Council agrees to sell historic buildings

The Albert Lea City Council approved development agreements at its meeting Oct. 9 for selling the Jacobson Building and the city’s portions of the Freeborn Bank to a local investment group called Century Partners.

The local investment group will pay $1 total for both properties in downtown Albert Lea. If failing to complete the project within a few years, the investment group will need to pay a promissory note of $158,000 – the assessed value of the buildings – to the city.

City Manager Ian Rigg and councilors cited several reasons for agreeing to the terms:

• Developing the two historic buildings would be infeasible without some public assistance.
• The city will no longer be responsible for heating and insuring the buildings.
• The development will increase the local property tax base and create jobs.

Mayor Rich Murray and Councilor Larry Baker both abstained from voting due to ties with the investors. Rigg noted that only staff, not elected officials, negotiated the deal.

The city owns the top two floors of the Freeborn Bank Building at 201 S. Broadway Ave. and the entire Jacobson Building next door at 211 S. Broadway Ave. The two buildings share an entry, lobby, internal stairway and elevator.

The city bought the buildings, which were in severe disrepair, in 1998 to preserve them. In 2006, the city invested $2 million to prepare them for development, including restoration of the bank building exterior, along with a new roof, skylight, and water, sewer and electrical service to the buildings. Extensive work is still needed inside to make the buildings useable.

The city sold part of the bank building – the basement, main level, mezzanine and second floor – to Sobro Properties in 2018. Sobro recently sold its part of the building to Century Partners, enabling Sobro to pay back $740,000 in economic development loans from the city.

To help fund the development, the city council approved Tax Increment Financing up to $111,500 for the project in June 2022.

All agreements are contingent upon Century Partners submitting proper plans and specifications to the city. The investment group hopes to renovate the buildings into restaurant, event and office space. Century Partners leased the buildings several months ago to start reconstruction inside. The development agreement includes preservation of the newly-restored façade of the Jacobson Building. That project is expected to wrap up later this month

For more details, watch the council meeting on YouTube.