City Officials Weigh Financing Options for 701 France Avenue Redevelopment
The Edina City Council held a focused discussion regarding the ongoing development efforts at 701 France Avenue, weighing potential financing strategies designed to balance project goals with municipal risk. While no formal vote was taken during the late June session, city leadership signaled a need for innovative financial structuring to move the landmark proposal forward at the high-traffic intersection of 70th and France.
City Economic Development Manager Bill Nuendorf outlined the administrative perspective on the project’s financial needs, emphasizing the importance of shielding the city from potential fiscal exposure. He noted that the city is currently evaluating alternative methods to support the site's revitalization without overextending local resources.
If we're going to continue to be involved, we have to get more creative. And the challenge there is being creative without bearing any undue risk.
Evaluating Liability and Design
Representatives from Mortenson, the firm leading the development, presented a lease-based structure as a primary option for financing. The proposal aimed to differentiate the project’s financial burden from traditional bond issuances, which can sometimes place a larger strain on city debt capacities.
This lease structure is not viewed the same as a bond issuance. It's really a contingent liability versus a direct general obligation.
However, the proposal did not meet with universal support from the council. Concerns were raised regarding whether the long-term public benefit—specifically the inclusion of a parking ramp—justified the city's participation in the financing scheme.
What we get out of this is a parking ramp and I don't know that I want that. I'm open to other creative solutions... but I don't love this creative solution.
The 701 France Avenue project is part of a broader conversation about development standards in the Southdale district. Commissioner Risser pointed to broader regulatory challenges, noting that current design guidelines may inadvertently create compliance hurdles for developers, citing other local projects like the redevelopment near Pentagon Park as comparative examples of the complexities inherent in Tax Increment Financing (TIF) districts.
I feel like what we're doing is because of our greater Southdale area design guidelines, we're forcing developers to come up with projects that perhaps violate our code and are possibly non-compliant.
The council concluded the meeting by providing direction for further study, as officials look to refine the financial model before reconvening. No timeline for a final decision was provided, as staff continues to evaluate the feasibility of the proposed financing structures.
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Votes (1)
701 France Avenue Project Update and Financing Strategy
Dissent: Commissioners Risser and Agnu voiced strong opposition to the proposed lease structure.
Moved by None [N/A] · Seconded by None [N/A]
The HRA discussed a complex Lease Revenue structure where a third-party non-profit would issue tax-exempt bonds to build parking. Commissioners expressed concern over risk, the city's eventual ownership of a parking ramp, and the viability of high-rise residential versus hospitality or office uses on Site A. Dissent focused on whether the city should be in the 'parking business.'
Notable Quotes (4)
If we're going to continue to be involved, we have to get more creative. And the challenge there is being creative without bearing any undue risk.
This lease structure is not viewed the same as a bond issuance... It's really a contingent liability versus a direct general obligation.
What we get out of this is a parking ramp and I don't know that I want that. I'm open to other creative solutions... but I don't love this creative solution.
I feel like what we're doing is because of our greater Southdale area design guidelines, we're forcing developers to come up with projects that perhaps violate our code and are possibly non-compliant.
Ordinances & Resolutions (4)
Policy document cited by Commissioner Risser as potentially forcing non-compliant or infeasible development requirements.
The city's overarching development vision that the 701 France project aims to satisfy.
The existing tax increment financing agreement that currently governs the project site.
Area-specific plan focused on density and landmark development at key intersections.
Source document
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Affordable Housing Policy Changes
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