Base map from Winona County, Schneider Geospatial; illustration by Monica Veraguth
Last week, Fastenal purchased four properties at the 150 block of Huff Street and is interested in acquiring the last remaining parcel from the city of Winona Port Authority. Across the street, the former YMCA is slated for demolition to create parking for Fastenal’s riverfront office, and the Port Authority is in the process of buying the former ProBuild property on Second Street for parking.

Fastenal buys bridge land, seeks city’s piece


(4/28/2021)

by CHRIS ROGERS

 

Fastenal may have secured all the parking its new 400-to-600-employee office building in downtown Winona will need. With a series of downtown land purchases, Fastenal Vice President for Real Estate Dana Johnson said the company will be able to create 600 parking spaces. Fastenal has all but acquired the entire block at 150 Huff Street, which Johnson said might be used for parking. Across the street, contractors are expected to demolish the former YMCA in the near future, clearing the site to be repurposed for parking, according to Fastenal. 

Last week, Fastenal purchased four properties at 150 Huff Street — the vacant block just west of the bridge landing and one block south of the company’s new office — for a combined $198,250. MnDOT offered the properties first to their former owners, a combination of landlords and homeowners, who then resold the parcels to Fastenal. 

“We just want to assemble the block and land,” Johnson said. “And we will develop a civil site design for a surface parking lot, and we’ll choose if and when we want to develop it as that. And like we said before, we have no long-range plans for it.” If there is a community need for the site, or if someone has a great idea for a development there, Johnson said Fastenal would be open to it.

Asked if the deals were driven by a need for more parking overall for the new office, a desire for parking closer to the office building, or something else, Johnson replied, “With my position on the Port Authority board, I’ve always held the position that anyone doing development in Winona should consider doing parking as part of their development plan.” He noted that the new office building will host up to 600 employees and said that between the office, the old Y, and the 150 Huff Street block, “We’ll be able to develop over 600 parking stalls. So I guess I’m just being consistent with what I’ve asked other people to consider.”

Fastenal had purchased the northern half of the 150 Huff Street block in January for $390,500. Fastenal bought the former Y for $950,000 in February, bringing its total spending on downtown land for possible parking to $1.5 million so far.

 

City poised to sell property bought ‘for public purposes’

The last remaining property on the 150 Huff Street block is owned by the city of Winona Port Authority. Johnson said Fastenal would seek to buy the last parcel from the city, and Winona Economic Development Director Lucy McMartin confirmed on Friday that the city had received a letter of interest from Fastenal. She said the city would “absolutely” be open to selling it. Selling the land would require a public hearing and vote by the Port Authority Commission.

Johnson is a long-time member of the Port Authority Commission, the City Council-appointed governing body for the city’s economic development branch. As a city official, Johnson has been involved in many of the Port Authority’s discussions of downtown land buys in and around Fastenal properties, but he abstained from a vote to purchase the 150 Huff Street property. 

The city itself just bought this property from MnDOT for $30,000. The deal closed in late March following a January vote by city officials. “I think we’ve got to buy it,” Port Authority Commission President Mike Cichanowski said at the time. “It helps us control that block.” Asked if the purchase was part of a plan to work with Fastenal, McMartin told the Post in January, “We haven’t discussed anything in great detail, just in general that with 400 employees, parking in the area is one of the things they’re working on,” she said. “We’re just at the stage … where we’re just trying to assemble the land.” 

Because the former owner had passed away, MnDOT offered the property to the city “for public purposes” without putting it up for sale on the open market. Normally, MnDOT land must be sold to the highest bidder. Under state law, MnDOT may give local governments this exclusive option to buy land only if it is used “for public purposes.” The law doesn’t define the allowable uses, but a MnDOT policy manual suggests “transit, park, other.” In an interview, MnDOT Office of Land Management Engineering Specialist Loren Irwin said, “It could be parking. It could be drainage. It could be parks. It could be economic, as well.”

In January and February, city and MnDOT officials went back and forth on whether private development would satisfy the “public purpose” requirement, with MnDOT staff seeming to say it would be OK at one point and later indicating legal action would be needed to remove the requirement. McMartin asked MnDOT to take the requirement out.

“Can you remove the deed restriction ‘public purpose’? Can public purpose be parking?” McMartin asked Irwin in a January 11 email obtained through a public information request. She asked whether selling the land for a private development or whether leasing parking to a private development would count as public purpose. “Can we license the parking for a large development project?” McMartin wrote. She added, “Also is economic development considered a public purpose? Of course we see value in that it increases the tax base and often provides jobs for the public good.”

Irwin replied on January 11, “Yes … We have not ever had any issues. It is how the city determine[s] what is best for your city. If sold for less than fair market value, it would revert back to the state.”

In an interview last Friday, McMartin said, “I remember talking to [Irwin] on the phone and talking to him about parking for a larger economic development project, and he said that they’ve never had a problem with that, that parking to help spur development is considered a public purpose.”

By contrast, Irwin said in a Tuesday interview that MnDOT attorneys advised McMartin that, to sell the land for private development, the city might need to petition a court to remove the public purpose restriction in the property’s deed. That court process is called a quiet title. “I’m not an attorney, so I referred the community development [department] to our attorney, and then … they said if they were going to use it for too much of an economic purpose, they would need to quiet title it,” Irwin told the Post.

That matches a February 2 email in which Irwin told McMartin, “As per our phone conversation, the city would need to do a quiet title action to remove the statement, ‘The above described tract of land and the title thereto shall revert and vest in the state of Minnesota whenever said tract of land ceases for the stated public purposes’ from the title.” McMartin forwarded this email to Johnson the same day.

Asked on Tuesday about MnDOT’s version of events, McMartin reiterated the message she got from the state was that it was up to “how the city determine[s] what is best for your city.” She noted that the deed itself does not include any mention that the land must be used for a public purpose. However, the deed does reference the state law that establishes that requirement. 

“We will do what we need to do if we need to do some sort of action, [or] if we need to do a resolution to state what our public purpose is,” McMartin said. “It’s a piece of land that nobody else was going to buy, and we had an opportunity to buy it, and the port thought it could be parking.”

Chris@winonapost.com

 

Winona Post Reporter Zach Kayser contributed to this report.

 

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