Plaza land becomes latest dispute involving new Vikings stadium

  • Article by: JANET MOORE , Star Tribune
  • Updated: August 21, 2013 - 5:56 AM

$975 million project is already under tight deadline.

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Seen from the Star Tribune building, looking south, southwest a portion of the light rail station block owned by local real estate developer Bob Lux is visible to the left and the Hennepin County morgue/crime lab to the middle right and are in play for the Vikings stadium deal.

Photo: David Joles, Star Tribune

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A dispute over the land under the busy Downtown East light-rail stop is the latest messy complication to arise in the construction of the $975 million Vikings stadium.

Property owner Minneapolis Venture LLC filed suit late Tuesday in Hennepin County District Court against the Minnesota Sports Facilities Authority, claiming that negotiations over the land next to the stadium site have been “perplexing and unproductive.” The suit seeks clarity from a judge on whether the above-ground plaza and its coveted underground parking garage are part of the massive stadium’s reach.

Authority Chairwoman Michele Kelm-Helgen said the suit will not delay the stadium’s already-tight construction timeline, which calls for groundbreaking this fall, and completion by the 2016 NFL season.

But the land owned by Minneapolis Venture on the eastern edge of downtown, bordered by Park Avenue S. and Kirby Puckett Place between 4th and 5th streets, is a key piece in the development of the stadium’s expansive environs.

Architectural renderings of the glassy sports facility depict the light-rail stop and a plaza on the property that Minneapolis Venture purchased from the city of Minneapolis in 2007, part of a $65 million deal that included five parking ramps. And the 455 parking stalls beneath the Downtown East plot are critical for the authority to control in order to meet a legislative mandate to provide 2,500 parking spots in proximity to the stadium.

As plans have ramped up for the new stadium, which is being built on the current Metrodome site, officials from the authority and Minneapolis Venture have met three times and had “dozens” of conversations about possible sale of the land, said Jon Austin, a spokesman for Minneapolis Venture.

At times, the suit says, it was unclear whether the authority even wanted to purchase the land although “it was communicating to the public that Downtown East was within its control.”

However, the suit alleges it’s still unclear whether the land will be purchased in a traditional land deal, or taken by eminent domain. An appraisal has been done, although that figure has not been released publicly. Hennepin County records indicate the market value is about $4 million.

“We clearly have been trying to negotiate with this group to purchase the land,” Kelm-Helgen said. “The value that they have indicated for the property is much higher than our appraisal and what our budget includes. We’re quite a ways off in our negotiations.”

Austin said the authority and the Vikings “seem to have the mistaken impression that they have some claim on our property and that we’re obliged to wait on their timetable. We disagree profoundly with those notions and have tried repeatedly to get some clarity from both parties as to their interest in the Downtown East property.”

As the stadium takes shape and the overall economy improves, and as a $400 million apartment and office complex has been proposed by Minneapolis developer Ryan Cos. on five nearby blocks, Minneapolis Venture said the uncertainty has had a chilling effect on possible development on its land. Some of the principals of Minneapolis Venture also own the Block E entertainment complex in downtown Minneapolis.

Kelm-Helgen noted that construction of the new stadium will begin by tearing down the Metrodome’s far-eastern flank first — so control of the Downtown East plaza isn’t immediately needed for the fall groundbreaking.

Interests associated with Vikings owner Zygi Wilf own two parcels of land north of the stadium that are likely to be used for parking facilities. Vikings spokesman Lester Bagley said negotiations for that land are proceeding without contention.

Last week, the authority ramped up scrutiny into the Wilf family’s business dealings, after a New Jersey judge said the family was guilty of fraud, breach of contract and violations of the state’s civil racketeering law in connection with the Wilfs’ real estate empire.

The Minneapolis Venture lawsuit also highlights a disagreement over terms of a 2003 agreement between the group and the Minnesota Sports Facilities Commission, the authority’s precursor organization, which spells out the use of the plaza before sporting events, including Vikings games. The agreement expires Oct. 31.

Minneapolis Venture notified the authority that it will consider the agreement terminated Oct. 31, meaning the plaza will be unavailable for the Vikings’ four home games in November and December or for any playoff games. Partner Robert Lux argues in undated correspondence that the agreement was terminated when the commission was dissolved in 2012.

Kelm-Helgen said the two sides are in agreement that a judge could help to decide this issue. The Vikings’ Bagley said the plaza “is an important game-day gathering space. It’s important for transit commuters and Vikings fans to have safe access in the area.”

 

Janet Moore • 612-673-7752

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