Vikes and Arden Hills: There is a there there
- Article by: ERIC WIEFFERING
- Star Tribune
- May 11, 2011 - 9:00 PM
Zygi Wilf, Minnesota Vikings owner, attended Tuesday's news conference to herald the team's deal to build a new stadium in Arden Hills.
But it was Zygi Wilf, New Jersey-based real estate developer, who made the decision to leave the confines of downtown Minneapolis.
Politically, the smart decision for Owner Zygi would have been to stay downtown. That's where Gov. Mark Dayton seems to want him to be. That's where some of the region's top CEOs urged him to stay, especially after Minneapolis Mayor R.T. Rybak mortgaged his political future with a tax proposal that puts city bars, restaurants and retailers at a competitive disadvantage with their suburban counterparts.
Developer Zygi knows that all of this is true. But as a second-generation builder, he couldn't punt away the possibility of getting his hands on 400 acres within 10 miles of downtown Minneapolis.
Criticizing Wilf for wanting to go to Arden Hills is a little bit like faulting a cat for chasing a mouse. Real estate, after all, is how Wilf could afford to buy the Vikings, and how he's able to spend whatever it takes to field a winning team. Over the last five decades the Wilf family companies have built 25,000 homes. They own more than 20,000 apartments and own or manage more than 25 million square feet of office and retail space.
The former Twin Cities Army Ammunition Plant is one of the largest undeveloped parcels of land in any metro area in the country, a blank canvas for any developer with the means to match his or her ambition. The Wilfs appear to have both.
[Note to all those who believe that "Up North" begins at Hwy. 36: The munitions plant land is the same distance to downtown Minneapolis as the Mall of America.]
"From a developer's perspective, a stadium on that site makes all kind of sense," said Rob Davidson, who has owned and leased commercial real estate in the Arden Hills area for about 25 years and who serves on Arden Hills' economic development commission.
The site is so big that a previous developer, Minneapolis-based Ryan Cos., anticipated that it might need between 15 and 20 years to complete a mixed-use project that would have included 2,200 residential units, 875,000 square feet of retail and mixed-use space, 575,000 square feet of industrial and 1.2 million square feet of office.
Ryan dropped out of the project in 2009, citing market conditions -- collapsing real estate prices, skittish lenders -- and the cost of cleaning up the residue of four decades of making bombs and bullets. The U.S. Army already has spent almost $200 million cleaning up much of the site for industrial uses, and a future owner would have to spend more to prepare the land for residential development.
Easy? No. But then again, most of the Wilf real estate projects are in New Jersey, not Nebraska. I'm guessing this won't be the first time they've come across a contaminated site.
Besides, a Vikings stadium solves a few problems.
At 200 acres, the stadium and related developments would essentially serve as an anchor tenant for future development, including hotels, bars, restaurants, and maybe eventually office, retail and housing. All the asphalt that will be poured for 21,000 parking spaces will also help cover up or contain some of the environmental concerns.
The Government Service Agency has been trying to sell the land, rechristened Northern Pointe, on behalf of the Army ever since Ryan dropped out of the project. Several planned auctions have been postponed. Real estate experts suspect Wilf could get a pretty good price given current market conditions and some of the uncertainty around the environmental issues.
In short, there are many good reasons why Developer Wilf would choose a sprawling, 400-acre site in Arden Hills over the cramped confines of downtown Minneapolis. But before you begin Google mapping your route to the northern suburbs, remember that a battery of legislators and the governor would need to sign off on another $150 million or so for road improvements.
Even Owner Wilf might find that a tough sell.
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