From Twin Cities Pioneer Press, Friday 07/13/2012
By Frederick Melo
Dominium Development took a “significant step” forward in its plans to convert two Schmidt Brewery buildings in St. Paul into affordable housing for artists, according to an attorney for the company.
This week, the St. Paul City Council approved the authorization of $69.3 million in “conduit” bonds, which will help pay the lion’s share of the $100 million project.
“When they’re all ready to go, (planning director) Cecile (Bedor) has the go-ahead to sign them,” said council member Dave Thune, chair of the city’s Housing and Redevelopment Authority. The council vote was Wednesday, July 11.
The tax-exempt bonds are sold by the city on behalf of Dominium, which will bear the financial burden of repaying them.
West Seventh Street brewery became the seventh-largest brewer in the nation after Prohibition, and has since housed a lumberyard, gas stations and, more recently, an ethanol plant, but hasn’t churned out anything but well water since mid-2004.
Dominium plans to take over 8 of the brewery’s 15 acres and turn the vacant Bottle House and Brew House at 882 W. Seventh St. into 248 lower-rent housing units for artists. The buildings have been vacant for about a decade. The company also plans to construct 13 townhomes on vacant land next door.
Initial financing agreements are in place with private investors, and John Nolde, an attorney representing the company, predicts financing will close in mid- to late August. Construction could begin some 30 days later.
The city has committed $2.8 million from a proposed tax-increment financing district, which will effectively recycle property taxes from the site back into the development. Another $1.5 million Community Development Block Grant loan will be payable over 35 years, at a 1 percent interest rate, with interest and principal deferred for 15 years.
Dominium also will receive affordable-housing tax credits and state and federal historic tax credits.
The West 7th/Fort Road Federation bought the site’s Rathskeller office building last year, the keg-and-case storage building and several adjoining lots with $1.89 million in no-interest city loans.
The federation hopes to clean up the site and draw commercial tenants. It has retained a broker to put a bug in the ear of restaurant owners, office businesses and others, but Thune said the federation wait for Dominium to finish most of its construction before moving new tenants in.