Deal: Demolish auditorium for parking


(5/14/2018)

by CHRIS ROGERS

The city of Winona is moving forward with plans to acquire the former Winona Junior High School auditorium and turn it into a parking lot. At a meeting last week, the city’s Port Authority Commission endorsed a prospective deal in which the current owners, MetroPlains and GLS Properties, would demolish the former theater and gym and turn the leveled ground over to the city. In exchange, the city would forgive a $400,000 debt MetroPlains and GLS owe the city from a 2001 loan.

Historic building’s last gasp

In a city that has lost a lot of historic buildings, MetroPlains’ redevelopment of the former junior high’s classrooms into the Washington Crossings apartments has been a poster child for historic preservation. However, the company never found an economical way to repurpose the old junior high’s auditorium, gym, pool, and locker rooms, so that portion of the building has sat vacant for nearly two decades. Recently, it has deteriorated significantly. Instead of exterior downspouts, the building has interior drains. Two years ago, those drains froze inside the unheated building, burst, and started flooding the theater. When the Winona Post toured the building in 2016, there was over a foot of standing water in the balcony. Beneath ornate Beisanz stonework on the lobby walls, moss and algae were growing on the floor.

At that time, the city’s Heritage Preservation Commission (HPC) urged the Port Authority to use some of the $250,000 Opportunity Winona funds, which it had dedicated to subsidize downtown development projects, to save the old auditorium. The HPC formally asked the Port Authority Commission to fund a historic reuse study, which would have analyzed whether there was a feasible way to rehabilitate and repurpose the building. The full Port Authority Commission never formally considered the HPC’s request. City staff brought the matter to a Port Authority subcommittee — which, at the time, was meeting privately in contradiction with the Minnesota Open Meeting Law — and told the HPC the Port Authority was not interested.

Also in 2016, MetroPlains asked the Port Authority for financial assistance to fix the busted drains. MetroPlains representative Craig Stenson said the company could not afford the $50,000 repair project and asked the Port to forgive $110,000 of its loan to help finance the repairs. The Port Authority Commission rejected the request. It is MetroPlains’ problem, city officials said. “You chose not to fix it,” Port Authority Commission member Dana Johnson told Stenson. “It’s too bad that was the choice because the result was an incredible amount of damage to a building that probably had a lot more value 10 years ago than it does today.”

This week, city officials reported that MetroPlains and its partner, GLS Properties, have still not repaired the drains. Winona Building Official Greg Karow ordered the owners to install new scuppers on the roof to correct the drainage problem in 2016. Winona Economic Development Director Lucy McMartin explained the property managers have been collecting stormwater and dumping it — with a system akin to putting a bucket under a leaky roof — but they have not installed new scuppers. “Over the last few months we’ve been in communication with them about either putting in the scuppers so they can divert the water or demolishing the building due to its condition,” McMartin told the Port Authority. At the same time, McMartin said that the owners have been trying to refinance their loans with the city and with other lenders. Out of those conversations came the idea that the city would forgive its loan if MetroPlains and GLS Properties take down the auditorium and give the land to the city, McMartin explained. A representative for the companies was not immediately available for comment.

 

“It’s just emotional, I guess, because I graduated from the junior high and the high school over there,” Port Authority Commission member Laurie Lucas said. “And when they came and asked us to give them more money just to fix up the scuppers I spoke up then, too. I said, ‘That was your responsibility to do it.’ And they didn’t do it then, and the building is in even more disrepair, and I just think it’s really sad when we lose one of our landmarks in Winona.”

On the Winona Post’s Facebook page this week, readers urged the city to try to save the theater, saying that it would fit in perfectly with the city’s vision for an “arts and culture district” downtown, while others questioned whether Winona can reliably fill a 1,000-seat theater.

“It can’t be fixed, so it needs to come down,” Port Authority Commission Chair Mike Cichanowski said after Thursday’s meeting. Johnson claimed renovating the auditorium would likely cost over $6 million. In an interview, he stated that, for a theater, that is just too much money. If anyone wants to fundraise, go for it, he said. Johnson asked rhetorically, “Does the community need a 1,200- or 800-seat theater? Is there a demand?”

The city has invested over $2.3 million in the Masonic Temple Theatre so far and hopes to complete $3 million in additional improvements someday.

Site would help satiate hunger for parking

“Maybe we can get some parking out of this,” Cichanowski said of the auditorium site. City manager Steve Sarvi also indicated the city hopes to convert the land into a parking lot. McMartin explained that the 16,000-square-foot site would yield, at most, approximately 50 parking stalls.

Is forgiving a $400,000 loan a high price to pay to get 50 parking spots? “I think it’s a good deal for the community. We could use the parking,” Johnson responded. MetroPlains has been unable to keep up with loan payments, and Cichanowski pointed out that the demolition itself will be an expensive project.

As downtown developments are picking up steam, downtown parking has become a hot topic for the city. Consultants completed an in-depth parking study this winter that concluded the city has more than enough parking, even with the proposed 60 Main Street project (see sidebar) eliminating around 83 public parking spaces and other new apartments driving up demand. However, some Winonans — particularly downtown business owners and Winona Friendship Center members — have loudly raised concerns about parking availability being a serious problem. Since the parking study, city leaders approved a deal to sell the Hardee’s block to Fastenal founder Bob Kierlin’s Main Square Development, LLC, and Hiawatha Education Foundation for the construction of high-end apartments, offices, and a Montessori pre-school. That project will eliminate roughly 150 parking spaces currently on the Hardee’s block, which serve the Winona County Government Center, the Winona County History Center, the Friendship Center and Masonic Temple, and the general public. While the Main Square Community development will provide parking for its tenants, city manager Steve Sarvi said the loss of parking for the senior center highlights “the glaring need” to relocate the center. The city is also displacing public parking in other downtown lots to meet contractual obligations to provide the county government center with parking.

The parking study recommended stepping up parking enforcement, creating shared parking agreements, and rearranging parking time limits to make better use of existing parking downtown. The city has only partially followed those recommendations, but faced with criticism earlier this year, Sarvi and McMartin assured citizens that the city was looking for sites where the city could create new downtown parking lots, potentially by demolishing buildings. “We’re leaving no stone unturned to address the parking situation downtown,” Sarvi said in February.

Deal is not final yet

The Port Authority Commission’s vote last week gave city staff tentative approval to negotiate a formal agreement with the property owners. Once drafted, the Port Authority Commission will need to vote again to approve the agreement. Because the former junior high is on the National Register of Historic Places but has not been designated by the city as a local historic site, the property owners do not need HPC approval before beginning demolition.

Keep reading the Winona Post for more on this story.

Chris@winonapost.com

 

Big downtown developments in the works

60 Main Street

Last April, Minneapolis-based Sherman Associates proposed building a six-story structure with 60 hotel rooms and 94 high-end apartments at the site of the city-owned parking lot north of the Winona 7 cinema. Sherman Associates estimated the total project cost at $32-$35 million.The conceptual plan included a 169-stall parking garage with 45 publicly available parking spaces; however, it would result in a net loss of 83 public parking spaces compared to what is available at the site today. The developer asked the city for a deal on buying the land, funding for utility improvements, and a type of local tax break called tax increment financing. City staff and Sherman Associates are still negotiating the details of a development agreement. It is taking longer than expected, but city officials hope to have a deal in place this fall.

Main Square Community

This February, Bob Kierlin’s Main Square Development, LLC, and Hiawatha Education Foundation proposed building a Montessori pre-school and a four-story structure with 60 high-end apartments, office space, and underground parking. Main Square Development estimated the total project cost at $25 million. The development would take up an entire city block, the city-owned Hardee’s block, and last week, the Port Authority Commission voted to sell the land for $1.9 million. The city agreed to pay for environmental clean up at the site, which is estimated to cost $600,000. If the city wins a state grant to fund the cleanup, the city’s cost would only be $150,000. Main Square Development plans to begin construction later this summer and hopes to have the school ready for students by August 2019.

102 Walnut Street

Last year, 102 Walnut, LLC, proposed a historic restoration project to convert the former InTech building at 102 Walnut Street into offices and apartments. Managing partner Peter Shortridge estimated the total cost at $7.6 million. The city granted a tax break called tax increment financing and a $150,000 reduced-rate loan for the project. In February, Shortridge said he is hoping to start construction soon, but is still working on getting necessary approvals from the Minnesota Historic Preservation Office.

Rock, LLC

The Indiana-based Rock, LLC, has spent $2.9 million this spring buying the former Tri-Mac lumber site next to the Mississippi River on Washington Street, as well as neighboring properties. The company has not announced what it plans to do with those properties, and representative Robert Weaver said he cannot disclose what the company is working on, except to say, “It’s going to be good for the community. It’s going to be positive.” The high prices Rock, LLC, paid for the properties caught some people’s attention. “I think if you’re spending that kind of money on land, you must have a heck of a project behind it,” Winona County Assessor Steve Hacken stated.

Last week, the company closed on 73 Washington Street for $1 million; Hacken’s office assessed the property value at $298,300. It also closed on the purchase of 216 West Second Street for $395,000; Hacken’s office assessed the property value at $181,900.

 


 

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