Construction commenced Wednesday on MoZaic, a $45 million, 78,000 square-foot office/restaurant/commercial development that has gone through a number of permutations and tribulations since it was first proposed roughly a half-decade ago.
“We think it’s critical for Uptown to have that other bookend, with Calhoun Square on one end and MoZaic on the other,” said Stu Ackerberg, owner of the Ackerberg Group, developer of the MoZaic project.
MoZaic is located in Lowry Hill East on Lagoon Avenue between Hennepin and Fremont avenues, just south of the Midtown Greenway, north of the Lagoon Theater and adjacent to the Uptown Transit Station.
The building will feature 65,000 square feet of Class A office space on the building’s top three floors and a 13,000 square-foot restaurant/commercial space at ground level. At 10 floors, MoZaic is set to become the tallest building in Uptown.
The project also involves the construction of a plaza space at street-level and the installation of a new bike ramp and bridge at the intersection of the Midtown Greenway and Girard Ave.
Floors 2-6 of the building will be a parking ramp with 436 stalls, and a surface parking lot will provide an additional 120 spaces. But the surface parking lot may be around only temporarily, as a future phase of development on the east side of the site could accommodate 100,000 to 150,000 square-feet of additional commercial, residential or mixed-use space and would involve the lot’s removal.
Years ago, plans called for MoZaic to feature a hotel. That idea was scrapped and plans revised to include the construction of a number of condos along with a teardown and reconstruction of the Lagoon Theater. When the condo market tanked, the Ackerberg Group decided to scrap the residential component of the project altogether, and the building now under construction at what will be 1320 Lagoon Ave. reflects construction plans that have remained largely unchanged for two years and will leave the Lagoon Theater intact.
“We were ready to go in 2008 but then the capital markets fell apart and our lender wasn’t able to perform,” Ackerberg said.
“We’re diligent, persistent, and we believe in the site. The reason it’s going up now is because we’re able to put together a financing package that works,” he added.
MoZaic is the first office project initiated without a major tenant already in place in Minneapolis since 2008. With the trajectory of the economy still somewhat unclear, Stu Ackerberg said that his company had to finance the construction of MoZaic’s office space internally.
Ackerberg cautioned against interpreting the commencement of construction as an indication that the market for mixed-use projects like MoZaic is on the upswing.
“This is a unique project,” he said, adding that construction of the parking ramp is funded by $11 million in federal stimulus funds.
“If we wouldn’t have gotten those we couldn’t do the project today,” Ackerberg said.
Despite the risks associated with self-financing the construction of MoZaic’s office floors, the Ackerberg Group is confident that the company’s just-commencing search for tenants will end in success.
“There is demand for the right space in Uptown. Downtown seems to have more vacancy, but there’s a limited supply of (Class A) space in Uptown,” said Thatcher Imboden, development specialist with the Ackerberg Group.
“Based on our experience at other properties, we certainly feel comfortable that we’ll be able to (lease the space),” he said, adding that the offices will be ideal for firms trying to impress clients.
Project renderings indicate that MoZaic’s office space will indeed be impressive.
An Ackerberg press release state that “the floor-to-ceiling glass structure will step back on each floor to create deck space for tenants and add to the building’s architectural impact. Floor plates range from approximately 18,000 to 24,000 square feet and will feature unobstructed views of downtown Minneapolis, Lake Calhoun, Lake of the Isles, and south Minneapolis.”
In the same release, Mayor RT Rybak praises the project, stating that “we’re particularly pleased that MoZaic will bring daytime office workers to Uptown and create an exciting new public plaza and Greenway connection and we can’t wait to see the finished product.”
Ward 10 City Council Member Meg Tuthill echoed Rybak’s praise for MoZaic.
“We need that balance (between daytime jobs and evening-time entertainment), and we’ve lost it. We are building all these condos (in Uptown), but wouldn’t it be wonderful if people could walk to work?” she said.
Carina Ruhlandt, Zoning & Planning Committee Chair for the Lowry Hill East Neighborhood Association, said in an e-mail that the creation of daytime jobs in Uptown is more important to the neighborhood at this point than the construction of more residential units.
“There have been hundreds of units of new housing built in the last decade, and hundreds more are proposed to be built in the near future, so it’s actually a relief to see a development with office space that will provide day-time occupants to the area,” she said.
“This helps other local businesses, such as restaurants, as well as providing the security of having eyes on the street during more hours of the day.”
She also downplayed concerns about the building’s height due to its location south of the Greenway and complimented the Ackerberg Group for being “very communicative throughout the process of designing and re-designing their project.”
After years of false starts and plan revisions, MoZaic is finally under construction, and the building should be completed by January 2012.
Financing was ultimately provided, in part, by MidCountry Bank and through Recovery Zone Facility Bonds issued by the City of Minneapolis. Hennepin County’s Transit Orientated Development funds will assist in the funding of the pedestrian/bike bridge and trail connection to the Midtown Greenway.
“We’re finally moving some dirt, so now it’s real,” Ackerberg said.