Hopkins Searches for Movement on Fifth Avenue Flats Project

For sale signs have popped up on properties that were to be part of the stalled Fifth Avenue Flats project, and members haven’t formally discussed the project . But officials say the project isn’t over with quite yet.

The city continues to work with Kelly Doran, founder and principal of Doran Cos., to delay any legal action against Doran-Pratt Development as long as Doran “works with the city in good faith,” said Kersten Elverum, the city’s director of economic development and planning.

Hopkins considered legal action against Doran-Pratt in order to force the developer to reimburse the city for Fifth Avenue Flats’ legal costs—including those incurred during eminent domain proceedings and while appealing a court decision that killed the creation of a tax increment financing (TIF) district.

Those costs are estimated to be in the “multiple six figures,” according to the city attorney.

A court order following Doran’s divorce requires him to try to sell two properties integral to Fifth Avenue Flats—the old Sinclair gas station at 501 Mainstreet and a vacant single family home on Sixth Avenue.

Hopkins officials are talking with Doran about giving the city the first right of refusal for the properties, Elverum said. That would allow the city to try to match any offer Doran receives.

They’ve also talked with other developers and discussed the possibility of bringing another one onto the project, something Elverum said Doran was open to.

Meanwhile, Hopkins continues to talk with the owners of Hopkins Park Plaza, whose legal challenge brought the project to a halt. The city tried to seize that property through eminent domain and establish a TIF district.

But the Minnesota Court of Appeals found in 2010 that Hopkins failed to meet the legal standards for finding the properties “structurally substandard” when establishing a TIF district. Since the city couldn’t establish the TIF district, it couldn’t seize the property.

However, the Hopkins Park Plaza owner has outlined the broad terms that would convince him to sell to the city, Elverum said.
If all the pieces do wind up coming together, the project could look different than originally imagined. Doran-Pratt Development initially proposed building a 254-unit luxury apartment complex with 13,000 square feet of retail space.

But Elverum said Doran wants to cut out the retail space because lenders are more hesitant to lend for retail projects in the current market. That would leave Fifth Avenue Flats exclusively a residential development, albeit one still composed of upscale apartments.

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