20 Aug 2014
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Klodt Arrives at Deal on Lutheran Digest Site

The planned purchase greatly expands the footprint of a downtown project previously limited to the Park Nicollet site.

Klodt Arrives at Deal on Lutheran Digest Site Klodt Arrives at Deal on Lutheran Digest Site

Klodt Cos. has reached an agreement to purchase the old Lutheran Digest site on Ninth Avenue—increasing the number of units in the downtown’s centerpiece project by 55 percent.

The developer planned a 64-unit building and a 40-unit building when all it had was the 1.2-acre Park Nicollet site on Eighth Avenue. Now that it’s signed a purchase agreement for the .6-acre Lutheran Digest site, Klodt plans to build 71-unit and 90-unit buildings, said John Bell, Klodt’s vice president of construction and development.

The company expects to close on the property, located at 31 Ninth Ave. S., when it closes on the city-owned Park Nicollet site at the end of the year.

Planners envision Eighth Avenue as a “pedestrian seductive” corridor that will entice riders into the downtown from the light rail station planned for Excelsior Boulevard. 

The Park Nicollet site was the first step toward making that vision a reality. Hopkins acquired the property after the hospital closed several clinics in the area in 2009 and in April 2011.

But city officials have long seen the potential to expand the project through the acquisition of neighboring properties, such as the Lutheran Digest parcel. 

Until recently, the owner wanted more than Klodt was willing to pay. In June, Bell estimated there was only a 30 percent chance of acquiring the building.

He declined to disclose how much Klodt will pay for the Lutheran Digest site.

Klodt plans to complete the project in two phases. The first phase will involve the construction of a building running along Eighth Avenue, Bell said. The building will contain 4,500 square feet of what Bell called “quasi retail.”

The city has pushed for lots of retail space because of the way it promotes an active street scene, but Klodt has warned that the market won’t necessarily support that. Discussions have centered on marketing ground-floor space for both retail and so-called live-work studios for artists, insurance agents and other people who work and live in the same space.

The second phase will be the building of an L-shaped building on First Street South and Ninth Avenue, Bell said. That building will be all residential, although with walkout units on the first floor to promote an active streetscape.

Klodt aims start groundwork by April 1, 2013. The first building should be on the market a year later.

Groundwork on the second building will mostly take place simultaneously. (“When we’re digging the hole, we’re digging the whole hole,” Bell said.) The building will be finished no later than April 2015 but could be completed as soon as the fall of 2014.

The project’s land use approval process will kick off soon. Kersten Elverum, the city’s economic development and planning director, said she expects Klodt to submit its site plan and zoning requests in June.  Those requests should go before the Zoning and Planning Commission in July and the in August.

There will be a public hearing in June on the sale of the land to Klodt. That hearing was scheduled to take place Tuesday, but council members continued it because of delays transferring the title to the Housing and Redevelopment Authority.


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