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HomeMy WebLinkAboutRedevelopment Commission Minutes 11.25.24 CITY OF SOUTH BEND REDEVELOPMENT COMMISSION SOUTH BEND REDEVELOPMENT COMMISSION MINUTES November 25, 2024, at 9:30 a.m. BPW Conference Room, 13th Floor, County-City Building https://tinyurl.com/RDC-Meeting-11252024 The South Bend Redevelopment Commission was called to order at 9:31 a.m. President Troy Warner presiding. 1. ROLL CALL Members Present: Troy Warner, President David Relos, Vice President Vivian Sallie, Secretary Eli Wax, Commissioner Gillian Shaw, Commissioner Members Absent: Leslie Wesley, Member At-Large Legal Staff: Sandra Kennedy, Corporation Council - Virtual Danielle Campbell Weiss, Asst. City Attorney Redevelopment Staff: Caleb Bauer, Exec. Director, DCI Sarah Schaefer, Deputy Director, DCI Erik Glavich, Director of Growth and Opportunity, DCI Rosa Tomas, Director of Finance, DCI - Virtual Joseph Molnar, Asst. Dir. of Growth and Opp., DCI Erin Michaels, Property Development Manager, DCI Tim Corcoran, Chief Planner, DCI - Virtual Michael Divita, Principal Planner, DCI - Virtual Chris Dressel, Senior Planner, DCI - Virtual Laura Hensley, Board Secretary, DCI Others Present: Matt Barrett, 110 S. Niles Ave. Rex Weaver, Stoic Distilling Co. CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING –November 25, 2024 2 David Michael, Stoic Distilling Co. Jessica Stackowicz, Stoic Distilling Co. Jenn Hacker, Stoic Distilling Co. Barbara Tuner, 56085 Chapel Ln. Tina Patton, 707 Sherman Ave. Nathan Klein, Ivy Alley, 321 W. Wayne Blake Nipper, WSB Tiernan Kane, Unity LLC Howard Tuthill, Iron Shoe Distillery Jamey Haigh, Unity LLC Jesse Sensenig, Goshen Brewing Co. Abram Christianson, 806 Leland Ave. Brian Connolly, 1523 Sunnymede Ave. Alejandro Saucedo, 403 ½ W. Jefferson Ave. Linda Brotherson, Great Lakes Capital 2. Approval of Minutes A. Approval of the Minutes of the Regular Meeting of Thursday, November 11, 2024 Upon a motion by Vivian Sallie for approval, second by David Relos, the motion carried unanimously; the Commission approved the minutes of the regular meeting of November 11, 2024. 3. Approval of Claims A. Claims Allowances 11.12.2024 Upon a motion by David Relos, second by Vivian Sallie for approval, the motion carried unanimously; the Commission approved the claims allowances of November 25, 2024. 4. Old Business A. None 5. New Business A. River West Development Area 1. Purchase Agreement (Stoic Beverages) Joseph Molnar, Assistant Director of Growth and Opportunity, presented the purchase agreement that is the result of a request for proposals for 410 W. Wayne St. after a defaulted development CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING –November 25, 2024 3 agreement. Mr. Molar explained the timeline and steps that were taken to date. In June, 2025, the RDC issued a request for two (2) parcels and the RFP stipulated that the bidder could bid on one (1) or both, had clear submission requirements, clear evaluation criteria as well as clear deadlines for submissions. On August 22nd, all bids were received and opened which were four (4) in total. On October 10th., staff publicly presented their recommendation for negotiations to proceed with Stoic Beverages which most successfully met the criteria of the proposal. The Redevelopment Commission approved the staff recommendation and directed staff to negotiate with Stoic Distilling Co. Stoic was also chosen due to their experience, financial responsibility, purchase price, and consistency with the River West development plan. Tiernan Kane, Unity LLC, presented a second proposal. Alejandro Saucedo, Howard Tuthill, Jamey Haigh, Tina Patton, and Matt Barrett spoke against the purchase agreement. Brian Connolly, Jesse Sensenig, Nathan Klein, Abram Christianson, and Jonathan Boulos spoke in favor of the purchase agreement. Commissioner Eli Wax asked if Stoic has intentions to apply for a tax abatement and David Michael stated that they do not. Commissioner Relos asked about a family-focused atmosphere and Rex Weaver stated that the outdoor area will be family-friendly. Secretary Sallie asked about the timeline and completion of the renovations and Mr. Weaver stated that they had started cleaning up the landscaping and doing everything permitted with the limited access agreement. Mr. Weaver explained that 18 months is the goal. Commissioner Eli Wax asked Mr. Kane why they submitted this second proposal with a similar establishment when the first proposal was for a mix of residential and commercial development and stated that an occupant in that location would hinder the development. Mr. Kane stated that they requested communications with the city, and it appears that the preference would be for a distillery in that location and Mr. Kane wanted to ensure that it is done in the right way. Commissioner Wax asked if Unity LLC had agreements with the private parcels that they do not own at the site, and Mr. Kane stated that they did not have agreements. Commissioner Shaw asked how long Rue 152 has been in business and Mr. Weaver stated 5 ½ years. Commissioner Shaw also asked about fundraisers and community involvement and Mr. Weaver stated that they have participated in fundraisers for suicide prevention and the Boy & Girls club in the past, however, are open to whatever the area/community needs. President Troy Warner addressed Unity LLC that the housing dialog will continue but for this RFP, we will stay with the first staff CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING –November 25, 2024 4 recommendation and move forward with discussing housing in the future. Mr. Warner stated that this is a good problem and that there is interest in the surrounding properties. Commissioner Wax agreed and respected the RFP process and hopes Stoic Distilling Co. can work with other developers to maximize the neighborhood. Upon a motion by Vivian Sallie for approval, second by David Relos, the motion carried unanimously; the Commission approved the Purchase Agreement as presented with a Right of First Refusal for twenty (20) years after Certificate of Completion on November 25, 2024. 2. Development Agreement (Revs Development LLC) Joseph Molnar, Assistant Director of Growth and Opportunity, presented this development agreement for six (6) parcels located 3 blocks West of the Dream Center on the corner of N. Johnson St. and Orange St. The agreement is for deconstruction of the existing church and parking lot in an amount not to exceed $150,000 and constructing a minimum of two (2) housing units for $400,000. Revs Development LLC purchased the property in the Fall of 2024. Mr. Molnar explained that if the developer does not meet their commitments the RDC will have an exclusive option to purchase the property at no cost. Barbara Turner with Revs Development LLC explained that she has had years of successful experience. Ms. Turner’s background along with her son includes 26 projects in Chicago including the John Hancock Building. Commissioner Relos asked about financing and Ms. Turner stated that this would be self-funded. Ms. Turner plans to build 2-8 high quality homes barring utility complications. Brian Connolly, and Tina Patton spoke in favor of Ms. Turner and her Son. Caleb Bauer, Executive Director of Community Investment, noted a correction to the agenda will be this agreement will come out of the West Washington TIF district. Mr. Bauer also encouraged the Commission to act due to an accelerating timeline with this developer. President Warner and Commissioner Sallie agreed to promote the revitalization of this area. Upon a motion by Vivian Sallie for approval, seconded by Troy Warner, the motion carried unanimously; the Commission approved the Development Agreement as presented with the funding coming from the West Washington TIF district on November 25, 2024. 3. First Amendment to Lease Agreement (Beacon Health System) CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING –November 25, 2024 5 Erin Michaels, Property Development Manager presented a proposal to amend the lease agreement to Beacon Health Systems on the first floor of the Leighton Building located on the corner of Main St. and Jefferson Blvd. at 111 W. Jefferson. The amendment extends the term expiration date to April 30, 2026 for the completion of a new patient tower. Upon a motion by David Relos for approval, seconded by Eli Wax, the motion carried unanimously; the Commission approved the First Amendment to the Lease Agreement as presented on November 25, 2024. 4. Sixth Amendment to Purchase Agreement (RealAmerica Development, LLC) Joseph Molnar, Assistant Director of Growth and Opportunity, presented this amendment to the purchase agreement extending the closing date for the Market Rate Parcel to March 31, 2025. The parcels are split between Market Rate and Affordable. The Market Rate Parcel had environmental concerns (lead) in the soil that was higher than accepted for that area. The City partnered with MACOG and received a grant from IDEM to remediate. Upon a motion by Eli Wax for approval, seconded by Troy Warner, the motion carried unanimously; the Commission approved the Sixth Amendment to the Purchase Agreement as presented on November 25, 2024. 5. Third Amendment to Purchase Agreement (The Monreaux, LLC) Joseph Molnar, Assistant Director of Growth and Opportunity, presented an amendment to the purchase agreement to extend the closing date and contingency date to June 30th, 2025. Devereaux Peters applied for the READI Grant as a part of this project and the announcement for that grant has been delayed with a total investment of $16 million. Commissioner Eli Wax asked why the project would need an additional six months. Caleb Bauer, Executive Director of Community Investment, stated that the grant was a combined READI request that involves other sites (Inwood building North of the site, another building on the East side of Michigan St.) and this would unlock grant funding for all of the projects. Upon a motion by David Relos for approval, seconded by Troy Warner, the motion carried unanimously; the Commission approved the Third CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING –November 25, 2024 6 Amendment to the Purchase Agreement as presented on November 25, 2024. 6. Opening of Bids (Lot 2 Bendix Dr. Minor Subdivision) Joseph Molnar, Assistant Director of Growth and Opportunity, stated that no bids were submitted, and the team will be reaching out to developers. 7. Real Estate Purchase Agreement (415 E. Madison St.) Joseph Molnar, Assistant Director of Growth and Opportunity, presented a request for the real estate purchase of $300,000 for 415 E. Madison St. The building was built in 1868 by Singer Sewing Co. and currently has a daycare located on the ground floor. The total property is 3.36 acres along the St. Joseph River with 60,000 square feet of usable space. The acquisition would allow the city to guide the redevelopment along the riverwalk. The purchase agreement does lead to a longer due diligence period of 120 days and the RDC may terminate at any time during that period if unable or unwilling to terminate a shared parking easement on the property. Mr. Molnar noted a correction to the agenda will be this agreement will come out of the River East TIF district. Commissioner Wax asked what is the level of confidence that the building can be renovated and not demolished. Mr. Molnar stated that it’s been maintained and is a four-story building with views of the river and is a very attractive 150-year-old building. Mr. Molnar explained that this could be a residential conversion and/or ground floor retail space. He believes that the daycare has a yearly automatic renewal. President Troy Warner requested a 120-day update and Mr. Molnar stated we could get back to the Commission in January. Upon a motion by David Relos for approval, seconded by Vivian Sallie, the motion carried unanimously; the Commission approved the Real Estate Purchase Agreement as presented with the funding coming from the River East TIF district on November 25, 2024. 8. Assignment Agreement (Great Lakes Capital) Caleb Bauer, Executive Director of Community Investment, presented items 5A8 and 5A9 together, a pair of agreements related to the overall development agreement with Great Lakes Capital that was approved by the Commission earlier this year for the Madison Lifestyle District. CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING –November 25, 2024 7 Mr. Bauer explains the first of these agreements is an assignment of project funds agreement. READI 1.0 from the Indiana Economic Development Corporation and the local RDA selected this project for a $11.78 million award, one of the largest awards in the state of Indiana. Funds would be used to supplement the city's funds per the development agreement, for the construction of the public structured parking garage that will serve the development and offset parking needs for Beacon Health System. This agreement assigns those funds and subjects the Commission to a subgrant agreement terms by GLC. Mr. Bauer explains the second of these agreements is a confirmation agreement. This asserts that READI funds can be used to reimburse the Commission for costs incurred that were not clearly specified in the development agreement with GLC (South Bend Medical Foundation demolition). It clarifies those responsibilities of the Commission that relate to the project funds. It also confirms certain aspects of the development agreement and commitments of both GLC and the Commission to cooperate in good faith to ensure success of the project. Linda Brotherson, Representative with Great Lakes Capital, stated that this agreement is making sure the project is moving along in a timely fashion and the READI funds are spent correctly. The confirmation agreement acts as a notice to commence that would typically be seen later in the project. Mr. Bauer also explained the process of the site, first is demolition, then a new parking lot would be constructed, the Board of Public Works issued an RFP for a construction manager to oversee the project, and this will keep the project within budget and on the completion schedule. Commissioner Eli Wax asked for a timeline update with the lease extension for the other buildings. Ms. Brotherson stated that we need to have the READI dollars spent by June 2025. Everything is tracking and we are not changing any dates. President Troy Warner expressed concern about deadlines for spending those funds and Ms. Brotherson stated that this agreement facilitates this process. Commissioner Relos asked about the 8% return in the agreement. Ms. Brotherson stated that it would track with the development agreement, and it is a return percentage and we would not be able to issue a notice to commence without reaching the 8%. Mr. Bauer explained that the risk with issuing a Notice to Commence is, parties could theoretically back out. However, with this new change of language, we're simply restating that and then clarifying that it will be considered as it relates to the economic negotiations of the rate for the parking license. She explained that the RDC has other funds, and we are trying CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING –November 25, 2024 8 to meet their 66% of dollars spent. The READI 2.0 funds will need to be spent by December 2028. Mr. Bauer stated that this is a new condition added by the IDC. Matt Barrett asked if there is any additional liability incurred. Danielle Campbell Weiss, Assistant City Attorney, explained we are responsible for the entire project. If it goes South, we would also be responsible for the redevelopment authority portion as a fund holder, so if the funds would have to be repaid by GLC, we'd also have to reimburse them for those funds. Mr. Bauer explained that a parking garage constructed on the site is not something that is lacking in value, and if GLC ultimately were not able to deliver the mixed-use development that has been started, other developers would be able to use that garage and move forward. Upon a motion by David Relos for approval, seconded by Troy Warner, the motion carried unanimously; the Commission approved the Assignment Agreement as presented on November 25, 2024. 9. Confirmation Agreement (Great Lakes Capital) Upon a motion by Eli Wax for approval, seconded by Vivian Sallie, the motion carried unanimously; the Commission approved the Confirmation Agreement as presented on November 25, 2024. 6. Progress Reports A. Tax Abatement Erik Glavich, Director of Growth and Opportunity, stated that we will be bringing a tax abatement to the Council for the old Hope Rescue Mission building for rehabbing the building. B. Common Council None C. Other Caleb Bauer, Executive Director of Community Investment, stated that the Indiana Code does allow the Commission to meet to receive information only on commercial prospects. Without a need for the public notice requirement, we would like to briefly meet with the Commission after this meeting. Per that provision of Indiana code, to share some information. 7. Next Commission Meeting Thursday, December 12, 2024, 9:30 a.m. CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING –November 25, 2024 9 8.Adjournment Thursday, November 25, 2024, 11:17 a.m. ______________________________ Vivan G. Sallie, Secretary _____________________________ David Relos, Vice President