Contrary to a pervasive rumor, the Nye’s Polonaise Room deal is not dead, the developer said this week.

“Right now, we are doing analysis as we come up with the plan that is both viable and meets various stakeholder needs, to some extent,” said Maureen Michalski, senior project manager for Schafer Richardson, the Minneapolis company proposing redevelopment for the site of the popular restaurant and bar just north of downtown.

The firm, in partnership with Nye’s owners Rob and Tony Jacobs, in December announced it planned to build a 30-story residential and retail tower on the site currently home to Nye’s.

Apart from the expected disappointment among the piano bar’s patrons, the developer soon faced opposition from Our Lady of Lourdes Catholic Church next door. But what started as concern that the high-rise construction could damage the 100-year-old church building has turned into a much broader resistance movement.

“The neighborhood engagement against the proposal is now as significant as the church’s original concerns,” said Mike Erlandson, a public relations professional hired to represent the church and various neighborhood voices in the deal.

The Nicollet Island-East Bank Neighborhood Association initially supported the project, but its leaders later “tabled” that to wait out the controversy and hope for a compromise.

“I think everyone would like to see development on the site, but the scale of the current project is not appropriate,” Erlandson said.

But the concern over the building’s height may prove to be a sticky point for Schafer Richardson as well. The developer has made a concession on underground parking, amending its plans from two to one level to minimize vibrations that may affect the church’s foundation. But because of the site’s high fixed costs, any new building may need to be tall to make it profitable.

“There are certain parameters for any site that govern what you can and can’t do,” Michalski said. “Economic feasibility is important to any development project, but certainly we haven’t presented a pro forma [financial statement] because that’s ultimately proprietary.”

Kristen Leigh Painter