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HomeMy WebLinkAbout2.a. 2008 Street Improvement Project Bid Disscussion, City Project #418AGENDA ITEM: Review Bids 2008 Street Improvement Project, City Project #418 AGENDA SECTION: Discussion PREPARED BY: Andrew J. Brotzler, PE, City Engineer 7 4GENDA NO. 2.k APPROVED BY: ATTACHMENTS: Map RECOMMENDED ACTION: Discussion 4 ROSEMOUNT CITY COUNCIL City Council Work Session: June 3, 2008 ISSUE: Review bids for the 2008 Street Improvement Project, City Project #418. BACKGROUND: On Wednesday, May 28, 2008, bids were received for the 2008 Street Improvement Project and read aloud publicly. The project includes surface improvements to approximately 1.2 miles of 32 -foot wide urban streets including the following: Claret Avenue (between 155t Street West and Cornell Trail West) Cornell Trail (between Claret Avenue and east end) 156t Street West (between Claret Avenue and Chippendale Avenue) Cicerone Path (from Cornell Trail West southwest approximately 720 feet) Based on the review of the low bid received by Staff and the City Attorney, we would like to review the bid in detail with Council prior to Council considering action for the bids received. SUMMARY: Staff will provide an overview of the low bid at the meeting. EXECUTIVE SUMMARY G: \ENGPROJ \418 \ReceiveBidsAwrdContract-CWS6-3-08.doc 2008 Street Improvements ROSEMOUNT 1 ll T: /GIS/City /Maps/Departmental Maps/Engineering/Chris/2008 Recon Locate AGENDA ITEM: Proposed Changes to the Harmony Development by Rottlund Homes GENDA SECTION: bi S Gil S 510 PREPARED BY: Eric Zweber; Senior Planner AGENDA NO. 2 rg. ATTACHMENTS: Brockway Glass Development Plan /Preliminary Plat; Harmony 5th Development Plan /Preliminary Plat; Staff Report from the May 27 Planning Commission Meeting; May 27 Planning Commission Minute Excerpt; Dakota County 2007 Rental Market Survey; GVA Marquette Apartment Trends Spring 2008; APPROVED BY: RECOMMENDED ACTION: Discussion 9 ROSEMOUNT CITY COUNCIL City Council Work Session: June 3, 2008 EXECUTIVE SUMMARY ISSUE Rottlund Homes is acquiring all the vacant property within the Harmony subdivision and the neighboring Pickens property. The original preliminary plat for Harmony includes an outlot for 120 rental units within two apartment buildings and another outlot for a third building that is planned for 60 units of senior housing. The two outlots are part of the vacant property that Rottlund is acquiring, but Rottlund does not build apartments or senior housing. Rottlund has requested an amendment to the planned unit development (PUD) and preliminary plat to allow the 120 apartments and 60 senior housing units to be replaced with 78 townhomes. There is also a requested change to replace 28 Urban Villa style townhomes with 16 Garden Homes style quad- townhomes. In addition, the Pickens property is requested to be platted into nine single family lots. SUMMARY Port Authority Meeting May 20 The Port Authority reviewed the Rottlund proposal and its influence on the tax increment financing (TIF) funds during their meeting on May 20. Ehlers ran a TIF calculation for the Rottlund proposal that projects a built out by 2012 with a total gross tax increment of $1.14 million. The apartment and senior housing is projected to be built out in 2015 with total gross tax increment of $2.51 million. At this time there is no identified builder for the apartments and senior housing so there is no clear way to determine the anticipated build -out of these two projects. Staff has requested Ehlers provide some additional financial information regarding the two proposals but has not received it at this time. The Port Authority conversation consisted of discussions if the townhouse market would support the build out of Rottlund's proposal and if the removal of the apartments and senior housing would affect the City's housing mix and life cycle housing goal. The Port Authority requested staff provide the townhouse information to assess their market niche. There were discussions about the importance of apartment and senior housing site in 2004 when the Harmony subdivision was approved; multiple family developments approved since 2004; the 106 units in the Core Block East project, the 200 plus units that received preliminary plat approval in the Prestwick Place development, and the apartments east of Downtown which received concept plan approval; and the draft Comprehensive Plan that designates additional land for multiple family housing. The Port Authority will be reviewing the Planning Commission meeting minutes and the townhome designs during their meeting on June 3. Staff will provide an update on the discussion during that meeting. Planning Commission Meeting May 27 The Planning Commission reviewed the Rottlund proposal and conducted a public hearing on May 27. The staff report and minutes from that meeting are attached to this executive summary. During the public hearing, four individuals provided comments. The first individual stated that he was in support of the proposal and that the timely development of the entire subdivision would be beneficial to him because there would be more individuals within the homeowners association to help pay required maintenance costs. The second individual was a neighboring property owner on Bonaire Path who complained about the road assessment levied by the City for Bonaire Path. He also indicated he does not support approving more homes when there are some built homes left vacant in the community. The third individual had a number of questions of Rottlund regarding maintenance of his neighboring property and how a street connection would be made, but did not speak against the conversion of the apartments or senior housing. The fourth individual was questioned if there were any changes proposed to the approved single family homes and was satisfied when he found out there were none. The Planning Commission had questions about how the off street parking was provided; what was the history of the redevelopment project and the TIF district; and clarification on the Comprehensive Plans goals and policies on life cycle housing. One Planning Commissioner expressed concern about losing the apartments but agreed with the other Commissioners that the composition of the housing mix for this subdivision and its effect on the housing mix of the City as a whole was a policy question that the City Council should address. The Planning Commission voted 4 -0 to recommend approval of Rottlund's request after finding that the proposal is generally in compliance with the Zoning and Subdivision Ordinance. Recent Apartment Research Staff has assembled information about apartment trends in Dakota County that is available. GVA Marquette Advisors (GVA) has conducted an analysis of average rents and vacancy rates of large apartment complexes in the Twin Cities Metropolitan area (Metro). GVA has found that vacancy rates in the Metro have declined annually since 2004 to a 3.9% vacancy rate in 2008. GVA states that some of the reasons for this decrease in vacancy rates are due to job growth (14,000 additional jobs in the first quarter of 2008) and the increase in home foreclosures (12,700 during 2007). The GVA data shows that this low vacancy rate applies locally as well. According to the GVA data, Dakota County has an overall vacancy rate of 4.2 the South Central market (Lakeville, Farmington, Burnsville, Eagan) has a vacancy rate of 3.9 and the Southeast market (eastern Dakota County and southern Washington County, including Rosemount) has a vacancy rate of 3.9 The GVA data also shows the Apple Valley /Rosemount market having a 2008 vacancy rate of 2.6 a decrease of 3.8% from the 2007 vacancy rate of 6.4 2 The Dakota County Community Development Agency (CDA) conducted a 2007 rental market survey in which they surveyed all apartment complexes within Dakota County. The CDA survey is supportive of the GVA data. The CDA survey shows a 2007 overall vacancy rate in Dakota County of 4.7 down 1.5% from the 2006 vacancy rate 6.2 The CDA survey also shows a 2007 overall vacancy rate in Rosemount of 6.1 down 4.9% from the 2006 vacancy rate 11.0 RECOMMENDATION This item is scheduled for formal action at the Council meeting on June 17, 2008. Staff is bringing this item to the Council so there can be discussion since the decision to modify the development is more of a policy decision than a technical decision. Staff would like the Council to let staff know if there is additional information necessary to assist in making the decision. 3 rr .g .y $dat -1 sg,0 111 j "1 F 1111 11 1 1 1 1 a E ti 6 k E x 11 f 1.11 N s ii 5 o N 5 A Ei n 4� W b ri I I I i j e- I aI� I I;a�I H ns tom._._. I 11 L-- i t z 3 1 1I 11 f \Nal= .2 kf yY Yy.11 as }Ui dp Wp1h It�ry r I_ I T 2 122 1v 0,810 t00wn,00 2 •C10dJ aote 02\ Or2 \2 soo 0 EXCERPT FROM MINUTES PLANNING COMMISSION REGULAR MEETING MAY 27, 2008 5.b. The Rottlund Company Major Amendment to PUD, Preliminary Plat, Rezoning and Final Plat of Harmony 5th Addition and Pickens Plat (08- 12 -AMD, 08- 13 -PP, 08- 14 -ZA, 08- 19 -FP). Senior Planner Zweber presented this item. Rottlund Homes is acquiring all the vacant property within the Harmony subdivision previously owned by CPDC individually and the neighboring Pickens property. The original preliminary plat for Harmony includes an outlot for 120 rental units within two apartment buildings and another outlot for a third building that is planned for 60 units of senior housing. Rottlund has requested an amendment to the planned unit development (PUD) and preliminary plat to allow the 120 apartments and 60 senior housing units to be replaced with 78 townhomes. There is also a requested change to replace 28 Urban Villa style townhomes with 16 Garden Homes style quad townhomes. In addition, the Pickens property is requested to be platted into nine single family lots. Mr. Zweber stated that last year M I Bank (M &I) assumed possession of the vacant parcels that were owned by CPDC. M &I has been negotiating the sale of all the vacant parcels to Rottlund, but Rottlund has conditioned the sale on applying for and receiving an amendment to the planned unit development (PUD) and preliminary plat to convert the 120 apartment units and 60 senior housing units into townhouses. Mr. Zweber further explained that Rottlund is not interested in developing apartments and senior housing in Rosemount, but they have been having success building and selling townhouses within the Harmony subdivision. Mr. Zweber further explained the different areas of planned development and the characteristics including the site layout, townhome and single family design, landscaping and tree preservation, access and parking, rezoning, the city park area and utilities. In greater detail, Mr. Zweber explained that the parking spots requested by the Applicant in the townhome area are a few spaces short of what is required but that is being remedied by extra parking spaces in another area. Commissioner Schultz asked if the homeowners' association approves of giving up the six stalls at the clubhouse. Mr. Zweber replied that the homeowners' association would have to agree but that Rotdund is a part of that association. Chairperson Messner asked where the shortage of six stalls exists. Mr. Zweber showed the Commission on the site layout where the parking spaces should have been installed. Commissioner Howell asked Mr. Zweber to explain the impact on the tax money that is to be paid back to the TIF. Mr. Zweber gave a brief background of the TIF matter. He stated that the excess in the TIF monies is being used to pay for redevelopment in the downtown area. The City has recently purchased both of the outstanding TIF notes relating to the Harmony project. The townhomes Rottlund proposes would produce less TIF monies than the original apartments and senior housing proposal which is one of the reasons why the matter was discussed with the Port Authority. However, timing of development affects the TIF generated also. Chairperson Messner inquired about Outlot A on the Pickens property and Mr. Zweber replied that it is undeveloped. He stated that the pipeline easement goes through the north side of the property and it will remain private open space. The Applicant, Michael Noonan, of Rottlund Homes approached the Commission and stated he would discuss three issues. Mr. Noonan stated Rottlund Homes is thankful for the opportunity to work on completing the Harmony development, providing housing Rottlund feels the market is looking for. He stated construction on the houses should begin by this September. Mr. Noonan responded to earlier questions. He staetd the homeowners' association is in support of sharing the parking in the clubhouse. Rottlund Homes controls the association. Parking in the clubhouse area is an amenity provided by the association for overflow parking for residents. With respect to the addition of the 16 Garden home units, Mr. Noonan replied that Rottlund felt it important to construct that as four blocks of four because of the temporary ponding being placed in the area which would remove three units. With respect to the gas line easement, Mr. Noonan replied that the City staff's recommendation is acceptable. With respect to the Outlot A private open space area, Mr. Noonan stated that Rottlund would be happy to convey that piece of property to the City or Dakota County. Chairperson Messner asked Mr. Noonan if there are any proposed changes to the amenities as originally designed. Mr. Noonan stated that the clubhouse is built and that CPDC and M &I were not willing to perform so Rottlund stepped in and finished the project. The pool opened up last weekend and an open house is planned for next weekend. Mr. Noonan stated that in terms of other amenities, they are largely involved with the park that the City is designing. The gazebo and clock tower are not going to change. In conclusion, Mr. Noonan stated that Rottlund felt it was important to give the neighborhood some closure and complete the development rather than wait for a developer of senior housing. The public hearing was opened at 7:13p.m. Bryan Bailey, 13667 Brick Path, Rosemount, approached the Commission and stated he feels this new development is a positive thing for the community. He stated the City should definitely go forward with medium density housing. Mr. Bailey further stated that he looks forward to the amenities being completed as the homeowners are paying for incomplete amenities through their association dues. Richard Lamotte, 2318 Bonaire Path, approached the Commission and expressed his disappointment with a new development when there are a lot of empty houses in Rosemount due to foreclosures. He stated that this will affect everyone's taxes which is especially difficult for people trying to sell their property in the current market. Mr. Lamotte stated there are too many open questions in this development and it doesn't make sense when there are so many vacant properties in Rosemount. Fred Blanchard, 13594 Brass Parkway, approached the Commission and stated he lives in the development in a single level townhome with no basement and no stairs and he really enjoys it. He stated a couple of concerns or questions for the developer regarding the 10 -12 feet of grass on the east side of their house, the completion of the road as you come into the development from the south, construction around the gas line, and concerns with the details of the location map included in his notice. Mr. Noonan approached the Commission to address Mr. Blanchard's questions. He stated that Rottlund intends to maintain the Pickens property including grading the property and advancing the infrastructure to develop the nine single family lots and to maintain it in a way that meets the expectations of the neighborhood. With respect to the completion of the road Mr. Blanchard mentioned, Mr. Noonan replied that the property there is not a part of the proposed development and is owned by another party for a commercial area. The road that is not complete is to service that parcel alone and not the Pickens property. Rottlund Homes will complete the public road network within the community at large. With respect to construction around the gas line, Mr. Noonan replied that Rottlund is not allowed by law to build on or near the gas line as there are setbacks they need to comply with. Rajan Chattanathan, 13228 Bronze Court, in Rosemount, approached the Commission and asked if Rottlund intends to complete the single family homes along Bronze Parkway that were in the original proposal. Mr. Noonan replied that the current proposed development does include the completion of the 15 lots in that area. There were no further public comments. MOTION by Schwartz to close the public hearing. Second by Schultz. Ayes: 4. Nays: None. Motion approved. Public hearing was closed at 7:32p.m. Chairperson Messner asked about the overall density of the development and asked if Mr. Zweber could explain the City's goal with respect to density. Mr. Zweber highlighted the original intent of the development and stated the City tries to accommodate housing at different stages of people's lives. The Port Authority and City Council do not want to give up that lifecycle housing element. He further explained that in the next comprehensive plan, lifecycle housing is still the goal. Since the original concept of this development, Mr. Zweber stated that other planning efforts have been completed to fulfill the apartment and senior housing needs of the community such as Bards Crossing, the new Stonebridge development, preliminary platted apartments in the Akron area. Mr. Zweber stated that density alone is not the issue but making sure the City has housing for all types of people living in Rosemount. Commissioner Howell stated that she has mixed feelings about the development in that she feels we need rental rather than townhomes and she understands the concerns regarding the current economy. She wondered if the Commission should approve a major PUD amendment based on the economy at the present time. Chairperson Messner replied that the role of the Planning Commission is not so much on the policy issues that the Port Authority and City Council deal with but more of the overall issues as they've been put forth. He stated that he also has economy concerns but that the proposed development looks like a good product and he would support the proposed amendment. Commissioner Howell asked if the garden units would possibly sell quickly if it would be possible to add a greater number of those units beyond what is currently proposed. Chairperson Messner stated that it would require another PUD amendment at the time of the addition. MOTION by Messner to recommend approval of the Major Amendment to the Planned Unit Development, Rezoning of the Pickens Plat to R1 -PUD: Low Density Residential Planned Unit Development, and Rezoning of Outlot D and Outlot E of Harmony 5th Addition to R3 -PUD: Medium Density Residential Planned Unit Development, subject to the following conditions: 1. Compliance with the City Engineer's Memorandum dated May 22, 2008. 2. Six (6) stalls of the off street parking requirement shall be fulfilled within the parking lot for the Harmony Clubhouse provided that the additional parking area shown as proof of parking is constructed. Second by Schwartz. Ayes: 4. Nays: None. Motion approved. MOTION by Messner to recommend adoption an Ordinance B- L< an Ordinance amending Ordinance B City of Rosemount Zoning Ordinance for Harmony 5 Addition and Pickens Plat. Second by Schwartz. Ayes: 4. Nays: None. Motion approved. MOTION by Messner to approve the Preliminary Plat and Final Plat for Harmony 5 Addition and Pickens Plat subject to the following conditions: 1. Compliance with the City Engineer's Memorandum dated May 22, 2008. 2. Receive an agreement with the owner of the pipeline easement to allow the placement of the parking stalls and driveways on Block 7 within the easement. Second by Schwartz. Ayes: 4. Nays: None. Motion approved. As follow -up, Mr. Zweber stated this item will be discussed at the next Port Authority meeting on June 3, 2008. It will then go before the City Council on June 17, 2008. AGENDA ITEM: Case 08- 12 -AMD; 08- 13 -PP; 08- 14 -ZA; 08- 19-FP The Rottlund Company Major Amendment to PUD, Preliminary Plat, Rezoning and Final Plat of Harmony 5th Addition and Pickens Plat. AGENDA SECTION: Public Hearing PREPARED BY: Eric Zweber, Senior Planner AGENDA NO. 5.b. ATTACHMENTS: Site Map; Brockway Glass Development Plan /Preliminary Plat; Harmony 5 Addition Final Plat; Pickens Property Final Plat; Harmony 5 Phasing Plan; Harmony 5th Development Plan /Preliminary Plat; Harmony 5 Preliminary Site Plan; Harmony 5 Preliminary Landscape Plan; Harmony 5 Grading, Drainage, and Erosion Control Plan; Pickens Property Development Plan /Preliminary Plat/Preliminary Site Plan; Pickens Property Preliminary Landscape Plan; Pickens Property Grading, Drainage, and Erosion Control Plan; Vantage Townhomes Elevations and Plans; Urban Villa Townhomes Elevations and Plans; Garden Homes Elevations and Plans. APPROVED BY: RECOMMENDED ACTION: Motion to recommend approval of the Major Amendment to the Planned Unit Development, Rezoning of the Pickens Plat to R1- PUD: Low Density Residential Planned Unit Development, and Rezoning of Outlot D and Outlot E of Harmony 5 Addition to R3 -PUD: Medium Density Residential Planned Unit Development, subject to the following conditions: 1. Compliance with the City Engineer's Memorandum dated May 22, 2008. 2. Six (6) stalls of the off street parking requirement shall be fulfilled within the parking lot for the Harmony Clubhouse provided that the additional parking area shown as proof of parking is constructed. -and Motion to recommend adoption an Ordinance B- an Ordinance amending Ordinance B City of Rosemount Zoning Ordinance for Harmony 5 Addition and Pickens Plat. 4ROSEMOUNT PLANNING COMMISSION Planning Commission Meeting Date: May 27, 2008 Tentative City Council Meeting Date: June 17, 2008 EXECUTIVE SUMMARY 33OON JIMA 39NVIO Of 1D3'ens .ld03 JITh,0 -and- Motion to approve the Preliminary Plat and Final Plat for Harmony 5 Addition and Pickens Plat subject to the following conditions: 1. Compliance with the City Engineer's Memorandum dated May 22, 2008. 2. Receive an agreement with the owner of the pipeline easement to allow the placement of the parking stalls and driveways on Block 7 within the easement. ISSUE Rottlund Homes is acquiring all the vacant property within the Harmony subdivision and the neighboring Pickens property. The original preliminary plat for Harmony includes an outlot for 120 rental units within two apartment buildings and another outlot for a third building that is planned for 60 units of senior housing. The two outlots are part of the vacant property that Rottlund is acquiring, but Rottlund does not build apartments or senior housing. Rottlund has requested an amendment to the planned unit development (PUD) and preliminary plat to allow the 120 apartments and 60 senior housing units to be replaced with 78 townhomes. There is also a requested change to replace 28 Urban Villa style townhomes with 16 Garden Homes style quad townhomes. In addition, the Pickens property is requested to be platted into nine single family lots. BACKGROUND In 2004, the City approved a preliminary plat and PUD of the Harmony subdivision for Contractor Property Developers Company (CPDC) to redevelop the former Brockway Glass facility into a development that consisted of 624 residential units. Since that time, 188 residential units have been built, 166 of which are townhouses and 22 single family homes. As newspaper reports remind us, the housing market is currently slow and it is unknown when it will begin to turn around. The slowest market in the Harmony development is the semi- custom homes in which only 12 of the available 47 lots have been constructed upon. Last year, M I Bank (M &I) assumed possession of the vacant parcels that were owned by CPDC. M &I has been negotiating the sale of all the vacant parcels to Rottlund, but Rottlund has conditioned the sale on applying for and receiving an amendment to the planned unit development (PUD) and preliminary plat to convert the 120 apartment units and 60 senior housing units into townhouses. Rottlund is not interested in developing apartments and senior housing in Rosemount, but they have been having success building and selling townhouses within the Harmony subdivision. Existing Zoning District: Proposed Zoning District: Existing Unit Mix: AG: Agricultural (Pickens property) PI: Public /Institutional (Apartment and Senior Housing) R1 PUD: Low Density Residential Planned Unit Development (Pickens Plat) R3 PUD: Medium Density Residential Planned Unit Development (Harmony 5 Addition) 79 Units of Single Family 40 Units of Garden Homes 227 Units of Urban Villas' 98 Units of Vantages 120 Units of Apartments 2 60 Units of Senior Housing 624 Total Units Proposed Unit Mix: 88 Units of Single Family' 56 Units of Garden Homes 223 Units of Urban Villas 152 Units of Vantages 519 Total Units 1 Includes both row homes and back -to -back units. Only Urban Villa row homes are proposed in the revised plans. 2 Includes the nine new single family lots of the Pickens property. PORT AUTHORITY COMMENTS The original Harmony subdivision was the redevelopment of the abandoned Brockway Glass factory into a residential neighborhood. As a redevelopment project, the City (through the Port Authority) contributed tax increment financing (TIF) funds to help with the costs of demolition, remediation, and infrastructure. The increment from the tax base raised by the residential construction is used to first pay back the TIF funds used during development, and then any additional increment would be available for Downtown redevelopment. Because of the impact this request may have on the TIF revenue, the proposal was shown to the Port Authority at their meeting on May 20. The Port Authority Commissioners had mixed responses to the proposal, mostly regarding the effect this proposal would have on the overall housing mix within the City. Some Commissioners expressed concern over losing 120 apartment units but were accepting of the senior housing change, while other Commissioners expressed concern over losing 60 units of senior housing and were accepting of the change of apartment units. The mix of housing units within the City is a policy issue, not a zoning issue. The City has expressed goals and policies within its Comprehensive Plan to provide housing for persons in all stages of their life. It is expected that the City Council will address this issue during their review. SUMMARY Site Layout The apartments and senior housing was originally approved in the southwestern quadrant of the subdivision, bounded by 135 Street, Brockway Avenue and Bronze Parkway. Adjacent to the apartment and senior housing site is the clubhouse for the entire subdivision and a City park. The clubhouse has recently been completed and is available for use by all of the residents of the Harmony subdivision. The City park has not been constructed yet or made available to the public because the street serving the park, Bronze Parkway, has not been constructed. The revised preliminary plat proposes 49 townhome units in place of the apartments and 29 townhomes units in place of the senior housing. The new townhome units will fit within the boundaries of the outlots created by the original preliminary plat. There will be a slight change in the proposed grades from the original plat, but it will not affect the use and development of the clubhouse and City park. In total, the change represents a decrease in 102 units from that initially proposed. All will be constructed as owner occupied. The Pickens property was not part of the original plat and is located directly east of Harmony. The property is bounded by the Progress Rail line to the south and east, Bonaire Path to the north, and Harmony to the west. The property is highest in elevation adjacent to Harmony and slopes down toward the rail line and Bonaire Path. 3 Apartments 120 3.32 36.14 Senior Housing 60 2.61 22.99 Block 3 28 2.57 10.89 Pickens Property N/A N/A N/A Overall Development 624 84.59 7.37 r Former Apartments 49 3.32 14.75 Former Senior Housing 29 2.61 11.11 Block 3 16 2.57 6.23 Pickens Property 9 6.79 1.33 Overall Development 519 91.38 5.68 While the Pickens property was not a part of the original Harmony subdivision, its development was planned for incorporation within the original approval. The east end of the current 135``' Street is stubbed to the western side of the Pickens property to provide future access. Within the 135t Street right -of -way is sanitary sewer, municipal water, and stormwater infrastructure that was sized appropriately to serve the development of the property. The Pickens property is proposed to be developed into nine single family lots located on a cul -de -sac of 135 Street. The land will be graded to be relatively flat adjacent to 135t Street and then slope downwards towards the rail line and Bonaire Path. One other revision to the preliminary plat is proposed in addition to the apartment, senior housing, and Pickens sites. The property bounded by 133' Street, Butterfly Path, 134t Street, and Bronze Parkway (labeled Block 3 within the final plat) was originally planned for 28 townhomes of the Urban Villa style. The Urban Villa townhomes are typically row homes or back -to -back units with the living area and kitchen on the first floor and bedrooms on the second floor. Rottlund has proposed to replace these 28 units with 16 units of their Garden Homes. The Garden Homes are single story quad townhomes. They are slightly larger than the Urban Villas and are particularly marketable to seniors due to their single level layout. Rottlund does not have many Garden Homes left in the future phases of the development and wanted to take the opportunity to revise the preliminary plat to provide for additional Garden Home units. Phasing Rottlund is not proposing to final plat and construct all of their remaining townhomes at this time. The Harmony 5th Addition final plat is limited to the townhomes and single family lots remaining to the west of Bronze Parkway and north of 135 Street. This phase of development does not include the revised apartment and senior area or the townhomes south of Bronze Parkway. During the construction of the Harmony 5t Addition, all of the remaining public streets will be constructed, including all of Bronze Parkway and 135 Street. The construction of all of Bronze Parkway is particularly important to the City because it allows the development of the city park. The only private streets that will be constructed are located west of Bronze Parkway and north of 135 Street. The remaining private street will be constructed with the future townhouse phases. Residential Density 1 Units Units Net Acres Net Acres Net Densi et liensi 4 Townhouse and Single Family Design Rottlund is proposing to build three types of townhomes in the Harmony 5 Addition: the Garden Homes; the Urban Villa townhomes; and the Vantage townhomes. The Garden Homes are a single level quad -unit buildings identical to the Garden Homes that have been built in Harmony. The Urban Villas of the 5 Addition are proposed to be all row homes with entrance facing the streets and individual garages accessing onto a private drive. The Urban Villa units are a two level deign with the garage and living space on the first floor and the bedrooms located on the second floor. In the previous Harmony phases, some Urban Villa units were back -to -back unit, but all the remaining Urban Villa units proposed to be built are the thru -unit tow home design The Vantages are three level townhomes that are similar, but not identical, to the Gable style three level townhome built in the previous phases of Harmony. The Vantage design has the garage and mechanical room on the first floor, the living space on the second floor, and the bedrooms on the third floor. The Vantage garages all access onto private streets and are primarily located interior to the blocks, screened from the public street by the Urban Villa units. Staff supports the inclusion of the Vantage designs into the Harmony PUD. Rottlund is proposing nine single family homes on the Pickens property. These single family homes will be a part of the PUD and homeowners association of the Harmony subdivision. The home designs will be subject to the same restrictions and requirements of the Harmony single family lots. Landscaping and Tree Preservation The landscaping and tree preservation has only slightly changed from the original proposal. Ten (10) additional significant trees are being removed from the Harmony 5 Addition, mostly in the location of a temporary pond and the former senior housing site. Twenty (20) significant trees are being removed from the Pickens property, mostly in the location of 135 Street and the building pads. All of the trees removed are significant trees and none are heritage trees as defined by the Ordinance. The landscaping plan and the amount of tree replacement exceeds the requirement of the Ordinance. Staff is supportive of the species and the proposed location of the landscaping. Landscaping in the Harmony 5 Addition is focused to buffer the subdivision from South Robert Trail and buffer the Pickens property from Bonaire Path and the rail line. The majority of the existing trees between the Pickens property and the original Harmony subdivision are protected and maintained. Access and Parking Access to the residential units is consistent with the access within the original subdivision. Single family homes access directly onto public streets, but townhomes directly access either a private street or shared driveways before entering onto the public streets. This townhouse access is beneficial for two reasons. First, it prevents vehicles from backing out of garages or driveways from backing onto the public streets allowing better and increase traffic safety. Second, there is an aesthetic benefit to moving the garages to the sides or backs of the townhomes and away from the vision from the public right -of -way. The Zoning Ordinance requires that one stall of common off street parking is created for every two townhome units. The proposed revision to the preliminary plat requires 58 common parking stalls to be created, but the provided plans only show 52 common stalls within the townhouse 5 neighborhoods. Rottlund has requested that the deficiency of six (6) parking stalls be accommodated through the parking lot of the clubhouse. The clubhouse currently has a parking lot with 45 parking stalls, but also shows an additional proof of parking that the parking lot could be expanded to include an additional 16 stalls. Staff was originally concerned that granting this request would create a precedence for future subdivisions. The City has received requests in the past to use City owned and maintained parking for shared parking and the City has always denied those requests. Staff does not believe this request would undermine the City's past decisions because: The clubhouse parking is owned and maintained by the homeowners association. The clubhouse parking would be expanded beyond its original amount of parking. The clubhouse parking is located adjacent to the townhomes that would be using the shared parking. The Ordinance provides a provision for shared parking of uses that have different operation hours. The clubhouse will be typically used during the day and early evening, while townhomes would typically use the parking in the late evening or overnight. Staff is supportive of the shared parking arrangement if the additional 16 stalls in the proof of parking are constructed. One additional parking issue remains in the Rottlund proposal. Six (6) of the parking stalls and a shared driveway is proposed within the pipeline easement on Block 7 (the former senior housing site). Staff does not have a concern about parking within the easement, but the City alone cannot approve this parking arrangement. The owner of the pipeline easement must agree to this construction. If the pipeline company does not allow this, the subdivision will be short an additional six (6) stalls for a total deficiency of twelve (12) stalls. Staff proposed a condition of approval that would require Rottlund to get permission from the pipeline company. If Rottlund does not, then Rottlund would need to come back with a revised layout of Block 7 that shows how the parking would be addressed. As an alternative, Rottlund has requested that the City permit up to twelve (12) shared parking stalls in the clubhouse parking lot. Staff is reluctant to allow this alternative because the parking deficiency would disproportionably bore on the townhomes of Block 7. Staff would like to hear from the Planning Commission regarding this proposal. Rezoning To allow the development of the revised Harmony subdivision and the Pickens property, two rezonings need to occur. The former apartment and senior housing sites are current zoning PI: Public /Institutional. These areas were never rezoned during the original Harmony approval and maintained its initial zoning designation which accommodated the Brockway golf course. The Brockway golf course was located between the Brockway Glass manufacturing plant and South Robert Trail. Rottlund requests that the former apartment and senior housing site be rezoning to R3 PUD: Medium Density Residential Planned Unit Development to accommodate the construction of their townhomes. The Pickens property is currently zoned AG: agricultural. Rottlund requests that the property be rezoning to R1 PUD: Low Density Residential Planned Unit Development to accommodate the development of the single family homes. Staff recommends the approval of both rezoning requests. 6 City Park The Harmony subdivision includes one City park in the southwest corner and is divided into two parts by the Bronze Parkway. The park has not yet been developed because Bronze Parkway, which provides access to the park, has not been constructed. The part of the park north of Bronze Parkway is designed with a number of active recreational features, including a ball field and basketball court. The part of the park south of Bronze Parkway is designed to have a nine -hole disc golf course. The proposed revision to the preliminary plat has no effect on the park design. The approval of the Harmony 5t Addition final plat will include the construction of Bronze Parkway and allow the construction of the City park. The park dedication for the entire Harmony subdivision was either dedicated or paid as fee -in -lieu with previous phases. No additional park dedication in required for these approvals. The Park and Recreation Committee has reviewed these proposals and has recommended approval. Utilities /Engineering Comments The only utility issue of note in the proposed revision is the location of a temporary storm water pond on the west side of Bronze Parkway. The ultimate design for the City's regional stormwater system is that the storm water from the Harmony 5t Addition would flow into a regional pond west of South Robert Trail, but that regional pond does not exist today and it is unknown when that pond will be constructed. To accommodate the storm water from the Harmony 5t Addition, a temporary pond is being constructed on the west side of Bronze Parkway in place of three Garden Home buildings. When the regional pond is constructed, the temporary pond can be removed and the final three Garden Home buildings can be constructed. Attached to this Executive Summary is a memorandum (memo) from the City Engineer. The memo contains revisions that are needed to the plans and specifications and is a condition of approval, but there is nothing within the memo that is of special concern and all the issues can be addressed before the City Council approval or construction. RECOMMENDATION Staff recommends that the Planning Commission recommend approval to the City Council of the preliminary plat, final plat, PUD amendment, and rezoning for Pickens and Harmony 5 Addition. 7 DAKOTA COUNTY 2007 RENTAL MARKET SURVEY PUBLISHED BY: DAKOTA COUNTY CDA May 2007 SUMMARY OF DAKOTA COUNTY MULTI HOUSING UNITS 2007 The following are the results from the Dakota County 2007 Rental Market Survey. The cities included in the survey were: Apple Valley, Burnsville, Eagan, Farmington, Hastings, Inver Grove Heights, Lakeville, Lilydale, Mendota Heights, Rosemount, South St. Paul, Vermillion and West St. Paul. The units represented refer to units identified through responses to the survey. Graphs 1 80 contain information on the rental units identified by response to the survey. AVERAGE RENTS Average rent trends from 2003 2007, as shown by bedroom size, are shown on Graphs 9 13. 2007 AVERAGE RENTS AND AMOUNT OF INCREASE OR (DECREASE) FROM 2006 Unit Size Efficiency One Bedroom Two Bedroom Three Bedroom The average rent for all units in the county combined in 2007 increased by $8.77 or 1.03 Highest Average Rent for Efficiency Units: Burnsville Eagan Inver Grove Heights Mendota Heights Apple Valley Inver Grove Heights Apple Valley Mendota Heights Eagan Eagan Apple Valley Inver Grove Heights 2007 Average Dollar Amount Rents of Change $592.27 $738.49 $912.35 $1,199.74 $646.03 $631.24 $570.07 Highest Average Rent for One Bedroom Units: $860.00 $788.02 $784.94 Highest Average Rent for Two Bedroom Units: $1,047.69 $1,005.00 $960.02 Highest Average Rent for Three Bedroom Units: $1,293.14 $1,277.95 $1,179.59 $13.20 $3.62 $12.52 $11.30 Percent Change 2.28% 0.49% 1.39% 0.95% NOTE: The following cities did not have any survey responses for the following bedroom sizes: Efficiency units Lakeville, Mendota Heights and Vermillion One bedroom units Vermillion Three bedroom units Mendota Heights and Vermillion Cities with minimal or no reported units in a specific bedroom size are not included in the "Highest Average Rent" listing. VACANCY RATES The overall vacancy rate for 2007 was 4.7 down from 6.18% in 2006. The optimum level of vacancy in a healthy rental market is at least 5 Graph 14 shows county -wide vacancy rate trends. Graph 15 shows county -wide vacancy rate trends by bedroom size from 2003 2007. Unit Size Efficiency One Bedroom Two Bedroom Three Bedroom 2007 COUNTY -WIDE VACANCY RATES AND INCREASE (DECREASE) FROM 2006 2006 Vacancy Rate 2007 Vacancy Rate Percent Change 6.15% 4.91% 7.17% 5.83% Highest Vacancy Rates for Efficiency Units: West St. Paul Farmington South St. Paul West St. Paul Rosemount South St. Paul South St. Paul Lakeville Farmington Apple Valley Lakeville Hastings 9.09% 8.33% 6.12% Highest Vacancy Rates for One Bedroom Units: 10.64% 7.32% 5.86% Highest Vacancy Rates for Two Bedroom Units: 9.39% 8.79% 8.74% Highest Vacancy Rates for Three Bedroom Units: 5.53% 5.43% 5.26% 3.73% 4.31% 5.14% 4.06% Lowest Vacancy Rates for E Hastings Inver Grove Heights Eagan (39.35 (12.22 (2831 (3036 fficiency Units: 0.00% 0.00% 2.76% Lowest Vacancy Rates for One Bedroom Units: Mendota Heights Apple Valley Hastings Lowest Vacancy Rates for Two Bedroom Units: Eagan Inver Grove Heights Hastings 4.04% 4.20% 4.27% Lowest Vacancy Rates for Three Bedroom Units: Rosemount South St. Paul West St. Paul 0.00% 0.00% 0.00% NOTE: The following cities did not have any survey responses for the following bedroom sizes: Efficiency units Lakeville, Mendota Heights and Vermillion One bedroom units VermiMon Three bedroom units Mendota Heights and Vermillion Cities with minimal or no reported units in a specific bedroom size are not included in the "Highest or Lowest Vacancy Rates" listing. SUMMARY OF COUNTY'S RENTAL DATA 2007 Efficiency 1 BR 2 BR 3 BR TOTALS Number of Units 536 7,889 10,688 1,575 20,688 Percent of Market 2.59% 38.13% 51.66% 7.61% 100.00% Average Rent $592.27 $738.49 $912.35 $1,199.74 $859.64 Number of Vacancies 20 340 549 64 973 Vacancy Rate 3.73% 4.31% 5.14% 4.06% 4.70% Each city summary includes specific information regarding average rents, vacancy rates, special notes, summary of rental data, graphs and a map to indicate rental property locations specific to that city. Senior housing information was obtained and compiled in the section "Senior Housing Units The summaries do not include the senior housing developments when calculating averages and percentages. Tax Credit housing information was obtained and compiled in the section "Tax Credit Housing Units The Housing Tax Credit Program provides tax credits for owners and investors of affordable rental housing. The tax credit is a fixed percentage of certain development cost or property acquisition and is provided annually for 10 years. Federal regulations require tax credit developments to adhere to restrictive rent and income guidelines for a minimum of 15 years, and in many cases, 30 years, depending on the deed restrictions. Developments with allocations in 1990 and each year thereafter are required to comply with these requirements for a minimum of 30 years. The summaries do not include the tax credit developments when calculating averages and percentages. NOTE: The 2007 survey includes a "Congregate and Assisted Living" section. Congregate Housing usually offers basic supportive living services. Assisted Living typically provides more extensive services. Memory Loss Management Services offer specially designed accommodations for those in need of special care because of memory impairment. The summaries do not include the Congregate and Assisted Living developments when calculating averages and percentages. The 2007 survey includes a "Small Cities" section. This is the ninth year surveys were sent to complexes in smaller cities. Lilydale, and Vermillion are included in this section. Properties in Coates, Hampton, Mendota and Randolph did not respond to this year's survey. A map of Dakota County follows the county-wide data. This map indicates the locations of all units responding to the 2007 Market Survey which would include the congregate, assisted living, tax credit and senior housing. sclorA TWP 0 DAKOTA COUNTY Surveyed Market Rate Rental Housing 1 W E 2 3 4 5 6 Miles Rental Units by Location 1 25 26 75 76 -175 176 -300 More than 300 (See Key for information about individual locations.) Sources: Dakota County Community Development Agency Maps created by the Dakota County Office of GIS April 2007 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 22,000 21,000 20,000 19,000 18,000 17,000 16,000 15,000 2003 Graph 1 Graph 2 21,235 RENTAL UNITS IDENTIFIED BY RESPONSE TO SURVEY 2003 2007 COUNTY -WIDE TREND IN THE NUMBER OF UNITS RESPONDING TO THE RENTAL MARKET SURVEY 21,052 0 20,505 20,533 2004 2005 2006 2007 Rental Units TREND IN THE NUMBER OF UNITS RESPONDING TO THE RENTAL MARKET SURVEY BY CITY A.V. BV EAGAN FARM HAST IGH LV 2003 2004 112005 2006 2007 M.H. ROSE 20,688 SSP WSP Graph 3 Graph 4 MENDOTA HGHTS 1% WEST ST. PAUL 12% NUMBER OF COUNTY -WIDE RENTAL UNITS 2007 I.G.H. 11% 2 BEDROOM 51% PERCENTAGE BY CITY EAGAN 25% SO. ST. PAUL 3% FARMINGTON 1% HASTINGS 3% ROSEMOUNT 1% PERCENTAGE BY BEDROOM SIZE EFFICIENCY 3% BURNSVILLE 31% 3 BEDROOM 8% LAKEVILLE 3% APPLE VALLEY 8% SMALL CITIES 1% 1 BEDROOM 38% HASTINGS SO ST PAUL 9% 2% HASTINGS APPLE VALLEY BURNSVILLE APPLE VALLEY 2% 18% 45% I.G.H. 7% WEST ST. PAUL B% FARMINGTON 2% SO ST PAUL 3% HASTINGS 4% APPLE VALLEY 8% LAKEVILLE 3% I.G.H. 12% EFFICIENCY UNITS TWO BEDROOM UNITS ULYNERM 1% MENDOTA HGTS 1% Graph 5 WEST ST. PAUL 11% Graph 7 EAGAN 27% BURNSVILLE 30% PERCENT OF COUNTY -WIDE RENTAL UNITS BY CITY 2007 FARMINGTON 1% ROSEMOUNT 1% EAGAN 25% 5% LAKEVILLE 2% I.G.H. 9% SO ST PAUL 4% SO. ST. PAUL 1% ONE BEDROOM UNITS ULYIRSMT 1% MENDOTA HGTS 1% WEST ST. PAUL 1 FARMINGTON 1% Graph 6 BURNSVILLE 33% BURNSVILLE 39% EAGAN 25% THREE BEDROOM UNITS Graph 8 NOTE: The following cities did not have any survey responses for the following bedroom sizes: Efficiency units Lakeville, Mendota Heights and Vermillion One bedroom units Vermillion Three bedroom units Mendota Heights and Vermillion $1,200 $1,000 $800 $600 $400 $200 Graph 9 $0 Monthly Rent AVERAGE RENT TRENDS COUNTY -WIDE BY BEDROOM SIZE 2003 2007 EFFICIENCY 1 BDRM 2 BDRM 2003 02004 0 2005 2006 2007 3 BDRM $900 $800 $700 $600 $500 $400 $300 $200 $100 $0 Graoh 10 $1,200 $1,000 $800 $600 $400 $200 $0 Graph 11 Monthly Rent EFFICIENCY UNITS AV BV EAG FARM HSTG IGH RSMT SSP WSP 2003 2004 2005 0 2006 0 2007 ONE BEDROOM UNITS Monthly Rent AVERAGE RENT TRENDS BY CITY 2003 2007 LILY CNTY AV BV EAG FARM HSTG IGH LV MH RSMT SSP WSP HAMP LILY MEND CNTY O 2003 2004 2005 2006 0 2007 NOTE: The following cities did not have any survey responses for the following bedroom sizes: Efficiency units Lakeville, Mendota Heights and Vermillion One bedroom units— Vermillion Three bedroom units Mendota Heights and Vermillion $1,500 $1,250 $1,000 $750 $500 $250 $0 P Graph 12 $2,800 $2,600 $2,400 $2,200 $2,000 $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 MONTHLY RENT 1 1 1 1 i MONTHLY RENT Graph 13 0 AVERAGE RENT TRENDS BY CITY t�P ,SSG \G� TWO BEDROOM UNITS O 2003 2004 2005 2006 0 2007 THREE BEDROOM UNITS 02003 2004 2005 2006 0 2007 AV BV EAG FARM HSTG IGH LV RSMT SSP WSP HAMP LILY CNTY Represents 5 penthouse apartments that were verified as three bedroom apartments in the 2004 survey. Previously they were stated to be 2 bedroom apartments. NOTE: The following cities did not have any survey responses for the following bedroom sizes: Efficiency units Lakeville, Mendota Heights and Vermillion One bedroom units Vermillion Three bedroom units Mendota Heights and Vermillion CO co e C/ m R Y. u m Graph 14 8 7 6 5 4 3 2 0.9 COUNTY -WIDE VACANCY RATE TRENDS 1998 2007 0 I 1 1 1 I I I I 1998 1999 2000 2001 2002 2003 Year 2004 2005 2006 2007 Graph 15 COUNTY -WIDE VACANCY RATE TRENDS BY BEDROOM SIZE 2003 2007 EFFICIENCY 1 BDRM 2 BDRM 2003 02004 2005 a 2006 2007 3 BDRM City Efficiency %of Units 1 Bedroom %of Units 2 Bedroom %of Units 3 Bedroom %of Units 13M Apple Valley $398 $705 $855 $1,119 $558 $751 $940 $1,230 126 3.3% 118 2.3% 80 Burnsville 7 6.9% 810 21.4% 1421 28.2% 303 52.3% Eagan 8 7.9% 901 23.8% 1010 20.1% 22 3.8% Farmington 12 11.9% 69 1.8% 103 2.0% 3 0.5% Hastings 6 5.9% 195 5.2% 445 8.8% 19 3.3% Inver Grove Heights 24 23.8% 133 3.5% 597 11.9% 96 16.6% Lakeville 85 2.2% 171 3.4% 24 4.1% Rosemount 37 1.0% 44 0.9% 12 2.1% South St. Paul 37 36.6% 272 7.2% 227 4.5% 5 0.9% Vermillion 8 0.2% West St. Paul 7 6.9% 1155 30.5% 891 17.7% 15 2.6% Totals 101 3783 5035 579 Size Number of Units Published FMR's Dakota County CDA Payment Standards (Effective March 1, 2007) Region 1 Region 2 Apple Valley, Burnsville, Eagan, Inver Grove Heights Lakeville, Mendota Heights Farmington, Hastings, Rosemount, West St Paul, Small Cities Efficiency 1 Bedroom 2 Bedroom 3 Bedroom Totals 101 3,783 5,035 579 9,498 $398 $705 $855 $1,119 $558 $751 $940 $1,230 $558 $706 $903 $1,222 UNITS THAT FIT WITHIN HUD PUBLISHED FAIR MARKET RENT LIMITS FOR USE WITH THE SECTION 8 HOUSING CHOICE VOUCHER PROGRAM The numbers below reflect units which responded to the survey with rents that fall within either the HUD published Fair Market Rents (FMR) or the Dakota County CDA's Payment Standards. The FMR's are prepared annually by HUD for the entire Minneapolis -St. Paul Metropolitan Statistical Area and are based on the 40 percentile of the rental market by bedroom size. The data collected in this market survey enables the CDA to analyze the Dakota County rental market apart from the full metropolitan statistical area to determine the 40 percentile specifically for the Dakota County rental market by bedroom size. The CDA determines the payment standards from this analysis. Payment standards can be established on a local level between 90% and 110% of the FMR. A higher standard from 110% to 120% of the FMR can be requested and is referred to as an exception payment standard. The CDA did not request any exception payment standards based on the results of this survey. County -Wide Totals Totals By City 45.9% of the units surveyed fall within the Dakota County CDA's Payment Standards. Only units that responded to the survey are included in these numbers. Unit Size Efficiency One Bedroom Two Bedroom Three Bedroom VACANCY RATES SUMMARY OF ROSEMOUNT'S RENTAL MARKET 2007 2007 AVERAGE RENT AND VACANCY CHANGES FROM 2006 INCREASE (DECREASE) 2007 Ave. Rent $565.00 $599.39 $798.37 $918.75 AVERAGE RENTS VACANCY RATES Dollar Amt. Percent of Change Change $0.00 0.00% ($63.94) (9.64 $4.51 0.57% ($76.70) (7.71 2006 2007 0.00% 6.67% 11.48% 18.18% AVERAGE RENTS Rosemount's overall average rent for 2007 decreased by $22.33 or 2.86 Average rents for all bedroom sizes were lower when compared to the county averages. 0.00% 7.32% 6.35% 0.00% SUMMARY OF ROSEMOUNT RENTAL DATA 2007 Differenc e 0.00 0.65 (5.13) (18.18) The overall vacancy rate for Rosemount in 2007 was 6.11 down from 10.98% in 2006. Vacancy rates were the lower for efficiency and three bedroom units and higher for one and two bedroom units when compared to the county averages. Vacancies in Rosemount account for 1.13% of the vacancies county-wide, see Graph 56. SPECIAL NOTES Rosemount has 0.87% of the rental market in Dakota County, see Graph 57. Rosemount has one senior housing development: Cameo Place (44 units). See "Senior Housing" section for details. Rosemount has one tax credit development: Kidder Park Townhomes (36 units). See "Tax Credit Housing Units" section for details. For trend information from 2003 2007, regarding the number of rental units, average rents and vacancies, see Graphs 58 60. 0 BR 1 BR 2 BR 3 BR TOTALS Number of Units 1 41 126 12 180 Percent of Market 0.56% 22.78% 70.00% 6.67% 100.00% Average Rent $565.00 $599.39 $798.37 $918.75 $759.77 Number of Vacancies 0 3 8 0 11 Vacancy Rate 0.00% 7.32% 6.35% 0.00% 6.11% GRAPH 56 GRAPH 57 ROSEMOUNT OF COUNTY'S RENTAL MARKET 2007 COUNTY -WIDE COUNTY -WIDE Vacancies Rental Units ROSEMOUNT ROSEMOUNT ®1 BR- 3UNITS 0 2 BR 8 UNITS Units represented refer to units identified through responses to the survey. EFFICIENCY (1 UNIT) 0.2% 1 BR (41 UNITS) 0.5% 02 BR (126 UNITS) 1.2% ®3 BR (12 UNITS) 0.8% 250 200 170 I7 150 100 50 0 2003 Graph 66 Percentage 10 8 6 2.94 2 0 2003 Graph so 174 2004 2005 2006 2007 8.62 RENTAL UNITS ROSEMOUNT TRENDS 2003 2007 153 0—Rental Units VACANCIES f6� .180. 3.27 10.98 $1,000 $800 $600 $400 $200 $0 Graph 69 6.11 2004 2005 2006 2007 AVERAGE RENT BY BEDROOM SIZE Monthly Rent EFFICIENCY 1 BDRM 2 BDRM 3 BDRM 0 2003 2004 2005 0 2006 0 2007 Units represented refer to units identified through responses to the survey. The Twin Cities rental market has shown improvement, recover- ing from the effects of a sluggish job market which plagued the region during the second half of 2007. Our survey showed a 3.9% physical vacancy rate in the 1st Quarter of 2008, down from 4.2% last quarter and 4.4% one year ago. We expect vacancies will continue to decline throughout the Metro Area as the sum- mer months approach. We calculate an average market rent of $908 for the quarter, up 3.7% over 12 months and 1.0% from last quarter. Smaller unit types have demonstrated more substantial rent growth, with the average rent for a studio /efficiency unit up 5.0% from a year ago. Meanwhile, one bedroom and two- bedroom units showed 3.8% and 3.7% rent growth, respectively. Clearly we have seen marked inventory growth in the form of "shadow" markets, including investor -owned condos and also townhouse and single family home rentals. However, these in- creases in rental inventory seem to be largely offset by in- creases in renter demand associated with the more than 12,700 foreclosures in the Twin Cities region in 2007 (per RealtyTrac). The apartment market has also benefited from regional job growth. Twin Cities businesses added about 14,000 jobs during the 1st quarter of 2008, according to MN -DEED Current Employ- ment (CES) estimates. The Education Health Services Sector continued to expand, adding 4,500 jobs during 2008 1st Quarter. The Manufacturing Sector also added 2,200 jobs, after several consecutive quarters of declines (having lost 4,700 jobs between 2005 and 2007). These trends are clearly positive signs for the apartment market. We expect the Twin Cities market will absorb between 1,700 and 2,000 units during 2008, outpacing new construction at roughly 860 units for the year. Thus we forecast a steady decline in the regional vacancy rate in the forthcoming months. Developers are gearing up for more substantial supply increases beginning in 2009, however. We expect between 1,300 and 1,600 units will come to market in 2009. Another 4,000 units are being consid- ered for 2010 and 2011, including more than 1,800 units within the city of Minneapolis. Best Regards, s:er Brent Wittenberg Vice President Twin Cities Metro Area -1st Qtr 2008 Average Market Rents and Vacancy by Unit Type $1,800 $1,500 g $1,200 cn o: 0 $900 0 Q $600 $300 $o c S�J a� off 1 a� off x hip "1 Oche ce 0� X 40 0 I c a Average Rent $908 Vacancy 3.9% 18.0 15.0 12.0 9.0 6.0 3.0 0.0 Twin Cities Metro Average Rent and Vacancy Rate 1st Qtr of Each Year 2004 -2008 Twin Cities Metro Area City of Minneapolis City of St. Paul Downtown Minneapolis South Mimieapolis North Minneapolis East Minneapolis U of M. SE, NE Mpls Of $635 $605 5.0% $766 $757 3.8% $1,055 $1,029 2.5% $964 $949 3.7% $1,352 $1,422 -4.9% $1,279 $1,251 2.3% $1,604 $1,587 1.1% $908 $876 3.7% 31OO8' $617 $589 $823 $785 $1,293 $1,252 $1,158 $1,092 $1,407 $1,308 $1,595 $1,595 $892 $844 $659 $615 7.2% $759 $735 3.3% $1,156 $1,134 1.9% $966 $923 4.7% $1,674 $2,007 -16.6% $1,388 $1,341 3.5% $876 $848 3.3% $606 $618 -1.9% $1,073 $1,023 4.9% $1,354 $1,310 3.3% $1,690 $1,622 4.2% $2,491 $2,395 4.0% $1,144 $1,093 4.7% $618 $579 6.7% $720 $699 3.0% $983 $932 5.5% $1,583 $1,479 7.1% 8769 $732 5.0% $420 $420 0.0% $676 $638 6.0% $974 $912 6.8% $1,292 $1,180 9.5% $864 $809 6.8% $707 $474 49.1% $822 $669 22.8% $1,373 N/A N/A $1,036 $947 9.4% 8936 $920 1.7% $866 8700 22.3% Studio 5,190 199 One Bedroom 47,360 1,620 One Den 2,114 89 Two Bedroom 48,419 1,952 Two +Den 1,190 87 Three Bedroom 6,594 333 Three Den /Four 366 4 Total 111,233 4,284 Studio 2,495 94 One Bedroom 8,231 265 One Den 136 10 Two Bedroom 3,813 161 Three Bedroom 242 4 Four Bedroom 58 0 Total 14,989 541 Studio 861 33 One Bedroom 5,711 223 One Den 254 13 Two Bedroom 4,603 174 Two Den 130 30 Three Bedroom 509 25 Total 12,070 498 Studio 759 30 One Bedroom 2,261 82 One Den 85 4 Two Bedroom 961 67 Three Bedroom 20 0 Total 4,086 183 Studio 1,178 40 One Bedroom 3,578 81 Two Bedroom 1,255 55 Three Bedroom 69 1 Total 6,114 188 Studio 13 One Bedroom 140 8 Two Bedroom 173 12 Three Bedroom 30 2 Total 356 24 Studio 103 19 One Bedroom 551 73 One +Den 12 2 Two Bedroom 135 13 Three Bedroom 19 1 Total 822 108 3.8% 3.4% 4.2% 4.0% 7.3% 5.1% 1.1% 3.9% 3.8% 3.2% 7.5% 4.2% 1.7% 0.0% 3.6% 3.8% 3.9% 5.1% 3.8% 23.1% 4.9% 4.1% 4.0% 3.6% 5.0% 6.9% 0.0% 4.5% 3.4% 2.3% 4.4% 1.5% 3.1% 15.4% 5.7% 6.9% 6.7% 6.7% 3.4% 3.8% 5.3% 4.6% 11.7% 6.9% 2.8% 4.4% 4.3% 3.5% 2.8% 4.2% 6.5% 0.0% 3.8% 2.7% 4.3% 20.3% 4.8% 47.7% 7.1% 5.3% 6.2% 4.4% 0.9% 6.5% 25.0% 5.2% 2.8% 3.0% 3.6% 4.3% 3.1 15.4% 5.0% 8.1 6.7% 7.0% 0.5% -0.4% -1.1% -0.6% -4.4% -1.9% -1.7% -0.6% -0.6% -0.2% 4.7% 0.1 -4.8% 0.0% -0.2% 1.1% -0.4% -15.2% -1.0% -24.7% -2.2% -1.1% -2.3% -0.7% 4.1 0.4% -25.0% -0.7% 0.6% -0.8% 0.8% -2.9% 0.0% 0.0% 0.7% -1.2% 0.0% -0.3% 18.4% 8.9% 9.5% 13.2% 5.3% 7.9% 16.7% N/A N/A 9.8% 0.8% 9.0% 5.3% 0.0% 0.5% 13.1% 4.8% 8.3% Studio 442 3 $619 $574 7.9% 0.7% 3.4% -2.8% One Bedroom 1,701 21 $721 8695 3.7% 1.2% 2.5% -1.2% One Den 17 0 $794 $794 -0.1 0.0% 11.8% -11.8% Two Bedroom 1,289 14 $969 $954 1.6% 1.1% 2.8% -1.8% Three Bedroom 104 0 $1.200 $1,200 0.0% 0.0% 5.8% -5.8% Three Den/ 4 BR 58 0 51,595 $1,595 0.0% 0.0% 0.0% 0.0% Total 3,611 38 $825 $806 2.4% 1.0% 2.8% -1.8% Blaine ntown St. Paul North of 1 -94 (St. Paul) South of 1 -94 (St. Paul) Anoka Champlin Bloomington Average Rents and Vacancies 3/20Q8 g y 3t1007° Change $792 $723 9.6% $972 $943 3.0% $1,174 $1,185 -0.9% $1,275 $1,194 6.8% $1,830 $2,262 -19.1% $1,401 $1,242 12.8% $1,080 $1,065 1.4% 200 3 ?200 Cfiangts $485 $479 1.2% $649 $639 1.6% $794 $762 4.2% $786 N/A N/A $978 $987 -0.9% $729 $709 2.8% an $595 2.4% $732 $725 1.0% $1,021 $984 3.7% $1,708 $1,759 -2.9% $853 $839 1.6% $611 $591 3.4% $785 $748 4.9% $1,210 N/A N/A $1,056 $1,038 1.7% $1,422 N/A N/A $1,718 61.678 2.4% $955 $908 5.1% $644 $633 1.7% $755 $736 2.6% $834 $823 1.4% $987 $925 8.7% $820 $803 2.1% Apple Valley I Rosemount $888 $842 5.4% $955 $955 0.0% $1,038 81,066 -2.7% $1,348 $1,317 2.3% $1,242 $1,251 -0.7% $1,975 $1,899 4.0% $1,059 $1,030 2.8% $720 $706 2.0% $854 $837 2.1% $1,041 61,023 1.7% $822 $807 1.9% East St. Paul One Bedroom 295 Two Bedroom 470 Three Bedroom 71 Total 838 Units Paean 12.5% 3.0% 5.0% 3.0% 4.3% 20D `:z an9 2.7% 1.7% 1.0% 3.8% 2.6% 1.3% 0.0% 1.4% -1.4% 3.1% 2.2% 0.9% Studio 311 One Bedroom 1,004 One Den 157 Two Bedroom 488 Two Den 96 Three Bedroom 52 Total 2,108 Studio 116 8 One Bedroom 1,862 74 Two Bedroom 1,823 58 Two Den 10 0 Three Bedroom 204 11 Total 4,043 153 Studio 187 7 One Bedroom 1,528 85 Two Bedroom 1,183 47 Three Bedroom 35 1 Total 2,935 140 Studio 247 One Bedroom 1,317 One Den 67 Two Bedroom 1,109 Two Den 24 Three Bedroom 218 Total 2,984 Studio 8 One Bedroom 270 Two Bedroom 562 Three Bedroom 66 Total 906 One Bedroom 329 One Den 6 Two Bedroom 560 Two Den 46 Three Bedroom 266 Three Den/Four 8 Total 1,216 13 29 11 36 30 0 119 35 0 33 0 13 87 8 28 2 39 0 13 0 9 0 31 4.2% 2.9% 7.0% 7.4% 31.3% 0.0% 5.6% 6.5% 3.8% 27% 4.0% 5.4% -1.4% 3.2% 4.2% -1.0% 0.0% N/A N/A 5.4% 5.8% -0.4% 3.8% 4.8% -1.0% 3.5% 5.6% 4.0% 3.1 4.8% 2.8% 4.7% 32.7% 10.3% 62.6% 0.0% 10.5% 3.8% 4.2% 4.0% 9.1% 4.1% 22% 1.2% 1.0% 2.7% 2,5% 0.2% 0.0% N/A N/A 3.0% 4.2% -1.2% 0.0% N/A N/A 6.0% 10.4% -0.4% 2.9% 3.6% -0.7% 0.0% 2.6% 6.0% 4.5% 4.9% 1.4% -1.8% 25.7% -2.9% -31.4% 0.0% -4.8% -0.2% 1.4% 0.0% -6.0% 0.6% 12.5% 0.4% -1.1% -1.5% -0.6% 2.5% 3.0% -0.5% 0.0% 0.0% 0.0% 2.4% 9.0% -6.7% 0.0% 17.4% -17.4% 3.5% 4.9% -1.3% 0.0% 0.0% 0.0% 2.6% 8.4% -3.8% Studio 197 4 $661 $643 2.9% 2.0% 0.9% -0.8% One Bedroom 2,660 75 $794 $779 2.0% 2.8% 2.8% -0.7% One Den 161 8 $959 $934 2.6% 5.0% 3.5% 1.0% Two Bedroom 2,632 114 $974 $928 5.0% 4.3% 4.0% 4.1% Two +Den 56 1 $1,008 81,010 -0.2% 1.8% 8.5% -3.2% Three Bedroom 308 21 $1,137 $1,103 3.1% 6.8% 5.0% 3.4% Total 6,014 223 8893 $862 3.6% 3.7% 3.4% 0.3% 8 W cn 0 co 2 W U c E E 0 U 0 N m W d C 0 Y J' O U E 0 y n E 0 0) W x W ID 3 c W W m L C c nQ m E 8 o L q U O F Eo N O O N W N g r m C i L Q W ma nut s w rn g o 0 C L y w H E W N 0 0(510 1 U N L C n W �U m m C7 r O�N m O N `O a A OI T W T O U ®U Southwest Market As of 1st Quarter 2008, the average market rent in the Southwest Market was $994 per month, up from $964 a year ago. The vacancy rate declined to 4.2% in 2007, but increased slightly to 4.3% in 2008 1st Quarter. Southeast Market As of 1st Quarter 2008, the average rent in the Southeast Market was $943 per month, up from $942 in 2007. The vacancy rate, meanwhile, showed a significant decline to 4.5 compared to 6.6% a year ago. South Central Market In the South Central Market, the average rent in 1st Quarter 2008 was $907 per month, up 6.8% over the past 12 months. The vacancy rate has shown a steady decline since 2005, to a low of 3.9% in 1st Quarter 2008. Average Market Rent Vacancy by County In the 1st Quarter of 2008, Washington County had the highest average rent among the seven metro counties ($973 /month), as well as the highest vacancy rate (5.0 Anoka County had the lowest average rent ($837 /month),and the lowest vacancy rate (3.1 Townhome Market Rents Vacancies Townhome properties are typically larger in size and thus many of these communities command higher rents than traditional apartment complexes. As of 1st Quarter 2008, the average monthly rent for townhome communities was $1,122 per month, down from $1,154 a year ago. The decline in average rent is an indicator of increasing competition from investor -owned townhomes single family homes. The overall physical vacancy rate was 4.5 up from 4.2% a year ago.