Robbinsdale city leaders give preliminary approval to tear down Terrace Theatre for new Hy-Vee store

After 65 years, the Terrace Theatre is on its way to being demolished now that the Robbinsdale City Council has given preliminary approval to redevelopment plans for the site.

It's still not a done deal, but the City Council's unanimous vote Monday moves the controversial project forward. It also shows the city's support for replacing the ­theater and part of an adjacent mall with a Hy-Vee grocery store near a key intersection in the northwest metro suburb.

"This isn't a rubber stamp tonight. … There's a lot of things that we're going to be working on with Hy-Vee," said Mayor Regan Murphy.

The plans to tear down the 1950s-era theater ramped up suddenly last month when developers announced that it could be replaced, along with the north side of the Terrace Mall, by a Hy-Vee store.

Since then the plans have divided city residents, with some eager to have a grocery store return to ­Robbinsdale for the first time in years and others rallying to preserve the local landmark — even vowing to boycott Hy-Vee stores.

"We want to make the theater a destination again," David Leonhardt told the council. "Take your time. This is a very important decision. We should not be rushed into it."

Leonhardt, who heads a preservation group trying to save the theater, asked for a 60-day extension on the vote. But at a packed five-hour meeting Monday, the council unanimously approved the preliminary plat for the redevelopment, as well as other measures.

The plans by St. Louis Park-based Inland Development Partners include a 91,500-square-foot Hy-Vee, a 4,500-square-foot convenience store and coffee shop, gas pumps and a drive-through on the 10-acre site, off 36th Avenue and W. Broadway.

Construction on the project, which could cost as much as $30 million, could start by October, with the store opening in September 2017. It would be the seventh Hy-Vee in the Twin Cities for the growing Des Moines-based chain, and the city's first grocery store since a Rainbow Foods closed on the same site in 2013.

"Redevelopment's not for the faint of heart; it's not easy," Kent Carlson of Inland Development ­Partners told the council, saying that only 24 percent of 149 residents surveyed said they didn't support the development and wanted to save the theater.

"We feel that we have great support. … This has been a challenging site for many folks," he said.

Carlson has said before that the theater has structural problems. The Terrace, which closed in 1999 and is owned by a New York City-based investment group, has no windows left. Doors and seats are gone and the leaky roof is failing.

But Leonhardt and other preservationists say the blight analysis exaggerates the theater's decay and that it's still worth saving. He also said the Hy-Vee would compete with local Robbinsdale businesses.

"We're absolutely going to continue to fight this," he said after Monday's vote.

There are still several steps left before the theater and the wrecking ball meet.

On Aug. 10, city leaders will discuss tax-increment financing for the site. Then on Aug. 23, there will be another public hearing and second reading of Monday's ordinance. And city leaders will still have to vote on final plans and demolition of the building.

Council members said Monday they supported the project because it would revitalize a blighted area and bring economic development.

"I don't expect this to be something that everybody thinks is great," Council Member Dan Rogan said, adding that the council has been working on redevelopment of the site for more than a decade.

"I think that this is a wonderful development in a place that we have not been able to get anything developed."

Kelly Smith • 612-673-4141