Riverview Landing TIF submittalREQUEST FOR FINANCIAL ASSISTANCE FORM
CITY OF OTSEGO
AND
OTSEGO ECONOMIC DEVELOPMENT AUTHORITY
REQUEST FOR FINANCIAL ASSISTANCE
TAX INCREMENT FINANCING (TIF)
OR
TAX ABATEMENT
FORM FOR
Guardian Angels Riverview Landing
Riverview Landing Inc.
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CITY OF OTSEGO
REQUEST FOR FINANCIAL ASSISTANCE FORM
1. Project history & description:
In June of 2016, 521 Land Company, a land opportunity acquisition holding Company owned by GA,
purchased a 14+/- acre site, part of a failed retail/commercial development project fronting the
Mississippi River in Otsego, from the foreclosing Lending institution. The Companies sole purpose
is to acquire land, in anticipation of potential or possible Guardian Angels Senior Residential and
life quality developments, at advantageous rates and/or circumstances. The benefit of this
arrangement is that potential sites can be economically acquired and held for a specific desired
project while the viability of a Senior Services and Residential community can be evaluated. It
also allows for the orderly process of feasibility studies, governmental approvals and construction
design/estimates to be completed without the influence of land speculators driving the price of
potential sites past the point where the project has no chance of economic feasibility. In the event
the potential project is determined to be economically challenged past the point of viability 521
Land Company, due to its low-cost purchase point, has the capability to divest without negative
capital impact to the Guardian Angels organization.
Riverview Landing, Inc., a Minnesota nonprofit corporation (the "Organization") was formed on
February 6, 2017 for the specific purpose of exploring the opportunity to acquire, develop,
construct, own and operate a senior livin g commun i ty on the banks of the Mississippi River in
Otsego, Minnesota. The Organization is a subordinate affiliate of Guardian Angels who has
provided compassionate and life quality care for Seniors in the region for the past 52 years.
Riverview proposes to develop a Senior Services and Life Quality Living Community Campus on
the land currently owned by 521 Land Company called Guardian Angels Riverview Landing. It is
anticipated that the campus would be developed in phases to coincide with the needs of the Otsego
area Senior populations housing and personal service’s needs. Phase I, proposed for 2017/18,
includes 165,589 square feet, with 143 home units. The homes will include independent living,
assisted living, and secured memory care living. In addition, there will be numerous varied
common areas and elements for resident use and enjoyment as well as both community and public
amenities; including a separate dedicated community activity and gathering building. Riverview
Landing will provide old world charm in a warm and inviting setting right on the banks of the
Mississippi River. The continuum of care available at Riverview Landing will allow seniors to
receive, and more importantly be able to increase, as needed, the level of personal services they
may physically require without having to move to a new home.
2. Business information:
Business Name: Riverview Landing, Inc.
Address: 9200 Quantrelle Avenue NE
Otsego, MN 55330
Telephone: 763-746-3400
Contact Name: Dan Dixon
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3. Description of the business:
Riverview Landing will include Independent, Assisted and Secure "neighborhoods". Additional
features designed for the special needs of elderly and handicapped persons will include accessible
bathrooms, emergency call and wellness smart monitoring, inside parking facilities, care provider
staff on site 24/7, a wellness center with hydro-therapy pool, resident and community (seniors
only) dining facilities, class rooms, activity spaces, controlled access entry, and available social,
recreational and spiritual programs. Services available to all residents will include meals, scheduled
transportation, activities, and emergency response. Residents of the assisted living and memory
care units also receive housekeeping, 24-hour supervision, and optional personal care services for
activities of daily living, depending on each resident 's level of need. Home health care services
is available from area providers for those residents in need of such support.
Living expenses at Riverview Landing will be established to be affordable to the mainstream
segment of elderly and handicapped Otsego residents. Residents who find themselves in a limited
financial circumstance will be assisted in securing elderly waiver or other eligible assistance so that
they can continue to maintain their residence within the Guardian Angels community, it’s the
Guardian Angels advantage!
Services and programs provided to residents of the assisted living and memory care homes will
meet all state regulatory requirements and include resident care planning and management, meal
planning by licensed dieticians to meet the nutritional needs of older adul ts, light housekeeping
and personal laundry services, medication monitoring, daily resident checks, 24-hour on-site
supervision by care professionals staff, social and recreational activities led by care
professionals, and scheduled van transportation for personal appointments and group
activities.
Riverview Landing will provide the opportunity for senior residents of the Otsego community to
have the choice, and ability, to remain residents of the Community even as their life circumstances
and personal needs evolve. It will provide a place for parents and loved ones of Otsego residents
to relocate to be near their family as they age. The Otsego community will be able to provide
continuing quality of life benefits to its Senior residents through this project by capitalizing on the
Guardian Angles organization’s 52 years of providing exceptional senior housing, senior support
services and expertise dedicated to and benefiting Otsego Seniors and their Families.
4. Present ownership of the site:
Name: 521 Land Company, LLC
Address: 508 Freeport Avenue NW, Elk River MN 55330
Telephone: 612-435-7777
Contact: Ron Touchette
5. Information on the proposed project (Phase I):
Size of property: 5.757 acres / 250793 square feet
Building square footage: 165,589 square feet
Number of Homes: 143
Number of residents: 143, first residents
16, second residents (on average)
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Total 159 Residents
Parking: 45 inside parking garage spaces
117 Surface parking spaces
Total 162 spaces
Description of building: See attached draft site & building plans
6. Total estimated project costs:
Description Uses
Land 400,000
Existing Land Assessments, (current parcels as of 7-1-16) 511,049
Building & Property Related 20,611,967
Furniture, Fixtures & Equipment 1,197,600
Financing, Feasibility, Accounting, & Legal 868,451
Capitalized Interest 1,386,771
Debt Service Reserve 1,733,464
Working Capital & Start-up Expenses 2,180,271
Contingency 596,120
Community Amenities 1,438,705
Public Amenities 175,000
Total estimated project cost: $31,099,398
7. Project costs and use of TIF funds:
TIF funds will be used to offset and complete the gap to allow for the project to meet Bond
financing ratio parameters as well as the Bond Buyer’s expectation requirements. The cost
of the project as a whole has risen from an early estimate of $22-25 million to an expected
realized cost of $31.1 million; an increase of approximately $6.1 million dollars.
8. Specific reasons and circumstances requiring TIF assistance:
a. Increased interest rate, (0.525%), a financing expense increase of $133,090 annually,
$3,460,339 over 26 years.
b. Construction costs have increased approximately 6%, a $1,426,232-dollar increase.
c. Public Amenities cost to the overall project, $175,000.
d. Community Amenities cost to the project, $1,438,705.
e. Unit amenities, decks, balconies, patio’s, 4 season sun rooms, heated parking, in home
amenities (w/d, dishwashers, fireplace, etc) all added significantly to the overall cost to
build; estimated realized cost to the project of $350,000.
f. Upsized commercial kitchen and congregate dining facilities providing community support to
keep people in their present family home, cost to the project of more than $500,000.00.
Today’s market with its increased robust building environment and positive economic outlook
have created a circumstance that has changed the economic viability of this project. This
circumstance has caused the full project to be in a position where it cannot move forward
without TIF assistance. TIF dollars are the only way to bridge the gap to meet Bond covenant
requirements, to meet bond issuance expectations required to sell the bonds, to meet the
increased (increasing) actual physical building costs, and to assist in meeting the costs of adding
public amenities to the project that are for the benefit of Otsego senior residents at large.
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Without the probable or forecastable success of a Bond offering, this project is not
financeable. The addition of TIF dollars creates the ability to meet the required Bond
covenants and only in that case can the project move forward with a Bond offering in Early
July and ground breaking in August.
9. Market value information:
Current market value (per Wright County Assessor): $ 596,887
Estimated market value at completion: $12,115,000
10. Real estate property tax information:
Existing real estate taxes of property: $ 19,561
Estimated real estate taxes of property completed: $ 196,275
11. Source of financing information:
Description Sources
Municipal Bonds 27,808,349
Equity – 521 Land Company 400,000
Existing Bldg/Land Credit, (offset to Existing Assessments) 465,027
Equity - Guardian Angels Corporate 2,426,022
Total Financing $31,099,398
12. Project participants and vendors:
Architect: Pope Architects
Ward Isaacson
651-789-1585
wisaacson@popearch.com
1295 Bandana Blvd N, Ste 200
St Paul, MN 55108
General Contractor: Kraus-Anderson Construction Company
Jim Beckwith
612-335-2726
jim.beckwith@krausanderson.com
523 South 8th St.
Minneapolis, MN 55404
Engineer: Campion Engineering Services, Inc.
Marty Campion
763-479-5172
mcampion@campioneng.com
1800 Pioneer Creek Center, P.O. Box 249
Maple Plain, MN 55359
Developer: Rock Solid Companies
Ron Touchette
612-435-7777
ron@rocksolidcos.com
7078 East Fish Lake Rd.
Maple Grove MN 55311
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13. Project construction schedule
Estimated construction start date: August 2017
Estimated construction completion date: September 2018
Projected completion by year: 2017 - 15-20% completed
2018 - 100% completed
14. Economic and community benefits:
This Project:
a. Creates approximately 100 permanent new jobs, including livable and high wage positions,
within the City of Otsego. These include approximately 15-20 jobs to be filled by
Supervisors, Nurses (RN & LPN’s), Social workers and Department Directors in the $40 to
$80 thousand wage range plus full benefits. An additional 40-50 full and part time jobs in
various other capacities such as nursing assistants, chefs, activity aides, wellness
professionals in the $30 to 40 thousand wage range all with benefits as well. There will also
be another 15 to 20 frontline positons full and part time such as receptionist, dietary aids,
housekeeping, laundry in the hourly wage range of $10 to 15 dollars an hour with benefits
available for all employees over 30 hours per week.
b. Provides a significant continuing economic advantage to the City of Otsego and local
businesses.
c. Provides significant development of an underutilized foreclosed property at a very visible
high-profile location within the City.
d. Creates significant community tax base and property tax revenue on a tract of land that has
remained undeveloped for many years despite numerous efforts to spur interest and
commercial building activity.
e. Fills Otsego’s gap in life cycle housing by providing high quality affordable housing to Seniors
in the community. No longer will Otsego seniors be forced to leave the community due to a
lack of quality senior housing options.
f. Will attract a continuous flow of employees, residents, and visitors (often daily in some
cases) to the community who will patronize local businesses on a continuous and rotating
cyclical basis.
g. Creates increased incentive for commercial, retail and quick-serve restaurant
establishments, that are driven by local market and demographic factors including the
number of daytime employees and daytime residential density, to locate within the City of
Otsego.
h. Will be a showcase signature flagship property positioned at the very entrance into the City
of Otsego from Elk River on Highway 101.
i. Will attract new residents to Otsego through job availabilities as well as families desirous of
an opportunity to live in proximity to family members residing at Riverview Landing.
j. Will enhance and encourage the growth of wellness and senior related commercial
opportunity and development within Otsego such as pharmacy, durable medical equipment,
professional services and supportive service businesses.
k. Creates enhanced availability of Home Health Care and Hospice services focused on the
senior population directly to the Otsego at large community.
l. Creates the opportunity for community congregate dining (expected up to half of the diners
will be from the community at large – 90 meals a day served in ER now on a freewill donation
basis) – providing community support to keep people in their present family home.
m. Provides for an annual operating budget of approximately $6-7 million directly into the
Otsego economic engine. Wages alone account for approximately 55% of this budget; $3.5
to $4 million annually to area residents to be employed at Riverview Landing.
n. This project will be unlike anything in Otsego or any surrounding community. It will become
a focal point of the community and will be an exceptional campus for all to see as they enter
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or exit the City. It will be a building that draws attention to the quality city that Otsego has
grown into. This is not your ordinary senior housing project – it is one that will capture
people’s attention and pique their curiosity about the facility and the surrounding
retail/commercial/service area! People will know, talk about and visit the flagship senior
housing community campus along the banks of the Mississippi in Otsego, MN.
15. Municipality references:
Elk River, Mayor John Dietz, 763-441-5783
GA Care Center skilled nursing, Riverview senior apartments, Guardian Oaks HUD,
Evans Park apartments, market rate, Angel Ridge HUD, Guardian Angels by The Lake
assisted living, Guardian Angels-Elim Home Care and Hospice and Corporate Office.
Albertville, City Administrator, Adam Nafstad, 612-328-0878
Engel Haus housing with services
Zimmerman, City Administrator, Randy Piasecki, 763-856-4666 ex. 24
Pine Tree Manor & Pine Cone Manor HUD Apartments
Becker, City Administrator, Greg Pruszinski – 763-200-4239
Woodbrier HUD apartments
Coon Rapids, City Administrator, Matt Stemwedel – 763-767-6486
Autumn Glen Senior Living/Assisted living
16. Developments recently completed in other municipalities:
Elk River, $3.8 million renovation, completed November 2016
GA Care Center, Skilled Nursing - 100 wing / Bailey Lane
Coon Rapids, $17 million new construction, completed December 2014
Autumn Glen Senior Living/Assisted living, 100 home building
Managed by Guardian Angels
Albertville, $8.1 million new construction, completed October 2014
Engel Haus housing with services
17. Supplemental information attached:
- Current Legal description of the property
- Application fee of $5,000 has been paid to the City of Otsego
- Site plan and building rendering
18. Number of years in business:
52 years
19. Number of years located in the City of Otsego
Services provide to Otsego senior residents through Guardian Angels communities located
in surrounding municipalities for 52 years.
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20. Potential for business growth or future development
Phase II & Phase III – Includes sister building for additional active independent living
senior population. Separate entrance, additional dining and amenities options, expected
to add another 150 home units at a cost commiserate with Phase I plus COL increases.
Commercial Outlots – Support service development potential to be decided.
21. Will the project be Owner operated:
Yes
22. Will the project contain retail/commercial rental space:
No
23. Land costs per acre / square foot
$1.59 per sq ft / $69,481 per acre
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