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Construction is at least three years away, but a local developer is leading an effort to amass 80 acres between Spirit Mountain and the St. Louis River for a housing/lodging/retail complex. (Clint Austin / caustin@duluthnews.com)

Developers eye 80 acres below Spirit Mountain

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A major development project is taking shape at the base of Spirit Mountain.

Developer Brad Johnson said he is in line to acquire about 75 of the 80 acres he hopes to amass for a project that could cater to tourists, homebuyers, shoppers, diners and maybe even office workers. Located in Duluth's Riverside neighborhood and dubbed the Village at Spirit Lake, the mixed-use development would include access both to the slopes and to the banks of the St. Louis River.

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But don't expect action any time soon. Johnson said construction probably won't begin for at least three years.

And building won't be cheap. Johnson estimates he and his investors have spent about $1 million to acquire land as part of a concerted four-year effort. He said installing roads, utilities and trails in the area will require an additional $3 million to $6 million. Final construction costs could run another

$10 million to $100 million.

A daunting task, but Johnson has a track record of development success in Duluth, having been a co-developer of the Ramsey Village Townhomes, in addition to working on several development projects in Chanhassen, Minn.

He's also partnered with a group of investors to form the Spirit Valley Land Company, which includes Mark and Keith Youngren and Pete Lukovsky, who own land in the area; and Dave Goldberg, a hotelier and manufactured home entrepreneur who donated $1 million to the Heritage Sports Center and has had the Boys and Girls Club there named after him.

Assuming the economy continues to strengthen, Johnson predicts the Village at Spirit Lake could be fully developed in 10 years.

He envisions ski-in/ski-out vacation homes and possibly a lodge on the part of the development bordering Spirit Mountain.

"We can only hope it comes to fruition," said Kris Ridgewell, executive director of the Spirit Valley Citizens and Neighborhood Development Association, of the project.

Renee Mattson, executive director of the Spirit Mountain Recreation Area, said the development, as described to her, would fit well with Spirit Mountain's long-range plans to build a chalet at the base of the slopes, giving people a new access point.

"We always hoped our plans would spur other development," she said.

Spirit Mountain's chalet plans, along with the new development, could bring fresh money into the neighborhood, said Jay Fosle, who represents Riverside on the City Council.

He said he believes Proctor profits more from Spirit Mountain than western Duluth.

"We really don't have details yet, but I think it will be a boon for the neighborhood," Fosle said.

The Duluth City Council approved selling a section of the old Duluth, Winnipeg and Pacific Railroad corridor to developers for $67,000 Monday night. When redeveloped, the abandoned rail line will accommodate a roadway, as well as a neighboring recreational trail that will be built at the developer's expense. The three-quarter mile trail road and path will hook into Gogebic Street.

The trail must be built in conjunction with the access road, said Brian Hanson, executive director of the Duluth Economic Development Authority. If the developer fails to build a trail on the rail corridor within 10 years of acquiring it, Hanson said it will revert to city ownership.

City Councilor Dan Hartman said the old rail line already is a rugged yet popular mountain bike route.

"As someone who uses the trails a lot, I have a real issue with the idea that the existing trail won't be used as it is today," he said. "It's hard to see something that beautiful go away."

Ultimately, however, Hartman voted in support of the land sale, like all other councilors at Monday's meeting. "I had to balance my personal selfish desire to keep the area as it is with what's best for the city," he said.

Johnson plans to build on the network of trails that already run through the area, including the Munger Trail, the Superior Hiking Trail and the Western Waterfront Trail.

Hanson praised the development as a way to increase the city's tax base and possibly sales tax revenues, as well.

To support the project, the Duluth City Council also voted Monday to return to the state another 14 acres as part of a complicated transfer. The state gave this property to the city in 1973 with the understanding that it would be used "exclusively for park and recreation purposes in connection with the proposed Spirit Mountain Ski and Recreation Area." Although the land has been deemed unneeded, the city can't unload it directly.

Plans call for the state to take over the land in question and then hand it over to the Duluth Housing and Redevelopment Authority, which in turn would sell it to the Spirit Valley Land Co.

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