An architectural rendering of the proposed stadium and plaza project on the former Dico Inc. site at 200 S.W. 16th St. in Des Moines. Rendering special to the Business Record

Backers of a proposal to build a professional soccer stadium complex on a contaminated site near the Raccoon River have expanded their vision to include redeveloping the surrounding area with hotels, housing, commercial spaces and entertainment districts.

Pro Iowa, a campaign to bring profession soccer to Iowa, along with the real estate arm of Krause Group and the city of Des Moines, plan to use sales and hotel-motel taxes generated from the Iowa Reinvestment Act to help pay for the $535 million project that would include 29 separate projects.

The centerpiece of the ambitious redevelopment plan would be construction of a professional soccer stadium that would be located on six acres at the former Dico Inc. site at 200 S.W. 16th St. In 1983, the site was added to the Environmental Protection Agency’s Superfund list. Immediately surrounding the proposed stadium would be what’s being called the Global Plaza, parking for about 500 vehicles, a hotel and additional soccer fields as well as access to the Raccoon River.

“On this activated plaza space is where we see new spaces for our heritage festivals - it’s where we can build an environment that would be a new home for those events that happen in our community every year,” said Danny Heggen, development manager for Krause+, Krause Group’s development arm.

Pro Iowa and Krause+ are expected to provide additional details of their proposed project during a Des Moines City Council workshop on Monday morning. The proposal and a development agreement with Krause+ are also expected to be discussed at Monday’s council meeting.

Last fall, Krause Group offered to partner with Des Moines to redevelop the former Dico.site, where dilapidated buildings have been a magnet for graffiti. Des Moines city officials last year announced plans to take ownership of the site, located east of the Raccoon River and south of Martin Luther King Jr. Parkway.

Pro Iowa, Krause+ and the city of Des Moines plan to seek funding through the Iowa Reinvestment Act. If approved, the city would create an estimated 65-acre reinvestment district that would allow a portion of new sales and hotel-motel taxes growth to be captured and reinvested back into the area.

“This is a crucial part of the funding for this project,” said Scott Sanders, Des Moines’ city manager.

Redevelopment of the former Dico site is important to the city, Sanders said.

“You have, from the city’s perspective, a Dico site that is transformed from one of the most negative parcels in the city to one of the most positive sites with this redevelopment,” he said. “It becomes a destination as opposed to, frankly, an embarrassment.”

In addition, redevelopment would spark additional economic activity, he said.

“There’s going to be quite an opportunity to translate that investment into other economic benefits,” Sanders said.

The reinvestment district would also include properties owned by Minneapolis-based developer Sherman Associates located south of ML King Parkway.

Krause+ is also seeking a development agreement with the city for properties it owns in the Western Gateway and near Tuttle Street south of Martin Luther King Jr. Parkway. Heggen said Krause+ envisions constructing a 1,200-space parking garage on land it owns near the 1300 block of Tuttle.

The Krause Group in recent years has expanded its real estate holdings in the Western Gateway, an area in downtown Des Moines that is generally west of 10th Street and between Grand Avenue and M.L. King Parkway. The group is considering developing up to 500 housing units in the Western Gateway as well as building a hotel and retail and other commercial spaces, Heggen said.

Heggen said he expects 16th Street, which stretches from Ingeroll Avenue south to ML King Parkway to be redeveloped and become a connection between the stadium and neighborhoods to the north including the Sherman Hill area.

“We are thinking that as this whole area comes together into the vibrant area that it will be a catalyst for people to want to stay or live here,” he said. “This area can become where people can live, where they eat, where they play, where they work. They can walk or bike to work. It becomes a hub of connectivity.”

Before any of the proposed redevelopments become reality, funding is needed.

The proposed redevelopment Dico and Western Gateway redevelopment project will likely have stiff competition from other proposed, high-profile Iowa projects. For example, backers of a 350-seat multipurpose arena at Merle Hay Mall 
also plan to apply for the Iowa Reinvestment Act program.

“Both projects are competitive on their own merits,” Josh Mandelbaum, Des Moines city councilman said. “Ultimately it’s going to be something the Iowa Economic Development Authority will have to look at. I think both are worthy projects.”

Heggen estimated it would take up to 10 years to redevelop the 65-acre area. The proposed soccer stadium, however, would be the first project undertaken.

So far, Pro Iowa has raised $13.7 million in private donations for the development of the soccer stadium, the group said in a news release.
 
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What is the Iowa Reinvestment Act?
The Iowa Reinvestment Act program, overseen by Iowa Economic Development, allows cities to create special districts where money from sales and hotel-motel taxes can be set aside to help pay for projects that spur economic development. In place since 2013, the reinvestment act has provided key financing to several high-profile Iowa projects, including the $101 million convention hotel in downtown Des Moines.
- Kathy A. Bolten