Hotel Online 
News for the Hospitality Executive

advertisement 
 
A $40 million Kimpton Hotel Proposed as Part of Expansion
 at Mall of America in Bloomington, Minnesota

By Scott Carlson and Nicole Garrison-Sprenger, Pioneer Press, St. Paul, Minn.McClatchy-Tribune Business News

Nov. 28, 2006 - The Mall of America, the nation's largest retail-entertainment complex, appears close to getting a big shot in the arm.

Just how big, though, depends on getting public financing, a request that will test how valuable a draw the complex is in the eyes of lawmakers.

A 6,000-seat performing arts auditorium, another roller coaster, an outdoor-sporting goods store the size of two Targets, and a hotel will be among the additions to the Mall of America's current complex and its $1 billion-plus expansion, officials for the Bloomington megamall said Monday.

With a long-simmering ownership battle over, the mall now is poised to proceed with some of these initiatives regardless of whether it gets tax assistance. The proposed expansion -- called Phase II -- could add up to 5.6 million square feet to the existing center, officials said.

Plans include a $40 million Kimpton hotel, upgrades to the mall's seven-acre indoor amusement park and the opening of a 13,000 square-foot Mexican restaurant.

An expansion with all the trimmings, however, will require new tax-increment financial assistance for construction of parking ramps and other infrastructure.

"The public funding package is essential for the Mall of America expansion," said Bill Griffith, an attorney for the mall.

Griffith didn't outline how much tax assistance the mall is looking for. It could face some tough sledding. A similar proposal failed to gain traction during the last legislative session. He estimated that groundbreaking for Phase II might begin next summer with completion of the full project 36 to 38 months later.

Until earlier this month, the mall's ownership had been in gridlock for several years, a scenario that mall officials claim thwarted efforts to move ahead with the expansion plans. That legal spat also has delayed what industry experts contended has been a much-needed rejuvenation of the existing mall, whose once-bustling fourth- floor entertainment wing has gone largely vacant and its indoor amusement park has been left without a marketing theme since losing the Camp Snoopy name this year.

Whatever happens to the mall's bid for new tax assistance, its bevy of prospective new tenants said they want to be part of the growing complex because of its national visibility and that it's a strong tourist draw. MOA officials estimate their center draws 40 million visitors annually.

A EG Worldwide of Los Angeles said it would partner with mall ownership group Triple Five to build the performing arts auditorium in Phase II, aiming to host music and dance performances. AEG owns the Los Angeles Kings, a hockey team, and a piece of the L.A. Lakers. The group operates similar facilities in Dallas and Las Vegas where artists such as Elton John and Dolly Parton have performed.

AEG didn't disclose the price of its proposed MOA auditorium, but said similar projects have ranged in cost from $50 million to $150 million.

Mall officials also said Bass Pro Shops, a Springfield, Mo.-based outdoor-goods retailer, would lease about 250,000 to 300,000 square feet in Phase II, which just gained approval from the city of Bloomington last week. Construction of Phase II could begin by mid-2007. About 70,000 square feet in the Bass Pro Shop will be devoted to Tracker, Nitro and Tahoe boats built by the Tracker Marine Group.

In addition, San Francisco-based Kimpton Hotels and Restaurants will build a hotel that will be attached to the south side of the mall off of Killebrew Drive. It will be Kimpton's first property in Minnesota.

The hotel will be eight-stories high with 202 rooms that will go for $180 to $250 a night. Construction of the $40 million project, pending city approval, is expected to take 14 to 16 months.

Developers of the Kimpton Hotel said they hope the project is ready in time for the 2008 Republican National convention, to be held in St. Paul.

Bass Pro Shops also is looking to attach a hotel to its planned store, mall officials said.

Mall officials said they would invest $25 million into new rides and attractions at the Park at MOA -- formerly Camp Snoopy -- over the next 18 months. Construction is expected to begin next year on a Gerstlauer Euro-Fighter roller coaster. Gerstlauer is a Germany-based designer and manufacturer of amusement rides. The roller coaster is expected to debut in 2008.

The mall also plans to fill the fourth-floor space once occupied by Fat Tuesday's and Knuckleheads with Cantina No. 1 Corona, the first restaurant branded by Corona beer. The 13,000-square-foot restaurant will feature Mexican food and specialty beers and is targeted to open Cinco de Mayo, 2007.

Two previous plans for enlarging the mall failed to take hold. One envisioned a so-called "hyperport," billed as an international showplace to display new technology. More recently, mall owners floated a casino plan that failed to get the attention of lawmakers.

This month, TIAA-CREF, one of the original owners of MOA, divested its entire stake in the and sold it to an investment group led by Triple Five of Minnesota, officials for the parties said. New York-based TIAA declined to disclose terms of the sale, citing confidentiality agreements. However, the transaction is thought to be worth hundreds of millions of dollars.

Scott Carlson can be reached at scarlson@pioneerpress.com or 651-228-5470.

Nicole Garrison-Sprenger can be reached at ngarrisonsprenger@pioneer press.com or 651-228-5580.

The Mall of America's once-bustling fourth-floor entertainment wing has gone largely vacant and its indoor amusement park has been left without a marketing theme since losing the Camp Snoopy name this year. A long-simmering ownership battle has delayed what industry experts contended has been a much-needed rejuvenation of the mall.

In Business

Fast start: Retailers kicked off the holiday shopping season with a strong start last weekend with one notable exception: Wal-Mart. It disclosed disappointing sales figures.

Skid: Stocks suffer worse day in four months.

-----

Copyright (c) 2006, Pioneer Press, St. Paul, Minn.

Distributed by McClatchy-Tribune Business News. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. NYSE:WMT,


To search Hotel Online data base of News and Trends Go to Hotel.OnlineSearch
Home | Welcome| Hospitality News | Classifieds| One-on-One |
Viewpoint Forum | Ideas&Trends | Press Releases
Please contact Hotel.Onlinewith your comments and suggestions.