Downtown East in Minneapolis poised for second chance
Wednesday, May 29, 2013
When plans were revealed to build a pair of 20-story office towers and a 9-acre park next to the new Vikings stadium, several housing developers wasted no time looking for an opportunity.
“After the announcement, the phone started ringing,” said Tom Streitz, director of housing and policy department for the city of Minneapolis.
The $400 million project and the $975 million stadium now in the works have created a buzz that maybe — finally — Downtown East will attract residential development that could help transform the area in a way that the Metrodome never did more than 30 years after its debut.
“This has really ignited some huge interest and the kind of optimism that we haven’t had for along time,” said Cynthia Froid, a real estate sales agent whose office is just a few blocks from the redevelopment site.
While the enthusiasm may be warranted, spinoff development isn’t guaranteed, said Mary Bujold, president of Maxfield Research Group. Interest rates, the economy and jobs growth will dictate what eventually gets built, she said, noting she has received inquiries about residential development, as well. “There are people out there who are simply wondering where they might fit in,” she said.
Ryan Cos. announced earlier this month that it plans to build office towers that would accommodate up to 6,000 workers on a five-block area owned by the Star Tribune. A major parking garage will serve the towers’ primary tenant, possibly Wells Fargo, and the new Vikings stadium. Ryan has a contract on the land, but it faces several hurdles, including financing, design review and municipal approvals.
Streitz and others say the workers filling those office towers and a public park are far more important than the new stadium for attracting residential development. “Housing will follow jobs,” Streitz said. “And Minneapolis is attracting a lot of new employers.”
Already, Basant Kharbanda, an investor with multiple land holdings in downtown, says that he has plans to redevelop land he already owns near the new stadium. He envisions building another mixed-used development including offices and housing. Though he’s already working on renderings, his effort is contingent upon the final outcome of the Ryan project.
“We plan to work with [Ryan] closely,” Kharbanda said. “We want the development to be complementary.”
Across Minneapolis, several thousand apartment units are already under construction, most of them in the nearby North Loop, Uptown and University of Minnesota neighborhoods. Developers are hoping to satisfy deep demand for upscale rentals from a growing number of renters by choice who are seeking the excitement and convenience of life in the city.
Until now, most of that development has happened on the fringes of Downtown East — an island of surface parking lots and old office buildings that surround the Metrodome, which is about to host its last season of professional football.