The city and a local developer are working on a multi-story residential and retail project that could reshape the face of a Main Avenue block downtown.

The proposal is still in the early stages of planning and design but could include a three- or four-story luxury apartment complex with about 7,000 square feet of retail space and one to two levels of underground parking, Beard Group President and CEO Bill Beard said.

The apartment would be built on property spanning a single-family residence, a city parking lot, the Sebastian Automotive garage and the Veterans of Foreign Wars building and parking lot.

“What we would bring to the community is an alternative for housing that currently doesn’t exist,” Beard said. “I don’t think that there’s been a new market-rate apartment for 20 years, perhaps, that’s been built in the community.”

Through a shuffling of properties among different owners, the plan could also lead to a new building for the Prior Lake Veterans of Foreign Wars post.

Post Quartermaster Ed Speiker said the V.F.W. initially hoped to buy the city’s lot on the corner of Main Avenue and Pleasant Street, just next door to the post’s building, to construct a smoking deck for veterans and patrons. When the city nixed the idea, the plan turned to a new building altogether.

“We need a new V.F.W. in Prior Lake,” Speiker wrote in an email. “We want to make it attractive and efficient to all citizens. A comfortable place to visit with friends.”

If everything comes to fruition, the development would work like this, Speiker and others said: The V.F.W. would sell its building and parking lot properties to the city, which would then sell to Beard. The V.F.W. could then buy the next-door city-owned lot for its new building.

Beard has also bought or is in the process of buying the Sebastian Automotive and another privately owned property on the same block. All of this would leave Beard with one big, continuous piece of land in the end.

The City Council on Monday approved a purchase agreement between the Beard Group and the city’s Economic Development Authority essentially guaranteeing that the city will buy the two privately owned pieces of land if Beard’s development doesn’t happen in the next year or two.

Beard said that the group will begin refining its plans for the development right away but wouldn’t likely be able to break ground until March 2021 at the earliest.

“Prior Lake has been on our radar for an awful long time,” Beard said. “So when there was any kind of interest on their part, we responded right away.”

The V.F.W. building was constructed in the 1930s and was originally home to the Lake Theater. The V.F.W. bought the property and moved into the building in the 1960s.

“The building constantly has repairs,” Speiker said, estimating somewhere between $3,000 and $6,000 is spent each month “just trying to keep the thing together.” The biggest improvement to the building since 1977 was a $100,000 bathroom renovation several years ago.

Speiker said the building also has flooding and sewer issues and needs a new kitchen, bar and accessibility features like elevators.

“It’s time that we do something,” Speiker said.

Speiker said the post’s members weren’t interested in becoming tenants at the new Beard property, so Beard suggested selling their land and building on the city’s lot on the corner of Main and Pleasant.

In April the V.F.W. hosted a special meeting to vote on the idea. The meetings normally host about 20-25 members, but around 60 came, according to Speiker. Nearly all voted in support.

Speiker said the V.F.W. is still in the early stages of its planning, too, but he’s thinking about a two-story building with a bar, new kitchen and event space complete with a sheltered outdoor patio for smoking patrons.

The plan would be to buy the corner from the city, build the new building and then move out when construction is complete. They’d hope to break ground in 2020.

“It needs to be a win-win for the city and for the V.F.W. and for the community,” Speiker told the council Monday. “I think it’s that and more.”

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