The Minnesota Sports Facilities Authority on Monday approved negotiations with Ryan Companies for new parking ramps and skyway bridges associated with the new Vikings stadium in downtown Minneapolis.
Negotiations were authorized for plans to revamp five square blocks immediately west of the stadium. Although the contract has not yet been signed, it calls for two new parking ramps and more than 1 million square feet of office space in two 20-story towers. Developments providing between 300 and 350 apartments are also part of the mix, along with a new city park and retail stores.
The project is an opportunity to put thousands of stadium parking spaces to use during times when there are no football games, said Rick Collins, vice president of development at Ryan Companies.
"It's wonderful to be able to work with the MSFA and the Vikings to use parking that would otherwise be used for a limited number of events and make it available to a lot of employees who will need it," Collins said.
But key to this plan is finding a major employer for the proposed office towers. Collins said his company is in talks with Wells Fargo, but the bank has not yet agreed to be the anchor tenant. A Wells Fargo spokesperson said after the vote that the bank is encouraged by the progress of the plan, and Wells Fargo will continue to discuss the opportunity with Ryan Companies.
Tax breaks and other public incentives are often used to lure big employers. That is not the case with Wells Fargo, Collins said.
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Public money is covering about half the cost of the stadium itself, but Ryan plans to finance what it calls the Downtown East project with help from the city of Minneapolis.
The plan calls for the city to use $65 million in bonds to finance one of the parking ramps and the park. However, revenue from the ramps will be used to pay off the bonds and Ryan has said it will assume the risk of any shortfalls for the first decade of operations.
The plan does right by taxpayers, Minnesota Sports Facilities Authority Chair Michele Kelm-Helgen said.
"This really is a good deal for the stadium authority because we recover all those operating costs with the guarantee that Ryan is putting in," Kelm-Helgen said. "Really, the city is using their bonding capacity to put together the financing for this. But it really is the ramps that are being used to pay off the bonds."
Ryan beat out two other bidders, Basant Kharbanda and Vedi Associates, Inc., for the project. Only Ryan was able to meet the goals outlined in the request for proposals, Kelm-Helgen said.
"Really, the city is using their bonding capacity to put together the financing for this. But it really is the ramps that are being used to pay off the bonds."
Minneapolis City Councilmember Cam Gordon is a longtime critic of using public money to fund the Vikings stadium. However, he said, if done right the development will be good for downtown. Gordon said he wants to make sure the project is useful to city residents, especially the new park.
"I'm concerned about the risk and all the public expense and I want to make sure that we're not just taking this all on so that we can give a great game day experience on this big, green space next to the stadium that then sits idle," Gordon said, "except that people can look at it and go on their lunch breaks from the office towers."
Gordon, whose ward borders downtown, said he wants to see a full-service city park with a community center and other amenities.
Ryan hopes to complete purchase of the land owned by the Star Tribune by the end of the year. Planners of the Downtown East project hope to break ground in April and have tenants in the office towers in 2016, in time for the first kickoff at the new Vikings stadium.