HomeMy WebLinkAboutIV.D - Downtown Property Study_Adopted_1.5.2021
CITY OF HASTINGS
DOWNTOWN PROPERTY STUDY
City of Hastings Downtown Property Study |
Table of Contents
Introduction ................................................................................................................................................................... 1
Shared Development Factors ........................................................................................................................................ 3
COVID-19 Global Pandemic................................................................................................................................... 3
Market Forces ....................................................................................................................................................... 4
Project Economics ................................................................................................................................................. 4
Developer Interest ................................................................................................................................................ 4
Housing Need ........................................................................................................................................................ 5
Parking .................................................................................................................................................................. 5
Site Evaluations.............................................................................................................................................................. 6
Site 1 ..................................................................................................................................................................... 6
Site 2 ................................................................................................................................................................... 10
Site 3 ................................................................................................................................................................... 13
Site 4 ................................................................................................................................................................... 16
Site 5 ................................................................................................................................................................... 20
Development Precedents ............................................................................................................................................ 22
Implementation Plan ................................................................................................................................................... 23
Table of Figures
Figure 1: Downtown Area and Study Sites ............................................................................................................ 3
Figure 2: Site 1 Parcels ......................................................................................................................................... 6
Figure 3: Site 1 Constraints ................................................................................................................................... 7
Figure 4: Site 1 Development Scenario ................................................................................................................. 7
Figure 5: Site 1 Alternate Development Scenario ................................................................................................. 8
Figure 6: Site 2 Parcels ........................................................................................................................................ 10
Figure 7: Site 2 Development Scenario ............................................................................................................... 11
Figure 8: Site 2 Alternate Development Scenario ............................................................................................... 11
Figure 9: Site 3 Parcels ........................................................................................................................................ 13
Figure 10: Site 3 Development Scenario ............................................................................................................. 14
Figure 11: Site 3 Alternate Development Scenario ............................................................................................. 15
Figure 12: Site 4 Parcels ...................................................................................................................................... 16
Figure 13: Site 4 Development Scenarios ........................................................................................................... 18
Figure 14: Site 5 Parcels ...................................................................................................................................... 20
Figure 15: Development Constraints .................................................................................................................. 20
Figure 16: Site 5 Development Scenarios ........................................................................................................... 21
City of Hastings Downtown Property Study | 1
Introduction
This report contains the preliminary findings and recommendations for the use of property owned by
the Hastings Economic Development and Redevelopment Authority (HEDRA). This study was undertaken
with the financial assistance of the Dakota County Community Development Agency (CDA). The
contents of this report are a collaboration between City Staff and the Cunningham Group.
Downtown Hastings is a focal point of the local
economy and community identity. The Downtown
area encompasses a 20-block area bounded by the
Mississippi River, railroad line, Fifth Street and
Eddy Street (see Figure 1). The historic buildings
along second Street represent Hastings’ Main
Street. This area is a collection of an evolving mix of
retail, service, office, and housing uses. The
downtown area also includes the historic City Hall,
post office, Hastings Family Service and Hastings
Art Center. In 2016, the riverfront renaissance
project made a $6 million investment in
streetscape and Levee Park improvements,
reinforcing Downtown as the focal point of
community life in Hastings.
The latest addition to Downtown is The
Confluence. This project is the rehabilitation of the
former Hudson Sprayer factory into a mixed-use
development consisting of hotel, restaurant, event
center and housing. The opening of The
Confluence will bring new activity and opportunity
to the Downtown area. The Confluence is
anticipated to open in 2021.
More change is on the horizon. HEDRA has
authorized a preliminary development agreement
with Spades SBC to construct an office building in
the Downtown area. This project would add a new
element to the market for Downtown businesses
and influence the use of HEDRA property.
In 2020, Downtown Hastings (and the rest of the
community) was rocked by the COVID-19
pandemic. The accompanying stay-at-home order
and the closure of bars and restaurants brought a
halt to much of the commerce in Downtown for
more than two months. We currently do not know
the long-term economic effects of COVID-19. It is
Downtown Hastings, 1870's
Downtown Hastings, 1900's
Downtown Hastings, 1915
City of Hastings Downtown Property Study | 2
possible that some businesses will not reopen.
There will be changes in shopping and tourism
that cannot be predicted. Despite all the
changes, many things will endure. Hastings has
built a strong and resilient Downtown. People
and businesses will return.
HEDRA plays a unique role in expediting and
sustaining that return. HEDRA provides
financial assistance programs to help achieve
the economic development objectives of the
City. These programs will aid in the recovery
following the Covid-19 pandemic and promote
opportunities that build on the visitors
attracted to The Confluence. HEDRA’s ability to
positively affect the future of Downtown is
enhanced by property holdings. The
development of HEDRA property has the ability
to support and enhance private investment into
the Downtown. The Purpose of this study is to
understand the alternatives and best use of
these properties.
This study examines five sites consisting
completely or partially of HEDRA-owned
property. These sites are located in the eastern
area of downtown. Each site presents different
opportunities and constraints.
This report contains preliminary findings,
recommendations, and a description of options
for the development of each site. The report
provides information to enable the HEDRA
Board to begin focusing on preferred options
and to identify additional issues needing
investigation. Based on the guidance solicited
from this report, Staff will utilize the
implementation portion of this plan to focus
staff efforts. Additionally, information within
this plan will guide HEDRA actions and inform
other downtown property.
Downtown Hastings, 1980's
Downtown Hastings, 2019
Downtown Hastings, 2020
City of Hastings Downtown Property Study | 3
Figure 1: Downtown Area and Study Sites
Shared Development Factors
There are certain factors that influence development on all five sites.
COVID-19 Global Pandemic
At this particular point in time, the presence of COVID-19 creates significant uncertainty about
development in Downtown Hastings. How will businesses adapt operations to be successful? What
businesses cannot (or do not) adapt and subsequently close? Does the multi-family housing market
shift? We will not know the answers to these questions for some time.
It is important not to get trapped seeking answers to questions that have no immediate answers.
Planning for the use of HEDRA properties requires a long-term perspective.
• For more than 100 years, Downtown Hastings has endured pandemics, recessions and wars.
Downtown is damaged, but it adapts, recovers and evolves. This will happen again.
• The Governor’s Stay at Home order brought to light the ability for many people to telework.
Hastings has the opportunity to benefit from people seeking good live/work environments.
• The new housing envisioned by this study forms a downtown neighborhood and a new market
Site 1
Site 2
Site 3
Site 4
Site 5
City of Hastings Downtown Property Study | 4
for Downtown business. These properties give HEDRA the ability to help create a safe and
attractive environment for Downtown.
Market Forces
The ability to implement the findings of this study is dependent on the market demand for the particular
development type. No market research was conducted specifically for the study. The comments made
are based on professional experience, knowledge of Hastings, and other available resources. Any
specific market research would likely be performed in conjunction with an effort to develop a specific
site.
The market assumptions used in this report include:
• Retail development will be difficult for property not located on Second Street.
• With the exception of a large single user, office use will be limited to components of larger
mixed-use development.
• There is a demand for housing in the Downtown area. The amount of demand has not been
quantified.
The demand for Downtown housing is an important factor in implementation. If the capacity of these
sites to support housing exceeds the demand, it may not be possible to undertake all of the initiatives
described in this Study. It may be necessary to prioritize sites to ensure that limited development
demand is directed where most needed.
Project Economics
In general, development occurs when the revenue generated by the project is sufficient to pay operating
expenses, debt, and a reasonable return on investment. An important factor for development in
Downtown is the additional costs of redevelopment. Redevelopment projects experience costs not
found in development on “greenfield” land. These costs include site assembly, demolition and clearance
of structures, and environmental cleanup. Parking can be a significant factor in downtown
redevelopment. The development that makes best use of available land rarely has enough remaining
property for the necessary surface parking. Structured parking may cost three to five times more than
surface parking.
While Downtown Hastings is a desirable development location, it does not automatically generate
additional revenue. New redevelopment projects must compete with existing buildings for tenants,
forcing lease and rental rates to be competitive with existing development. These rates may not
generate sufficient revenue to cover all necessary expenses. In some cases, the City has tools (such as
tax increment financing) to offset these additional costs.
HEDRA must be prepared to play an active role in making development in the Sites financially feasible
Developer Interest
A desirable plan for the City does not necessarily translate into a project that is attractive to developers.
Individually, each site has the capacity for a relatively small project. These projects may be manageable
for a broad array of smaller developers. While smaller projects may have smaller overall risk, they also
have smaller reward. A key to implementation will be making development of these sites more
attractive than competing opportunities.
City of Hastings Downtown Property Study | 5
Housing Need
The need for additional housing has been established as an economic development priority for the City.
As Hastings approaches full development within the existing city limits, it is important to make effective
use of redevelopment sites. The housing opportunities identified in this study help meet the following
local housing needs:
• Apartments increase the supply of new rental housing. This housing is often sought by people
that want to move to Hastings, but want to rent first prior to owning. The units also expand our
capacity to promote live/work opportunities. If these projects attract existing residents, other
existing housing becomes available for new residents.
• There appears to be strong demand for townhouse units as step up housing from apartment
renters. HEDRA property provides an opportunity to bring this housing style to the Downtown
Area.
• Growing a Downtown neighborhood expands the market for Downtown businesses.
Parking
Redevelopment within a historic downtown often presents challenges related to parking. Each of the
sites identified within this study will likely face challenges related to providing adequate parking for the
use in addition to satisfying ordinance requirements. The presence of the 100 spot commuter surface
parking facility presents some relief but also sits on a site identified for potential future redevelopment
In 1955, the Metropolitan Council constructed a
Wastewater Treatment Plant (WWTP) adjacent to
downtown. The Metropolitan Council has since
purchased new land along Highway 54 and will be
constructing a new WWTP. The new WWTP is within
the 2020-2025 Metropolitan Council Environmental
Services Capital Program with $3,000,000 in funding
budgeted from 2020-2022 and $39,000,000 in
construction funding budgeted from 2023-2025. The
new WWTP project is identified as project number
908800.
Potential for Parking on WWTP Site
The existing WWTP is located on approximately 3.65
acres of land. Once vacant it presents an
opportunity for redevelopment. The adjacent
railroad, underlying infrastructure and the likelihood
of a lift station being required on site could limit
opportunities for traditional redevelopment. The
space could however serve as a long-term parking
solution serving the parking needs of downtown
Hastings and provide a solution to agreements
associated with the funding used to construct the existing 100 spot commuter surfacing parking lot.
Aerial View of Current Hastings WWTP and Existing
Commuter Parking Lot
City of Hastings Downtown Property Study | 6
Site Evaluations
Site 1
Characteristics
Site 1 has been used for a variety of purposes. The site was developed
prior to 1884 with railroad tracks and buildings occupied by a
hotel/boarding barn and a corn and feed mill. The Site has been
occupied by a paper warehouse, a hide tanning facility, and bulk
petroleum storage facilities. Based on research by Braun Intertec,
buildings and/or structures associated with these former uses
occupied the site at various times over the time period between 1884
and 2003. A railroad track also traversed the site from at least 1884
through 1961.
From December 2018 through April 2020, the property in site 1 was
subject to an option agreement between HEDRA and Rungoli, Inc. The
developer ("Panache") proposed to build a cidery with office and
residential uses on the second and third floors. Panache did not
exercise the option to purchase the property and the agreement
expired on April 30, 2020.
The development capacity of site 1 is constrained by several factors
(see Figure 3):
- Flood plain
- Easement for powerline that crosses the site
- Adjacent to rail line with increased noise from rail bridge
crossing
Figure 2: Site 1 Parcels
Parcel A: 19-63950-00-010
0.64 acres $202,300 EMV
HEDRA Ownership Vacant Parcel
Parcel B: 19-63950-00-021
0.85 acres $268,400 EMV HEDRA Ownership
Vacant Parcel
Parcel A
Parcel B
View of existing site conditions (2020)
City of Hastings Downtown Property Study | 7
Figure 3: Site 1 Constraints
These factors push development to the southern half of the site. Development is likely to favor the
southwest corner of the site to mitigate noise from the rail line.
The site also requires environmental remediation. Two petroleum tank releases have been reported on
the site. The site has been identified on the Comprehensive Environmental Response, Compensation,
and Liability Information System (CERCLIS), CERCLIS No Further Remedial Action Planned (NFRAP) and
Voluntary Investigation and Cleanup (VIC) databases for documented soil and groundwater
contamination on the site and adjoining properties. The City intends to utilize grant funds from the
Metropolitan Council to assist with the remediation.
Figure 4: Site 1 Development Scenario
100-Year Flood Hazard Zone
MRCCA Shore Impact Zone
Electric Transmission Line
Active Rail Line
City of Hastings Downtown Property Study | 8
Figure 5: Site 1 Alternate Development Scenario (parking adjacent to railway)
Development Scenarios
When the Downtown Property Study was conceived in 2019, the Study was designed to be a tool for
determining the development capacity of this site. Panache had not conducted any detailed site
planning. The Study would provide information to guide discussions with other developers if the
Panache option agreement expired.
HEDRA has approve entering into a preliminary development agreement with Spades for the potential
development of an office building in site 1 changes the role of this Study for site 1. The Study creates a
foundation to build on as Spades conducts its site evaluation.
The physical constraints control where the building is located the actual development will be
determined by economics, use, and parking. The illustrations in Figure 3 shows how the flood plain and
power line constraints which encourage a building location pushed to the south with parking extending
north and east. A building location adjacent to Tyler Street may be preferable to mitigate noise from the
rail line. Building regulations and parking requirements will constrain building size.
The City anticipates depth to bedrock as a barrier to any below grade parking and as such surface
parking for an office building of this size will need to be carefully considered, and off-site alternatives
likely explored. As such, parking economics will play a role in shaping development. Planning for use of
the site will be about an act between providing enough mass for the project to be financially feasible
and in the parking needs of that use.
Recommended Development Strategies
The review and evaluation of the properties in Site 1 (see Figure 2) led to the following development
strategies:
- Leverage Metropolitan Council grant and conduct cleanup of site.
- Execute a preliminary development agreement with Spades to evaluate the feasibility of
constructing an office building.
City of Hastings Downtown Property Study | 9
Next Steps
In order to continue momentum surrounding the development of site 1, Staff will focus on coordination
and collaboration with Spades. Once fully executed, the City will complete the following in accordance
with the Preliminary Development Agreement (PDA):
1. Prepare ALTA survey of the Property and provide it to the Developer.
2. Provide developer with information on all known development regulations for the site
3. Perform property cleanup pursuant to the terms of the grant agreement with the
Metropolitan Council.
4. Provide the developer with a written statement describing the post-cleanup condition of the
property and a description of all considerations for site development, such as the need for a
vapor intrusion mitigation system.
5. Assist Developer in identifying options for providing adequate parking for the Project.
6. Assist the Developer in identifying options for interim office space if needed prior to
availability of the Project.
7. Work with the Developer to create options to mitigate barriers to the Project.
8. Identify sources and uses of non-local financial assistance.
9. Investigate issues related to green cities including what it means to become a green city,
what actions would the City take over the next ten years, what is the estimated cost of these
actions, and what benefits would be realized.
10. Work with the Developer to identify alternative sites within Hastings if site 1 is deemed
unsuitable.
City of Hastings Downtown Property Study | 10
Site 2
Characteristics
Site 2 consists of six parcels located between 2nd Street and Levee
Park. HEDRA owns a small parcel in the northeast corner of the site
(Parcel B). The remainder of the site is privately owned. A 0.63 acre
vacant parcel (parcel A) lies immediately west of the HEDRA parcel.
The southern half of the site is occupied by Graphic Design, Hastings
Family Service, and two small buildings currently used for office.
Figure 6: Site 2 Parcels
Parcel A: 19-32150-02-040 0.63 acres
$248,100 EMV Jenteaco LLC Ownership
Vacant Parcel
Parcel B: 19-32150-02-020 0.22 acres
$84,400 EMV HEDRA Ownership Vacant Parcel
Parcel C: 19-32150-02-060
0.34 acres $205,900 EMV (Land)
$611,200 EMB (Building) Hastings Family Service
Ownership
Existing Building
Parcel D: 19-32150-02-070 0.09 acres
$55,500 EMV (Land) $181,500 EMV (Building)
Jenteaco LLC Ownership Existing Building
Parcel E: 19-32150-02-071
0.07 acres
$52,100 EMV (Land) $187,400 EMV (Building)
Rosemary Kranz Ownership Existing Building
Parcel F: 19-32150-02-080
0.36 acres $217,000 EMV (Land) $419,100 EMV (Building)
Rosemary Kranz Ownership Existing Building
A B
C D E F
Image of existing conditions of Parcel A (2020)
Street View of Site 1 existing buildings along 2nd Street (2020)
City of Hastings Downtown Property Study | 11
Development Scenarios
The base analysis addresses the fundamental question about site 2, "can the vacant property support
development?" The analysis concludes that these two parcels can accommodate a mixed-use project
and the related parking spaces. The project shown below in Figure 7 includes a 5,000 square-feet of
retail/restaurant facing the park and 35 apartment units.
Figure 7: Site 2 Development Scenario
Both Graphic Design and Hastings Family Service are important parts of the Downtown community. The
redevelopment of these parcels is not a goal of this study. That said, it must be acknowledged that the
best redevelopment strategy is to include all properties within the block. The use of all parcels creates
more flexibility in creating a project that fits both second Street and the Riverfront. Illustrations in Figure
8 show the scenario that extends development onto the Graphic Design site.
Figure 8: Site 2 Alternate Development Scenario
City of Hastings Downtown Property Study | 12
The work performed to date does not go into greater detail. The financial feasibility of such a project has
not been explored. A key aspect of financial visibility will be the ability to acquire property at a
reasonable price. Additional property owners have not been contacted as part of this phase of the
study. The work performed in this study does not look beyond the massing of development on the site.
A more detailed investigation of the physical relationship of the structure and the adjacent riverfront
will be needed.
Recommended Development Strategies
The future development of site 2 is dependent upon the interest of other property owners. This report
will be used to engage in discussions and determine interest of those property owners.
Next Steps
The next step is to engage other property owners in site 2 in the discussion of long-term plans. Unless
one or more of the property owners is interested in exploring the redevelopment project, there are no
short-term development opportunities for this Site as the HEDRA parcel is not large enough to support a
standalone project. Questions to be explored include:
- Can site 2 play a role in meeting the needs of Spades either as an alternate site or through
parking?
- Has the Coronavirus changed the plans of current property owners?
- If properties within site 2 become available, should HEDRA pursue the purchase of additional
properties to further site control of the block? Additional site control could provide the
opportunity for a standalone project absent participation by the entire site 2 block.
City of Hastings Downtown Property Study | 13
Site 3
Recommended Development Strategies
The review and evaluation of the properties in site 3 (see Figure 9)
shows that site 3 has the capacity for additional multifamily housing
in the Downtown. The key factor in the development of the site is the
ability to redevelop the portion of the parking lot. This lot is
constrained by encumbrances created by the grant funds used for
original construction. The park property located adjacent to 2nd
Street is owned by the City and not encumbered by the use
restrictions.
Characteristics
Site 3 consists of the parking lot and park located at 2nd Street and
Tyler Street. This site was developed as a 100-stall park-and-ride lot
for the future extension of commuter rail or BRT service to Hastings.
The project was funded by a grant from the Metropolitan Council
using State bonding funds. This funding and the related agreements
constrain alternative use of this property.
In 2010, the City received a $600,000 grant from the Metropolitan
Council to build a 100-space parking lot to service the Red Rock
Corridor Transitway. The grant was funded through State bond funds
allocated to the Metropolitan Council. The State required the
Metropolitan Council to have an ownership interest in the property.
This was accomplished through a ground lease between HEDRA and
the Metropolitan Council.
As part of the grant agreement HEDRA agreed to not take any action
Figure 9: Site 3 Parcels
Parcel A: 19-32150-16-011
0.61 acres $158,400 EMV
HEDRA Ownership Parking Lot
Parcel B: 19-32150-16-010
0.30 acres $79,200 EMV HEDRA Ownership
Parking Lot
Parcel C: 19-32150-16-012 0.91 acres
$238,800 EMV HEDRA Ownership
Parking Lot
A B C
Street View of existing parking facility looking north
City of Hastings Downtown Property Study | 14
that would affect the tax-exempt status of the State's bonds. This provision prohibits HEDRA from selling
a portion of the parking lot for private development.
The future development of transit service serving Hastings and utilizing this parking lot is uncertain. The
Implementation Plan for the Red Rock Corridor was created in 2016. Since then the focus has been on
increasing transit usage in the corridor and creating small area plans around proposed station locations.
There is no firm calendar for design or construction. This uncertainty may create an opportunity to
discuss alternatives with the Metropolitan Council. If the Metropolitan Council is willing to accept the
substitution of an equivalent number of spaces possibly at what will become the former Hastings WWTP
site, then there is the basis for discussing the States willingness to agree. The information in this report
will be used to facilitate those discussions.
The former Milwaukee Road depot is located on second Street adjacent to the railroad tracks. No reuse
of this historic building is currently planned. Amtrak service passes the depot daily but does not stop at
the depot.
Development Scenarios
This site lends itself to a variety of development configurations. Given its location, development in the
near term would likely be residential in nature. The expansion of the Downtown business district along
second Street could create future retail opportunities in a mixed-use project.
The base scenario for site 3 shows the complete use of the property for a mixed use development. The
scenario illustrated in Figure 10 consists of the following:
- 20 apartment units
- 8 townhouse units
- 2 carriage units
- 4,000 square-foot first floor retail
Figure 10: Site 3 Development Scenario
City of Hastings Downtown Property Study | 15
Figure 11: Site 3 Alternate Development Scenario
The alternate scenario for site 3 places development solely on the park property owned by the City. The
scenario illustrated in Figure 11 consists of the following:
- 32 apartment units
- 4,000 square-feet of retail space could be built without encroaching on the parking lot. The
scenario would require an agreement with the Metropolitan Council for the use of the
parking lot to support the housing.
Market and economic factors will determine whether the project is a mixed-use or all multifamily
housing. In this scenario, all of the transit parking is transferred offsite.
Next Steps
The key to the development of the site is the willingness of the Metropolitan Council to consider
alternatives for providing parking for a future transit use. An agreement with the Metropolitan Council
would open the door to discussions with the State about satisfying bonding considerations.
Development in site 3 is connected to the other sites in this study. As noted previously, the future use of
this site should be determined before seeking development in site 2. Development in sites 1, 4, or 5 may
meet near-term market demand.
City of Hastings Downtown Property Study | 16
Site 4
Recommended Development Strategies
The review and evaluation of the properties in site 4 (see Figure 12)
led to the following development strategies:
- Although HEDRA does not own all property within this Site, it
should be considered as a single development site. The
assembly of the entire site helps to create a project that is
financially feasible and enhances the downtown area.
- The preferred use for the site is multifamily housing. This use
produces the density to make redevelopment feasible. This
also grows the “Downtown neighborhood”.
Characteristics
Site 4 contains the half block located behind the Post Office on third
Street between Ramsey Street and Tyler Street. The total area of site
4 is 0.85 acres.
Figure 12: Site 4 Parcels
Parcel A: 19-32150-15-050
19-32150-15-051 19-32150-15-052
0.21 acres in total $57,780 EMV
Joint Ownership between HEDRA and Vivian Walker Parking Lot
Parcel B: 19-32150-15-061
0.11 acres $262,900 EMV
HEDRA Ownership Existing Building
Parcel C: 19-32150-15-062
0.11 acres $235,200 EMV Patrick Allen and Vivian Walker
Estate Ownership Existing Building
Parcel D: 19-32150-15-070
0.21 acres $168,200 EMV
River City Investments, LLC
Ownership Existing Building
Parcel E: 19-32150-15-080
0.21 acres $59,800 EMV
HEDRA Ownership Parking Lot
D
B
C
A E
Existing building and parking lot on Parcel A (2020)
Existing City Owned Parking lot on Parcel E (2020)
City of Hastings Downtown Property Study | 17
The site contains seven parcels that represent three properties:
- HEDRA owns one small parcel (0.21 acres) on the eastern edge of the site. The property is
currently used as a parking lot. The HEDRA parcel is too small to redevelop on its own. The
parking provided on the property is not an essential part of overall Downtown parking.
- The adjacent parcel with a single-family house was recently purchased. The owner of the single-
family house is evaluating options for redevelopment for more dense housing. As with the
HEDRA parcel, this property is too small to redevelop independently. If the two parcels were
combined they may create a viable development site. It will be important to be mindful of
parking considerations of any redevelopment of the site.
- The western half of the site (Parcels A, B, and C) when combined contains a 9,000 square foot
building and parking lot. The City of Hastings owns the North half of the building. The space is
leased to the Hastings School District for use as the Area Learning Center. The south half is
privately owned. The Savana Sanchez Memorial Community and Art Center opened in this
space in 2019. The City and the property owner jointly own the three parcels that make up the
adjacent parking area.
From a redevelopment perspective, the best alternative is to assemble these parcels into a single
development site. The development scenarios that follow all assume redevelopment of the entire site.
This approach is consistent with the 2003 Heart of Hastings Plan.
Housing is the most viable future use of this site. In addition to the need for housing in the community,
housing provides the best opportunity to absorb the redevelopment costs of demolition and clearance
of existing improvements. While a commercial component to the project may be desirable it is unclear
if the market would support the commercial space.
Development Scenarios
Two housing scenarios were explored. Scenario 1 shows two three-story apartment buildings (see
Figure 13). The site analysis is based on 11 units per building with 1,500 gross square feet per unit. The
site can accommodate surface parking for these housing units. This configuration would accommodate
a mixed-use building with street-level retail on Ramsey Street if shown to be financially feasible. HEDRA
has expressed a desire to expand commercial opportunities to the south of 2nd Street and this site
presents an opportunity to do so if deemed financially feasible.
City of Hastings Downtown Property Study | 18
Figure 13: Site 4 Development Scenarios (Scenario 1, left and Scenario 2, right)
The second scenario converted one of the multifamily buildings to a combination of townhouse and
carriage house units (see Figure 13). This change would bring a different housing type to the downtown
area.
The development scenarios for site 4 provide a good illustration of the intent of this Study. The
scenarios show the broad elements of potential redevelopment:
- Intensity of development
- Basic building configuration and mass
- Ability of site to meet parking needs
- Relationship to adjacent property.
The scenarios show what is possible and provides guidance for decision-making by HEDRA. The details of
actual development will be determined by negotiations with a developer and market factors at that
time.
Site assembly is an important consideration in redevelopment. Assuming that the current owner of the
residential parcel would be interested in developing the entire site, HEDRA will need to consider
acquisition of the other half of the ownership interest in the property at 213/215 Ramsey. While the City
owns approximately one-half of this property, there are several other complexities to resolve:
- The City portion of the building was formerly used as the Senior Center. This use was moved to
the former Tilden Elementary School in 2011. At that time, the City entered into a lease and cost
sharing agreement with the Hastings School District to use the building for the Area Learning
Center. The lease was extended in 2019 and runs through September 1, 2026. The City has the
right to terminate the lease at any time, but must give written notice at least one year prior to
termination.
- There are common wall and parking lot agreements and easements with the owners of the
remainder of the building. These issues disappear with acquisition of this portion of the site.
City of Hastings Downtown Property Study | 19
- We do not at this time know the terms of the lease with the Sanchez Center and how it impacts
acquisition.
The property owner has not been contacted about interest in selling the property.
Next Steps
The ability to consolidate ownership of 213/215 Ramsey is a key to redevelopment of the western half
block. This step involves three items: (1) determining interest in selling, (2) determining the initial price,
and (3) conducting research on the property title and any other legal encumbrances on the building and
parking lot.
Staff will work with the owner of the residential parcel to determine the feasibility of projects with and
without 213/215 Ramsey St. It’s possible that the project has a phased approach with the southeast
quarter of the block being developed first in partnership with HEDRA and the owner of the residential
parcel with the southwestern quarter of the block being developed at a later time. Ultimately, the
willingness of the private property owner to sell will help to determine the direction of final
development strategies.
City of Hastings Downtown Property Study | 20
- Site 5 is adjacent to an
active rail line.
Approximately 28 trains
pass this location each day.
- The site is located adjacent
to a segment of the regional
trail system.
- Existing single-family homes
are located adjacent to the
western edge of the site.
Development on the
residential parcels extends
to the adjacent lot line.
- The northern section of the
Site is adjacent to the
parking lot in site 3.
These issues are illustrated
in Figure 15.
Site 5
Recommended Development Strategies
The review and evaluation of the properties in site 5 (see Figure 14)
led to the following development strategies:
- The site could be redeveloped with a townhouse style of
dwelling.
- The site design must fit with adjacencies to rail line, regional
trail and homes along Tyler Street.
- The City should consider vacating Bally Street North of Fifth
Street and the sections of Third and Fourth Streets within the
site. This will create a stronger development site.
- This site should not be developed until the ability to
redevelop site 3 has been determined as site 3 and portions
of site 5 could be combined.
Characteristics
Site 5 consists of seven parcels all owned by HEDRA. HEDRA acquired
the former United Building Center (UBC) property in 2005. Initial
downtown planning envisioned these parcels as parking. The 2003
Heart of Hastings proposed housing-based redevelopment oriented
to downtown and transit. Neither of these ideas have become reality.
The City currently uses the buildings for storage.
The context of the setting for site 5 is an important factor in its future
development. The following are constraints in future redevelopment:
Figure 14: Site 5 Parcels
Parcel A: 19-32150-17-021 0.11 acres
$23,000 EMV HEDRA Ownership
Vacant Lot
Parcel B: 19-32150-17-020 0.32 acres
$67,200 EMV HEDRA Ownership
Vacant Lot
Parcel C: 19-32150-17-080
0.42 acres $284,300 EMV
HEDRA Ownership Existing Building
Parcel D: 19-32150-32-030 0.16 acres
$123,200 EMV HEDRA Ownership
Existing Building
Parcel E: 19-32150-32-020 0.11 acres
$91,600 EMV HEDRA Ownership
Existing Building
Parcel F: 19-32150-32-010
0.10 acres $47,700 EMV
HEDRA Ownership Existing Building
Parcel G: 19-32150-32-011
0.12 acres $48,600 EMV
HEDRA Ownership Existing Building
B
A
C
E D
F
G
Figure 15: Development Constraints
Site 5
Site 3
Residential
Residential
Residential
Residential
Residential
Trail
Ra
i
l
r
o
a
d
Residential
Site 4
Commercial
Institutional
Ty
l
e
r
S
t
r
e
e
t
3rd Street
4th Street
2nd Street
City of Hastings Downtown Property Study | 21
Development Scenarios
Given the location of these parcels, the only redevelopment option is for residential housing. The site
provides an opportunity to bring different housing types to the Downtown area. Most downtown sites
are better suited to multifamily housing whereas this site is well suited to some form of townhouse
product.
Development scenario 1 (see Figure 16) shows a mixture of 12 townhouse units (2,000 – 2,400 sf/unit)
and 7 carriage units (625 sf/unit). This is only one possible configuration of townhouse-style housing on
the site. This concept illustrates the development capacity of the site and the relationship with adjacent
land uses. Given the proximity to the rail line, the front of units should be oriented away from the tracks.
An alley/access drive would provide separation from the adjacent homes. This development also
enhances this segment of the trail.
Figure 16: Site 5 Development Scenarios (Scenario 1 left, Scenario 2 right)
Development scenario 2 shows a variation of the base site analysis. In this scenario, 4th Street and the
adjacent section of Bally Street are closed. Closing adjacent streets offers additional opportunities for
development but also necessitates the need to consider vehicular access both for future residents as
well as emergency services vehicles to ensure safety.
Next Steps
Ownership of the property gives HEDRA a means of mitigating any additional development costs at this
location. The small size of the project may limit the number of homebuilders interested in the site.
The development of site 5 should occur after decisions are made concerning site 3, as site 5 has the
opportunity to offset the loss of spaces connected to development on site 3. It may also be possible to
package the sites as a single development project.
City of Hastings Downtown Property Study | 22
Development Precedents
The following are precedents provided by Cunningham Group that depict the types of development
envisioned within downtown Hastings including townhouses, carriage units, and apartments.
Carriage Units Townhouses Small Apartments
City of Hastings Downtown Property Study | 23
Implementation Plan
Based upon analysis of each of the identified redevelopment sites the following implementation plan is
recommended and serves as a work plan for City staff.
Task Timeline
Si
t
e
1
Execute Prelim. Dev Agreement with Spades SBC Q1 2021
City Due Diligence Q1 -Q4 2021
Developer Due Diligence Q1 -Q4 2021
Si
t
e
2
Contact Property Owners to understand long term plans for their property Q1 2021
Determine HEDRA’s willingness to purchase additional properties Q1 - Q2 2021
Si
t
e
3
Metropolitan Council coordination on alternative parking for future transit use Q1-Q2 2021
If parking not able to be moved, contact developers about project on City park Q3 2021
Si
t
e
4
Contact owner of 215 Ramsey about interest in selling & if so, purchase price Q1-Q2 2021
Coordinate with owner of 315 3rd Street about redevelopment project
with/without southwestern ¼ of the block
Q4 2020 – Q2 2021
Si
t
e
5
Identify if there is an alternate solution for parking currently on Site 3 Q1 - Q2 2021
Identify any environmental contamination within the site Q2 - Q3 2021
Identify grant opportunities if contamination is found. Execute on grants Q3 – Q4 2021
Contact prospective developers Q3 2021 – Q1 2022