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HomeMy WebLinkAboutPlanning Commission - 06/09/2025APPROVED MINUTES EDEN PRAIRIE PLANNING COMMISSION MONDAY, JUNE 9, 2025 7:00 PM—CITY CENTER Council Chambers 8080 Mitchell Road COMMISSION MEMBERS: John Kirk, Frank Sherwood, Andrew Pieper, Ed Farr, Trisha Duncan, Robert Taylor, Dan Grote, Charles Weber; Phou Sivilay CITY STAFF: Jeremy Barnhart, City Planner; Carter Schulze, City Engineer; Matt Bourne, Manager of Parks and Natural Resources; Kristin Harley, Recording Secretary I. CALL THE MEETING TO ORDER Chair Pieper called the meeting to order at 7:01 p.m. II. PLEDGE OF ALLEGIANCE – ROLL CALL Commission member Farr was absent. III. APPROVAL OF AGENDA MOTION: Grote moved, seconded by Taylor to approve the agenda. MOTION CARRIED 8-0. IV. MINUTES MOTION: Kirk moved, seconded by Weber to approve the minutes of May 27, 2025. MOTION CARRIED 7-0 with one abstention (Grote). V. PUBLIC HEARINGS A. DANFOSS COMPREHENSIVE PLAN AMENDMENTY (2025-02) • Amendment to Comprehensive Plan for approximately 57 acres currently owned by Danfoss Energy Solutions, re-guiding the property from Industrial Flex Tech and Office to Mixed Use. Barnhart presented the staff report. The City initiated this amendment after learning the property would be sold. This presented an opportunity for the City of Eden Prairie to examine the land use of the property and assess the City’s retail, PLANNING COMMISSION MINUTES June 9, 2025 Page 2 housing and land use goals. These properties are guided Industrial Flex Tech, with one parcel also guided Office. This Comprehensive Plan Amendment and map change would result in the parcels being re-guided Mixed Use, allowing the City to realize its vision for the property, which had great visibility from Highways 5 and 212, access from Mitchell Road and Technology Drive. The parcels had good infrastructure in terms of water and sewer capacity, and the ability to handle increased traffic. Barnhart displayed a colored map showing the different parcels. He concluded this was a prime candidate for office, retail, and residential Mixed Use land use. Barnhart gave some background: the City had identified a couple parcels for Mixed Use (Eden Prairie Center, crosstown). Here, the predominant use would be residential but was the same vision. Office uses would be addressed since one parcel was already so guided. The residential density was anticipated to be between 40 and 75 units per acre. Traffic distribution, utilities, tree preservation, stormwater management, et cetera, would be reviewed by staff as the property develops via development proposals. The existing large manufacturing, large office building, and small office building would continue to operate. Future development proposals might trigger an EAW (Environmental Assessment Worksheet) review. Commission members did not need to be concerned about this at this time. Staff would continue to work with Danfoss, the owner, on a mutually compatible project. Staff recommended approval. Pieper asked for and received confirmation there had been a planned LRT station on City Hall property, which would now not be built. Doug Neuberger, head of real estate for Danfoss for the Americas, stated he and his colleagues disagreed with the Comprehensive Plan Amendment for the entire property. The west side of the property was zoned Industrial and would stay that way, but he feared an overall re-guiding would make the property less desirable to future industrial tenants. The east side of the property was more appropriate for residential and retail, and he was aligned with staff on these site plans. He disagreed with what was being called industrial, seeing that parcel more of a business park. Staff and Danfoss seemed to be growing apart in their visions for this property over time. He also disagreed with expanding the retail footprint in the eastern portion, on which the office buildings currently sat. TransWestern broker, Nate Erickson, also explained the objection to an overall re- guiding of the property. There was a buyer under contractor for entire 57 acres. Danfoss would cease operations at the end of the year, with perhaps some operations continuing into early 2026; therefore, ultimately, the property would be vacant. The buyer had a plan that fit with the closing this year. He stated the re- guiding could change the equation for Danfoss and the buyer, potentially having a significant adverse effect and economic harm. He estimated the effect would be in PLANNING COMMISSION MINUTES June 9, 2025 Page 3 the millions of dollars plus downtime. The west existing industrial properties could be reused as industrial, but a lease or sale to a new user would limit the tenant’s ability to expand or improve the building if the area was re-guided to Mixed Use. The industrial use was congruent with the other buildings in that area. Most anchor tenants were grocers who had alternative locations within Eden Prairie and/or had no plans to expand. He feared a domino effect. He agreed with the destination retail plan on the east side of the site, but with the proposed re- guiding, Danfoss would not be able to execute a plan in a reasonable amount of time. Barnhart replied there seemed to be three competing goals: the City’s long-term vision, Danfoss’s goal to sell quickly by the end of the year, and the buyer’s goal to lease or sell quickly. Staff sympathized and supported the continued use of the industrial. He emphasized this Comprehensive Plan Amendment would not rezone the properties. Tonight’s decision could affect the land use for 40 or 50 years, and the commission members had to weigh this vision against the current, short-term market issues and the owner’s immediate goals. The guidance would not prevent the properties being used and maintained as industrial. He asked if the City would like to see a new industrial building in a heavily wooded area having the visibility and access described above. Barnhart proposed these uses were more appropriate for the Golden Triangle. From a planning perspective, well-designed, well-run cities did not make that calculation. He urged the commission to take the best path forward and asked what goal should have precedent: the City’s long- term goals or the goal to sell the property? Pieper asked if a compromise had been explored, allowing the western parcels to remain guided industrial whereas the others could be re-guided Mixed Use, and Barnhart replied staff did not want to see a new industrial building in the western portion, which was less accessible. Staff wished to avoid a corridor of large Flex warehouses that may or may not employ people. Weber asked what was being done with the other Danfoss property along Wallace Road, and Barnhart replied that parcel, being separate geographically, was left out of this Comprehensive Plan Amendment. Duncan asked why this parcel was not included, and Barnhart replied the current, much larger property under consideration offered a unique opportunity that the other parcel did not. Barnhart added there was mostly consensus between staff and Danfoss. The north half of the office lot and vacant land north of that was the essential debate. Duncan asked if there was space to add more industrial in the Golden Triangle. Barnhart replied most of that was built up and the City was starting to see redevelopment in that area. This was a unique situation: 57 acres to redevelop in the heart of the City. The large Industrial Flex buildings would be less visible in the Golden Triangle business park, which was more appropriate for them. Discussion followed on the lack of a grocery store in the area. PLANNING COMMISSION MINUTES June 9, 2025 Page 4 Duncan remarked this was a dilemma and she could see both sides. There was also a potential for high traffic with significant Mixed-Use reuse. Barnhart replied he was able to apply ratios to support his staff report and would be required to provide traffic analysis along with any development application. Most uses would generate increased traffic, water and sewer needs. Comparing a worst-case scenario versus no re-guiding was not a helpful metric; the memo in the staff report provided for further analysis in the future based on known information. Sherwood asked for and received confirmation Barnhart had received some messages showing interest in buying/developing the eastern part of the property. Barnhart replied all parties received the same message: the large industrial building would continue but staff did not wish a new industrial building to be constructed, with residential and destination retail envisioned for the east side. The northern part of the industrial parcel was the most controversial; otherwise, the owner and staff were largely in agreement. The residential would require a Comprehensive Plan Amendment. Duncan summarized what she believed was the process of the Comprehensive Plan’s drafting during which this was a Flex Industrial property. The 2040 Plan was met by this property, so her question was, did this exceed goals? Barnhart replied that the Metropolitan Council had a prescription for housing growth and employment growth, and for affordable housing units; Eden Prairie met those without this Amendment change. Kirk stated his goal in these meetings was always to attempt to understand the essential issues and what he heard staff saying was, staff was comfortable with the existing Industrial but would like to see in this site located in central Eden Prairie expanded residential and retail. However, Danfoss wished to keep the Industrial guiding in order to avoid limiting the next buyer to expand the industrial footprint. Some parcels would probably move toward Mixed Use. He concluded the City wished to limit the industrial footprint and even preferred its removal, whereas Danfoss had a buyer that might wish to expand. Taylor agreed with Kirk’s assessment, and added his agreement with staff’s recommendation the commission envision a long-term future for Eden Prairie. Kirk reiterated how the City’s perspective was more long term than the landowner’s perspective. Pieper asked if this had been identified as a study area during the drafting of the Comprehensive Plan, and Barnhart replied it had not been. Responding to new information received at the end of last year, staff had responded to the potential best use of this property. Danfoss had been at this site for a long time. Pieper observed Danfoss struggled with a sudden change to the land use just before a sale. Barnhart replied the mixed use expanded opportunities; at present, selling the office space for an office space use, for example, was unlikely today. PLANNING COMMISSION MINUTES June 9, 2025 Page 5 However, a property owner’s hardship, from staff’s perspective, could not be allowed to dictate 50 years of land use. Pieper asked if the large building would trigger a waiver if demolished. Barnhart replied staff had contemplated this; staff was fine with no new industrial being added. If torn down, an industrial building could be rebuilt. The west side would not be rezoned per se. Sivilay asked for and received clarification Danfoss objected to the rezoning of the west section of the property. He rhetorically asked why the Public Works facility on the southwest side just outside this property would not also be re- guided. Barnhart replied it would not due to it being government property, but he understood the analogy. The goal was to have all parcels appropriately zoned and guided. Sivilay stated he was attempting to find a happy medium. Barnhart replied commission members could in a motion voice their concern to the City Council regarding the western parcel being re-guided to Mixed Use. However, staff recommended all parcels to be re-guided Mixed Use. Kirk asked for and received clarification the Planning Commission was providing a recommendation to the City Council in terms of the long-term use of the property based on the Comprehensive Plan. Sivilay suggested 24 acres could be guided Mixed Use, leaving the west unchanged. Pieper noted this was similar to the previous Comprehensive Plan Amendment that came before the commission. Sivilay added there was a great need for light industrial, and Eden Prairie along with surrounding cities had a lot of it. Barnhart stated staff received many calls to request industrial buildings, many without users or tenants identified. Industrial buildings could be marketed quickly. He urged the commission look long term rather than short term and ask what the best use of this site would be. Erickson added that during this process Danfoss had selected a developer with a collaborative approach who planned a senior housing development for the southeast corner, also villas and multifamily units with ground-floor retail. There would be an industrial-type building in the northern section but with creative features. This developer envisioned 25 percent office space for engineering, life sciences, and manufacturing. While he acknowledged the great visibility and access to this site, he considered it a “tweener” site between the retail in Eden Prairie Center, and retail in Chanhassen. He urged this site not be made an island, as he considered their plan congruent with other uses in the area. There were two large industrial buildings that would be leased out very quickly, as there was a large demand for industrial due in part to the Covid-19 pandemic. PLANNING COMMISSION MINUTES June 9, 2025 Page 6 Duncan asked him for a recommended solution. Erickson replied Mixed Use on south portion of east side, but the northern/northeast portion business park remaining as is or even the City buying that portion and taking the risk. Duncan asked for a zoning recommendation, and Erickson urged the zoning be consistent with Industrial Flex Tech so as to not be limited in the future. He acknowledged the existing office building was not marketable and could be re-guided. Weber asked the difference between “rezoning” and the re-guidance plan, as the two terms seemed to be used interchangeably. Barnhart replied they were not interchangeable; this was a Comprehensive Plan Amendment, not a zoning change. The Zoning Ordinance was based on the Comprehensive Plan and establishes the details of property requirements: setback, maximum height, building standards, landscaping requirements, et cetera. The current properties under consideration were guided Industrial Flex Tech. This established a general character of the property, but re-guided did not necessarily result in rezoning. Weber asked for and received confirmation a residential development would require a zoning change. Duncan asked which zoning districts fell within Mixed Use. Barnhart replied a portion could be RM2.5 and another portion zoned Office or Commercial. The guided Mixed Use offered the most flexibility. MOTION: Grote moved, seconded by Sherwood to recommend approval of the Amendment to the Comprehensive Guide Plan re-guiding the property from Industrial Flex Tech and Office to Mixed Use as recommended by the staff report dated June 9, 2025. There was discussion on the motion. Sivilay asked for and received confirmation this Amendment was not changing any zoning, but amending the Comprehensive Plan, and would not prohibit any sale of the property. Motion carried 7-1 (nay vote by Duncan). PLANNERS’ REPORT MEMBERS’ REPORTS VI. ADJOURNMENT MOTION: Taylor moved, seconded by Sherwood to adjourn. Motion carried 8- 0. The meeting was adjourned at 8:02 p.m.