parcel E
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Prepared by:
701 Washington Avenue North, Suite 200, Minneapolis, MN 55401
LHBcorp.com
LHB Project No. 230558.00
62
With this application, please submit a formal letter requesting assistance and stating the
need for assistance. An escrow fee will be required to pay all legal and financial service
fees associated with the application process. Any unused portion of this fee will be
returned to the applicant if the project is not approved or if the applicant decides not to
proceed. The application is not considered complete until the application escrow has
been received.
Business Name:_________________________________________________________
Address:_______________________________________________________________
City, State, Zip: _________________________________________________________
Contact Person:____________________________ Title: ________________________
Telephone:________________________________Email:________________________
Parent Company or DBA (if applicable): _______________________________________
Address:_______________________________________________________________
City, State, Zip: _________________________________________________________
Business to be listed as primary on legal documents:____________________________
Consultant Name:_______________________________________________________
Contact Name:______________________ Title: ______________________________
Address:______________________________________________________________
City, State, Zip: ________________________________________________________
Phone:________________________________ Email: _________________________
Type of Subsidy Requested
☐Tax Increment Financing (TIF) ☐ Tax Abatement ☐ Other:___________________
Type of TIF: ☐ Economic Development ☐ Redevelopment ☐ Housing
CITY OF
CHANHASSEN Business Subsidy
Application
Applicant Information
Consultant Information
Subsidy & Owner Information
63
City of Chanhassen, P.O. Box 147, 7700 Market Blvd, Chanhassen, MN 55317 • www.chanhassenmn.gov • 952.227.1100
Ownership Structure & Financial History
☐Corporation ☐ Partnership ☐ LLC ☐ Proprietorship ☐ Other _________________
Proprietorship, partners, officers, directors, and holders of outstanding stocks of
10 percent or more of business ownership must be accounted for in the table
below.
Name Title % of Ownership
%
%
%
%
Have there ever been judgments or injunctions against the business or owners?
☐ Yes ☐ No If yes, describe: ______________________________________
Is there pending litigation involved in the business?
☐ Yes ☐ No If yes, describe: ______________________________________
Has the business or the owners of the business ever filed for bankruptcy?
☐ Yes ☐ No If yes, describe:______________________________________
Has the business or the owners defaulted on a loan commitment?
☐ Yes ☐ No If yes, describe: ______________________________________
Is the business or owner(s) currently delinquent on property taxes in
Chanhassen? ☐ Yes ☐ No
Is the business or owner(s) currently delinquent on utility bills in Chanhassen?
☐Yes ☐No
Are you engaged in international trade?
☐Yes ☐ No
If awarded, what is the intended use of funds? If possible, please provide preliminary
cost estimates._________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
Project Information
64
City of Chanhassen, P.O. Box 147, 7700 Market Blvd, Chanhassen, MN 55317 • www.chanhassenmn.gov • 952.227.1100
Project Type: ☐ Expansion ☐ Startup
Do you have facilities in other locations? ☐ Yes ☐ No
If yes, please list:________________________________________________________
Will any jobs be relocated from another Minnesota site? ☐ Yes ☐ No
If yes, which location(s) will the jobs be located from? ___________________________
*Provide a statement within the attachment section as to why the project cannot be completed at its current
location/facility.
What is the company’s current number of Full Time Equivalent employees in
Chanhassen? _______
*Full Time Equivalent (FTE) is based on total annual hours of 2,080.
What is the company’s current number of FTE employees in Minnesota? ______
Number of new FTE jobs to be created within two (2) years in Chanhassen? ______
Number of new FTE jobs to be created within five (5) years in Chanhassen? ______
*Job numbers will be used to determine eligibility for scoring and for job creation commitments.
What is the hourly base wage of the lowest-paid job that will be created? ______
How many jobs earning a base wage of 200% of the State Minimum Wage or higher are
anticipated to be created? ________
*Wage & Job Creation. A project receiving a business subsidy must have demonstrated that one-third (33%) of the
full-time equivalent positions created or retained within the city will be paying at least 200% of the State of MN
Minimum Wage in effect at the time the business subsidy is awarded.
What is the average base wage of all the jobs created? _____________
Wage Levels
per Hour
Number of Permanent
FTE Positions at this
Wage Level
Hourly Value of Health
Insurance Benefits
(Health & Dental)
Hourly Value of Non-
Health Insurance Benefits
(Life, Profit Sharing,
Bonuses, Retirement, etc.)
Less than $14.50
$14.50 - $14.99
$15.00 - $16.99
$17.00 - $18.99
$19.00 - $20.99
$21.00 - $22.99
$23.00 - $24.99
$25.00 - $26.99
$27.00 - $28.99
$29.00 - $30.99
$31.00 and Over
Wage/Benefit Table
Jobs & Wages
Housing and Redevelopment TIF applicants may skip this section.
65
City of Chanhassen, P.O. Box 147, 7700 Market Blvd, Chanhassen, MN 55317 • www.chanhassenmn.gov • 952.227.1100
PID: ________________________________________________________________________
Total Size of Property: __________________________________________________________
Total Size of Facility: ___________________________________________________________
Commercial/Industrial Breakdown, in square feet
Manufacturing/Assembly/Processing Research Laboratory
Office Warehouse
Other
Residential Breakdown
Total number of 1-bedroom units: ____ Total Square feet per 1-bedroom unit: ____
Total number of 2-bedroom units: ____ Total square feet per 2-bedroom unit: ____
Total number of 3-bedroom units: ____ Total square feet per 3-bedroom unit: ____
Total number of 4-bedroom units: ____ Total square feet per 4-bedroom unit: ____
Total square feet of other: _______
Will the facility be leased or owned: ☐ Leased ☐ Owned
Are there any environmental risks associated with the site, building, or the business
itself? ☐ Yes ☐ No
Have the state environmental review requirements been met, if applicable?
☐Yes ☐No
Note: 20% of equity is required.
Local
Government Bank Equity DEED Other Total
Property
Acquisition
Site
Improvement
New
Construction
Renovation of
an Existing
Building
Purchase of
Machinery &
Equipment
Public
Infrastructure
Other
Total Project
Costs
Property Information
Estimated Sources and Uses
66
City of Chanhassen, P.O. Box 147, 7700 Market Blvd, Chanhassen, MN 55317 • www.chanhassenmn.gov • 952.227.1100
Task Estimated Completion
Date
Commitment of all Funds
Start of Construction
Purchase of Equipment
Complete Construction
Begin Operations
Attach the following information with the application. Application is not considered
Complete until all documents have been received.
o Provide a brief narrative of the company.
What is the business' competitive position in the marketplace? Briefly describe the past
and present operations of the business and/or events leading up to its creation. Include
when business was established and any change in controlling ownership within the last
five years. Does the marketing strategy support the planned expansion or start-up? Is
public assistance necessary for this project? If so, why will the project not proceed
without public assistance?
o Site information, including site plan, renderings of the proposed project, narrative
description of the location, scope, size, and type of development.
o Planning and zoning analysis: Does the project conform to the current zoning?
Are any variances needed? If so, please identify and explain.
o Studies and analysis in support of project:
o Preliminary economic analysis showing existing taxes, future taxes, and
source and use of funds.
o Pro forma analysis of the project or market that have been completed.
o Market feasibility analysis.
o Preliminary economic analysis of the company’s financials may be required and
would need to include review of the following information: three years historical
financial information, including balance sheets, profit and loss statements, and
cash flow statements.
o Payment of $12,000 escrow fee.
Estimated Project Timetable
Application Checklist
67
City of Chanhassen, P.O. Box 147, 7700 Market Blvd, Chanhassen, MN 55317 • www.chanhassenmn.gov • 952.227.1100
NOTICE TO THE COMPANY: DATA PRACTICES ACT
The information that you supply in your application to the City of Chanhassen EDA
("city") will be used to assess your eligibility for financial assistance. The city will not be
able to process your application without this information. The Minnesota Government
Data Practices Act (Minnesota Statutes, Chapter 13) governs whether the information
that you are providing to the city is public or private. Financial assistance is provided for
the project, the information submitted in connection with your application will become
public, except for those items protected under Minnesota Statutes, Section 13.59,
Subdivision 3(b) or Section 13.591, Subdivision 2.
I have read the above statement and I agree to supply the information to the city with
full knowledge of the matters contained in this notice. I certify that the information
submitted in connection with the application is true and accurate.
__________________________________________________ _________________
Signature of Applicant or Authorized Representative Date
Office Use Only
Received by: Date Received: Fee paid:
68
Two Carlson Parkway N | Suite 400
Plymouth, MN 55447
763.285.8808
roerscompanies.com
Roers Companies
Roers Companies is a full-service real estate, property management, and construction firm based in
Plymouth, Minnesota. Founded in 2012 by Brian and Kent Roers, the firm started with an entrepreneurial
spirit and passion with projects in the Bakken oil fields of North Dakota. Since then, the entrepreneurial
and hands on nature has enabled the company to grow to 250 employees with offices in Minnesota, Texas,
and Florida and expanded further with in-house development, construction, and property management.
These functions allow the company to control all aspects of the project through volatile markets and
enable us and our investors to own and operate its projects in the long term. This vertical integration along
with a very diverse and deep pool of high-net-worth investors has allowed Roers Companies to
differentiate itself in the marketplace and deliver strong projects to the communities it is within. The
company has remained under majority ownership of Brian and Kent since inception.
Market Analysis
The marketing strategy supports the additional units in this market for three reasons. First, Roers
Companies developed and owns Venue Apartments, a mixed-use development adjacent to the subject
properties. Since its inception, the property has remained consistently leased, has strong tenant retention,
and strong tenant satisfaction. Second, it is our understanding that the market for commercial space in
Chanhassen is very strong sporting historically low vacancy rates with strong demand for national and local
retailers. We have experienced a strong amount of interest in the potential of future commercial space.
Third, the City’s vision for the evolving downtown with the new zoning, new City Hall building, and the
desire to break up the super blocks, all contribute to the vision of this corner. These three pieces of
information allow Roers to feel very confident in the marketing plan for this project.
Public Assistance
The project is requesting public assistance in the form of tax increment financing for three reasons. First,
the project is a prominent corner located at the center of downtown Chanhassen and is the acquisition of
a dated and partially blighted, operating hotel making the acquisition price above what would be
considered market for a similar project. Second, there are significant sitework costs above and beyond
what a normal multi-family and commercial project would require, which includes the construction of a
new public road. Finally, the retail rents are being offered below market to attract local tenants in order to
maximize job creation in the community. Because of these three factors, the project would not proceed
but for the use of public assistance in the form of tax increment financing. If public assistance was not
provided, the project would not meet a market rate of return and therefore there would not be equity
available to fund the project.
69
Two Carlson Parkway N | Suite 400
Plymouth, MN 55447
763.285.8808
roerscompanies.com
Site Information
The project is located at the Southeast corner of Market Boulevard and West 78th Street. The project will
consist of 2 stories of underground parking which will be for residents and retail users, sectioned off
accordingly. The project will be 5 stories tall with 306 total market rate housing units. Both buildings will
be highly amenitized with a pool deck, fitness center, community space, dog wash and dog run, work from
home spaces, and roof top terraces. Central to the ground floor circulation are the retail spaces which are
carefully designed in collaboration with various community stakeholders and potential tenants with the
goal of maximizing the activity, jobs, and public benefit of the site. Roers Companies has partnered with
Kimley Horn, who is also working on the city’s public infrastructure project, to ensure a seamless transition
with the projects likely occurring at the same time. In addition, Roers has partnered with ESG architecture
who has designed many of the most prominent urban apartment buildings in the twin cities to bring an
urban mixed-use project to downtown Chanhassen with high quality materials, glazing, and keen urban
design.
Zoning
The project will comply with the “CBD” zoning guidelines which are currently being implemented and have
been reviewed concurrently with the city’s implementation to ensure cohesion. Specifically, the project
has been inspired by Sec 20-731 of the code stating, “The intent of the “CBD District is to provide for
downtown business development supporting a strong central business district while enhancing the overall
character of the community in conformance with downtown redevelopment plan, goals and objectives.”
This project will provide smaller blocks with sidewalks promoting walkability, hidden parking structures,
varied facades with minimal setbacks from the street, active mixed uses with commercial space targeting
restaurants and other similar users and will be constructed with high quality classic materials to contribute
to a desirable downtown destination. The design team is working closely with Staff on whether or not
variances will be required to enable the plans set forth and goals of the project to come to fruition.
Financial Analysis
Please refer to the attached documentation.
70
Two Carlson Parkway N | Suite 400
Plymouth, MN 55447
763.285.8808
roerscompanies.com
71
VENUE
APARTMENTS
ALDI
CHANHASSEN
STATION
CHANHASSEN
DINNER
THEATERS
974
977
964
RETAIL PARKING
RESIDENTIAL
RESTAURANT
960
973
FUTURE LOREDO DRIVE EXTENSIONRESIDENTIALROOF ROOFMARKET BLVDW 78TH ST
MARKET ST
LOBBY
RETAIL
RESIDENT PARKING
RETAIL
LOBBY
PET EXERCISE
PLAN
NORTH
Scale:1" = 80'-0"
Market Blvd & W 78th St DISTRICT SITE PLAN
8/24/2023
Chanhassen, MN 72
974
964
29,681 SF
RETAIL PARKING
6,696 SF
RESIDENTIAL
4,595 SF
RESTAURANT
MARKET BLVDW 78TH ST
3,034 SF
LOBBY
7,928 SF
RETAIL
12,585 SF
RESIDENT PARKING
3,151 SF
RETAIL
2
MP1.9
ALDI
VENUE
APARTMENTS
JIMMY
JOHN'S
FUTURE LAREDO STREET EXTENSION22,108 SF
RESIDENTIAL
6.06%1
MP1.9
TOWN
HOME
TOWN
HOME
TOWN
HOME
TOWN
HOME
TOWN
HOME
2,085 SF
TERRACE 1,071 SF
BOH
7,323 SF
AMENITY
PET EXERCISE
PLAN
NORTH
Scale:1" = 60'-0"
Market Blvd & W 78th St STREET LEVEL PLAN
8/24/2023
Chanhassen, MN 73
37,897 SF
RESIDENTIAL
2
MP1.9
1
MP1.9
28,678 SF
RESIDENTIAL
1,485 SF
AMENITY
5,196 SF
AMENITY
PLAN
NORTH
Scale:1" = 60'-0"
Market Blvd & W 78th St LEVEL 2 FLOOR PLAN
8/24/2023
Chanhassen, MN 74
2
MP1.9
1
MP1.9
44,578 SF
RESIDENTIAL
28,678 SF
RESIDENTIAL
PLAN
NORTH
Scale:1" = 60'-0"
Market Blvd & W 78th St LEVEL 3 PLAN (LEVELS 4 & 5 SIMILAR)
8/24/2023
Chanhassen, MN 75
2
MP1.9
1
MP1.9
37,584 SF
RESIDENTIAL
PLAN
NORTH
Scale:1" = 60'-0"
Market Blvd & W 78th St LEVEL 6 PLAN
8/24/2023
Chanhassen, MN 76
57,755 SF
PARKING
36,066 SF
PARKING
EXISTING RETAINING WALL
TO BE REPLACED IN KIND
EXISTING RETAINING
WALL TO BE REMOVED -
FOUNDATION WALL
EXPOSED
RETAIL ABOVE (UNEXCAVATED)
MOVE
IN
2
MP1.9
VENUE
APARTMENTS
PARKING
4,375 SF
RESIDENTIAL
1
MP1.9
6.01%6.01%
513 SF
PLAN
NORTH
Scale:1" = 60'-0"
Market Blvd & W 78th St MINUS 1 LEVEL PLAN
8/24/2023
Chanhassen, MN 77
2
MP1.9
45,518 SF
PARKING
1
MP1.9
ELEC
PLAN
NORTH
Scale:1" = 60'-0"
Market Blvd & W 78th St MINUS 2 LEVEL PLAN
8/24/2023
Chanhassen, MN 78
LEVEL 1
100' - 0"
LEVEL 2
115' - 0"
LEVEL 3
126' - 8"
LEVEL 4
137' - 4"
LEVEL 5
148' - 0"
LEVEL 6
158' - 8"
ROOF LEVEL
169' - 4"
MINUS 1 LEVEL
88' - 8"
MINUS 2 LEVEL
77' - 4"
6.06%
6.01%10' - 8"10' - 8"10' - 8"10' - 8"11' - 8"15' - 0"11' - 4"11' - 4"LEVEL 1
100' - 0"
LEVEL 2
115' - 0"
LEVEL 3
126' - 8"
LEVEL 4
137' - 4"
LEVEL 5
148' - 0"
LEVEL 6
158' - 8"
ROOF LEVEL
169' - 4"
MINUS 1 LEVEL
88' - 8"
MINUS 2 LEVEL
77' - 4"10' - 8"10' - 8"10' - 8"10' - 8"11' - 8"15' - 0"11' - 4"11' - 4"Scale:1" = 30'-0"
Market Blvd & W 78th St SITE SECTIONS
8/24/2023
Chanhassen, MN
EAST/WEST SECTION THROUGH WEST BUILDING
NORTH/SOUTH SECTION THROUGH WEST BUILDING
79
CITY OF CHANHASSEN
CARVER AND HENNEPIN COUNTIES, MINNESOTA
ORDINANCE NO. _____
AN ORDINANCE AMENDING CHAPTER 20
CHANHASSEN CITY CODE
“CBD” CENTRAL BUSINESS DISTRICT
THE CITY COUNCIL OF THE CITY OF CHANHASSEN, MINNESOTA ORDAINS:
SECTION 1. Chapter 20, Article 20-XVIII of the City Code, City of Chanhassen, Minnesota, is
hereby amended to read as follows:
Sec 20-731 Intent
The intent of the “CBD District is to provide for downtown business development supporting a
strong central business district while enhancing the overall character of the community in
conformance with downtown redevelopment plan, goals and objectives.
Sec 20-732 Permitted Uses
The following uses are permitted in the “CBD” District:
(a) Restaurant
(b) Entertainment
(c) Commercial Services
(d) Commercial Retail
(e) Commercial Office
(f) Brewery with Taproom producing less than 3,500 barrels subject to section 20-969
(g) Brew pub subject to section 20-968
(h) Hotels
(i) Multi-family housing
1) When a multi-family housing use has frontage on West 78th Street, a portion of
the building shall incorporate a restaurant, entertainment, commercial service,
commercial retail, brewery, brew pub, or microdistillery use.
(j) Microdistillery with cocktail room subject to section 20-967
(k) Public parking ramp
(l) Post office
(m) Library
Sec 20-733 Accessory Uses
The following are accessory uses in the “CBD” District:
(a) Parking lots and ramps
(b) Signs
(c) Temporary outdoor sales and events subject to section 20-964
(d) Accessory solar energy systems subject to section 20-1093
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(e) Utility Service
Sec 20-734 Conditional Uses
The following uses are conditional uses in the “CBD” District:
(a) Brewery operated in conjunction with taproom producing over 3,500 barrels per year.
(b) Day care center
Sec 20-735 Interim Uses
(a) Farmers Markets
Sec 20-736 Lot Requirements
The following minimum requirements shall be observed in the “CBD” District:
(a) There is no minimum lot area, lot frontage, or lot depth.
(b) There is no maximum lot coverage.
Sec 20-737 Setbacks and Height Restrictions
The following performance standards shall be observed in the “CBD” District:
(a) Setback and height standards:
Build To Zones Side
Yard
Setback
Height (ft)
CBD
Character
Areas
Primary
Roadways
Secondary
Roadways
Total
Stories
Ground
Story
Upper
Stories
78th Street,
Market Blvd,
Great Plains
Blvd
Laredo Dr, Chan
View Rd, Kerber
Blvd, Market St
Min Min Max Min Max Min Max
Downtown
Mixed Use
0’ – 15’ 0’ – 30’ 0’ 1 6* 14 18 9 12
Downtown
West
5’ – 25’ 10’ – 30’ 0’ 1 6* 12 15 9 12
*If building more than 3 stories and adjacent to property zoned as Residential Single Family
(RSF) then the setbacks applicable for the RSF zoning district shall apply.
(b) The Central Business District (CBD) shall be broken down into the following character
areas:
1) Downtown Mixed Use – high quality architecture with ground level retail along
w. 78th Street, upper level residential or office, buildings towards the street,
parking in the rear, pedestrian focused.
2) Downtown West – high quality architecture, commercial and retail focus with
more traditional suburban development pattern with parking to the side of
buildings with pedestrian connections from streets to storefronts.
3) Civic/Institutional – high quality architecture with public or institutional uses
serving as anchor destinations and attractions.
4) Central Business District character areas diagram:
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SECTION 2. This ordinance shall be effective immediately upon its passage and publication.
PASSED AND ADOPTED this 25th day of September, 2023, by the City Council of the
City of Chanhassen, Minnesota
Laurie Hokkanen, City Manager Elise Ryan, Mayor
(Published in the Chanhassen Villager on ______________________________)
82
2 Carlson Parkway N | Suite 400
Plymouth, MN 55447
763.285.8808
roerscompanies.com
HOLD: Project Financials
83
Litigation Summary
I. Litigation Matters
Roers Management Inc. (Settled)
In December 2020, Roers Management Inc. (“RMI”)—a North Dakota contracting and construction
business operated by a separate branch of the Roers family—initiated a lawsuit claiming that Roers
Companies’ use of “Roers Companies” infringed RMI’s rights in the trademark ROERS BUILDING
SUCCESS. RMI also claimed ownership (and infringement) of the trademarks in “Roers” and “Roers
Companies.” Roers Companies disputes these claims and presented evidence that Roers Companies (not
RMI) owns the trademark ROERS COMPANIES. The case proceeded through discovery. The parties then
settled their dispute on non-monetary terms. Under the terms of the parties’ settlement, RMI acknowledged
Roers Companies’ ownership and rights in the ROERS COMPANIES trademark, and RMI agreed to refrain
from using ROERS COMPANIES in any capacity. For its part, Roers Companies agreed not to use ROERS,
alone, in certain real estate settings. Roers Companies also agreed to certain, limited restrictions on future
changes to its Roers Companies logo. All active litigation between the parties has been dismissed, with each
party bearing its owns costs and attorney fees.
Doboszenski v. Core Living (Settled)
Former employee filed discrimination-related claims regarding failure to accommodate her disability,
reprisal and discriminatory discharge. Core Living LLC (now known as Roers Residential LLC), a
subsidiary of Roers Companies LLC, denied the allegations in their entirety and disputed the claims through
litigation. Without admitting any liability, Roers Residential LLC (F/K/A Core Living LLC) agreed to a
private settlement with the plaintiff and the case has been dismissed.
Robinson v. Core Living LLC (Settled)
Former employee filed discrimination-related claims with the Wisconsin Equal Rights Division and the
EEOC. Core Living LLC (now known as Roers Residential LLC), a subsidiary of Roers Companies LLC,
denied the allegations in their entirety and disputed the claims through litigation. Without admitting any
liability, Roers Residential LLC (F/K/A Core Living LLC) agreed to a private settlement with the plaintiff
and the case has been dismissed.
The Pines at Rapid v. HDC (Settled)
An affiliate of Roers was the plaintiff in a matter seeking to recover damages from a general contractor in
connection with a settling issue affecting a multifamily housing project owned by the affiliate in South
Dakota. The parties reached a private settlement and the matter was dismissed.
Tioga Apartments v. HDC et. al (Ongoing)
An affiliate of Roers is the plaintiff in a matter seeking to recover damages from a general contractor,
architect and engineer in connection with a settling issue affecting a multifamily housing project owned by
the affiliate in North Dakota. Litigation is ongoing and it is anticipated that alternative dispute resolution,
such as mediation, will be pursued by the parties.
Bowen v. Community Within the Corridor Limited Partnership (Ongoing)
There is pending litigation involving the East Block of The Community Within the Corridor, a historic
redevelopment/affordable housing project located in Milwaukee, WI, which was co-developed and is co-
owned by an affiliate of Roers and a local, third-party developer, Scott Crawford Inc. As part of the
redevelopment, the developers undertook substantial environmental remediation of the project site and
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committed to certain testing and mitigation protocols in connection with the presence of trichloroethylene
(TCE), a carcinogen, on the property. The lawsuit alleges that CWC failed to disclose to tenants the presence
of TCE on the site and misrepresented the project as a safe, new housing facility. Roers and Scott Crawford
Inc., neither of whom are named in the lawsuit, have been working diligently and continuously on behalf
of Community Within the Corridor Limited Partnership to remedy the underlying technical/environmental
issues impacting the property, and have provided extensive support to those residents affected by these
issues. The parties have reached a preliminary agreement to settle the litigation, without any admission of
liability by CWC with respect to the allegations; this agreement is subject to court approval and that process
is ongoing. In the unlikely event the proposed settlement is not approved, an adverse outcome of the
litigation would not have a material impact on Roers’ financial or organizational health, nor affect its ability
to undertake future development projects.
Gregory T. Dunham, on behalf of himself and all others similarly situated v. Roers Companies (Ongoing)
(Fourth Judicial District Court, Hennepin County, Minnesota): This lawsuit was served on the company
on October 3, 2023. The plaintiff, a former maintenance technician, alleges claims under the Minnesota
Fair Labor Standards Act, the Minnesota Payment of Wages Act, and Minnesota common law, seeking to
recover alleged unpaid straight time and overtime wages and related damages, stemming from allegations
that he and others like him worked in an on-call capacity and were not properly paid for all time that they
were on-call. Plaintiff Dunham seeks to represent a proposed class of all individuals employed by the
company in an on-call capacity and paid on an hourly basis in the past three years. No such class has been
certified and the company has not yet had to respond to the Complaint, but the company denies the
allegations in their entirety and intends to vigorously defend the case. At this early stage in the case, while
we cannot predict any outcome, the company anticipates having significant defenses to liability and does
not believe the scope of any potential class will exceed approximately 30 individuals.
Tart and Smith v. Roers Companies (Dismissed). Lawsuit related to a security deposit dispute with a former
tenant, for an amount at issue under $1500. The matter was resolved and dismissed.
II. Regulatory Matters
In October 2022, Brian Roers, a principal of Roers Companies LLC, received notice of a complaint filed
with the Board of Realty Regulation, a division of the Montana Department of Labor & Industry. Mr. Roers
timely responded to the complaint as required by the notice, and has not received any further information
or inquiries from the Board since that time.
In January 2023, Kent Roers, a principal of Roers Companies LLC, received notice of an investigation and
request for information from the Certified Financial Planner Board of Standards, Inc.. Mr. Roers timely
responded to the complaint as required by the notice, and has not received any further information or
inquiries from the Board since that time.
In 2023, Roers Residential LLC, a subsidiary of Roers Companies LLC, executed a settlement and consent
order with the Iowa Real Estate Commission, relating to an allegation that the company failed to timely
notify the Commission of a previous entity name change in connection with its real estate brokerage license.
The settlement agreement did not include any admission of guilt or wrongdoing on the part of Roers
Residential LLC.
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