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Duluth's repeat effort to redevelop former Kozy Bar property falls flat

The sole proposal to restore the fire-damaged building the city received has been deemed inadequate.

File: Kozy July 2021.jpg
Pastoret Terrace sits behind chain link fence July 26, 2021, in Duluth. A legal battle has been raging since April 2018 over the future of the fire-damaged building that long housed the Kozy Bar and Apartments.
Steve Kuchera / File / Duluth News Tribune
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DULUTH — A recent request for proposals to renovate the Pastoret Terrace and Paul Robeson Ballroom buildings, formerly home to the Kozy Bar & Apartments, generated just one response, and it did not pass muster with the Duluth Economic Development Authority.

On Wednesday, commissioners voted 4-0 to reject that sole proposal from Bedrock-Flint Inc.

"It was deemed to be not viable. It basically didn't include all the elements we had required," said Chris Fleege, director of Duluth's planning and economic development division. He explained that while the Duluth-based masonry business proposed to repair the building's facade, it failed to adequately meet other historic preservation standards.

Since 2018, the city has been locked in a legal battle over what should become of the buildings. The case has pitted DEDA, the current owner of the property, against former owner Eric Ringsred and a group of preservationists called Respect Starts Here. Ringsred lost possession of the buildings after a series of fires dating back to 2010 resulted in their condemnation. Ringsred lacked insurance for the properties, fell behind on taxes and ultimately saw the buildings slip away to tax forfeiture.

Kozy fire
The Kozy Bar & Apartments has remained condemned for human habitation since a fire severely damaged the building late on the night of Nov. 15, 2010
Bob King / File / Duluth News Tribune

The city issued a request for proposals to redevelop the property in 2016 and a second time in 2017 but received just three responses, and none were deemed suitable or viable.

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DEDA then proceeded to move toward demolition of the fire-damaged buildings until a civil suit blocked those plans. Initially, the city prevailed in district court, receiving the go-ahead to tear down the structures. But the Minnesota Court of Appeals overturned that decision, citing the historic value of the buildings and finding the local officials failed to undertake due diligence in considering proposals to rehabilitate the 1887 Oliver Traphagen-designed Pastoret Terrace building.

The court returned the case to Judge Eric Hylden for reconsideration in August 2020 and ordered DEDA to "perform all maintenance and repairs necessary to prevent the property's further deterioration" pending further court proceedings.

In November 2020, yet another fire broke out at the properties and was extinguished.

FILE: Kozy fire 2020
Duluth firefighters battle the Nov. 1, 2020, blaze at Pastoret Terrace, formerly home to the Kozy Bar and Apartments.
Steve Kuchera / File / Duluth News Tribune

As he began to try the case for a second time, Hylden ordered DEDA to brace the Pastoret Terrace's facade to prevent an outward collapse of the structure. But that requirement was made contingent upon the plaintiffs posting a $140,299 bond to cover the cost of the work, so that the city could be reimbursed should it prevail.

The plaintiffs have so far been unable to do so, leaving the buildings essentially in an as-is state.

Fleege explained why the city issued yet another RFP in March of this year, with the case still in progress.

"It was to really evaluate whether there were any viable options for historic renovation," he said.

Pastoret Terrace
Oliver Traphagen designed the six townhouses that made up Pastoret Terrace in the Romanesque Revival style of architecture, which would essentially become his "trademark look" for buildings in Duluth.
Contributed / Duluth Public Library

Fleege said the RFP was publicly posted and directly emailed to more than 700 subscribed developers. The original due date for proposals was April 21, but that deadline was extended for an additional month, to little avail.

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Assistant City Attorney Bob Asleson said he wasn't particularly surprised by the lack of interest in historic redevelopment of the damaged property.

"Obviously, if somebody we hadn't heard from before came forward and said, 'Hey, I've got a great idea and money to pay for it,' we'd have taken it. But, essentially, it was our expectation that no one would," he said. Nevertheless, Asleson suggested the repeat RFPs should help demonstrate to the court the city's continued fruitless efforts to see the buildings historically restored.

Hylden will hear testimony about the state of the buildings July 5 and 6, with a ruling expected later this year.

PREVIOUSLY
The Minnesota Court of Appeals said Eric Ringsred and fellow plaintiffs failed to show why they should not be required to post the security before court-ordered repairs are undertaken.

Peter Passi covers city government for the Duluth News Tribune. He joined the paper in April 2000, initially as a business reporter but has worked a number of beats through the years.
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