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Burnsville Center2021 view of Dick's Sporting Goods and surrounding businesses.
Burnsville Center 2021December 2021 - the majority of the food court remains empty at the Burnsville Center.
Burnsville Center 2021December 2021 - empty space for lease at the Burnsville Center.
Burnsville Center 2021December 2021 - a small indoor golf course is added to the food court area at the Burnsville Center.
Burnsville Center 2021December 2021 holiday display at J.C. Penney.
Burnsville Center 2021December 2021 - for nearly two years the Burnsville Center's Children's play area remains closed dues to Covid restrictions.
Burnsville Center 2021December 2021 - Holiday season displays at Macy's Burnsville Center.
Burnsville Center 2021December 2021 - for nearly two years the children's play area is closed due to covid restrictions.
My Pillow Burnsville CenterMy Pillow at Burnsville Center, Spring 2021.
Burnsville Center 2021Army National Guard located in one of the empty Burnsville Center stores, April 2021.
Burnsville Center 2022Site for Santa at the Burnsville Center 2022.
J C PennyMarch 2023 J C Penny clothing display Burnsville Center.
Burnsville Center Taqueria El Dorado, a long time eating space at Burnsville Center is closed. Photo 2023.
Burnsville CenterMarch 2023 - empty stores, limited foot traffic on a Saturday at the Burnsville Center.
J C PennyMarch 2023 hallway to J C Penny Store, Burnsville Center.
Macy's Burnsville CenterMarch 2023 display at Macy's Burnsville Center.
Burnsville CenterMarch 2023, the Gordman's space at Burnsville Center is empty awaiting redevelopment.
Burnsville CenterMarch, 2023 the former Sears space remains empty.
J C PennyA 2023 display at J C Penny, Burnsville Center.
Burnsville Center entertainmentJoanne Bolles performs at Burnsville Center March 2023.
Burnsville Center entertainmentJoanne Bolles performs at Burnsville Center March 2023.
Burnsville Center entertainmentJoanne Bolles performs at Burnsville Center March 2023.
Burnsville Center,SkaterApolis on second floor of Burnsville Center 2023. Skatepark (Open Sessions), Lessons, Mall Rats Camps and after school programs.
Bikes with plastic pegs and pedals are permitted at SkaterApolis.
Addition slated for Burnsville CenterFebruary 17, 2023 - Burnsville Eagan Sun/Thisweek News

Addition is part of Asian themed food complex...
Burnsville Center 2022Applebee's closes at Burnsville Center 2022.
Burnsville Center 2022Applebee's closes at Burnsville Center 2022.
Council frustration with Burnsville Center boils over 2023March 10, 2023 - Burnsville Eagan Sun/Thisweek News

If a potential buyer emerges, should the city of Burnsville kick some money into the deal to save the ailing Burnsville Center?

The question, posed by Council Member Dan Kealey at a City Council work session Tuesday, was met with some skepticism and no clear answer.

But council members did agree to review economic development tools the city can use to possibly influence the future of the 1.1 million-square-foot mall property. An overview will help citizens understand “what we might do,” said City Manager Gregg Lindberg.

The council discussion drew scathing comments about the mall’s condition and its last two owners, portrayed by some council members as not caring about an economic engine for Burnsville since it opened in 1977.

A clearly frustrated Kealey appeared to be grasping for ways to prevent Burnsville Center from becoming, in his words, another Brookdale Center — the now-demolished mall in Brooklyn Center that gained infamy for its decline.

“I just don’t want to see the Burnsville Center continue to decline anymore than it already has,” Kealey said. “And I’ve been in that mall every month, or every other month, for the last few years, and in conversations with the current owner I advocated very hard for them to clean the carpet, because it was absolutely, unbelievably filthy dirty and getting dirtier month after month, and it just wasn’t getting any attention. It appears in my last visit that might have happened, but there’s stains already being made, new stains on it.”

Mayor Elizabeth Kautz said she walked the mall two months ago, “and it was awful.” The entrance between the former Gordmans and Macy’s space was filled with “pebbles and sand and everything,” Kautz said.

Burnsville Center is a “C-grade mall” that’s unlikely to draw significant investment from “a Simon or Brookfield or Pyramid and any other national, large-scale mall owner,” Kealey said.

But city participation in a public-private partnership could possibly ice a deal, even with a large mall owner, Kealey suggested. There are “lots of examples” nationwide of cities partnering with private owners, “even with (Simon Property Group) with redevelopment types of things.”

The discussion belied mistrust of the current owner, New York-based Kohan Retail Investment Group, which bought about half the mall property for about $17 million after the previous owner filed bankruptcy and the property was put up for auction in October 2020.

“Because I don’t trust the Kohan Group and Felix” Reznick, one of the principals, who has appeared before the council, Kautz said. Aside from dividing some outlots on the north side of the property for sale, the firm has done little to improve it, Kautz said.

Kealey and Council Member Dan Gustafson suggested Kohan may be angling to sell the property. Kohan owns the main mall building and tenant spaces and the outlots. Anchors Macy’s and JCPenney own their spaces and parking, and Seritage Growth Properties owns the former Sears space vacated in 2017 and its parking. Seritage recently put its mall properties up for sale.

Gustafson said he wouldn’t support loaning “tax money” to help buy the mall.

“This particular group (Kohan) is playing Wall Street,” Gustafson said. “They’re splitting that mall up as much as they can and taking as much cash as they can. They’re going to sell the core, and walk away and smile with the profit in their pocket, and I’m not here to bail them out. They jumped into this thing, they take care of it — that’s their job.”

The previous owner, Tennessee-based CBL Properties, was “giving that mall away and couldn’t lease it because they weren’t putting money into it,” Gustafson said.

Kealey characterized his idea of public participation as a city loan to a prospective buyer seeking assistance.

“If the knock on the door comes,” said Kealey, who said he’s heard “a lot of rumors,” “are we as a city going to be prepared to partner with the private sector to save that mall and get our money back in the form of getting paid back and higher property taxes, or are we just going to leave it a C-grade mall that’s been declining for 10-plus years? Are we just going to leave it to the private sector?”

The mall’s value has plummeted from a peak of $135 million, Kealey said.

Kautz said she’d oppose a loan that falls outside the city’s normal channels of economic assistance.

“I can’t put the city in debt to buy taxable bonds to bail out somebody,” she said.

An Asian-themed supermarket and food hall with multiple restaurants planned by Illinios-based Windfall Group for the former Gordmans space “could be a match that lights more development,” said Council Member Vince Workman. “Somebody has to go first. And this could be something that breeds more redevelopment in that mall.”

City has taken steps

The city has taken many steps to encourage redevelopment in the Burnsville Center-County Road 42 retail area. It has rezoned the area for mixed-use development, created a Center Village “vision” and secured tax-increment financing authority from the state Legislature.

Unlike a direct loan, TIF uses funds generated by increased property taxes from improved properties to aid developers or build public infrastructure. Property owners are forgiven from paying the tax increase for a set number of years.

The city also has an Economic Development Authority fund that can be tapped for purposes such as buying and assembling land for sale to developers and demolishing buildings.

But Burnsville has been lax in building its fund and lags far behind competing cities, according to its financial consultant, Ehlers Public Finance Advisors.

The council raised the EDA levy from $297,500 to $1 million for 2023, and city administration has proposed another $880,000 increase over the following three years. The goal is to build the fund to $5 million by the end of 2027, said Chief Financial Officer Jenny Rhode.

Residents frequently ask about the mall, and a “refresher” for council members and residents will be useful, Council Member Cara Schulz said.
Burnsville Center land to be divided up for redevelopment 2021September 17, 2021 - Savage Pacer

Burnsville planners embraced a proposal this week to divide up Burnsville Center's property into new lots that'll be marketed for redevelopment...
Dick's Sporting GoodsOne of the businesses at the Burnsville Center 2021.
Burnsville CenterSeptember 2022, Burnsville Center continues to have empty spaces.
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