2018.02.05 EDA Meeting PacketAGENDA ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF CRYSTAL REGULAR MEETING MONDAY, FEBRUARY 5, 2018 IMMEDIATELY FOLLOWING THE 7:00 P.M. CITY COUNCIL MEETING CRYSTAL CITY HALL COUNCIL CHAMBERS 1. Call to order * 2. Roll call * 3. Approval of minutes from January 2, 2018 Annual Organizational Meeting 4. Public Hearing to consider a resolution approving the sale of an EDA lot at 5573 Zane Avenue North to Novak-Fleck for construction of a new single family home 5. Consider tentative acceptance of a proposal from Novak-Fleck for construction of a new single family home on the EDA lot at 5607 Zane Avenue North 6. Informational item: 2017 Housing, Foreclosure and Rental Summary 7. Other business * 8. Adjournment * *Items for which no materials are included in the packet
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Minutes of the Economic Development Authority of the City of Crystal Annual Organizational Meeting January 2, 2018 1. Call to Order President Kolb called the annual organizational meeting of the Economic Development Authority of the City of Crystal (EDA) to order at 9:28 p.m. 2. Roll Call Upon call of the roll, the following members were present: Jim Adams, John Budziszewski, Elizabeth Dahl, Julie Deshler, Jeff Kolb, Nancy LaRoche and Olga Parsons. The following staff members were present: Anne Norris, Executive Director, John Sutter, Deputy Executive Director, Dan Olson, City Planner, and Troy Gilchrist, City Attorney. 3. Election of Officers The EDA considered officers for 2018. Motion by Commissioner Kolb (Adams) to approve the Mayor’s recommended slate of officers for 2018: President Olga Parsons, Vice President Nancy LaRoche, Secretary Elizabeth Dahl and Treasurer Jeff Kolb. Motion carried. Commissioner Kolb transferred the gavel to President Parsons. 4. Approval of Minutes Motion by Commissioner Deshler (Budziszewski) to approve the minutes of the December 5, 2017 regular meeting. Motion carried. 5. 4724 Lakeland - Lot Sale Public Hearing The EDA held a public hearing to consider a resolution approving the sale of an EDA lot at 4724 Lakeland Avenue North to Tollberg Homes for construction of a new single family home. Mr. Olson presented the staff report and took questions from the board. President Parsons opened the public hearing. There being no one present to offer testimony, President Parsons closed the public hearing.
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Motion by Commissioner Deshler (Budziszewski) to adopt the resolution authorizing the sale of 4724 Lakeland Avenue North to Tollberg Homes for new home construction. Motion carried. 6. 5573 Zane - Consider Builder’s Proposal The EDA considered tentative acceptance of a proposal from Novak-Fleck to purchase the EDA lot at 5573 Zane Avenue North. Mr. Olson presented the staff report and took questions from the Board. Following EDA discussion, motion by Commissioner Deshler (LaRoche) to tentatively accept the proposal from Novak-Fleck for the EDA lot at 5573 Zane Avenue North. Motion carried. 7. Consider Amended Bylaws Mr. Sutter presented the staff report and took questions from the Board. Motion by Commissioner Kolb (Dahl) to adopt the amended bylaws. Motion carried. 8. Other Business Mr. Sutter summarized anticipated lot sales during the next six months. 9. Adjourment Motion by Commissioner LaRoche (Dahl) to adjourn. Motion carried. The meeting adjourned at 9:49 p.m. ______________________________ Olga Parsons, President ATTEST: ______________________________ Elizabeth Dahl, Secretary
_____________________________________________________________________
FROM: Dan Olson, City Planner
____________________________________________________________________
TO: Anne Norris, City Manager (for February 5 EDA Meeting)
DATE: February 1, 2018
RE: PUBLIC HEARING: Consider resolution authorizing the sale of lot at
5573 Zane Avenue North for construction of new home
Novak Fleck, a Minnesota Residential Building Contractor with no enforcement actions,
has submitted a proposal to purchase the lot at 5573 Zane Avenue North for $60,000.
The EDA tentatively accepted the builder’s proposal on January 2, 2018. There have
not been any changes to the site or building plan since that tentative approval .
Attached are an aerial photo and proposed site and building plans for a new home with
an attached garage. The house would have approximately 1,200 finished square feet
on the main level with an open living-dining-kitchen area, three bedrooms and two
bathrooms. It would also have unfinished square footage on the lower level, with an
option to have it finished with additional bedrooms, a bathroom, and recreation room.
Similar homes have been built by Novak Fleck on other EDA lots, including 5209 - 49th
Avenue North which recently sold for $265,000. The builder does not yet have a buyer
for the home at 5573 Zane Avenue North.
On this lot a variance reducing the rear (south) setback from 30 to 10 feet would be
requested by Novak Fleck:
Because it is a corner lot, the minimum 30’ rear setback is measured from the south
lot line even though the house will face east (toward Zane Avenue).
A variance is required because the proposed home would be set back 10’ from the
south lot line.
The proposed home would be set back 30’ from Zane Avenue to m atch the setbacks
of the adjacent homes to the south.
Staff would recommend approval of this variance, which is scheduled to be reviewed by
the Planning Commission on February 12 and considered by the City Council on
February 20.
At the January 2 meeting, EDA members questioned whether or not a future property
owner could subdivide the property and construct another new home . As show on the
proposed attached site plan, the distance from the northeast corner of the new home to
the highway easement line (which is the north property line) is 51 feet. Therefore a
subsequent property owner would not be able to split off the north yard into a second lot
for the following reasons:
EDA STAFF REPORT
PUBLIC HEARING
5573 Zane Avenue North – Sale of lot to Novak Fleck
1. The second lot would need to be at least 60 feet wide plus the 5 foot
minimum setback for the new home, so there would need to be at least 65
feet from the northeast corner of the new home to the north property line; and
2. The current parcel contains 10,853 sq. ft. The minimum for two units on this
parcel (whether one duplex or two single-family lots) is 12,000 sq. ft.; and
3. If subdivided, both the lot with the new home and the second lot would only
be 95 feet deep (the minimum lot depth is 100 feet).
Only by receiving variances for all three of these requirements (lot width, area and
depth) could a second home be built. While it would be hypothetically possible for a
future Council to do this, staff opinion is that such approvals would be unlikely given the
location, configuration, etc. of the property.
For your information, the graphic below shows the status of upcoming EDA property
sales in the vicinity of 5573 Zane.
For 5573 Zane, if on February 5 the EDA adopts the attached resolution, and the City
Council approves the variance on February 20, then the lot sale would close soon after.
Construction would begin after closing with completion anticipated by summer 2018.
REQUESTED EDA ACTION: After holding the public hearing and receiving any
testimony, consider adopting the attached resolution authorizing the property sale of
5573 Zane Avenue North to Novak Fleck.
ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF CRYSTAL
HENNEPIN COUNTY
STATE OF MINNESOTA
RESOLUTION NO. 2018 - 02
A RESOLUTION AUTHORIZING THE SALE OF
5573 ZANE AVENUE NORTH
FOR NEW HOUSE CONSTRUCTION
WHEREAS, the Economic Development Authority of the City of Crystal (“the EDA”) is the
owner of 5573 Zane Avenue North, legally described as follows:
Lot 1, Block 2, Wilshire Terrace, Hennepin County, Minnesota (“the Property”);
and
WHEREAS, the EDA has solicited proposals from builders who desire to purchase the
Property from the EDA and construct thereon a new single family house; and
WHEREAS, the EDA has reviewed and accepted the proposal from Novak-Fleck.
NOW, THEREFORE, BE IT RESOLVED that the EDA authorizes the sale of the Propert y to
Novak-Fleck.
BE IT FURTHER RESOLVED that the sale shall be completed in accordance with the terms of
the Purchase and Redevelopment Agreement in substantially the form on file in City Hall, and
that the President and Executive Director are hereby authorized to sign said Agreement and
other documents required to complete the sale of the Property to Novak-Fleck.
Adopted this 5th day of February, 2018.
____________________________________
Olga Parsons, President
____________________________________
Anne Norris, Executive Director
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City of Crystal
4141 Douglas Drive N.
Crystal, MN 55422
City of Crystal
4141 Douglas Drive N.
Crystal, MN 55422
Aerial Image Hennepin County 2015
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PARK
_____________________________________________________________________
FROM: Dan Olson, City Planner
____________________________________________________________________
TO: Anne Norris, City Manager (for February 5 EDA Meeting)
DATE: February 1, 2018
RE: Consider tentative acceptance of proposal by Novak Fleck for the lot
at 5607 Zane Avenue North
Novak Fleck has submitted a proposal to purchase the lot at 5607 Zane Avenue North.
The lot price is $55,000. Novak Fleck is a state-licensed residential building contractor
with no enforcement actions.
Attached are an aerial photo, builder’s proposal form, and preliminary site and building
plans for a new home with an attached two-car garage. The house would have
approximately 1,200 finished square feet on the main level with an open living-dining-
kitchen area, three bedrooms and two bathrooms. It would also have unfinished square
footage on the lower level, with an option to have it finished with an additional bedroom,
a bathroom, and f amily room. Similar homes have been built by Novak Fleck on other
EDA lots, including 5209 - 49th Avenue North which recently sold for $265,000. The
builder does not yet have a buyer for the home at 5607 Zane Avenue North.
The required public hearing would be scheduled if the EDA gives tentative acceptance
of the proposal.
For your information, the graphic below shows the status of upcoming EDA proper ty
sales in the vicinity of 5607 Zane.
EDA STAFF REPORT
5607 Zane Avenue North
Lot purchase proposal from Novak Fleck
REQUESTED EDA ACTION: EDA tentative approval of the purchase proposal with
Novak Fleck for the EDA lot at 5607 Zane Avenue North.
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DATE: January 31, 2018 TO: Anne Norris, City Manager (informational item for Feb. 5 EDA packet) RE: Annual Housing Market, Foreclosure and Rental Summary A. Price data for sales of single family houses in Crystal and comparisons with surrounding cities 1. 2017 Median Home Price: N Mpls (Camden) $155,200 + 13.8% Brooklyn Center $186,125 + 12.8% Crystal $200,900 + 8.3% Robbinsdale $205,000 + 10.8% New Hope $222,000 + 2.3% Brooklyn Park $229,900 + 7.3% Maple Grove $274,025 + 6.7% Golden Valley $314,000 + 8.2% Plymouth $340,000 + 4.6% 2. 2017 Median Home Price per Finished Square Foot: Brooklyn Center $111 + 12.7% N Mpls (Camden) $114 + 17.5% Brooklyn Park $121 + 7.2% Robbinsdale $126 + 13.7% Crystal $128 + 8.9% New Hope $128 + 9.1% Maple Grove $137 + 6.9% Plymouth $148 + 5.7% Golden Valley $155 + 8.9%
__________________________________________________________ MEMORANDUM FROM: John Sutter, Community Development Director __________________________________________________________
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3. Percent Change in Median Home Price since the Housing Bubble N Mpls (Camden) - 5.4% since 2005 (peak year) Brooklyn Center - 4.6% since 2005 (peak year) New Hope - 1.7% since 2006 (peak year) Brooklyn Park - 0.5% since 2006 (peak year) Robbinsdale + 0.5% since 2007 (prior peak year) Crystal + 1.5% since 2005 (prior peak year) Maple Grove + 8.7% since 2007 (prior peak year) Plymouth + 15.6% since 2007 (prior peak year) Golden Valley + 15.9% since 2007 (prior peak year) 4. 2017 Distressed Sales as a Share of the Market Brooklyn Center 7.9% (peaked at 68% in 2009) Crystal 7.8% (peaked at 60% in 2011) N Mpls (Camden) 7.6% (peaked at 67% in 2009) Brooklyn Park 5.2% (peaked at 66% in 2009) New Hope 5.2% (peaked at 52% in 2011) Robbinsdale 4.0% (peaked at 55% in 2011) Plymouth 3.1% (peaked at 29% in 2011) Maple Grove 2.7% (peaked at 38% in 2011) Golden Valley 1.7% (peaked at 39% in 2011) B. Foreclosures In 2017 there were 30 foreclosures in Crystal, the lowest in at least 12 years. Two-thirds of the 2017 foreclosures were of mortgages originating before 2009, meaning that mortgages written during the housing bubble continue to generate foreclosures today despite the general recovery in the housing market. C. Rental Houses, Duplexes and Townhomes 8.3% of Crystal’s single family homes, duplexes and townhomes were rentals in 2017. This compares to 9.3% in 2016, 10.5% in 2015, 9.9% in 2014, 9.6% in 2013, 8.7% in 2012 and 7.6% in 2011. Two factors contributed to the decline in the rental share: 45 dwellings became rentals in 2017 while 72 dwellings ceased being used as rentals because they were sold to new owner-occupants. These market-driven changes resulted in a net reduction of 27 rentals in 2017. 51 relative homesteads and group homes became exempt from rental licensing after an ordinance change in fall 2016.
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Date of Sale (each vertical line represents one quarter)
Sale Prices of Single Family Houses in Crystal
Excluded are houses sold for more than $400,000 ($350,000 before 2017 and $300,000 before 2015),houses that were demolished, and new construction.Trendline is a 90-day moving average.
LAST GASPOF THEBUBBLE
FALSEBOTTOM THE REAL BOTTOM
TYPICAL MARKET WITH SEASONAL HIGHS & LOWS(BUT STRONG APPRECIATION)
Foreclosures in Crystal, 2005 to Present
0
50
100
150
200
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Annually
0102030405060
Quarterly
051015202530
Monthly
DISTRICT 7
DISTRICT 6
DISTRICT 5
DISTRICT 1
DISTRICT 2
DISTRICT 4
DISTRICT 3
Distribution of ForeclosuresThrough December 2017Hennepin County
0 2 4 6 8 101Miles
Data Source:December 2017 Sales Extract, Hennepin County Sheriff's OfficeTotal Records:809Records Successfully Geolocated: 807 (100%)Records Unsuccessfully Geolocated: 2 (1%)
Commissioner District Boundary
Count of ForeclosuresJAN - DEC 20170
1-25
30-60
80
243
Map Produced by Hennepin CountyRRES DepartmentSurvey DivisonJan 11, 2018
Note:Map reports mortgage foreclosure sales reported by the Hennepin County Sheriff to Taxpayer Services Department. Hennepin County's methodology is to count all foreclosure sheriff's sales categories (assessment, association, execution, judgment, and mortgage). The Sheriff's certificate of sale documents included in this report may still be within the owner's redemption period, which in Minnesota typically ranges from five weeks to six months.
Commissioner District Total 1 185 2 151 3 77 4 77 5 101 6 101 7 115
Foreclosures (Total Records: 809)
CITY OF CRYSTALFORECLOSURE RATEExisting Single Family and Duplex PropertiesAnnualized Average, Jan. 1, 2007 - Dec. 31, 2017
CITYWIDE DATA:Number of Existing Single Family or Duplex Properties in Crystal
Existing SF/Duplex Properties Foreclosed from Jan. 1, 2007 to Dec. 31, 2017
CITYWIDE ANNUALIZED AVERAGE FORECLOSURE RATE
BENCHMARK 25% ABOVE CITYWIDE AVERAGE
BENCHMARK 25% BELOW CITYWIDE AVERAGE
7,419 1,086 1.33% 1.66% 1.00%DATA BY NEIGHBORHOOD:
Name of Neighborhood
Number of Existing Single Family or Duplex Properties in the Neighborhood
SF/Dup Properties Foreclosed from Jan. 1, 2007 to Dec. 31, 2017 ANNUALIZED AVERAGE FORECLOSURE RATE
NEIGHBORHOOD RANK (from highest rate to lowest rate)Lions Park 405 81 1.82% 1Lee Park 353 70 1.80% 2Broadway 356 64 1.63% 3Welcome Park 673 121 1.63% 4Twin Oaks 510 90 1.60% 5Skyway 557 93 1.52% 6Becker 383 62 1.47% 7Forest 1,030 164 1.45% 8Cavanagh Oaks 443 67 1.37% 9Fair 300 40 1.21% 10Bassett Creek 499 53 0.97% 11Winnetka Hills 548 56 0.93% 12Brownwood 588 57 0.88% 13Valley Place 774 68 0.80% 14
>25% ABOVE CITYWIDE AVG.
>25% BELOW CITYWIDE AVERAGE
WITHIN 25% OF CITYWIDE AVERAGE