MINNEAPOLIS — The redevelopment of the historic Dayton's building faces more uncertainty after a judge appointed an outside "receiver" to oversee and manage the property, according to court documents filed last month.
After operating as a department store for more than a century, the building on Nicollet Mall was sold in 2017 to New York-based 601W Companies, which spearheaded an endeavor known as "The Dayton's Project" that opened in 2021. Now, court records reveal that a lender has accused the current owner of missing mortgage payments, leading the judge to select Minnesota-based Lighthouse Management Group as the receiver for the building.
Lighthouse Management declined to comment, but according to court documents, the company has the authority to "collect, control, manage, conserve and protect" the property and even "market the Receivership Property for sale" with approval by a court.
Despite financial challenges from the developer, the former Dayton's building -- which connects to the IDS Tower through the Skyway -- is not completely empty. On this weekday Thursday, there was a considerable amount of foot traffic inside the property from downtown office workers, as they made their way through the Skyway system at lunch hour. Some notable tenants in the Dayton's building currently include Ernst and Young and the new Gray Fox Coffee.
"The receivership is in some ways a technicality of ownership. The challenge for this building is the date it opened, right as the pandemic was happening," said Adam Duininck, the president and CEO of the Minneapolis Downtown Council. "There's a misconception that it's empty or that it's in worse financial shape than it is."
Duininck said at least a half-dozen new tenants have moved into the building over the past few years, and that leasing activity continues.
"Our hope is that whoever is in ownership is invested in the community and cares about Nicollet Avenue," he said.
The Dayton's Project website also still includes plans for chef Andrew Zimmern's 45,000-square-foot food hall, which have yet to materialize. However, through a spokesperson, Zimmern said he still wants to pursue the project.
"We are on hold with our piece of this project," he said. "My partners and I look forward to delivering a world class food hall, just like the one we operate in Atlanta, to the city of Minneapolis as quickly as the building's ownership and management structure stabilizes."
Jamal Britt, who happened to stroll past the Dayton's building on Thursday during a visit to downtown Minneapolis, said he hopes the building can recapture its former glory.
"I remember coming here as a kid, going through the Christmas tales, through the Christmas stores, getting cookies and seeing Santa Claus," Britt said. "Another retail store, or shopping or a couple of restaurants -- anything would be nice. Any added attraction would be nice."
