City of West St. Paul Buys Hy-Vee Property for Housing, Restaurants, and Park

Thanks to Blue Sky Bookkeeping and Dakota County for their support.

The City of West St. Paul is buying the former YMCA site, currently owned by Hy-Vee, with plans for a development including housing, restaurants, and public park spaces. The YMCA sold to Hy-Vee in 2019 but Hy-Vee changed plans earlier this year.

“The conversation that we’ve had around this is the fact that any developer could come buy it and put 460 units on there with really nothing the city can say about it,” said West St. Paul City Manager Nate Burkett. “So what we’re trying to do is be in control so we get more than just a bunch of housing.”

The city’s purchase offer has been in the works for a while, including a visioning process with City Council.

The city will pay $5.2 million for the property. Hy-vee paid $3.8 million in 2019, but also demolished the YMCA building, did extensive site work, and conducted surveys, tests, and reports that the city will get as part of the sale. The purchase price also includes the former AutoZone property and a vacant lot that were not part of Hy-Vee’s $3.8 million purchase. Burkett said it’s a comparable number, and more importantly expects to be able to sell to a developer for the same price or more. There’s likely be some sort of city subsidy to finance the park component.

What’s Going There?

The concept plans show 450 units of housing, 300 units of parking, open park/plaza space, and restaurant space. But nothing is certain.

“It’s all conceptual at the moment,” Burkett said. He’s described the plans as part vision and part proof of concept, showing what could go there but also what fits there. A developer will come up with more concrete plans.

Apartments will definitely be part of the development to make the project economically feasible. Despite a recent boom in new apartments, the Twin Cities continues to lead the nation in a lack of housing. While Burkett doesn’t expect to see 450 units on the site, it is a possibility.

“Every time the number of units in the development goes down, the amount of money that the city is going to have to put in goes up,” said Burkett.

Restaurants are also part of the plan, something the community has been demanding.

“There are no specific restaurants in mind at the moment. But everybody is in agreement that it’s going to be more of a locally-owned, maybe brew pub style,” said Burkett. “It’s not going to be fast food and it’s not going to be a national brand.”

The plan also includes a public gathering space that’s part plaza, part park and could include a water-front walkway. The project will be adjacent to the watershed restoration project and the River-to-River Greenway trail.

Retail could be part of the plan, but the retail market has been more challenging.

Timeline

The purchase agreement goes before the Economic Development Authority (EDA) on Monday. The closing date is December 15, but Burkett expects to have a preliminary agreement with a developer in the next 30 days. Then the city would work out details of a development agreement by October or November. If all goes according to plan, the developer could effectively buy the site directly from Hy-Vee.

Specific site plans wouldn’t come until spring 2023 at the very earliest.

If a deal with a developer falls through, the city could back out of the purchase agreement with Hy-Vee before the closing date. But more than likely the Council would want to go ahead and buy the site to control development.

August 8, 2022 Update: Council Approval

West St. Paul City Council approved the purchase agreement, with several comments from members explaining why housing is necessary and expressing excitement for the project.

“This is good indication of a different approach to development,” said Council Member John Justen. “Instead of waiting for things to come in and getting what we get, this kind of proactive development by the city will leave a legacy.”

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