Hennepin County judge delays demolition of Terrace Theatre; preservation group must pay $6 million

A Hennepin County judge has extended an order that halts the demolition of the Terrace Theatre in Robbinsdale but also orders a preservation group to come up with $6.3 million by Friday.

Judge Michael Browne made the decision Monday after denying the request from the group, Friends of the Terrace, for a temporary restraining order last week. The group then filed an appeal with the state Court of Appeals and rushed to get an injunction Saturday to halt demolition, which started that day.

Browne's order extends that delay in the demolition while the court process plays out. He required the Friends of the Terrace to post a bond of $2.8 million to the property owner and $3.5 million to the city's Economic Development Authority, which is made up of the City Council, by Friday.

"It's an awful lot," said Brad Nyberg, leader of the preservation group. "Basically we have to buy access to the court to have our appeal heard."

St. Louis Park-based Inland Development Partners wants to redevelop the 1950s theater and half of the adjacent mall into a Hy-Vee grocery store, a convenience store, coffee shop and gas pumps. A Rainbow Foods closed on the same site in 2013.

In court documents, the New York-based theater owner, Brixmor Property Group, said that the theater, which closed in 1999, has water damage, mold and a collapsing ceiling and roof. It estimated that the cost to bring it to code would be about $2.4 million.

The City Council has unanimously supported the redevelopment, saying it will revitalize a blighted 10 acres off 36th Avenue and W. Broadway and create 700 jobs. It would also generate more property taxes — about $418,500 a year, up from $69,000. Friends of the Terrace's attorney Erik Hansen, who fought renovation plans for Peavey Plaza in Minneapolis, said it's the first case he has seen where a city has advocated for the destruction of a historic building.

Both sides dispute whether last Saturday's demolition work was enough to ruin the building. Hansen said an engineer described the damage as limited and repairable. The demolition company said the roof support was severely compromised.