Lake & Nicollet Redevelopment (Kmart site)

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Nathan
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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby Nathan » November 4th, 2015, 12:47 pm

With all due respect... There's a White Castle DIRECTLY across the street. I can't think of any better catalyst. ;)

But in reality, it is only 5 blocks from Lyn/Lake... It's already a desirable location, and the redevelopment will make it even better :)

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby seanrichardryan » November 4th, 2015, 12:59 pm

I'm always surprised at the things being sold in that lot. There was a truck full of mattresses the other week, as well as 2 taco trucks, a mysterious semi truck, and of course the regular pigeon-feeding day drinkers. Always an interesting slice of humanity often not seen in the Twin Cities.
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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby Wedgeguy » November 4th, 2015, 1:22 pm

Nathan wrote:With all due respect... There's a White Castle DIRECTLY across the street. I can't think of any better catalyst. ;)

But in reality, it is only 5 blocks from Lyn/Lake... It's already a desirable location, and the redevelopment will make it even better :)
There are a few open lots on Lake between Lyndale and Blaisdell that would be great for some apartments/retail that are not luxury. Hoping we see more residential being built along that section of Lake as well as the Lake and Blaisdell corner.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby PhilmerPhil » November 4th, 2015, 3:54 pm

guys if you havent had the white castle slider with egg and cheese you need to go now. they crack an actual egg on the griddle

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby mattaudio » November 4th, 2015, 4:47 pm

Do you deliver?

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Minneapolis poised to buy Kmart parcel to reopen Nicollet Av

Postby acs » November 5th, 2015, 11:17 am

Finally, this is happening:

http://www.startribune.com/mpls-poised- ... 340922951/
The City Council will take a first vote next week on buying one parcel of land formerly occupied by a grocery store, which comprises part of the “Kmart site” at Lake Street and Nicollet Avenue. Officials announced Thursday morning that they also have a two-year exclusive option to purchase the land beneath Kmart itself.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby twincitizen » November 5th, 2015, 11:36 am

Huh, I don't recall it ever being announced that the Walgreens deal on the Supervalu site was not going forward.

The City will spend $5.2MM on the Supervalu site alone, plus $800,000 on the exclusive option to negotiate on the Kmart parcel. You have to imagine the purchase price of the Kmart parcel is at least $10MM (Kmart is 2.5x the size of Supervalu's land), considering the long-term lease and it not being vacant.

Obviously the City will not develop the site itself, but will be selling the entire block to a private developer(s). But how exactly, in the short term, does the city fund this potentially >$15MM expenditure? Normal budgeting? Sell TIF-backed bonds? State bonding request? Something else?

This seems like a perfectly valid use of TIF, funding the purchase of the properties by selling bonds that will be paid back by future increased tax revenues. The problem is that the site is not currently vacant, and in fact pays a great deal of taxes. While dense development on the site will obviously pay more taxes than current, I don't think it will be that much more to be enough to fund the purchase of the property. TIF bonds could fund a portion of the purchase price, but a good chunk will have to come from other sources.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby grant1simons2 » November 5th, 2015, 11:37 am

Their lease runs until 2053... Who in the hell was the person responsible for this happening again?

I might cry when I watch this getting demolished. It's such an essential part of our future to have Nicollet open again.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby acs » November 5th, 2015, 11:39 am

twincitizen wrote:Huh, I don't recall it ever being announced that the Walgreens deal on the Supervalu site was not going forward.

The City will spend $5.2MM on the Supervalu site alone, plus $800,000 on the exclusive option to negotiate on the Kmart parcel. You have to imagine the purchase price of the Kmart parcel is at least $10MM (it is more than twice the size of Supervalu's land), considering the long-term lease and it not being vacant.

Obviously the City will not be doing the development itself, and will be selling the site to a private developer. So how exactly, in the short term, does the city fund this potentially >$15MM expenditure? Normal budgeting? Something else? Sell TIF-backed bonds?
The article says the city expects purchasing the Kmart site to cost only $8 million.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby twincitizen » November 5th, 2015, 11:46 am

There's good reason to be skeptical of that.
Supervalu is assessed at $2.85MM - the City is paying $5.2MM - an 80% premium.
Kmart is assessed at $6.85MM - it's pretty hard to believe the city will pay anything less than $10MM

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby acs » November 5th, 2015, 11:51 am

The premium for the supervalu site may be because the city had to out-bid both walgreens and then Basim Sabri. With exclusive negotiating rights that won't be a problem.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby MNdible » November 5th, 2015, 12:16 pm

The article says that this is being funded from proceeds coming from the sales of other city owned properties, at least in the short term. I'd expect that the city wouldn't purchase the KMart parcel until it has the specifics of a redevelopment deal worked out.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby Wedgeguy » November 5th, 2015, 12:55 pm

acs wrote:The premium for the supervalu site may be because the city had to out-bid both walgreens and then Basim Sabri. With exclusive negotiating rights that won't be a problem.
I wonder how much of the parking lot would be included in that purchase price. Would that just be the building only? I'd have to figure the grocery owned at least part of their parking lot.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby acs » November 5th, 2015, 12:57 pm

According to the property map, both the Supervalu and Kmart sites include the parking lots.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby Nathan » November 5th, 2015, 1:28 pm


trigonalmayhem

Re: Lake & Nicollet Redevelopment (Kmart site)

Postby trigonalmayhem » November 6th, 2015, 9:06 am

Serious question: since Kmart has been so difficult with this up to this point (and is squeezing them for more than it's worth), is there anything stopping them from going Kelo v. New London and using eminent domain to just take this? The fact that it's for road infrastructure should help even more since it's not just for 'economic development.'

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby bubzki2 » November 6th, 2015, 9:16 am

It's always a last resort.

"The power to take private property for public use by a state, municipality, or private person or corporation authorized to exercise functions of public character, following the payment of just compensation to the owner of that property."

But I seem to remember an article from a year or two back talked to an expert and I thought he said there was a question whether the taking would be for a public use as required by law and could lead to years of challenges.

trigonalmayhem

Re: Lake & Nicollet Redevelopment (Kmart site)

Postby trigonalmayhem » November 6th, 2015, 9:21 am

I kind of hate that it's so hard to undo bad 'urban renewal' projects of the past because we're now so wary of or have curtailed the powers that were used to make them happen in the first place. It's verging on irony.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby Nathan » November 6th, 2015, 11:01 am

Also I think sears/kmart have actually been the ones who have been quite open to the discussion. It's just been an ownership tangle. Both property owners are completely within their rights... you don't get to just undo ownership of land, because you wanna make the city "nicer" this isn't a crucial connection, no one is getting hurt, money isn't being wasted, it's mostly aesthetic. Granted I'm all for it, but to tell companies that have been there for over 40 years that you're tired of them now after they had confidence in the city while everyone moved out to the suburbs is completely foolish. That kmart is super profitable, there's no good reason for the company to change. The city is doing this the right way.

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Re: Lake & Nicollet Redevelopment (Kmart site)

Postby amiller92 » November 6th, 2015, 11:08 am

bubzki2 wrote:But I seem to remember an article from a year or two back talked to an expert and I thought he said there was a question whether the taking would be for a public use as required by law and could lead to years of challenges.
I'd speculate that it could lead to years of challenges regardless of whether there was any serious question.

Not sure what' as more public use than a street though.


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