The Breeze condominium project hit another roadblock — this time at the Storm Lake City Council table.
The council failed to advance a request Monday night to extend the construction deadline for phase 2 of the Breeze Condos at 201 Sunrise Park Road.
Developer Shawn Foutch, through FB Storm Lake II LLC, asked the city to consider a third amendment to the development agreement. The proposed amendment would have moved the deadline for completing minimum improvements for Building 2 from Dec. 1, 2026, to Dec. 1, 2028. It also would have allowed for additional adjustments if economic conditions beyond the developer’s control required more time.
City staff asked the council to authorize negotiations on the amendment, with the agreement subject to review and approval by the city attorney.
The request comes as Foutch continues to face challenges getting phase 2 off the ground.
A previous plan called for 110 condo units to be built at once, but the project was eventually divided into two phases to avoid overwhelming the local housing market.
Phase 1, consisting of 51 units, was completed in 2022. During a July update to the council, Foutch said 26 units had been sold and 25 were being rented, but five units remained unsold. Foutch said those remaining sales are critical to obtaining financing for phase 2.
The second phase is expected to be a roughly $12 million project.
The requested deadline extension is also tied to the financing of the completed first phase. According to the city, tax increment financing (TIF) payments from phase 1 are currently being remitted directly to the developer’s bank to service debt from the original construction. The bank holds the TIF agreement as primary collateral on that loan and requires the extension to maintain the financing terms. The development agreement also calls for TIF payments to support phase 2, which the developer says are needed to fill funding gaps in the project’s capital budget.
During Monday’s discussion, Council Member Don Piercy Jr. questioned how much the city originally committed to the project.
City staff said the figure was about $3.1 million.
Piercy also raised concerns about repeatedly extending the deadline.
Council members also discussed how the city’s TIF arrangement works.
City Manager Keri Navratil explained that the city does not simply receive the tax increment as unrestricted revenue. Under the existing arrangement, the TIF payments are being used to service the project’s debt. Navratil noted that once obligations within a TIF district are paid off, revenues can be used for other eligible economic development projects in the district.
The council then discussed whether any conditions or milestones should be included in the proposed amendment. Piercy suggested that the city should not grant another extension beyond the proposed 2028 deadline.
City staff said that condition could be included in negotiations. But when it came time to make the requested motion authorizing staff to negotiate and execute the amendment, no council member made a motion. Mayor Meg McKeon confirmed the item failed because no motion was made, which leaves the existing Dec. 1, 2026, completion deadline in place.
