Rice Creek Commons could bring $315M to $700M in development, but there’s a hitch

– Minneapolis/St Paul Journal

Alatus LLC would pay $62.7 million for nearly 300 acres of land in Arden Hills under the terms of a master development agreement negotiated between the Minneapolis developer, Ramsey County and a joint development authority.

But whether or not the deal is struck could depend on the Arden Hills City Council, which sent Ramsey County a letter Monday asking it to delay a scheduled Sept. 4 vote on the agreement.

At stake is at least $315 million worth of development, according to the terms of the agreement. Louis Jambois, Ramsey County’s negotiator on the agreement, believes the full buildout value will be closer to $700 million.

Alatus, per the terms, will buy the property in five phases between 2020 and 2034. The company has to close on each of the five parcel groupings in increments of three years. That begins with a with a Dec. 31, 2020 deadline on 70 acres of land that Alatus will acquire for $22.5 million.

“We have a pretty aggressive development schedule. We want the pace of development to take advantage of the market,” Jambois said.

Under the agreement, Alatus will have to deliver at least $112.5 million worth of development on those 70 acres, including 170 units of owner-occupied housing, 228,000 square feet of commercial space, a 200-room hotel, 150 apartments, 42,000 square feet of entertainment space and 225 units of senior housing.

Future phases call for more owner-occupied homes, condos, 1.1 million square feet of office/commercial space and 210 apartments. In general, Alatus is expected to develop projects that have value of at least five times what it pays for the land, which is where the $315 million minimum comes from.

Deadlines on the projects could be extended if there’s a recession of at least six months, or if hazardous substances are discovered on the former ammunition plant site.

Mass grading and public improvements on the site are estimated to cost $68 million. The county is expected to contribute $51 million, Alatus is expected to pay $10 million and the city is asked to pay $8.2 million.

That’s where the Arden Hills City Council comes in, and it’s not happy with what it says is a limited role in negotiations so far. A letter signed by City Council members Brenda Holden, Steve Scott, Dave McClung and Fran Holmes, plus Mayor Dave Grant, asks for a delay in the vote. It also opposes several points of the agreement.

Jambois said he expects a lively discussion on Sept. 4 and also said that Arden Hills staff has sat in on weekly meetings between the developer and country officials.

“It’s time to find out where everyone stands,” he said.

By: Nick Halter
Date: August 28, 2018
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