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LARKIN, HOFFMAN, DALY & LINDGREN, LTD. The Honorable Mayor John Kysylyczyn City Councilmembers February 18,2000 Page 3 The nonconfonning use classification also affects adversely the ability of shopping center owners to sell, lease and [mance their properties. Many potential buyers/lessees, may be simply unwilling to buy a property that does not comply with the Code because the risk of being unable to rebuild or expand may be too great to assume, and even those buyers who are willing to take such a risk will obviously require substantial price reductions caused by the diminution in market value. For similar reasons, the nonconfonnity also affects lenders' willingness to finance a nonconfonning shopping center property. The typical lender is more conservative and risk averse than the typical buyer. Therefore, the nonconfonnity has a greater potential adverse impact on the universe of potential lenders than it does on the universe of potential buyers. Existing lenders may also be unwilling to invest in improvements to the shopping center even if such upgrades are allowed by the Code. This diminished ability to finance in turn reduces the resale value of the shopping center property. Policy Issues Related to Shopping Center District 25% Lot Coverage Restriction Bradley asked Resource Strategies Corporation ("Resource Strategies"), a land use planning finn that advises municipalities and government agencies throughout the metropolitan area, to review the Shopping Center District lot coverage restriction in relation to the Roseville Comprehensive Plan and the Roseville Zoning Ordinance, including recent amendments to the Shopping Center District further restricting and regulating twenty-four hour uses. Resource Strategies also reviewed over a dozen other metropolitan area zoning ordinances to detennine whether and how these communities regulate lot coverage and floor area ratio for retail commercial development. Resource Strategies' report is attached to this letter as Exhibit A. Its findings and conclusions are summarized below: . The twenty-five percent (25%) lot coverage restriction applies only to the Shopping Center District. There is no restriction on lot coverage in any of the six other Business Districts established in the Code. This puts Shopping Center District properties at a distinct competitive disadvantage. For example, Rosedale Marketplace, which is owned by an affiliate ofTanurb, is not in a Shopping Center District. Therefore, it does not face the nonconfonning use problems described in this letter. In contrast, a comparable shopping center also owned by Tanurb, Rosedale Commons is located in the Shopping Center District and is thus a non- confonning use based on the City Council's recent interpretation. It is plainly unfair for owners of retail property in the Shopping Center Districts to be subject to more restrictive requirements than owners of comparable retail property in nearby Business Districts. . Roseville has the lowest or most restrictive lot coverage provision of any of the metropolitan area communities surveyed by Resource Strategies. Roseville's lot coverage limitation is 40% more restrictive than Brooklyn Park, 60% more restrictive than Coon Rapids and Chaska, and 100% more restrictive than Plymouth. Moreover, three metropolitan area communities do not