The total cost of the 185,000-sf store and adjacent parking ramp is $164.5 million; the developer is Minneapolis-based Ryan Development. Most of the subsidy is providedthrough tax increment financing. Minneapolis Mayor Sharon Sayles-Belton blamed theheavy subsidy, which rose steadily in estimates starting with $16 million in 1996, for her inability to land the Democratic endorsement in her bid to be re-elected mayor this fall.
"The left wing of the DFL is saying, 'We're not happy with Target. We're not happy with Target. We're not happy with the progress you've made on affordable housing. We're not going to give you the endorsement'," Sayles-Belton said after the convention, according to the story. None of the candidates won endorsement.
Sayles-Belton and several Minneapolis city council members who voted for the deal say that such subsidies are necessary in order for cities to compete with thesuburbs for development.
Opponent R. T. Rybak says he favors having a Target discount store Downtown, butopposed the project as he saw the public costs rise.
The same development also prompted a bitter -- andultimately unsuccessful -- lawsuit from Opus Corp., who felt slighted when its bid to develop the same block with a Wal-Mart store and asking for no public subsidies was rejected by city officials. Rebecca Yanisch, then the head of the Minneapolis CommunityDevelopment Agency, a key player in putting together the development, told the Star Tribune that this bid was largely intended as a "spoiler" to thwart a rival.
Yanisch is now head of the Minnesota Department of Trade and Economic Development in the administration of Gov. Jesse Ventura.
Minnesota cities over the past quarter-century have given more than $4 billion in similar public assistance to commercial developments as part of revitalization efforts, according to the story.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.