Developer Ari Parritz has asked the city of St. Paul for $3.5 million in financial assistance to establish a six-story, mixed-use building at the northeast corner of Grand Avenue and Victoria Street, the current site of the Victoria Crossing East Mall and the former Billy’s on Grand restaurant and bar.
Parritz on Friday said the requested assistance would be structured as a “redevelopment TIF district.” Tax increment finance districts allow property tax proceeds from a real estate development to be used on site for a number of years, funding certain types of environmental or public-facing improvements.
“It’s being used primarily for blight remediation and other qualified redevelopment costs,” Parritz said. “The city already did their third-party blight study and it came back substandard on all three buildings. Everything we’ve heard from the city council is supportive of redevelopment here, and an appropriate use of redevelopment TIF. It meets all the statutory requirements.”
The largely residential project, under the applicant name 845 Grand LLC, would include 12,800 square feet of commercial and restaurant space on the ground level facing Grand Avenue, 90 market-rate apartments and one level of underground parking. The parking would span 23 public parking stalls and 99 residential parking stalls.
Replacing Billy’s on Grand, adjacent mall
The new structure would run about a half-block from 841 to 857 Grand Ave., replacing the longstanding home of Billy’s on Grand, which closed permanently in January, as well as the mall that houses the Juut Salon, Paper Source and the now-shuttered Trade Winds fashion and accessories boutique. It also would replace a vacant residential building.
“Juut is coming back into the project,” said Parritz, noting the beauty salon has found a temporary new home nearby. “They’re going to enter the central retail space in our building, targeted to summer 2027.”
For St. Paul, TIF has become an increasingly common — albeit controversial — funding tool to boost private real estate development, as it allows private developers up to 26 years of tax incentives. The city currently captures about 7.9% of its tax capacity for TIF spending.
Meanwhile, the Minnesota Department of Employment and Economic Development announced on Tuesday that it had awarded St. Paul $350,000 for abatement, demolition and public infrastructure improvements at the site. DEED officials noted that the project would increase the city’s tax base by $377,000 and leverage $44.2 million in private investment.
TIF use
A recent analysis from the fiscal watchdog group Insight St. Paul found that St. Paul’s tax levies to service TIF district debt increased 40% from 2015 to 2024, growing from $31.6 million to $44.2 million. While some suburbs also have adopted greater TIF use in recent years, the city of Minneapolis actually decreased its TIF spending by more than 50% during the same period.
City Council President Rebecca Noecker said Friday that at a time when the federal government is cutting funds to municipalities, cities have to dig deep to come up with their own redevelopment strategies for priorities like redevelopment on Grand Avenue.
“I’m supportive,” said Noecker, who represents the area. “It sounds like it’s a project that will bring needed vitality to the neighborhood. (TIF is) a controversial issue, but it’s a really important tool and it needs to be used judiciously. … Those are tax dollars we otherwise wouldn’t have had.”
Related Articles
Closure of Grand Avenue segment ends Tuesday with free community celebration
Dining Diary: Hit these two haunted St. Paul restaurants for spooky season
As The Lexington turns 90, a public celebration and a new chef
Leave a Reply