The new year could be the start of a new life for the Dinkydome, a longtime landmark that sits at the gateway to the University of Minnesota's Minneapolis campus.

Doran Development of Bloomington has reached an agreement to buy the building at 1501 University Av. SE. from Juno Investment Corp. of Minneapolis. By the middle of next year Doran hopes to have completed the purchase and begun work on a $40 million redevelopment, said Kelly Doran, the firm's founder and chief manager. Plans call for renovating the three-story building and adding a 10-story structure that will stretch all the way back to 4th Street and house about 180 apartments.

For almost 40 years, the Dinkydome has housed a collection of small offices, shops and restaurants. But its classical Greek style and distinctive domed roof provide a more accurate reflection of its origins.

It was built more than 90 years ago as the home of the Minnesota Bible College, now Crossroads College of Rochester.

"Its style is very unique," said Charlene Roise, president of Hesse, Roise & Co., a Minneapolis consulting firm that researches the histories of properties. "You just don't see buildings with domes like that very often. It's a building that makes a statement."

Minneapolis City Council Member Cam Gordon, who represents the university area, said Doran's initial redevelopment plans included possibly demolishing the building. Gordon said he's glad the developers reconsidered and "came to understand what a treasure the building is."

Doran said the plans now call for keeping most of the current tenants and remodeling the building, including the dowdy food court on the ground level. For the most part, tenants said they have received little in the way of information about how the development will affect their operations.

"In the end, I think we'll be better off [after the redevelopment]," said John Nicklow, general manager of the Downtime Bar & Grill. Nicklow said he wouldn't mind if his business had to relocate within the building once it is renovated.

Charlie Ward, owner of the Student Bookstore, said he has had one brief meeting with the developers, but still is unclear about how the redevelopment would affect his business. "I didn't come away from [the meeting] with a warm, fuzzy feeling," said Ward, who has three years left on his lease.

Repairing the dome

Besides cosmetic improvements, the renovation will involve repairing the domed roof and updating electrical and heating systems, Doran said. The developers also plan to install an elevator that can serve the three-story building, which currently is not wheelchair-accessible, Doran said.

A small annex added to the back of the building many years ago will be torn down and replaced by the larger structure that will house the apartments. Two businesses on the corner of 4th Street and 15th Avenue SE. -- Caribou Coffee and Erbert & Gerbert's sandwich shop -- will have to close during construction of the new building. But Doran said both eventually will be relocated in the redeveloped property, possibly in some of the 14,000 square feet of commercial space that will be part of the apartment building.

Doran said the apartment building could be completed by the start of the 2009 school year. "We're still finalizing the mix of apartment sizes," said Doran, who expects that it will include studios as well as units with one or more bedrooms. Monthly rental rates will likely be in the range of $700 to $850 per bed, so a two-bedroom unit would probably rent for roughly $1,500 to $1,600. That's slightly more than current rents for some newer upscale apartment buildings near the campus, such as 1301 University Av.

The new apartment building will have several amenities, including 24-hour security, exercise facilities and meeting and study rooms. The property also will have ground-level and underground parking.

Gordon said he welcomes the addition of more apartments close to campus, because it could help deter the ongoing conversion of single-family homes in the area to rental properties. "This could help restore the balance of owner-occupied houses and duplexes in the area and help stabilize those neighborhoods," he said.

Susan Feyder • 612-673-1723