The proposed budget for the Target Center renovation project has increased to $128.9 million — about $30 million more than the original term sheet approved by the City Council.
A significant increase in construction costs and other expenses not anticipated in the earlier agreement, including costly upgrades to make the building ADA-compliant, have driven the budget increase, according to city finance staff.
The City Council’s Community Development and Regulatory Services Committee approved the revised term sheet Tuesday. The full Council will vote on it Friday, April 3.
The city’s upfront costs for the project are increasing by $24.5 million under terms of the revised agreement — $74 million compared to $49.5 million originally approved by the City Council on Nov. 12, 2013.
The Timberwolves and the Lynx would pay $49 million and AEG, the building manager, would pay $5.9 million.
Future capital contributions from the city, however, would decrease by $30 million. The city has pledged $20 million for future capital costs at Target Center compared to $50 million originally.
The city has owned the Target Center since 1995. The makeover is designed to make the building more competitive with other entertainment venues in the region and more inviting from the street. Illustrations show a glassy new atrium and entrance at 1st Avenue & 6th Street
The teams and AEG have also agreed to extend their leases through 2035.
Architectural Alliance and Sink Combs Dethlefs are the architects on the renovation project and Mortenson Company is the construction manager.
Pending final approvals, the project is on track to be complete by early 2017.
When the original deal was struck for the project in the fall of 2013, then-Mayor R.T. Rybak called the renovation project a “pragmatic” solution that would lower property taxes and extend the city’s relationship with the basketball teams and AEG.
The city’s contribution for the renovation project comes from a mix of sales taxes that are also tapped to pay off Convention Center debt and help pay for the new Vikings stadium.
City Council Member Lisa Goodman (Ward 7) has called the renovation project an “environmentally friendly” way to reinvest in the sports facility.
“When this building is sitting dark much of downtown is dark, and when this facility is filled, restaurants, businesses, clubs and retail thrive around it,” she said when the original deal was approved. “These small businesses — more than anything else — are the employment base of our city.”
The renovation plan calls for a redesign of the exterior, new gathering and meeting spaces, additional clubs, improvement amenities throughout the arena, increased seating capacity for concerts and shows and improved loading docks.
The Target Center hosts about 200 events a year and attracts more than 1 million visitors from all over the state and Upper Midwest, according to a fact sheet posted at www.targetcenterrenovation.org.
The venue also generates about $16 in state taxes for every $1 the state has invested in Target Center.
The renovation project is also expected to create about 1,100 new construction jobs.
Construction is also nearing completion on new practice facilities for the Timberwolves and Lynx across the street from Target Center in the new Mayo Clinic Square.