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Saint Marys area prepares for dramatic change

March 28, 2017 GMT

While the majority of Rochester’s Destination Medical Center Development District is downtown, one subdistrict stretches west along Second Street to encompass Saint Marys Hospital.

The Saint Marys Place subdistrict brings Mayo Clinic’s historic hospital within the boundaries of the 20-year, $6.5 billion project to re-cast Rochester into an international health care destination.

Saint Marys has always been a key piece of the Mayo Clinic/Rochester landscape, with thousands of hospital employees, patients and visitors in the area every day and round the clock.

In recent years, older properties have been demolished to make room for new hotels and other improvements. Now with a boost from DMC, that process is positioned to rapidly pick up speed.

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The largest private DMC project currently in the works is the $115 million, 13-story Alatus development on Second Street Southwest and between 14th and 15th avenues, just west of the Mary Brigh entrance to Saint Marys. The project, which developer Bob Lux has described as a “legacy project” for the city, will feature 347 apartments and townhouses, plus about 21,000 square feet of commercial retail space.

Demolition of the The Brentwood on 2nd hotel and the Ray-Mar Motel on that corner is expected to kick off construction this spring, and the mixed-use project is slated to be completed by the end of 2018.

The DMC Corp. board recently extended the boundary of Saint Marys Place to include all of the Alatus project site, for which the city has approved $10.5 million in tax increment financing.

Described by the Twin Cities developers as a “beacon” to welcome visitors at the west entry to the Saint Marys and Second Street corridor, the project will mark a major change for the mostly residential Folwell neighborhood. Some Folwell residents, including Mark Bransford and Kevin Lund, opposed the project during the city review process, saying the height and scale of the complex, and its 540-space parking ramp, will have a dramatic and negative impact on the area.

Hotel project scuttled

While the Alatus project had speed bumps on its road to city approval, it was nothing compared to the mountain trail that a St. Cloud developer climbed with his proposed $63 million Holiday Inn complex.

After months of contentious meetings in late 2015 and early 2016, Larry Brutger withdrew plans for the hotel project across from Saint Marys on Second Street Southwest at 13th Avenue. The proposal was for a 225-room Holiday Inn on what’s now a half-block parking lot, plus additional space occupied by an adjacent retail building.

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The project would have included 31 extended-stay suites, town homes on the First Street side, a 320-space parking garage, 2,000 square feet of retail space and potentially a pedestrian tunnel from Saint Marys to properties on the north side of Second Street -- a long-time city goal.

While some Kutzky Park resisdents opposed the project, the developer said it was the “lack of support” from the DMC Economic Development Agency that led him to pull the plug.

“In the end, the reason I canceled the project is that I did not feel there was any support from the EDA and that the EDA really does not have any true process in place,” Brutger told the Post Bulletin via email. “I first met with the EDA and city staff on Aug. 13, 2015. When (Rochester City Council President) Randy Staver brought our project in front of the DMC Corp. board four months later, the majority of board members had not even heard of our project.”

Major hospital expansion

At the heart of the DMC subdistrict is, of course, Saint Marys Hospital, and Mayo Clinic has plenty of development plans of its own. This month, it announced a $217 million, five-year “domino effect” of expansion and renovation projects on the hospital campus.

The elaborate proposal includes adding three floors to the Generose Building, moving and upgrading the cardiac surgery facilities and expanding the Neonatal Intensive Care and Pediatric Intensive Care units.

While it may be awhile until construction cranes appear, some work to build out existing empty “shell space” within the hospital is expected to begin within a few months.

Much of this initiative is about modernizing the historic Saint Marys campus and finding creative ways to “expand” within the landlocked space. The most visually dramatic piece of the multiyear project is building three more floors on top of the five-story, 24-year-old Generose Building.

Adding three floors will add 150,000 square feet to the building. About half of that space is expected to house Mayo Clinic’s consolidated Physical Medicine and Rehabilitation Hospital, currently based in the hospital’s Mary Brigh Building.

The use of the other half of the new floors has not been decided yet, though it may be used to expand the current Generose mental health services.

Moving Physical Medicine and Rehabilitation into Generose will be the first time a department outside of the behavioral and psychiatric areas has been based there. Dr. Robert Cima, medical director of Mayo’s Hospital Operations, said the Generose Hospital will not change, but the building is expected to become “multi-use” going forward.

“The reality of what we’re looking at here with the Saint Marys campus is that we’re somewhat surrounded,” he said. “We have to make better use of the land we have, and that means going up.”