Developer Plans $150M Grindstone River Plaza

The project is supposed to include seven retail zones (including an outlet mall), a hotel with indoor and outdoor water park and a smaller mixed-use portion along the Grindstone River. The project will have up to 60 stores with three large anchors, says Jerry Schultz with the development corporation, but he says his firm is starting small. The first phase will only consist of two retail strips of about 15,000 sf total, as well as some fast-food restaurants and a convenience store. "With the economy the way it is, we're not going to jump in with both feet," he tells GlobeSt.com. "It's tough right now, but you're starting to see some movement. It was slow from May through July, everybody was just sitting on what they have. Only in the past month and a half have we started to hear businesses talk about expanding again."

He says the property should have good demand from all the casino customers. "We get four million cars going by the place each year, and the area is also on the direct route for vacationers for both northwestern Wisconsin and northeastern Minnesota," Schultz says.

Final negotiations are going on right now for the hotel, an "international firm," Schultz says. He also says the 15,000 sf is about 50% occupied, and has hired Diehl and Partners LLC to lease the retail portion and sell out-lots at a rate of $16 per sf. "We're also talking with a major sporting goods store as an anchor," one of three planned big-box stores, Schultz says. Also, he's not going to build the outlet mall portion, and is in talks with companies such as Chelsea Premium Outlets, the division of Simon Property Group that also runs the Albertville Premium Outlets about an hour to the south, closer to Minneapolis.

The project will also include multifamily in the back of the project. "We'll have about a dozen apartments, and 15-20 condos," he says.

The development will probably take until 2012 to finish, he says, right about the time that a high-speed rail line is supposed to be finished between the Twin Cities and Duluth. The line, an extension of the Twin Cities to Chicago line, will stop right near the Grindstone center, Schultz says. "We're working with the railroad alliance on this," he says.