The City of Monona has taken steps to enter into a development agreement with Galway Companies, Inc. on the Yahara Riverfront redevelopment project. On March 28, the Community Development Authority will vote on whether or not to enter the development agreement and City Council will cast a vote on the final approval at a later date. The terms of the proposed agreement are stated below as pulled from the Community Development Authority agenda for March 8, 2017. As a summary, Phase 1 of the development will be comprised of a five story apartment building 73 market rate apartments at minimum, and 26,000 square feet of commercial/retail/office/public space. Phase 2 will include 160 market rate apartments and/or independent market rate living senior housing units. Phase 3 will consist of an office/retail building of at least 33,600 square feet. Phase 3 will include an office/retail building of at least 33,600 square feet.
DEVELOPMENT AGREEMENT (proposed)
Between the City of Monona and Galway Companies, Inc.
A mixed use development to be constructed in three phases. Phase 1 will consist of a five story apartment building with a minimum of 73 market rate apartments and a minimum of 26,000 square feet of commercial/retail/office/public space. On the lower level at the plaza elevation will be approximately 3,700 square feet of commercial space of retail and restaurant space. There will be an additional 3,000 square feet of flex space on the lower level which will be intended for a public bathroom/park shelter space. Phase 2 will consist of 160 market rate apartments and/or independent market rate living senior housing units. Phase 3 will consist of an office/retail building of at least 33,600 square feet.
SCHEDULE – Each phase shall be fully completed (ie. receipt of occupancy permit), as follows:
Phase 1 – No later than December 31, 2018
Phase 2 – No later than December 31, 2021
Phase 3 – No later than December 31, 2022
EXTENSION – Developer may extend completion deadlines upon payment of fee as follows:
Phase 2 – One Year Extension from 12/31/21 to 12/31/22 – $321,063.00
Phase 2 – One Year Extension from 12/31/22 to 12/31/23 – $331,774.00
Phase 3 – One Year Extension from 12/31/22 to 12/31/23 – $135,000.00
Phase 3 – One Year Extension from 12/31/23 to 12/31/24 – $140,000.00
Payment in cash and due on the respective completion deadline prior to extension.
TAXABLE VALUE – Each phase shall have a minimum taxable value for real estate property tax purposes as follows:
Phase 1 – $12,000,000.00
Phase 2 – $19,000,000.00
Phase 3 – $ 5,000,000.00
The Phase 3 Required Value shall be reduced dollar for dollar to the extent Phases 1 and 2 exceed their required values; or in the event Phase 3 is completed prior to Phase 2, the Phase 2 Required Value shall be reduced dollar for dollar to the extent Phases 1 and 3 exceed their required values. Agreement shall set forth annual minimum tax payment until repayment of project costs.
Monona will convey the Development Parcel in three transactions, with each parcel conveyed to coordinate with the construction of each of the three phases of the development.
$2,000,000, payable in cash at closing of Phase 3 conveyance. Waived if: 1. The taxable value of Phase 1 is at least $13,000,000.00; and 2. The taxable value of Phase 3 is at least $6,975,000.00; and 3. The full completion of Phase 3 on or before 12/31/21.
TIF ASSISTANCE TO DEVELOPER
$2,000,000, payable in cash upon full completion of Phase 1.
$200,000 additional TIF Assistance for each $1,000,000 of taxable value of Phase 3 as of the Phase 3 Completion Deadline over the Phase 3 Required Value ($5M with land purchase, $6.975M with land purchase price waived). Payable pay-as-you-go.
Prior to completion of Phase 1 – At a maximum cost of $2.4M for the following: Demolish and clear Development Parcel, rough grade site, seed with grass Construct Lower Metropolitan Place (“LMP”)
Construct intersection with Broadway Water, sanitary sewer and electrical beneath LMP
Construct city storm sewer facilities in LMP and park
Prior to completion of Phase 2 – At a maximum cost of $2.7M for the following:
Reconstruct Upper Metropolitan Place (“UMP”)
Bury current overhead electrical service of UMP
Construct roadway between LMP & Bridge Road
Construct park amenities
Complete necessary water, sanitary sewer, city storm sewer, and electrical
SECURITY FOR FULFILLMENT OF OBLIGATIONS PERSONAL GUARANTEE
$2M from Doran and Kostichka, joint and several. May substitute a surety bond in a form acceptable to City Released upon timely completion of Phases 1 and 2 to Required Value
NOTE from LLC that Doran/Kostichka will form to own and develop the parcels
MORTGAGE from LLC that Doran/Kostichka will form on Development Parcel, subordinated to any first mortgage loans of the construction or permanent lenders for the Development, including any refinance or renewal thereof
RESTRICTION ON SUBSEQUENT CONVEYANCE – of Development Parcel to any party exempt from general property taxes.
CONSENT TO SPECIAL CHARGE per 66.0627
LAND REPURCHASE UPON FAILURE TO CONSTRUCT/RECONSTRUCT
If failure to construct – 75% of amount paid by developer. If failure to construct after casualty – $1.
For more information, visit the City of Monona website or call (608) 222-2525.