HomeMy WebLinkAboutPlanning Commission Minutes 10-27-1971PLANKNG COWSSTON
VILLAGE OF PLYMOUTH, QNNES 07'A
October 27, 1971
A special teet;ing of the Planning Commi,ssio was call -ad -to order by Acting Chairman
ookin at 7:30 p.m,. on Wednesday, October 27, 1971 in Room. 100 of, Wayzata Senior
High School.
M141QERS l'USLIM Aoting, Chairman Rog Xrvskin, Commissioners Xarlo June, John 'Roth-,
William keeley and Gerald Neils.
MEMB9RS AD$)ZNT; Chairman Jim Wahl,, Commissioners Warren Chapman, Dale Pollock and
Ed l gam,
8TAFF PRCSEM Ma.rtia W. Overhiser, Assessor Marvin Pulju. Assistant Assessor
Kthael Carroll..
OTHERS PRESENT- Ralph Goodwin, Committee Member - Multiple Development Impr,,,troment
Committee; Robert Wertheim, President Knutson Xortgage Compa iy
Acting Chairman. Kroskin introduced Mr. Wertheim and: thp'following .are notes :from his
presentation
Most developers build for profit and a few build to bav'e built some-
thing big, beautiful or for the good of the community.
Speaker reviewed Section 220 of the Federal. Housing Act as it was in
effect in 1965 and administered by VHA. In some cases the 220 FHA moni-s
approved for a .project were not totally allocated ;to the project. This
to some extent is stili, a problem with some projects
He stated that he was sure that the Village of Plymouth in re 4.ewifts
proposed projects tries to maximize taxes .and social benefit while
minimizing expenses to the "Village.
In responding to the question, "How A6 you underwrite a loan?", he stated
that they consider -what, wheeze, and vheft for each -,f` the following:
1. "foie "ideal' or the of :the person proposing the Pro-
ject (coutage of the developer).
2, Prb`it
3. Need for the proposer, use, and the, market for the projeot
4. Regulations and laws regulating the development
5, Zoning and surrounding area development
6. Building Lodes and regulations
7. Depreciation lAv s (current .laws make it advantageous to
build- and tear, down in 20-40 years)
Planning Commission Minutes -2- October 27, 1973
8. ' Niniinurs Wage
9. Taxes
Other factors which are considered in general terms are;
1. Mobility of paople
2. Traasportatio i- auto, and/or public
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I. Change (he felt that during the next 3»5 years the numbet of
apartment units built would substantially doorease 'because of
the Increase iii the popularity of townhouse: -Yd condominiums
and :also the tax advantage for buying a tower ee or condominium
4. Sophistication ivrelation to the. desires ..and taste of the con-
suming public.
Long, terms credit considerations by the lender for residential, commercial,
or i idustrial' loans are.
1. Lenders seem to be one year behind because they will continue
to loan on projects When.the market for that type of z se: may
be saturated.
2. khat do they finance? Lenders basically invest money to pro -
teat the principle off,, his investors and to make some: profit
on the, money invested. 3e-nders also learn by :,.stakes. `
Market $- Lenders do make studies continaul.l,y on the marker for rar ous
types of projects.. Basically if the project will sell in the lenders
opinion and ran be approved, it will receive a mortgage:
Operating Income = grossincomeless taxes and expenses; The: operating,
income is a very important indicator that lenders watch.
1 ublic water and sewer a requirement by most lenders.
Some areas, public transit is a necessity. Closeness to employment cent-
tans is also considered. Are there shopping areas available?
The mixt:?11,MQ of types of units and the nvobex of bedrooms is considered
The overall stability of the local area and the
MetroI
ol,itaa area is
ctnzsidered. (die charact;eri.,;ed the seven -county .Metro area as one of
the Most s'tafile in: the country.
Ili costs $11..,0.00-$17,000 per unit oto build multiple developments. They
currently 10 -Lid money for aparrmtnt projects at about 9%, In recent times
the maxizum interest rate that could. be charged to an individual has been
BY. and because money has been going for more thait 8%p, this c,l-Luses an in-
crease: in the number of companies and corporations building development
pro,'cts because they could borrow money and pay more than 8%.
Planning Comm ssioa Minutes -3- October 27, 1971,
QtMS TIOZIs AND ANSWERS.,
qr Whieh cotnc;s first—shopping center or people?
Ai people and then shopping center.
Qt is it a ,factor if dvveloper is obviously building the project to de-
preciate ,it in four .or ;Five years and then, sell.?
A- senders look at the project and try to determine if it will meet the
criteria listed above..
Q: What is the percentage of profit
A Mast developers shoot for 5-8°I4, but verb* few make more than 2% .
Q.Is it good that building .codes set minimums that result in the
maximum in quality?
A Quality of n project deperids more on how well :the project is planned
and designed than on the ctual, quality ofthe building, materials, Tae
suggested that from a Village standpoint we should have a master plan
and a planning staff to i€ bure quality control in the i4wverall planning
and desigt-. of ;projects. He felt that realistic zoning could play a
roll in the quality .of a community. He felt that unless the zoning is
related to the market, a community could, fox example, zone all com-
mercial, but it just would not happen unless there was a market for it.
Q What safeguards do lenders use to insure that a developer doesn't de-
velop the first phase of a project without some or all of the amenities
shown in his total development?
A: Lender requires, like the Village most likely would, that each phase
be for the mast part self.-contained..
14ULTIPLE DEVELOPMENT ? EPROVEMENT COMMITTEE REPORT
Commissioner Feeley, Chairman of the Committee, discussed with 'the Planning
Commission some of, the preli,ninary findings of his Committee. Their, findings
still be presenter) to the !council during November. He reported that the
Committee had decided rt to make any recommendations at this time concern
ing.fire districts or an architectural review committee. The Committee
has devoted most of their study to types of improvements and amenities to
be required in residential developments` and in which type of development
certaia requirements are to be provided.
Meeting adjourned at 1.0:30 p.m.
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