Apple Valley looks for transit-fueled development

Apple Valley officials are banking that the soon-to-be-launched bus rapid transit line can jump-start development in Central Village, a partially completed mixed-use project that stalled during the recession.

Last year saw a significant step forward with the city's approval of plans for Parkside Village, a 332-unit upscale apartment complex that's part of the Central Village development area. It's the biggest multi- family project to be built in Apple Valley in more than 10 years.

Community Development Director Bruce Nordquist said the developer, Denver-based Titan Investments, hopes to begin work on the apartment project in August.

Planned by the city in the early 2000s, Central Village is a 60-acre project that already has townhouses, senior housing, affordable/workforce apartments, a hotel, a small office building, shops and restaurants. The economic downturn slowed progress of filling in vacant portions of the project, with some parcels being taken back by lenders. About half of the 60 acres is yet to be developed.

The city now is eyeing six vacant, tax-forfeited properties west of the new apartment development, in an area near 152nd between Galaxie and Garrett avenues.

"We're still negotiating with Dakota County to determine a value for the land. It's going to take awhile. But we want to prioritize things for those parcels that are important to us," Nordquist said.

An office building — one with a large employer as an anchor tenant — is high on the city's priority list for filling some of the empty space. Nordquist said the city would like to see up to 100,000 square feet of office space, a total that likely would require an anchor tenant taking about 50,000 square feet.

Brent Karkula, a first vice president at CB Richard Ellis, said large office users in the southeast metro have gravitated to Eagan and Mendota Heights, partly to be closer to Twin Cities International Airport.

"New construction is expensive, and there's no shortage of existing space that would be cheaper for an office user," Karkula said. Large chunks of vacant office space include the former offices of Delta Air Lines and Blue Cross and Blue Shield in Eagan and the former Brown College campus in Mendota Heights.

The addition of bus rapid transit could help Apple Valley attract an employer, Karkula said. But he said he also believes the city will have to offer economic incentives to attract a large office user.

Apple Valley's reach for a large corporate presence fell short about a year ago, when tech-support company Stream Global Services considered relocating its headquarters from suburban Boston to Apple Valley but later said it could not find adequate space and instead opted for Eagan. The company has said its new headquarters would have 40 to 50 employees, with hundreds more workers in a neighboring call center.

Apple Valley had planned to use an $866,000 grant from the Metropolitan Council to help redevelop an older two-building office complex for Stream Global. The city recently got Met Council approval to use the funds instead to acquire three of the tax-forfeited parcels in Central Village for the office building. The property is about one-half mile from the Apple Valley Transit Station on Cedar Avenue that will be the southernmost stop for the new bus rapid transit line.

The city believes the location could be attractive for an office project, because it's bordered by a post office and the Grandstay Hotel & Conference Center.

Mass transit is another key ingredient. Initiated by the Dakota County Board almost 10 years ago, the bus rapid transit line is envisioned as the county's connection to the metro area's transit network.

Buses every 15 minutes will carry riders along Cedar from Apple Valley to the Mall of America, connecting to light rail that runs to the airport and downtown Minneapolis.