City Council Meeting Date: April 23, 2024
To: Mayor & City Council
From: Ben Martig, City Administrator
Jake Reilly, Community Development Director
Nate Carlson, Economic Development Coordinator
Subject:
TITLE
Public Hearing on Sale of Property Located at 115 5th Street W. Northfield, Minnesota.
BODY
Action Requested:
The Northfield City Council will hold a public hearing on the sale of property at 115 5th Street W. Northfield, MN.
Summary Report:
The City of Northfield acquired key downtown Northfield properties, including the former Northfield News building, for future redevelopment. The sale of the Northfield News site to Loon Liquors is emblematic of the City’s commitment to working with the local business community to create winning scenarios for all involved. The City of Northfield is committed to both helping local businesses expand and attracting new business enterprises to Northfield, as we continue to cultivate an environment that keeps Northfield a community with great appeal for everyone.
As a homegrown entrepreneurial endeavor, Loon Liquors is committed to the Northfield area. From its current location on Armstrong Road, the craft distillery has become a regional economic multiplier through its commitments to partnering with local farmers and other local business enterprises, and supporting tourism in the region. Loon Liquors is a destination distillery that draws people to Northfield for a unique educational and entertaining experience. The purchase of this site will afford the business an expansion opportunity and contribute to the vitality of the downtown business district. The Loon Liquors team’s proposal has significant potential to enhance the already popular tourist destination’s ability to draw more visitors to Downtown Northfield by featuring distillery tours, high-quality alcoholic and non-alcoholic craft beverages, and an expanded food menu that captures farm-to-table dining with 90% of its food and beverage supplies coming from farms located within 10 miles of the establishment.
Loon Liquors has achieved extraordinary success and is looking to expand its impact by moving to a higher profile setting that creates a win for its customers, a win for downtown Northfield and a win for Loon Liquors.
The public hearing will be immediately followed by a proposed action item approving the sale.
Alternative Options:
The City Council can decline to sell the building and direct staff on Council priorities related to current properties owned by the City.
Financial Impacts:
The City purchased this building on June 21, 2022 for $1.2 million. The City split the cost of an appraisal of the building in the first quarter of 2024. The sale price of $960,000 reflects the appraised value of the existing building.
City staff will provide the Council with a plan to recover the remaining initial investment (original purchase price and holding costs) in full through a City and County tax abatement of the new taxable value of the property for a period of time. This is a separate agenda item this meeting.
Tentative Timelines:
Loon Liquors has asked for a 120-day due diligence period with two options to extend closing an additional 30 days. The Purchase Agreement contemplates a closing on or before October 31, 2024.
Loon Liquors will spend the due diligence period finalizing the build out of the space and financing plan.
Loon anticipates a four- to six-month renovation phase with a grand opening to follow shortly after project completion.