On Tuesday, the Eagan Economic Development Authority approved a $14.73 million purchase agreement with Paragon Outlets Eagan LLC. for 29 acres of property in the city’s Cedar Grove Redevelopment Area.
Paragon Outlets, a Baltimore, Md.-based developer, wants to construct a 420,000-square-foot outlet mall on the site, located near the intersection of Hwy. 77 and Hwy. 13 in Eagan. The purchase agreement calls for Paragon to pay $5.8 million in land costs, plus $3.5 million for the relocation of Cedar Grove Parkway and $1.2 million to move an Xcel Energy gas pipeline underneath the site.
Paragon will also contribute $4.23 million to the construction of a multi-level parking ramp adjacent to the mall. The purchase also includes three acres of undeveloped land nearby, which will eventually be converted into a park.
The lion’s share of the parking ramp’s estimated $19 million price tag will be borne by the EDA, however. The EDA plans to use money generated by a Tax Increment Financing district in the Cedar Grove area to pay for much of the ramp, according to Eagan Community Development Director Jon Hohenstein.
On Tuesday, the EDA also directed city staff to apply for two grants from the Metropolitan Council and the Minnesota Department of Employment and Economic Development. If the city receives the grants, the money will be used to help defray the cost of the building, Hohenstein said.
City officials initially hoped that Paragon would finance and construct a privately-owned ramp, but it became clear in the negotiation process that Paragon did not intend to build a multi-level parking structure, Hohenstein said.
Hohenstein said the ramp was a priority for city officials, who worried that the high density redevelopment of the area wouldn't have sufficient parking without a multi-level ramp. The ramp maybe include as many as three levels and 1,400 to 1,600 parking stalls, according to information released by the city.
The proposed parking ramp will serve not just the proposed outlet mall but any satellite businesses that develop around mall, Hohenstein said. At this point, the city has no plans to charge a fee for ramp access. However, the city will likely ask local businesses adjacent to the ramp to contribute via leasing or special services agreements, Hohenstein said.
At least one other mall in the area—the Mall of America in Bloomington—is served by publicly-owned parking ramps, Hohenstein said.
Paragon Development Partner Kelvin Antill said the company is already in the process of recruiting tenants for the outlet mall, which will likely open in 2014. With the purchase agreement signed, the company will likely submit rezoning and subdivision applications later this summer, Hohenstein said.
Mall planners hope to have at least half the building completely leased by the time the doors open. Construction will likely begin in the spring of 2013, Antill said.
"We're very elated," Antill said. "This is a process we've been moving through for the past several months."