New upscale outlet mall in Eagan expected to lure visitors, inspire other development

  • Article by: SUSAN FEYDER , Star Tribune
  • Updated: August 13, 2014 - 3:40 PM

The 100-store mall, which opens Thursday, is making the area a destination for developers.

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Christian Anderson sweeps the sidewalk after power washing in the Twin Cities Premium Outlets in Eagan on Wednesday morning.

Photo: Monica Herndon, Special to the Star Tribune

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The once desolate landscape around Jensen’s Food & Cocktails in Eagan is filling in, a change owner Doron Jensen views as satisfying and long in coming.

It’s been more than 10 years since the city began clearing dozens of businesses from the 65-acre Cedar Grove area, until Jensen’s restaurant and a bowling alley were the only ones left. The economic slump and legal battles over the city’s use of eminent domain stymied efforts to redevelop the ghost town south of Hwy. 13 and east of Cedar Avenue.

“There were times I wished I was on the relocation list,” Jensen said.

Now an upscale outlet mall with more than 100 stores peddling Calvin Klein, Coach, Polo Ralph Lauren and other brands is set to open next door. The first of its kind in the Twin Cities, it’s projected to draw as many as 4 million visitors a year.

“In a way, it’s kind of a payoff for the long wait,” Jensen said. He’s spent about $1 million on improvements to his restaurant and has added lunch service to capture the shopping crowd.

A large outlet mall wasn’t part of the original plan to remake Cedar Grove, which had disintegrated as a commercial district after a new freeway routed traffic away and other retail centers sprouted elsewhere.

But city leaders say Twin Cities Premium Outlets wound up fitting their goals to help transform Cedar Grove — the former home of a dowdy strip mall and a hodgepodge of small merchants — into a destination with a well-ordered mix of retail, housing, hotels and public gathering places.

The mall, which opens Thursday, shifted the languishing redevelopment out of neutral. “It answered the question of who would be first,” said Jon Hohenstein, Eagan’s community development director. Before Baltimore-based Paragon Outlet Partners came on the scene in 2012, it was hard to get other developers interested, Hohenstein said.

Now upscale apartments — the first in Eagan since the mid-1990s — are going up just behind Jensen’s restaurant on the former site of a poultry-processing business. Construction of a hotel, the city’s first since 2002, is expected to start this summer.

Together with the mall, those projects are boosting Cedar Grove’s taxable market value from $27 million to $175 million. More increases could come as developers snap up remaining vacant parcels. Last week Ryland Homes presented a plan for 50 upper-end townhouses on either side of the mall.

“What they’ve wound up with is pretty unique,” said John Shardlow, a Twin Cities development consultant. Early plans included a large office building and far less retail.

“It’s arguably better that the redevelopment didn’t get started before the recession and then stopped,” he said. “They could have wound up with a partially completed project that was doomed to stagnation.”

Proximity to the airport and the Mall of America drove Paragon’s interest in Cedar Grove, said Kelvin Antill, a partner in the development firm. Nationwide, outlet centers have emerged as popular destinations for out-of-town and international visitors. The developers say the outlet mall will complement, not compete with, the Mall of America, which draws about 40 million visitors a year. The two shopping centers are connected by the Red Line, the metro area’s first freeway-based fast busway.

Antill said Paragon, which has similar malls in suburban Dallas and San Francisco, had no reservations about being first to build in Cedar Grove. “We are usually the main draw,” he said.

The Eagan outlet center will have about the same number of stores as Paragon’s other malls, but will occupy about half the acreage. The city, Paragon and Morrissey Hospitality Cos. are sharing the cost of a parking ramp with 1,550 spaces for the mall and hotel. That cut down the size of the mall’s parking lot, preserving more space for development.

“We knew we wanted an intense mix of uses,” said Mayor Mike Maguire. “And what we didn’t want was something with a sea of gray asphalt.”

More hotel bookings likely

The outlet mall figures prominently in an amped-up marketing campaign by Eagan’s Convention & Visitors Bureau. The bureau has doubled the number of states where it advertises and added the Winnipeg area. It also is promoting the city at more national travel industry trade shows.

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