EDSR INFORMATION #1 11-13-2012 - Laserfiche WebLink

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10/25/12 Finance&Commerce>Print>The great property tax free-for-all Much of the infrastructure including a foundation was already constructed. "It was on Target to finish the project," she said. City Administrator Joe Lynch disagrees. After delaying the Inver Grove Heights store when the recession hit, Target was increasingly concentrating on its 2013 expansion into Canada, Lynch said. Without Target, the city would have had a prime development spot sitting empty fora long time. "There was a concern they might never be back, that they would sell the property and take the loss on putting in the foundation," Lynch said. The $1.25 million forgivable loan went to Inver Grove Heights Investments LLC, a development entity created by Roseville-based McGough and other undisclosed investors involved with Argenta Hills. "I'd say the recession changed the fundamentals of retail development. ... rys [The city money] was absolutely the m ' catalyst and instrumental to this deal z ierie going forward," said Greg Munson, vice �� president of development at McGough. The store had to be built and has to stay open for five years for Inver Grove Heights( n i Investments to keep all the money but � � there was no requirement for the Target A store to produce a specific number of jobs. M"We didn't do it that way because we Shoreview granted $845,000 for the new knew the jobs would be transient. We Shoreview Retail Center, and it will grant another asked that they create jobs," Lynch said. $700,000 if the developers can land a high-end grocery store. (Staff photo: Bill Klotz) Neither Lynch nor Munson had construction job numbers available. But Lynch recalled that Target officials spoke of 200 full- time and part-time permanent jobs during the store's grand opening. McGough is also finishing work on additional space for smaller retailers and has already built and sold 20 homes in the area. The city expects to get an extra $104,000 in property taxes a year from the Target store. Brooklyn Park also did not have job requirements when it came to the $2.5 million for the office building on Target's existing six-building campus. Work is expected to start within nine months on another similarly sized office building. The Target award was among five — totaling $3.28 million — that the city of Brooklyn Park made under the program. Brooklyn Park business developer Amy Baldwin said the city wanted to avoid placing an undue burden on contractors when it came to counting construction jobs. "We wanted to keep it as simple as possible," Baldwin said. Jason Aarsvold, Brooklyn Park's community development director, notes that Target was due property tax abatements under a previous economic development agreement. By giving Target the money upfront for the office building, instead of abatements, Brooklyn Park will get more property tax revenue in coming years, he argues. Target has said it plans to transfer 3,900 Target technology workers from downtown Minneapolis to the campus, quadrupling Target's workforce in Brooklyn Park to 5,200 by 2014. And Target's recent real estate moves downtown suggest it may be adding more workers I there, too. With that many jobs flowing in, it is little wonder that online video shows no one speaking out when the $2.5 million was brought up during November and December 2011 EDA and City Council meetings in Brooklyn Park. Actual need for spending is unclear f inance-commerce.com/wp-content/plugins/tdc-sociable-toolbar/wp-print.php?p=52262 4/8