BY COUNCILOR GILBERT:
RESOLVED, that the proper city officials are authorized to enter into a agreement substantially in the form of that on file in the office of the city clerk as Public Document No. __________ with Lakewalk Townhomes L.L.C. and the Duluth economic development authority authorizing the development of up to 46 townhomes units adjacent to Lake Superior between 23rd and 25th Avenues East and the purchase of property by the city for the extension of Lakewalk.
STATEMENT OF PURPOSE: The purpose of this resolution is to authorize the city to enter into an agreement with Lakewalk Townhomes, L.L.C. for the development of up to 46 townhome residential units on property generally between 23rd and 25th Avenues East along Lake Superior. The agreement will include the acceptance of the donation of property from the developer to the city and will further allow the city to purchase property owned by the developer and needed for the extension of Lakewalk at substantially less than the appraised value.
The proposed development is expected to consist of approximately 21 units of condominium development and another 25 or so units of side-by-side units generally consisting of three units to a structure. The selling price of the units is expected to range from $300,000 to about $640,000.
The property in question is generally undeveloped or underdeveloped property situated between Interstate Highway 35 and Lake Superior lying between 23rd Avenue East and 25th Avenue East. The land is presently occupied by a few single family residences and the storage yard for a construction company with the rest of the land being undeveloped. The developer has acquired major portions of the property needed for the development, but substantial portions of the site have been forfeited to the state of Minnesota for non-payment of taxes. The developer has requested the city’s and DEDA’s help in completing the site assemblage necessary to make the development possible by the use of its ability to acquire the tax forfeited properties directly.
In exchange for this public assistance, the developer has committed to donate two privately-owned parcels of land adjacent to the development to the city at no cost. In addition they have agreed to sell the portion of the property it owns immediately adjacent to Lake Superior to the city at an amount less than one half of its appraised value for use in conjunction with the extension of Lakewalk. And they have committed to either construct sufficient value in the short term to generate enough tax revenue to the city to pay the principal and interest on bonds which could be sold to pay for the cost of acquiring the Lakewalk property or to post a letter of credit which could be drawn on for that purpose.
The net result of this project is new residential construction having a value in the neighborhood of $20 million, the redevelopment of an underutilized or poorly utilized site and the acquisition of property for the extension of Lakewalk at no out-of-pocket cost to the public.