HomeMy WebLinkAboutCouncil Information Memorandum 04-25-2019CITY OF PLYMOUTH
COUNCIL INFO MEMO
April 25, 2019
EVENTS / MEETINGS
Planning Commission Agenda for May 1 ........................................................... Page 2
Official City Meeting Calendars .................................................................... Page 3
Tentative List of Agenda Items ..................................................................... Page 6
CORRESPONDENCE
Helmet Rewards ...................................................................................... Page 9
REPORTS & OTHER ARTICLES OF INTEREST
What are CRE Experts Talking About? Downtown's Draw, Worker Woes
and the Amazon Effect, Minneapolis/St. Paul Business Journal .......................... Page 10
Minneapolis Continues to Lure Suburban Jobs to Downtown,
Report Says, Minneapolis/St. Paul Business Journal ....................................... Page 14
PLANNING COMMISSION AGENDA
WEDNESDAY, May 1, 2019
WHERE: CITY COUNCIL CHAMBERS
Plymouth City Hall
3400 Plymouth Boulevard
Plymouth, MN 55447
CONSENT AGENDA
All items listed on the consent agenda are considered to be routine by the Planning Commission
and will be enacted by one motion. There will be no separate discussion of these items unless
a Commissioner, citizen or petitioner so requests, in which event the item will be removed
from the consent agenda and considered in normal sequence on the agenda.
1.CALL TO ORDER – 7:00 P.M.
2.PLEDGE OF ALLEGIANCE
3.PUBLIC FORUM
4.APPROVAL OF AGENDA
5.CONSENT AGENDA
A.Approve the April 17, 2019 Planning Commission meeting minutes.
B.Daikin Applied Americas, Inc. Approve a site plan amendment and variance for a
building addition and related site work for property located at 13600 Industrial Park
Boulevard. (2019016)
6.PUBLIC HEARINGS
A.Sathre-Bergquist. Rezoning and preliminary plat to subdivide the existing lot located
at 18300 8th Avenue into two lots. (2018076)
7.NEW BUSINESS
8.ADJOURNMENT
Page 2
SUN MON TUE WED THU FRI SAT
1 2 3 4 5 6
7 8 9 10 11
12 13
14 15 16
5:00 PM SPECIAL COUNCIL MEETING
Interview Ward 1 Council candidates Parkers Lake Room
17 18 19 20
21 22 23 24 25 26 27
28 29 30
April 2019
3400 Plymouth Boulevard Plymouth, MN 55447 OFFICIAL CITY CALENDAR Phone: 763-509-5000 Fax: 763-509-5060
4:30 PM to 7:00 PM Hennepin County Open Book Meeting Lunch Room
7:00 PM PLANNING COMMISSION MEETING
Council Chambers
SUN TUES MON WED THUR FRI SAT
CHANGES ARE
5:00 PM SPECIAL COUNCIL MEETING Discuss design of Plymouth Creek Center with Architect Medicine Lake Room
7:00 PM REGULAR COUNCIL MEETING Council Chambers
5:00 PM SPECIAL COUNCIL MEETING Interview Architects for Plymouth Creek Center renovation Medicine Lake Room 7:00 PM REGULAR COUNCIL MEETING Council Chambers
7:00 PM HOUSING AND
REDEVELOPMENT
AUTHORITY
MEETING
Parkers Lake Room
5:30 PM SPECIAL COUNCIL MEETING Review Ward 1 Council applicants & vacancies on PRAC, Bassett and Elm Creek Water-shed Management Commissions Parkers Lake Room
7:00 PM PLANNING COMMISSION MEETING Council Chambers
5:30 PM SPECIAL COUNCIL MEETING
Economic Development Discussion (Part 1) Medicine Lake Room
9:00 AM-11:00 AM City Sampler
Maintenance Facility 14900 23rd Ave. N.
Page 3
SUN MON TUE WED THU FRI SAT
1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 29 30 31
May 2019
3400 Plymouth Boulevard Plymouth, MN 55447 OFFICIAL CITY CALENDAR Phone: 763-509-5000 Fax: 763-509-5060
7:00 PM PLANNING COMMISSION MEETING Council Chambers
7:00 PM ENVIRONMENTAL QUALITY COMMITTEE MEETING Medicine Lake Room
7:00 PM PARK & REC ADVISORY COMMISSION MEETING Council Chambers
7:00 PM PLANNING COMMISSION MEETING Council Chambers
7:00 PM HOUSING AND
REDEVELOPMENT
AUTHORITY
MEETING
Parkers Lake Room
SUN TUES MON WED THUR FRI SAT
MEMORIAL DAY
CITY OFFICES CLOSED
5:30 PM SPECIAL COUNCIL MEETING Economic Development Discussion (Part 2) Medicine Lake Room
5:30 PM SPECIAL COUNCIL MEETING
Discuss BRT option for Highway 55 Medicine Lake Room
7:00 PM REGULAR COUCIL MEETING
Council Chambers
5:30 PM SPECIAL COUNCIL MEETING Fire Station Space Needs Assessment & Design Recommendations Medicine Lake Room 7:00 PM REGULAR COUNCIL MEETING Council Chambers
Page 4
SUN MON TUE WED THU FRI SAT
1
2 3 4 5 6 7 8
9 10 11 12 13 14 15
16 17 18 19
7:00 PM PLANNING COMMISSION MEETING
Council Chambers
20 21 22
23 24 25
26 27
28 29
June 2019
3400 Plymouth Boulevard Plymouth, MN 55447
OFFICIAL CITY CALENDAR Phone: 763-509-5000 Fax: 763-509-5060
5:00 PM SPECIAL COUNCIL MEETING
Preliminary Budget Discussion Medicine Lake Room
7:00 PM REGULAR COUNCIL MEETING
Council Chambers
7:00 PM ENVIRONMENTAL QUALITY COMMITTEE MEETING
Medicine Lake Room
7:00 PM PARK & REC ADVISORY COMMISSION MEETING
Plymouth Creek Center
7:00 PM PLANNING COMMISSION MEETING Council Chambers
SUN TUES MON WED THUR FRI SAT
CHANGES ARE NOTED IN RED
5:30 PM SPECIAL COUNCIL MEETING Snow/Ice Removal Policy Medicine Lake Room
7:00 PM REGULAR COUNCIL MEETING Council Chambers
7:00 PM HOUSING AND
REDEVELOPMENT
AUTHORITY
MEETING
Parkers Lake Room 30
Page 5
Note: Special Meeting topics have been set by Council; all other topics are tentative.
EDA refers to the Economic Development Authority
Tentative Schedule for
City Council Agenda Items
April 30, Special, 5:30 p.m. Medicine Lake Room
•Economic development discussion (Part 1)
May 14, Special, 5:30 p.m. Medicine Lake Room
•Discuss BRT option for Highway 55
May 14, Regular, 7:00 p.m. Council Chambers
•Approve modifications to the Private Activity Bond Financing Policy
•Public improvement and assessment hearing for the Candlelight Terrace Street reconstruction
project (ST199001)
May 21, Special, 5:30 p.m. Medicine Lake Room
•Economic development discussion (Part 2)
May 28, Special, 5:30 p.m. Medicine Lake Room
•Fire Station space needs assessment and design recommendations
May 28, Regular, 7:00 p.m. Council Chambers
•Update from the League of Minnesota Cities and Insurance Trust
June 11, Special, 5:00 p.m. Medicine Lake Room
•Preliminary Budget Discussion
June 11, Regular, 7:00 p.m. Council Chambers
•Accept musical instrument donation from the Plymouth Rotary Club for the Zachary
Playground renovation
June 25, Special, 5:30 p.m. Medicine Lake Room
•Snow/ice removal policy
June 25, Regular, 7:00 p.m. Council Chambers
(CANCELLED)July 9, Regular, 7:00 p.m. Council Chambers
July 23, Regular, 7:00 p.m. Council Chambers
August 13, Regular, 7:00 p.m. Council Chambers
August 20, Special, 5:30 p.m., Medicine Lake Room
•Budget/CIP
August 27, Special, 5:30 p.m., Medicine Lake Room
•Budget/CIP
August 27, Regular, 7:00 p.m. Council Chambers
Page 6
September 3, Special, 5:30 p.m., Medicine Lake Room
•Budget/CIP (if needed)
September 10, Regular, 7:00 p.m. Council Chambers
September 24, Regular, 7:00 p.m. Council Chambers
October 8, Regular, 7:00 p.m. Council Chambers
October 22, Regular, 7:00 p.m. Council Chambers
November 12, Special, 5:30 p.m., Medicine Lake Room
•Budget/CIP (if needed)
November 12, Regular, 7:00 p.m. Council Chambers
November 26, Regular, 7:00 p.m. Council Chambers
December 10, Regular, 7:00 p.m. Council Chambers
Page 7
BUDGET PROCESS
Budget Calendar
2020-2021 Biennial Budget Preparation & 10-yr Capital Improvement Plan
Date Category Description
April 22, 2019 Budget Departments receive budget instruction
April – June 2019 Budget Departments prepare budgets
May 13, 2019 Budget Personnel changes submitted to HR
June 10, 2019 Budget Budgets submitted to Finance
June 11, 2019 Budget Council Study Session – Budget Goals
July 8 – July 17, 2019 Budget Department meetings
August 9, 2019 Budget Council receives budget materials for upcoming meeting
August 20, 2019 Budget & CIP Council study session (Budget & CIP meeting #1)
August 27, 2019 Budget & CIP Council Study Session (Budget & CIP meeting #2)
Council Regular Session (Financial Overview & Utility Study)
September 3, 2019 Budget & CIP Council Study Session (Budget meeting #3) (if needed)
September 10, 2019 Budget Council adopts preliminary levies & budget (Budget meeting #4)
October 2, 2019 CIP Planning Commission public hearing
November 12, 2019 Budget Council Study Session (Budget meeting #5) (If needed)
December 10, 2019 Budget & CIP Budget Public Hearing, CIP, Budget & Levy Adoption
December 27, 2019 Budget Levy is certified with Hennepin County
Page 8
City of Plymouth
News Release
For Immediate Release
April 18, 2019
Contact: Sara Lynn Cwayna
Public Safety Education Specialist
City of Plymouth
763-509-5198
scwayna@plymouthmn.gov
Police officers, firefighters and local businesses reward
cyclists, scooter riders and skaters for wearing helmets
Plymouth, Minn. – This spring and summer, when Plymouth police officers or firefighters spot cyclists or
skaters wearing a bike or multi-sport helmet, they might pull them over and reward them with a
certificate that they can redeem for free food or an ice cream treat at a local business.
Public Safety Education Specialist Sara Cwayna said bicycle crashes are the leading cause of summer
visits to the emergency room. She cited statistics that say more than 400,000 children age 14 and
younger are injured each year – and approximately 300 kids die from their injuries.
“About 85% of bicycling head injuries could have been prevented with the use of a bike helmet,”
Cwayna said. “Bike crashes can happen at any time. Even professional bike racers get in serious wrecks.”
Cwayna added that, in three out of four bike crashes, bikers usually get some sort of injury to their head.
The Plymouth Public Safety Department is partnering with several local businesses for the helmet
reward program.
-30-
Page 9
What are CRE experts talking about? Downtown's draw,
worker woes and the Amazon effect
By Nick Halter – Senior Reporter/Broadcaster, Minneapolis/St. Paul Business Journal
Apr 24, 2019, 2:56pm CDT Updated Apr 24, 2019, 4:00pm EDT
It’s a good time to be developing apartments and leasing office space in downtown
Minneapolis. It’s also a good time to be building speculative industrial buildings in the
suburbs and repositioning old suburban office properties.
However, rising construction costs and worker shortages could put a damper on what’s
been a boom in the Twin Cities commercial real estate market.
Those were some of the takeaways from the Minneapolis/St. Paul Business Journal’s
2019 Commercial Real Estate Update panel, which was held last week at the Edina
Country Club. Read on for highlights from the panel discussion.
Rising costs slow development
Speculative office development is, for the most part, only being done in downtown
Minneapolis or just outside the core, with almost none in the suburbs. That’s because
it’s the only place where the rents make new construction work, said Matt Rauenhorst,
vice president and general manager of The Opus Group.
“From 2010 to 2015, construction prices were rising in line with rents. After 2015, they
began rising faster than rent,” Rauenhorst said. “As construction costs go up, we have to
be more careful about which sites we are selecting.”
There are two aspirational office projects being pitched in St. Paul — Minnesota United
FC owner Bill McGuire has shown images of a large-scale office development next to
Allianz Field in St. Paul; and Los Angeles-based AECOM was selected to develop
Ramsey County’s riverfront site, and it showed a 40-story office tower.
Wellington Management Inc. is getting ready to kick off construction on a 155-unit
apartment project across from the stadium. Executive Vice President David Wellington
said that costs estimated for construction on that project increased 15 percent in one
year.
Page 10
Wellington said his company’s office properties, just north of the new soccer stadium,
rent for $10 to $15 per square foot, net. New construction requires rent into the $20 per
square foot. But perhaps a big user could choose the site due to its location between the
two downtowns.
“Anyone who wants to be in that location has been in love with the central location
between the downtowns, on light rail and one of the busiest intersections in the state
and wants to have an urban environment,” Wellington said.
What does work for office?
That’s not to say that office projects don’t work. They’re just different than 15 and 20
years ago.
Downtown is red hot, and many landlords are investing big money into renovation
projects. That’s not to mention two new office developments by United Properties and
Swervo Development in the North Loop, which are nearing completion.
Erin Fitzgerald, principal at Transwestern, has been on the forefront of leasing office
space in downtown Minneapolis, with assignments at Fifth Street Towers, Wells Fargo
Center, Washington Square and The Dayton’s Project. She said that in some of her
downtown office buildings, rents are up as much as 50 percent over the past five years.
Opus is in the process of repositioning the former Target West campus on the edge of
the city, and Rauenhorst said that type of project, because of its lower costs, is working.
Opus has quickly landed several tenants.
“I think we will see more of the repurposing office space rather than new speculative
office,” he said. “The cost of new office today puts you significantly over current rents.
Until we see real rent growth in those existing suburban properties [spec office won’t
happen]. Quite frankly, we are seeing the rent growth happening downtown much more
so than the suburban markets. So I don’t think you will see a lot of speculative office
projects like you saw in the late 1990s and early 2000s.”
Speculative office suites are hot
Transwestern keeps an inventory of at least 20,000 to 40,000 square feet of spec office
suites — fully furnished offices that are move-in ready for tenants. “And it’s flying off the
shelves,” Fitzgerald said.
Because Transwestern is doing large buildouts all the time, it’s able to use economies of
scale to drive down costs for things like furniture, carpet and other materials, Fitzgerald
said.
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“Seventy-five percent of the spec suites that we’ve built are leased within two months of
completion, and they are typically $3 to $4 a square foot higher than what average rents
are in any building.”
Spec suites have also allowed big national or global firms to quickly move into
Minneapolis and open an office here without going through a long design and planning
process, she said.
Rauenhorst said many smaller companies like the spec suites because company leaders
don’t have to worry about screwing up on the design and layout.
“You can walk in, see it, and say, ‘We love it. We can attract talent and we can move
right,’ ” he said.
The new reality of retail
The days of large shopping center development are probably over in the Twin Cities, and
Andrea Christenson, senior director, brokerage services, at Cushman & Wakefield,
explained the big reason why.
“Amazon,” she said. “If you went into a high-rise apartment building and took a photo,
you would be shocked at the visual of how many boxes come in a day. It’s nothing to see
50 boxes.”
That has an impact on commercial real estate, in a lot of ways. “To think that’s not going
to affect our retail outcomes and our storefronts and employment rates and all the other
things [is wrong],” she said. “It’s only going to get worse because of all the late adopters
who haven’t discovered Amazon.”
On the development front, e-commerce means fewer large-scale retail projects. “You’re
going to see smaller spaces,” Christenson said.
Boxes may be piling up in apartment buildings — Rauenhorst said Opus is designing
apartment buildings with expandable package rooms that are two to three times the size
they used to be — but there are things that are Amazon-proof.
Restaurants on the ground floor of mixed-use buildings are seen as an amenity for the
apartment dwellers above, Christenson said. That means landlords have to be
competitive on rents to land those restaurants.
Instead of national chains coming here and opening 10 or 12 big-box stores, the market
is seeing more things like axe throwing, escape rooms and CBD shops — smaller users
that aren’t competing with Amazon.
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Edina’s retail revolution
When the topic of Southdale Center and the Galleria in Edina were raised by an
audience member, Christenson said the area has been a success, as Southdale has
attracted Life Time Inc.’s new health club and coworking space, plus a Restoration
Hardware store and Shake Shack on its parking lot.
“One in five malls is going to close in the next five years,” Christenson said, citing
national prognostication. “Southdale is far ahead of the curve in reimagining what they
are going to do about it.”
Rauenhorst said many of the old office buildings around Southdale are ripe for
renovations. “There aren’t many buildings in that area that have gotten upgrades, new
images.”
Amenity battle
Transwestern tracks 55 office buildings in downtown Minneapolis and roughly 40 of
them are actively leasing to tenants.
“Thirty-five of those 40 have gone through a renovation in the past 15 years to add an
amenity package, like a fitness center, conference center, upgraded lobby area and in
some cases outdoor landscaped spaces or rooftop decks,” Fitzgerald said. “And it’s been
taken up a notch in the past four years. It’s on a tear.”
Transwestern is working with new Wells Fargo Center owner Starwood Capital Group
on a renovation that will add a fitness center, tenant lounge and improved lobby.
Opportunity zones
Wellington has always looked for properties on the “edge,” where there’s a potential for
appreciation. It’s doing an apartment project in St. Paul’s Midway, a redevelopment of
the former Rainbow Foods-anchored shopping center in Midtown Minneapolis and an
office project near Bassett Creek, west of downtown. All of them are in opportunity
zones.
Opportunity zones were part of the 2017 tax bill and provide advantages for investors in
lower-income neighborhoods.
“The opportunity zones came along and found us in a good spot with a variety of
transactions in the pipeline,” Wellington said. “It’s accelerated a couple projects.”
Page 13
Minneapolis continues to lure suburban
jobs to downtown, report says
By Nick Halter – Senior Reporter/Broadcaster, Minneapolis/St. Paul Business Journal 3 hours ago
Downtown Minneapolis continues to lure companies from the suburbs.
That’s according to research by CBRE Minneapolis, which tracked in-migration and out-
migration of office tenants in downtown and the North Loop. In total, downtown and
the North Loop have enjoyed a net gain of 1.4 million square feet of office tenants in the
past six years, which has helped the market absorb space left behind by Wells Fargo’s
consolidation to a new campus in Downtown East.
CBRE said downtown Minneapolis gained more than 1 million square feet of new office
tenants while losing about 200,000 square feet, for a net gain of 800,000 square feet.
The North Loop gained 660,000 square feet of tenants and lost around 80,000 square
feet, for a net migration of 581,600 square feet.
CBRE Senior Vice President Brandon Megal, who represents office tenants, said
companies have increasingly become willing to pay extra to get access to downtown’s
amenities.
“The ability to access transit and the amenity package downtown is more and more
attractive to retaining and recruiting talent, especially young talent,” Megal said.
The CBRE research mirrors what the Business Journal reported in 2016 — a wave of
migration from the suburbs. It also shows that the migration has continued since
then. In the past two years, Minneapolis has gained another 300,000 square feet.
CBRE found that the suburbs lost the most tenants to downtown Minneapolis. Ten
tenants from the Interstate 394 submarket moved to downtown Minneapolis and leased
331,600 square feet. Twelve tenants from the Interstate 494 submarket moved
downtown and leased 260,000 square feet.
That trend has caused suburban landlords to step up their game, said Steve Shepherd, a
broker who represents several suburban landlords in the west metro.
Page 14
“Our large tenants are taking a look downtown. Many aren’t willing to move there
because of all the inconveniences and added costs, particularly with parking and taxes,”
Shepherd said. “But they sure like the downtown amenities, and they are coming back to
us and saying, ‘I really like that fitness center and cafeteria — all the things I looked at in
the downtown building.’ ”
Shepherd does leasing at Southpoint Office Center in Bloomington, where landlord
Felton Properties just spent $2 million to add a full-service fitness center with classes
and personal training, plus a new cafeteria with exposed ceilings and contemporary
finishes.
“We’ve put over $2 million into that update with the intent of not only keeping our
tenants, but attracting some of those users that may only be looking at a couple
suburban options and still want that downtown amenity package and finish level,” he
said.
Some of the suburbs’ biggest losses in the past two years have been Sleep Number Corp.,
which moved in 2017 from Plymouth to 211,000 square feet in the 1001 Third Ave.
building.
This year, hearing aid company Amplifon also left Plymouth for 40,000 square feet in Fifth
Street Towers. That brought 180 jobs downtown. Country Financial left Arden Hills last
year and moved 130 employees into 29,000 square feet, also in Fifth Street Towers.
Amplifon opened a new office in downtown's Fifth Street Towers this year, moving from Plymouth.
ANTHONY GILBERT
Page 15
Minnetonka-based UnitedHealth Group Inc. chose to put its fast-growing Rally Health
company in downtown Minneapolis, taking 40,000 square feet in the new Millwright
building.
The downtown Minneapolis office vacancy rate is 21.5 percent, according to CBRE’s
first-quarter office report. The North Loop’s vacancy rate is 13.9 percent. The overall
metro vacancy rate is 18.3 percent.
Shepherd expects the trend to continue, but perhaps not at the same pace it has. He
expects that as millennials age, they'll prioritize the convenience of having a car to pick
up sick kids or make it to sporting events and concerts.
"I think there will be a pendulum swinging at some point, but I don’t know that it’s
going to be a complete reversal," he said.
Where the tenants are coming from (downtown Minneapolis only)
•10 tenants came from the I-394 submarket, leasing 332,000 square feet (31
percent)
•12 tenants came from the I-494 submarket leasing 274,000 square feet (26
percent)
•Five tenants came from the St. Paul suburbs, leasing 215,000 square feet (20
percent)
•15 tenants came from out of state, leasing 200,000 square feet (19 percent)
•The remaining 4 percent came from the Midway, downtown St. Paul and the
south metro suburbs
Source: CBRE Minneapolis
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