HomeMy WebLinkAboutCity Council - 09/17/2013 - Workshop APPROVED MINUTES
CITY COUNCIL WORKSHOP & OPEN PODIUM
TUESDAY, SEPTEMBER 17, 2013 CITY CENTER
5:00—6:25 PM, HERITAGE ROOMS
6:30—7:00 PM, COUNCIL CHAMBER
CITY COUNCIL: Mayor Nancy Tyra-Lukens, Council Members Brad Aho, Sherry Butcher
Wickstrom, Kathy Nelson, and Ron Case
CITY STAFF: City Manager Rick Getschow, Police Chief Rob Reynolds, Fire Chief George
Esbensen, Public Works Director Robert Ellis, Community Development Director Janet Jeremiah,
Parks and Recreation Director Jay Lotthammer, Communications Manager Joyce Lorenz, City
Attorney Ric Rosow, and Recorder Lorene McWaters
Workshop - Heritage Room H
I. CITY CENTER SPACE
Larissa Champeaux of Cushman& Wakefield, the City's leasing broker for the C.H.
Robinson space, provided an update on their marketing efforts. She said hard copy and
electronic showing materials, including a property fact sheet, floor plans and photos have
been produced. She said the City Center property is included in their bi-monthly marketing e-
mail, which reaches 1,200 Twin Cities' brokers. They are also responding to e-mail blasts
from brokers who have clients with space needs that match the City Center space. They have
also worked with the Eden Prairie City Center leasing team to create floor plan alternatives,
and they continue to monitor SW Light Rail plans.
To date, Cushman &Wakefield has conducted three property tours with prospective tenants.
They have received inquiries from other prospects that need space before C.H. Robinson is
scheduled to vacate. Champeaux said they anticipate the tour volume will increase once C.H.
Robinson vacates, or if smaller square footages are offered.
Champeaux said there are two lease proposals out for review: a financial services/collections
group (1-year lease on 60,000 sf with a third quarter 2014 lease commencement), and an
insurance/financial services group (seven-year lease on 30,000 sf with a fourth quarter lease
commencement). Both proposals include rates and improvement allowances consistent with
marketed figures. Champeaux said they have received one counter offer, and another is
expected shortly. Several other groups are considering the property but have not yet toured
it.
Champeaux provided the following list of strengths and challenges based on tenant and
broker feedback:
Stren-t�hs
• Perceived as accurately priced compared to other market options
• Parking
• Good amenities for the price
City Council Workshop Minutes
September 17, 2013
Page 2
• Responsiveness of ownership team
• Well maintained
• Back-up generator
Challenges
• Challenging floor plan to demise
• Difficult to envision how the space will look when vacated
• Some finishes are seen as dated
• Some prospects in the market for 50,000—60,000 sf prefer more freeway visibility
Getschow asked Champeaux for more input on the risks or advantages of splitting the space
for two or more tenants. Champeaux said with two or more tenants, lease terms are staggered
which spreads the risk out; however, it puts the City in the more traditional role of landlord.
She said the pool of prospects for smaller spaces is definitely larger. Mayor Tyra-Lukens said
she would have a hard time accepting a proposal from a smaller tenant at the moment
because there is only one prospect. Champeaux said they have not marketed the space to
smaller tenants, so there may be others that would be interested. Council Member Aho asked
if they have ideas on how the space might be divided. Champeaux said the tenant committee
has created several scenarios on how the space could be subdivided. Aho asked about the
likelihood that there will be a new tenant lined up by the time the space is vacated.
Champeaux said the company that is looking for 60,000 sf is currently deciding whether or
not to remain in their existing space. They have had parking issues at their current location,
and are working with the owner to see if those can be resolved. Aho said he would like to
hold out a little longer and continue trying to find one tenant to take the whole space.
Other Space Considerations
Community Development Director Janet Jeremiah noted that the City Council had asked staff
to look at the feasibility of establishing a business incubator,possibly in City Center.
Jeremiah said staff feels the Eden Prairie Center mall might be a better location for a business
incubator because it is a higher traffic area. She said a business incubator could be located in
the space currently occupied by Housing & Community Services. Housing & Community
Services staff have indicated that they feel isolated at the mall location and feel they could
carry out their work just as effectively at City Center. Jeremiah said staff has contacted both
General Growth and HUD to see if either party would object to such a switch. So far, HUD's
response looks promising, but they have not received a response from General Growth.
Butcher Wickstrom asked what kind of support the City would provide for an incubator.
Economic Development Director David Lindahl said staff is exploring a Coco scenario,
under which an outside organization would oversee the incubator. Mayor Tyra-Lukens said
she was under the impression that Housing & Community Services offices are located at the
mall because that location is more accessible for the clientele. Jeremiah said that was the case
when they first moved into the mall offices,but the immigrant population they serve is more
mobile now. Council Member Nelson said she supports having all City staff back at City
Center. She noted that it is a long way from the parking lot to the office space in the mall.
Butcher Wickstrom said a mall location would only attract certain kinds of businesses.
City Council Workshop Minutes
September 17, 2013
Page 3
Jeremiah said the mall location would be likely to attract office-based businesses,rather than
technology and manufacturing start-ups. Butcher Wickstrom and Mayor Tyra-Lukens asked
about who would be eligible to use the space and whether or not there would be rules about
users locating their businesses in Eden Prairie after leaving the incubator. Jeremiah said staff
and City Council would have to discuss criteria and administration in more detail if the
concept moves forward. Aho said the business incubator he toured in Boston uses a panel
that reviews applications and also act as mentors. He said that incubator is designed for short
term residency, from 6 to 12 months. Lindahl said he favors having a group like Coco
administer the program. He has been trying to get representatives from Coco out to Eden
Prairie to see if they could make their set-up work here. Jeremiah said the City could also
consider collaborating with Open to Business. Butcher Wickstrom said she would want to
put a cap on funding for a business incubator. Lindahl suggested that staff conduct further
best practices research on business incubators before proceeding.
Eden Prairie Plate
Parks and Recreation Director Jay Lotthammer gave an update on the Eden Prairie Players'
interest in carving out space for a community theater in City Center. He said the Players
toured the C.H. Robinson space and the Heritage Rooms. They determined the C.H.
Robinson space would not work for them due to the low ceilings and placement of columns
and posts. He said the Players have formed a subcommittee and had a consultant produce
sketches of what they have in mind. The subcommittee met with Building Official Kevin
Schmieg, who provided them with input on the concept. He advised them that the next step
would be for the group to hire an architect who can provide more detailed plans. Council
Member Case said he had the impression that the Players might be willing to have a multi-
use space, and asked if they would be pay for the space. Lotthammer said the Players feel
they need a dedicated space for the theater, and not a multi-use area. Lotthammer said the
Players would need one of the Heritage Rooms just to store scenery and props. They also
want to have risers for audience seating. They are hoping the City would provide the space
free of charge. Mayor Tyra-Lukens asked if the theater at the Hopkins Center for the
Performing Arts is a multi-use space. Getschow said that it is used for meetings by
community groups. Case said the City Council would need to look at what kind of precedent
they would be setting if they gifted such an amenity to a community group. Lotthammer said
the Players are part of the City's parks and recreation program. He has suggested they look
into becoming a 503C so they would have better access to grants and fundraising. Council
Member Aho said he would like to wait to see how lease negotiations for the C.H. Robinson
space go before committing to providing space for the Players. Lotthammer said the Players
realize will be many unknowns until C.H. Robinson vacates their space, and that they will
not have definite answers for some time.
Open Podium - Council Chamber
II. OPEN PODIUM
III. ADJOURNMENT