Cloquet Council condemns Solem Hotel building – Cloquet Pine Journal

CLOQUET — In an effort to breathe new life into downtown Cloquet, the city council voted 5-0 Tuesday, April 19, to condemn the Solem Hotel property at 915 Cloquet Ave.

By condemning the building, officials started the process for the city to acquire the building through eminent domain,

according to council documents.

“It still could have historic value if it’s renovated, so the city’s plan is to take the property and turn it over to a developer to renovate the building and turn it into some usable business space downtown to help revitalize that section of the downtown,” city attorney Bill Helwig said.

Officials have been in talks with the owner of the building since February, with the hope they could negotiate an agreement for the city to purchase the building.

The property, formerly the site of Pedro’s Grill and Cantina, has fallen into disrepair, with bricks falling from the second story of its facade, holes in its roof and damage to its interior walls, Helwig said.

“If you look at those photos of the interior structure — the basement, the second floor — it’s amazing a business was operating out of it,” Helwig said.

City representatives offered the building’s owner, Felipe A. Mata, $8,000 to purchase the property. The initial offer was based on the appraised value of the property, Helwig said.

Mata, who owned the building with the late Carlos G. Villareal, rejected the offer flat-out, Helwig said, and countered, asking the city for the market value listed on the property’s tax statement of $192,800. Villareal’s estate did not respond to the city’s offers, according to council documents.

Officials declined that offer and countered with an offer of $50,000, which Mata rejected, sticking with his initial counter-offer of $192,800.

The city denied the proposed amount for a second time, and offered $75,000 for the property. Mata declined that offer, as well, and did not make a counter-offer, documents showed.

The market value of the building was based on the property’s value when Pedro’s was located there, Helwig said. Without a business, the building’s value is drastically lower and officials would not allow another business to move into the property in its current state, Peterson said.

The city held a public hearing on the matter in March.

Officials received one public comment via email, which supported the city’s efforts to acquire the building.

Once the city initiates the condemnation process, Mata can fight the property valuation, Helwig said.

Helwig laid out that process for the council:

• The property owner can get the property appraised.
• If that appraisal puts the property’s value more than 40% higher than the city’s last best offer and a court sides with the property owner, the city would have to pay the amount determined by the court, Helwig said.
• The city would also have to cover Mata’s legal fees, Helwig said.

“In this case, I don’t see how our appraisal could be disputed for that amount if you look at the photos and read the descriptions and the appraisal,” Helwig said.

Officials had two choices, Peterson said: to let the property owner care for the property as he sees fit or to take action. He said city staff recommend the council condemns the building.

“The only way we can ensure something positive happens with this building is if the city moves forward with condemnation, if we are able to find a new private developer to take a look at this building and hopefully invest some of their funds and try to make a go of this building yet again,” Peterson said.

Ward 3 Councilor Chris Swanson asked if there was any indication the owner would fix the holes in the roof or make other repairs.

Rather than repair the building, Helwig said the owner told officials in one of his refusals that he would demolish it. However, Peterson said, “a demolition permit requires all owners of the building to sign on to the demolition permit, and the second person wouldn’t be a signer to the permit … in which case the building would just sit.”

All councilors present voted in favor of the measure, with Ward 2 Councilor Sheila Lamb absent.

Helwig said officials would file the condemnation petition this week and move forward from there. The process could take three to four months.