Min - Economic Development Corporation - 2004 - 10/20 - RegularALLEN ECONOMIC DEVELOPMENTCORPORA T ION (AFDC)
BOARD OF DIRECTORS
REGULAR MEETING
Oetobet- 20, 2004
Board
Kurt Kizer
Tim Wood
Ken Fulk
Maxine Sweet
Carl Cicincricich
Staff
Charisse Canfield
Jennifer (3rinlin
Dan Bownian
Call to Orderand Announce a Otiorum Present.
Guests
Jeff Starr
Bruce Heller
David Hoover
With as quorum of the Board present, the Regular Meeting of the Allen Economic Development
Corporation (AFDC;) was called to order by Vice President Tim Wood at 6;04 p.m. on Wednesday,
Octo'bur 20, 2004 at the AEDC Officc.Tfic following items were disciissed:
Election of Officers for the Allen Economic Development (orporation l3pard of Directors.
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Election. ............. . ....... . .................
Officers were elected for the cuiTcrit fiscal year. Kurt Kizer was Occtcd President by acclamatioll as
nominated by Maxine Sweet and seconded by Ken Fulk.Tini Wood was elected Vice President by
acclamation as nominated by Ken Fulk and seconded by Kurt 'Kizer. Ken 17�ulk was elected
Secretary/1'reasurcr by acclamation as nominated by Maxine Sweet and seconded by Tim Wood.The
officers will serve in these capacities until October 2005.
Approve Minutes of the September 15, 2004 Regular Mecting of the AEDC Board._ of ectors.
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The minutes of the September 15, 2004 Regular Meeting of the AFDC Board of Directors were
approved as, submitted on as motion by Ken Fulk, seconded by Maxine Sweet.
Convene into Closed Executive Session,
The Board convened into closed executive session at 6:15 pni. to deliberate coin mercial and financial
information and economic incentives for the development of Twin Creeks Office Center in Twin
Creeks Business Park.
Reconvene into i aztm cm
sion.
The Board reconvened into regular session at 7:17 p:ni.
Allen E'corionlic Developnient, Corporation
Regular Meeting, October 20, 2004
Page 2
Consider and take Action Regarding Infrastructure Incentives Su 1. it truction of a
Medical OfficeBuildin a Presby(g1anBmspiral.
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Concurrent with the expansion of Presbyterian Hospital of Allen, Cambridge Holdings, Inc. is
constructing a new 3 -story, 64,000 square foot medical office wing that will attach to the existing
hospital structure, They are currently in the pre -leasing stage. This component of the hospital
expansion project is projected to have a taxable value of approximately $9 in] Ilion on the building,
which will be owned by Cambridge,
Jeff Starr, Cambridge Holdings, Inc., appeared before the Board to request infrastructure incentives 10
offset the cost ortiie project that ultimately will assist the hospital with being competitive in the
reemitment ol"duality physicians to Allcn, With the rise in construction costs from the time the project
was first announced, assistance with the (Mention pond and utility infrastructure is being requested,
which will also betiefit Presbyterian Hospital in their long-term expansion plans,
Jeff Starr indicated that a gap of $250,000 exists, between what was budgeted for developnien( of the
medical office building and the actual cost of the building. Without additional funding, critical
alnCnitiCS/Spacc: Would have to be eliminated front the building in order to minimize costs and create
aff'ordab1c: lease rates for physicialls.
On a motion by Maxine Sweet, seconded by Tim, Wood, the Board approved all infrastructure
ineenti ve tip to $250,000, based upon infrastructure costs incurred by Cambridge for which reccipts,
are provided, This incentive is contingent upon Cambridge having a mininiurn of $9 million in
building and personal property value on the local tax rolls, No iiiiiiiinuin employment level is required.
The Board also aLtthorizcd [lie President to negotiate the appropriate contracts.
Approval of the Architectural Renderings and Construction Materials ce for an OffiBuilding-, r
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Prqgt.j gqjj.rjty to bet` ctdon ate
jy_4.5 Apy oil AFI)C-Owned Land at the
Southeast Cornerof RidgMqritj'7rjKqand US 75,
Fred Gans, Cornerstone Development ,L who is the developer of the project, was unable to attend the
niecting; therefore, no action was taken.
Consider and take Action for the A 11roval of Incentives,.in Sti )ort ofthe Dcvclqpt:)jgqt.p. Twill
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Creeks Office Center hiTwin Creeks Business Park.
Bruce Heller, JaRyCo, is proposing the development ofan office/tech business park in Twin Creeks
Business, Park that will accommodate several buildings designed for users requiring office/tech space
,from 2,000 to 22,000 square feet. The project would be located at the SEC cornet, of Walters Road and
Raintree Circle. The buildings do not, reature dock, grade or roll -up doors, but will accommodate a
wide variety of both sniall and large office/tech users and provide "value-added" office space that is in
demand.
There is a shortage of this type of space in Allen, resulting in companies locating to other areas. Due to
high vacancy rates across the Dallas/Fort Worth Metroplex, lenders are hesitant to provide funding herr
this type of project on a speculative basis. Heller is very familiar with the Allen market and feels that
the local market will sustain all office/tech prqject.Thcre are already several local companies that have
indicated their interest in space in the next 12-18 months, depending oil the final lease rate.
Allen Jeer ornic Development Corporation
Regular Meeting,, October 20, 2004
Page 3
Although Ileller is confident that space in this development will be substantially filled once
construction is Underway, assistance from the AEDC is being requested to assure lenders that
payments on the building will be met.
According to fleller, an AEDC Master Lease on the first building could serve as a mechanism to
secure funding; allowing JaRyCo to move forward with the development and secure tenants. Heller
assured the Board that any Master Lease contract made between JaRyCo, and the AUMC wouldinClLtdc
safeguards that ensure aggressive marketing of the development by JaRyCo and set out leasing,
requirements for the developer,
The Board discussed various details of the contract including the leasing of Clip, AEDC space first, time
limits, marketing and leasing accountability by the developer,
On a motion by Maxine Sweet, seconded by Kurt Kizer, the Board approved an 18 -month Master
Lease for 80% of the leaseable space on the initial 22,00O square foot building at. a rate of $12.50 per
square foot; contingent upon the Board's approval of" tlic final contract and architectural plaim The
Board authorized the President of the AEDC Board to negotiate the contract with JaRyCo.
Appointment of AEDC Sub-Conitnit-te-e-s-,
The Board agreed to make the following adjustments to AEDC subcomirfittees:
• Maxine Sweet replaced Jim Brazeall on the Blue Star Property Subcommittee,
• The Project Spotlight Subcommittee was eliminated.
• Carl Clernencich replaced .lino Brazeal on. the Pro.ject Apple subcommittee.
Project Flash Subcommittee 'was eliminated.
• 'Maxine Sweet replaced Jim Brazeal on the Millennium Corporate Center SubconinlittCe.
• Carl Clernencich replaced Kurt Kizer 011 the HOtel/MOtCl F"Und Distribution SUbconimittec.
Appr—ova—1 ofAEDC i!i n iazl Re r.ts....
Dan Bowman updated the Board on the financial status of the AEI)C and presented information on
historic sales tax payments made to Chelsea by the AEDC- The AEDC Payback Aaalysis was also
distributed to the Board. On a Motion by Ken Sulk, seconded by Maxine Sweet, the Board approved
the AEDC Financial Reports as presented.
Discuss Administrative and Marketirw, Activities of the AEDC.
Jennifer Grimm updatedthe Board on rnarketing activities of the AEDC. Board members were invited
to attend all or part of the upcoming Leadership Allen class dayto be hosted by the AEDC oil
November 12"'. Jennifer reminded the Board thata professional photographer will take Board and staff
photos on October 29"' at the AEDC office.
Charisse updated the Board. on the City of Allen's plans for a new Allen football stadium. An
independen(rcsearch firm has indicated that an open-air, stadium won]([ have trouble compethig as a
concert vc.nuc with other enclosed facilities ire the Dallas/Fort Worth area. The cost of as coniplete
market feasibility study fora municipal stadium is estimated at $30,000-40,000,
Allen Economic Development Corporation
Regular C1 October 2,0, 2004
Page 4
Charisse also updated the Board on WiQuest and'firnberwolf, both of which are considering coming
before the Board in November for incentives. Both companies are existing Allen businesses that 11rc
being lured to other conirn-unitics by low lease rates.
The possibility of a City Service Center locating on the former FSI tract was also addressed; however,
the, Board did riot prefer this option due to the high visibility ofthe location and potential alternative
land. uses. The possibility of locating the facility in Allert Station Business Park would be a better.
option. 'rhe majorobstacle to this option is the land price. If the A: DC; were to provide infrastructure
for this project and possibly another pending project, that would greatly enhance this location for the
service center.
The Board was updated on another potential user. for, Allen Station Business Park that would construct
a large manufacturing facility that would feature a front fayadc similar` to as two-story office building.
Kurt Kizer and'Tina Wood were designated to work with the prospect.
An incentive proposal for the RCL warehouse building was distributed to the Board. This proposal
addressed the possibility of offering incentives, in advance to companies inecting certain criteria, in
order to entice: users to lease this building, The consensus of the Board was riot to offer these
incentives in advance, but rather consider incentives on a case-by-case basis.
A group seeking to locate ain I;U,'ID International Training Center is seeking as partnership with a c,ity.
They have supplied a business plan and initial information. 'Pini Wood was designated to assist in the
review of the company to see if they are as viable candidate for Allen.
A major retail developer is interested iii meeting with AEDC and City officials to discuss potential
plains for Allen. Kurt Kizer and Maxine Sweet volunteered to meet with the company at the
appropriate time.
Schcdu Ling-Qf Next, AE.DC.-Roar of lit "pec'tots -mecti ns,
The next Board meeting was scheduled for Wednesday, November 17, 2004 at 6:00 p.ni,
Adjo—ul:u
On as motion by Ken bulk,, seconded by Maxine Sweet, the meeting was officially adja-)urnod at
8:55 pmi.
These minutes approved this 17"' day of November, 2004.
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Ken Fit 1k,
Kurt K zer, v S= t i