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HomeMy WebLinkAbout3/23/2021 DMCC Board of Directors Meeting - PresentationsDMC and Mayo Clinic 2020 Investment Report to DEED Background •By April 1 of each year, the DMC Corporation and Mayo Clinic are required to submit to the Minnesota Department of Employment and Economic Development (DEED) a report of all qualifying investments (construction costs) in the preceding year •DEED Certifies the investments, which releases state aid •State aid supports public infrastructure projects in the DMC District, enhancing the community experience DMC ANNUAL STATE AID FORMULA FUNDING FORMULA: Certified Private Investment x 2.75% = State funding for public infrastructure in the DMC district in Rochester, MN Submitted to and Certified by DEED State funding provides many community benefits: Mayo Clinic Capital Investment (Rochester, MN) Non-Mayo Private Investment (DMC District) Total Private Investment DMC ANNUAL STATE AID FORMULA FUNDING FORMULA: Certified Private Investment x 2.75% = $24.9M for public infrastructure in the DMC district in Rochester, MN Submitted to and Certified by DEED State funding provides many community benefits: Mayo Clinic Investment: $60.3M Non-Mayo Private Investment: $83.8M 2020 Private Investment: $144.1M 2020 Results: Mayo Clinic Investment Major Project Highlights: •Mayo Clinic Hospital, Saint Marys Campus modernization and growth •Pedestrian subway re-fresh •Tissue registry building expansion 2020 Results: Non-Mayo Private Investment The Hue Apartments Crave Restaurant at Hotel Indigo Hyatt House Cumulative Investment Cumulative State Aid Community Benefit •New jobs and businesses •Accessible public spaces •Generational improvements to streets and sewers Community Benefit •Increased mobility options •Greater arts and culture programming •Downtown Vibrancy •Mayo Clinic Investment: ~$60.3 Million •Non-Mayo Clinic Private Investment: ~$83.8 Million •Total 2020 investment: ~$144.1 Million 2020 DEED Submissions Highlights Bryk ApartmentsProject Why are we here today? Decision to support a DMC EDA recommendation of providing $2.2M of DMC funding for the Bryk Apartment Project PROJECT SUMMARY $2.2 Million Request of DMC Support To realize: •180 units of mixed income housing and commercial space •Along a major transit corridor •Within walking distance of: •Downtown retail •Major employment centers •Car-share service •City bus service •Community trail system Area Median Income: ‘The midpoint of a region’s income distribution –half of families in a region earn more than the median and half earn less than the median’ (metrocouncil.org) •Affordable housing: –Housing in which the resident is paying no more than 30 percent of gross income for housing costs, including utilities. •Workforce housing: 50%+ AMI –Housing for households earning around the area median income. Housing may include property tax reduction incentives to encourage lower rents. •Market Rate housing – –Serves 100% AMI and up –no rent restrictions, subsidies, or assistance used. Defining Housing Maxfield Report Priorities 1.Create new homeownership opportunities 2.Increase homeownership for People of Color 3.Create housing for people at 50% AMI or less 4.Enhance housing options for seniors 5.Preserve our affordable housing stock WHAT ARE OUR COMMUNITIES’ AFFORDABLE AND SUBSIDIZED HOUSING NEEDS BY 2030?Bryk Project = 180 units Downtown Area = ~1,213 units City of Rochester = ~2,343 units Olmsted County = 3,139 units Bryk Project Location PROJECT DETAILS •Mixed-use apartment building •180 workforce housing apartments with a mixed AMI ranging at 50%, 60% and 80% rental levels •Commercial Space: 7,260 SF Bryk Apartments Unit Counts 50% AMI Unit Count 54 60% AMI Unit Count 18 80% AMI Unit Count 108 TOTAL 180 PROJECT DETAILS •Project Investment = $39.3M •Construction Jobs = 206 positions •Permanent Jobs = 26 positions •Eligible Public Infrastructure = $10.9M –Site remediation –Utilities –Façade improvements –Corridor landscaping and outdoor amenities –Intermodal infrastructure •Mixed Income Workforce Housing •Neighborhood Stabilization and Revitalization •Designed to meet Sustainability Performance Goals •Targeted Business Requirements •Transit Corridor Density •Walkability to downtown and employment Community Benefits AFFORDABLE LIVING –Rochester, MN To enhance the quality of life of Rochester residents. Lower rent/mortgage costs Lower utility costs Lower transportation costs DMC Staff Review: •Confirmation of key project assumptions: –Construction costs –Lease up rate –Return expectations –Rental rate gap analysis –Eligible public infrastructure components •TOD zoning and DMC District Design Guidelines •Sustainability: Energy, Mobility, Materials •DMC EDA Review Project Analysis DEED Grant City TIF DMC Funding Developer Equity Senior Debt PROJECT FUNDING SOURCES Total Project Cost$39.3M FUNDING REQUEST DMC EDA Recommendation: •$2.2M in General State Infrastructure Aid Phase 2: 2020-2025 DMCC anticipates ~$200M of public infrastructure support Phase 2: Private Development DMCC anticipates $25M-$45M of private development support 2021 Capital Plan DMCC approved $7M of private development support March 2021 Bryk Project Recommendation: $2.2M Timeline DMCC Recommendation: March 23, 2021 City Council Recommendation: April 5, 2021 Bryk Construction Start: Summer 2021 Open for Occupancy: Dec 2022 Questions?Thank you! Discovery Walk Request of the DMCC Board •Authorize Discovery Walk construction bid documents to include add-alternatives. •Direct DMC EDA and City staff to present findings and recommendation at next regular meeting. Approvals and Process Creating a Connected City Mayo Clinic Business AcceleratorHilton & Guggenheim Stabile Mayo Opus The Discovery Square Canvas in 2015… Medical Sciences Harwick Baldwin Metro Mkt Place Premier Bank Townsquare Media Di s c o v e r y W a l k Kellen Collider Mayo Clinic Business Accelerator Maven on Broadway 501 on FirstResidence at Discovery Square Hilton & Guggenheim Stabile Mayo Opus The Discovery Square Canvas in 2022 Medical Sciences Harwick Baldwin Metro Mkt Place 514 Broadway The Hue Two DS One DS Premier Bank Townsquare MediaParking Structure 4th St Enhancements 500 Block The Village 400 Block The Office 300 Block The Café A Transformative Experience, Block by Block Investing in the User Experience Investing in Underground Services Investing in Community Community Co-DesignersCommunity Artists “Being in a wheelchair is a daily struggle. Snowmelt sidewalks would be of great benefit to not only myself but to others who use mobility aids.” Krista, community co- designer Optional Additions Snowmelt: $1.09MCommunity Shelters: $2.171M “We know the benefits of social connection on physical and emotional well-being. As social gatherings have changed during the pandemic having flexible outdoor gathering spaces have become even more important and valued.” Jenny, community co- designer Optional Additions Soldiers Field Extension: •Not part of the original scope of the project. •Emerged as a new opportunity through community input. •To be included in Soldiers Field Master Planning Request of the DMCC Board •Authorize Discovery Walk construction bid documents to include add-alternatives. •Direct DMC EDA and City staff to present findings and recommendation at next regular meeting. Downtown Waterfront Southeast Small Area PlanDMCC March 23, 2021 SLIDE2SLIDEToday’s Ask •Provide feedback on the work done to date •Introduce possible infrastructure required for the project Future Concept Today SLIDE3SLIDELocation GONDA BUILDING DMC Boundary DWSE Boundary DISCOVERY SQUARE 1&2 AMPI BUILDING Vision: Mixed use historic warehouse district that embraces economic, social, and environmental health in an urban environment that includes thriving local businesses, a variety of housing options, riverfront activation and inviting public spaces. Existing Site Why a Small Area Plan? 7 PROJECT SCHEDULE BACKGROUND & ANALYSIS VISION & FRAMEWORK SMALL AREA PLAN PUBLIC REVIEW PROJECT COMMITTEE NEIGHBORHOOD WORKSHOPS COMMUNITY FORUM PROJECT WEBSITE PROPERTY OWNER WORKSHOPS JUL ‘20 AUG ‘20 SEP ‘20 OCT ‘20 NOV ‘20 DEC ‘20 JAN ‘21 FEB ‘21 MAR- MAY ‘21 COMMUNITY SURVEY COMMISSION, COUNCIL, DMCC REVIEW COMMUNITY ENGAGEMENT PLANNING PHASE SLIDE8SLIDE SLIDE9SLIDEQuantifying the Vision SLIDE10SLIDEFuture Concept SLIDE11SLIDE SLIDE Plan approval process •3/24-*add Planning and Zoning Commission recap* •4/19-Rochester City Council public hearing •5/20-DMCC review Project next steps •Formation of development organization/partnership/body to keep the process moving forward •Define the best tool to adopt the primary features and principles of the Small Area Plan •Develop 6th street bridge concepts •Identify funding for 6th street bridge 12 SLIDENext Steps Downtown Waterfront Southeast Small Area PlanDMCC March 23, 2021 Downtown District Energy Update Why are we here today? Understand actions to date, next steps DMCC Board Sustainability Actions 2015: DMC Development Plan: Sustainability Goals Adoption 2015: Sustainable Energy Options Report Accepted 2016: District Energy System Strategy Resolution Passed 2019: Energy Integration Committee Energy Plan Approval 2020: Approval of $2M for DES design and construction PROJECT BACKGROUND 1.Four city buildings are heated (and cooled) by a steam line connected to the Olmsted County Waste to Energy Facility (OWEF) 2.Steam line has reached the end of its useful life and costs ($30M) to replace in kind, more (~$45M) to convert to hot water/chilled water system 3.City of Rochester, DMC EDA, and Olmsted County collaborated on a district energy evaluation to meet our collective missions CURRENT FINDINGS 1.County steam line will be decommissioned in 2023 2.Olmsted County elected to pursue independent solution 3.RPU Board supported approach to construct, operate and maintain the DES pending Rochester City Council direction 4.RPU created a DES business plan 5.March 2021: City Council Study Session on building heating and cooling options DISTRICT ENERGY: ECONOMIC AND ENVIRONMENTAL BENEFITS Development Footprint: 1. Current City Building SF (Green) = ~710,000 SF 2. Potential Additional Bldg SF (Blue) = ~2,260,000 SF Environmental Benefit: 1.Avoid ~7,400 MTCDE each year 2.~1,600 passenger vehicles removed from the road Economic Benefits: 1.Utility rates drop as more buildings connect 2.Reduced developer first costs NEXT STEPS 1.City of Rochester discussing an extension of steam line service with Olmsted County 2.Analysis continuing to refine DES opportunity, business plan and possible building connections 3.April 19th Rochester City Council Meeting: Update on DES Direction 4.May 20th DMCC Meeting: DES Project Funding discussion Questions?Thank you! Community Collaboration DMC joined a coalition of organizations to develop a coordinated response to the COVID-19 pandemic. Partners Include: City of Rochester, Olmsted County, Mayo Clinic, Rochester Area Chamber of Commerce, RAEDI, Rochester Downtown Alliance, Experience Rochester, Diversity Council and DMC Support Categories: •Direct Financial Aid •Programmatic Initiatives •Education, Training and Promotion Direct Financial Aid •Emergency Loan Program: $250K •City of Rochester CARES Funding: $1.4 million* •Olmsted County CARES Funding: $4.5 million •Keep it Local Grants: $325K (*$253K through City’s CARES Funding) •Downtown Small Business Relief Fund: $1 million Programmatic Initiatives •Liquor License Deferral •Property Tax Payment Deferral •Outdoor Patio Grants and Infrastructure Support •Free Downtown Parking •Curbside Pickup Locations Education, Training and Promotion •Rochester Ready Safety Pledge •Rochester Chamber “Path Forward” Webinar Series •DMC “Road to Recovery” Webinar Series •RDA Downtown Dialogues •DMC Business Pivot Series •Experience Rochester “Heart of Hospitality” Video Series •Mask Distribution •DMC Urban Evolution Podcast Impacts •Hundreds of businesses and non-profits supported •City sales tax collections in 2020 saw only a minor dip (-3.6%)* •Rochester is currently #1 in hotel occupancy in Minnesota •38.6% vaccination rate in Olmsted County (people with at least one vaccine dose) •Continued growth with construction projects and new downtown dining options *preliminary figures Next Steps •Rochester Reopens •Lessons Learned