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