The City of Minneapolis can provide important funding to support economic development and expanded health, wellness, equity, and opportunity through fitness, water safety, education, and economic impact in the Near North neighborhood with support for the V3 Sports Center. Located at 701 Plymouth Ave N, the V3 Sports Center is a 120,000 square foot, $90 million, multi-phased development with a 50-meter pool, a 25-meter training pool, running/walking and biking space, and a wellness-related retail/cafeteria and community gathering space. The owner and developer, the non-profit V3 Sports, Inc. is in the process of constructing the multi-phased facility that will bring new opportunities for youth-supporting programming, job training, and community amenities.

Project Details

The construction of the facility will occur in multiple phases over the next few years, with phase 1 of the project expected to open in second quarter of 2024. In support of the multi-phased $90 million project, the City will provide a $1 million forgivable loan to support components of the project. These costs address:

• the community café and associated job training program,
• investments into traffic controls and other infrastructure around the site,
• construction costs of yet-to-be-contracted phases,
• furnishings fixtures and equipment, and
• other related costs.

The loan would re-allocate $1 million from CPED’s General Fund budget, previously allocated to the Commercial Property Development Fund (CPDF), into the Great Street Program to fund this loan.

Timeline

V3 Sports, Inc. has $23 million in debt and equity commitments to date.  Phase 1 of the project is underway. The proposed City loan will fund components of this phase that are not-yet contracted this spring. Phase 1 is scheduled to open by mid-2024. Phase 1 includes a 25-meter instructional pool, drop in childcare, fitness and out-of-school space, café, hydro-therapy pool, and community gathering space. Phase 2, which includes the 50-meter pool, would begin after fundraising for that phase is complete.

Loan Terms

For this action, staff is requesting Council approval of a $1,000,000 Great Streets Gap Financing Loan to V3 Sports, Inc. for this project. The recommended terms of the loan are as follows:

• 20-year term

• 0% interest
• No scheduled payments
• Repayment of full principal balance due if one of the following events occurs:
  • The property is sold or transferred to an unrelated entity without City consent; or
  • The use of the property changes, without City consent, to something other than a community sports center.
• No debt forgiveness during term. At the end of the term principal balance forgiven if the borrower meets the following conditions:
  • there are no material changes in use of property;
  • there are no issues with delinquent taxes;
  • there are no unresolved City zoning and property maintenance violations;
  • there are no other defaults on the loan.
• Waiver of the 1% administrative fee
• The Great Streets loan will be documented by a separate loan agreement, evidenced by a promissory note and secured by a recorded subordinate mortgage on the property
• Business Subsidy Agreement/Living Wage Ordinance: V3 Sports, Inc. is a nonprofit business entity with less than 100 employees that provides health and social services to low-income and at-risk populations and is therefore exempt from the State Business Subsidy Act, City Living Wage Ordinance and Job Linkage requirements.