Whitney Hotel selling heirlooms

Sarah McKenzie
Staff reporter

Developers planning to build condominiums in the former Whitney Hotel in Minneapolis are organizing an auction to sell the hotel's heirloom pieces, including antique cappuccino makers and marble-top dressers.

Whitney Partners LLC, a development group led by Ned Abdul, owner of Minneapolis-based Swervo Development, plan to rehab the former 96-room riverside hotel to make way for 40 to 60 new condo units, said Michael Roess, a Coldwell Banker Burnet real estate broker working on the $30 million project.

Soderholm Commission Co. of Maple Plain is holding the auction for the hotel pieces, which Roess said are estimated to be worth $200,000 to $400,000.

Other items to be auctioned off include furniture, two grand pianos, bar stools, catering equipment and wine racks.

Whitney Partners took on ownership of the old hotel earlier this year after a previous developer, Chicago-based Standard Mills Ltd. failed to pay off a debt on the hotel.

The Whitney Hotel at 150 Portland Ave. is 125 years old.

The developers plan to start marketing the condos within the next few weeks. Prices are expected to range between $300,000 and $4.5 million for a 4,000-square-foot penthouse.

The architect on the project is Minneapolis-based Tanek Inc.

Swervo Development is behind several other condo conversions in downtown Minneapolis, including The Lenox, the American Trio Lofts, and the Sexton building in Elliot Park. In the Warehouse District, Swervo repositioned the Architectural Antiques building at 607 Washington Ave. N. for high-end lofts.

Edina's Southdale area seeks 21st-century look

David Peterson, Star Tribune
February 10, 2005

Tonight, nearly a half-century after Southdale became the first shopping mall of its kind, the city of Edina will introduce a series of plans aimed at transforming the nearby complex of disconnected strip malls and big-box stores into a true town center, with ponds, walking paths and a circulating transit system.

And with a new owner expected to be arriving in town, Southdale itself could well get similar renewal.

These plans could push the city into the national forefront of efforts to sculpt a new suburbia for the 21st century, according to a Washington, D.C.-based development expert.

"A lot of upscale communities are talking in these terms and a few are starting construction, but not that many have been completed yet," said Michael Beyard, senior resident fellow with the Urban Land Institute, which is based in Washington. "Edina could find itself out in front of the charge."

The area is between the Crosstown Hwy. 62 and Interstate Hwy. 494, and includes the neighborhoods bordering France and York Avenues S.

City officials are reacting cautiously to the plans, devised by a consulting firm hired by Edina and Hennepin County. And some elements, such as higher-density housing, are bound to attract opposition. But some residents say they welcome any attempt at re-engineering.

"A few people who live around here will walk to Cub or Southdale," said Jack Pastor, a retiree, but most "are like me: They live one block away from Southdale but take the car because of [the imposingly wide and congested] 66th Street. Even with traffic lights, some of these crossings are treacherous because people gun for the lights. It's not unusual on France for people to drive 50, even 60 miles per hour. Many times I push the limit a bit myself, and people fly by me."

Shoppers coming from farther afield would be encouraged to park in ramps being proposed for the edges of the area and walk or take some form of transit to stores. Gradually the whole area would evolve from stores sitting behind vast parking lots to storefronts bordering sidewalks, trails and green space.

While the dream is appealing, an executive of a major commercial real estate firm cautioned that there also is business reality to face.

"That Southdale stretch, if it were developed today, would look a lot different, no question," said John J. Johannson, senior vice president of Welsh Companies, which owns big parcels nearby. "But if we are talking about changing uses dramatically, it sounds like nice master planning but prohibitively expensive. It would take a tremendous contribution from the city, or something. That area is so strong -- such strong sales, such high demand. I don't mind higher design and architecture, but it sounds a bit challenging."

Leaders of the consulting firm, Hoisington Koegler Group Inc., of Minneapolis, told civic leaders Jan. 29 that the idea wasn't for the city to order the changes but to offer a "guide for private investment" that fulfills public objectives. Meeting participants said there was praise for many of the ideas but also concern about whether such major surgery might work or backfire.

Planners discussed major changes, including converting the Centennial Lakes theater complex into a hotel, converting Yorktown Mall into housing and open space, transforming a Target store so it faces the opposite direction, and potentially running a greenway through the toney Galleria mall that would connect with the Southdale site north across 69th Street.

Asked whether the time scale is likely figured in decades, not years, Mark Koegler, of Hoisington Koegler, said: "Absolutely. But incrementally, the goal is to begin next year, if we can."

Southdale itself, which opened in 1956, made suburban history as the nation's first fully enclosed, climate-controlled shopping center. In an era in which fewer and fewer enclosed malls are being built, however, the new concept moves in the opposite direction.

Cherry Creek North, the Denver project to which Southdale-area planners point as a model, boasts that it's more or less the anti-mall. "Instead of escalators and food courts," potential customers are told, "you'll be surrounded by fresh air and nature, not to mention some of Denver's finest and most unique establishments."

That presumably would be a sales pitch of a reinvented Southdale aiming to compete with the Mall of America and other shopping destinations. New features being proposed for the mall include a gigantic water park and a light-rail connection. Planning documents suggest that Edina is concerned about its competitive position.

The future of Southdale itself has often been questioned in recent years, not least when reports surfaced last month of its likely sale to a Virginia real estate investment trust known for redeveloping prominent malls.

The Mills Corp. would be the perfect partner for a city wishing to transform the whole area, Beyard said.

"They are probably among [the] most sophisticated shopping center developers in the world at this point," he said.

Beyard said he understands the concern in Edina over forcing shoppers outdoors in a northern climate, but he said creative planning could convert a negative into a plus.

"A lot of people love winter," he said. "Design beautiful lighting, skating, snow sculpture, and you could make it a more compelling environment than indoors and much oriented to local lifestyles. Mills can help there: They understand all that."

Despite an annual record, sales of new homes stall

Martin Crutsinger, Associated Press
February 1, 2005 ECONOMY0201

WASHINGTON, D.C. -- Sales of new homes rose to an all-time high in 2004, the fourth straight annual record. But activity in December barely budged after a big drop the previous month, suggesting that the nation's red-hot housing market finally might be cooling.

The Commerce Department reported that sales of new single-family homes climbed 8.9 percent for all of 2004 to a record high of 1.18 million, up from 1.09 million in 2003.

But sales rose a less-than-expected 0.1 percent in December after having fallen 13.1 percent in November.

Sales of both new homes and previously owned homes have set records for the past four years as home buyers have enjoyed the lowest mortgage rates in their working lifetimes, making housing one of the standout performers for the economy.

"We have had a tremendous success story in housing," said David Seiders, chief economist at the National Association of Home Builders.

For 2004, median new-home prices rose 12.3 percent to $218,900, from $195,000 in 2003. The median is the midpoint where half the homes sell for more and half for less.

Seiders predicted the price increase would be a slower 5 percent in 2005, but he said he did not see evidence of a bubble in the housing market similar to the stock market bubble of 2000 that saw a huge run-up in prices reverse dramatically.

In other economic news, the Commerce Department reported that Americans' personal income, boosted by a large dividend payment from computer giant Microsoft Corp., rose by a record 3.7 percent in December. That helped boost consumer spending by a solid 0.8 percent during the holiday season.

The government said the increase in incomes would have been 0.6 percent without the one-time dividend of $3 per share Microsoft made last month.

While it is unusual for a dividend payment from a single company to have such an impact, Microsoft is one of the most widely held stocks. The size of the payment -- $32 billion -- rivaled the $38 billion in federal income tax rebates in summer 2001.