The Minnesota Vikings are backing away from an agreement to buy four blocks near the Metrodome from the Star Tribune, newspaper officials announced late this morning.
The Vikings cited a turbulent credit market for causing them to re-evaluate their plans, according to Star Tribune Publisher Par Ridder.
Lester Bagley, vice president of public affairs for the Vikings, said “following our due diligence with Avista regarding the Star Tribune property acquisition, we decided not to proceed with the terms of the contract.”
He attributed the fall-through to the dramatic change in the credit markets since the deal was reached.
“We’re still committed to advancing a Minneapolis stadium solution and advancing a broader economic development package that will benefit the entire state,” Bagley said.
The Vikings had agreed in June to pay a reported $45 million for the land, which includes several blocks of ground-level parking and the newspaper’s 25-year-old Freeman Building, the newer of its two downtown buildings. The package had been valued at $21.5 million, according to Hennepin County records.
The Vikings had been angling for a new stadium on the downtown blocks, with a project coast soaring toward $1 billion. Owner Zygi Wilf bought three downtown parking lots in May for $5 million and had been negotiating to buy the underground ramp between the Star Tribune and the Metrodome — under the light rail station — for a reported $14.5 million. That ramp is owned by the city of Minneapolis.
Wilf’s efforts to buy the downtown land had been seen as key to further development in the east reaches of downtown Minneapolis and critical to his expected plea for money from the Legislature to help build a new stadium.
Both the Vikings and the Twins are committed to play in the Metrodome through 2009.
The newspaper will continue to consolidate its operations into its main building at 425 Portland Av. and close the Freeman Building, Ridder indicated in a news release. Ridder also stated that the newspaper’s parent company, Avista Capital Partners, will continue to work with real estate advisers to determine a next step.
STAFF REPORT
