Guthrie gives back land, pays city extra $1 million

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November 26, 2002 // UPDATED 1:33 pm - April 30, 2007
By: Kevin Featherly
Kevin Featherly

Deal includes cheap Guthrie employee parking, extending 9th Avenue toward the river,

and an extra block for the city to sell

By all appearances, the city negotiated a sweet deal last month when the Guthrie Theater Foundation accepted half the land they had agreed to buy for a new Downtown riverfront theater -- and pay $1 million more for the privilege.

Last year, the city, the Minneapolis Community Development Agency (MCDA) and the Guthrie signed a contract selling 10.2 acres to the Guthrie for $3 million. The

parcel's borders were Chicago and 11th avenues, the West River Parkway and South 2nd Street.

However, things changed earlier this year when the Guthrie presented design plans calling for a taller, more compact structure than the city said it initially envisioned.

"We were thinking at the time that the project would be much more horizontal on the ground, and would take up a much more significant share of the land area," said Chuck Lutz, interim MCDA director.

Some city officials charged the Guthrie with land speculating, changing its design to buy prime Downtown real estate low and sell high. Then, a district court judge awarded $7.9 million to area landowners whose property was condemned to assemble the site -- more than double what city officials budgeted when they agreed to help the Guthrie relocate.

"Consequently, we had a discussion about whether there was a piece of land the MCDA could take back -- or, I should say, not sell -- to the Guthrie," Lutz said.

Ten months of negotiations later, the city and the Guthrie compromised. The City Council on Nov. 22 formally approved the renegotiated deal that takes in $1 million more for the smaller parcel.

The theater's land now ends at 10th Avenue South, instead of 11th Avenue, putting a large city block back into the city's possession.

What the city gave In exchange, Lutz said, the city agreed to certain provisions it normally would not approve. Among those, he said, is the extension of a mid-block, street-level pedestrian walkway crossing South 2nd Street. The city has a policy against mid-block crosswalks.

The city also agreed to sell, at between $250,000 and $325,000, the "air rights" for a theater set-design workshop. The workshop will be built on the roof of a public parking structure that will replace a surface parking lot on the north edge of Washington Avenue, west of Chicago Avenue. A skyway-like walkway also will be built to allow workers to wheel sets from the scene shop to the theater.

Another compromise, according to Lutz: providing cheap Guthrie employee parking "within a reasonable proximity to the theater" in the ramp, and next to the theater complex on city-owned land. Employees will pay roughly $40 a month per stall during the first year of the seven-year deal, Lutz said.

Tim Blazina, the city's parking lots and ramps managers, said those stalls likely would fetch $80 to $100 a month on the open market once the $24 million parking ramp is built.

Lutz said the Guthrie's desire to strike an employee parking deal opened the door to the other negotiated changes.

Among other new terms approved Nov. 22: the city has agreed to extend 9th Avenue, which currently ends just to the north of South 3rd Street near the Metrodome. When the project is completed, 9th Avenue will run unimpeded from the stadium to South 2nd Street, adding nearly two additional blocks.

The city had already agreed to extend Chicago Avenue one block from Washington Avenue to South 2nd Street. However, as part of the new deal, the city is abandoning a plan to dig a tunnel to connect the new theater and the parking ramp south of South 2nd Street.

Mike Sachi, the city's parking facilities coordinator, said the underground tunnel originally was the Guthrie's idea and was intended to provide an underground pedestrian walkway from the theater to the new ramp on Parcel E. The Guthrie gave up the tunnel after convincing the city to open up 9th Avenue, a deal Sachi described as a one-for-one swap.

City officials said the negotiations demonstrate a willingness by theater officials to compromise in order to get a new riverfront Guthrie built.

"This is a public-private partnership in building this theater, and in order to be partners, you have to look at everyone else's interests and weigh that against your own," said City Councilmember Lisa Goodman (7th Ward).

"While they would've liked to have acted as a land broker and banked that land and made a profit off of it, they realized that there was a public interest in keeping their faith with the citizens of Minneapolis and not taking more than they needed," she said.

Goodman said the days of the city buying high and selling low are over. "We have a responsibility to the taxpayers in tight times to be able to manage their resources effectively," she said. "I think the Guthrie realized this."