Minneapolis planners back Pohlad family's 36-story downtown tower

Minneapolis planners on Friday chose a 36-story tower and hotel complex proposed by the Pohlad family's real estate company for a city-owned block on the north end of Nicollet Mall.

The planners recommended that the City Council approve selling the block to United Properties, the Bloomington-based firm that has become a main holding of the Pohlads, who also own the Minnesota Twins, after exiting the banking industry.

In doing so, the planners rejected proposals from three other local developers, including one for an 80-story tower that they squelched two weeks ago.

And while the recommendation still faces City Council scrutiny and vote, Mayor Betsy Hodges and other council members stood with United Properties executives at a news conference Friday morning to tout the project dubbed The Gateway. The name has long been associated with that area of downtown, which was where the city's railroad stations once operated.

"Our expectations are high for what's going to be here," Hodges said.

The recommendation essentially ended a contest that began last October when city officials said they would sell the block to a developer who would produce an iconic building and public park space that connected the end of Nicollet Mall with the North Loop neighborhood and the nearby Mississippi River. United and the three other developers submitted proposals in mid-December.

The block, called the Nicollet Hotel Block for the stately hotel that stood there for decades, since 1991 has been a parking lot and bus stop that never lived up to expectations as a mass transit crossing.

Executives for two of the other developers — Duval Development, which proposed the 80-story tower, and M.A. Mortenson, which proposed a 31-story tower — declined to comment.

Kelly Doran, principal at Doran Cos., which proposed a 30-story circular tower, said he was disappointed in the planning staff's decision but called the process fair. "I think the city tried to do this the right way," Doran said. "We are sorry to lose it, but United is a good company."

In choosing United, the city planning staff cited density and money.

The tower was the second-tallest among the four submitted and included the most residential units — 300. It features a Canopy by Hilton, the new boutique hotel brand in the Hilton portfolio. It would add to a miniboom of hotel construction in that part of downtown; two other developers have proposed boutique hotels just a few blocks from the site.

United offered the highest purchase price for the block, although Hodges and other officials declined to release the figure, which will be formally negotiated based on a new appraisal in coming months.

The Pohlads came under enormous public scrutiny for the way that the Twins stadium, Target Field, was built with funds from the public and the baseball team. By contrast, The Gateway will be financed privately by United Properties and its bankers and investors.

The development stood out from the other proposals by incorporating space for a $200 million streetcar line for which Hodges is seeking federal funds. Streetcar tracks would cut diagonally across its plaza and pass beneath the tower. "This place needs to be a place of beauty and a place of connection," Hodges said.

The plan, designed by the Duluth-based architecture firm LHB Corp., includes street-level retail and restaurants, skyway-level office space and possibly a charter school. The plaza features a webbing-like pergola that will provide porous shade. And one side of the plaza has a broad, sweeping staircase that would climb to the lobby of the hotel and to a skyway to the Central Library across the street.

City officials noted that the César Pelli-designed library was built to have up to three potential skyway connections added in the future. "It has always been a part of the plan," said City Council Member Lisa Goodman.

"This grand, natural progression will be a really exciting addition," said Bruce Cornwall, director of design and campus planning for LHB. "We anticipate a lot of people moving up and down that."

Cornwall said the parking requirements proved the most difficult to incorporate for the relatively small, odd-shaped block that's bounded by S. 3rd Street, Washington and Hennepin avenues and Nicollet Mall. The solution was to put all parking underground, which will result in expensive excavation and environmental work.

United is partnering with FRM Associates — the property owner of Marquette Plaza and Cancer Survivors Park that is immediately across the mall from the Nicollet Hotel Block — to join the two green spaces. United will pay for the extension of Cancer Survivors Park that will mirror the landscaping on its side of the street.

Friday's selection came before any public meetings were held. The rejection two weeks ago of Duval's 80-story tower provoked some public criticism toward city planners. The tower would have surpassed the IDS Center to become the tallest in the city.

"People want to see something a little bit more dramatic or iconic but, as the city, I would want to make sure it can get done," said Herb Tousley, head of real estate programs at the University of St. Thomas. "The 80-story building was very dramatic, but the city wasn't sure if they could deliver."

At the time, city officials said they would present remaining proposals to the Downtown Minneapolis Neighborhood Association on Feb. 16. They later decided to settle on United's. If approved by the City Council, the sale could happen during the summer with construction starting next year.

"I stood at the bus stop on that block every single day for the last 10 years," he said. When the city asked for proposals, he called Katter. "I said, 'What do you think of developing this block? Should we take a run at it?' "

Kristen Leigh Painter • 612-673-4767