The future of the $1.5 million unfinished River View Condos complex in downtown remains unknown, as developer David McNally transferred the property’s deed to a bank last week.
Construction on the 16-unit development at 2 Washington St. in Winona began in fall 2010 but remains far from complete, said Winona County assessor Steve Hacken. McNally transferred the deed to River Bank in La Crosse last week, along with the deed for a nearby four-building complex that housed the longtime lumber company he shuttered last summer.
McNally and River Bank CEO and president Brian Voelker both declined to comment Monday on why the transfer was made or whether the property will be put back on the market.
The condo development represented a significant investment in residential development on the Mississippi River, which other cities to the north, including Lake City, have encouraged with significant success—and which have brought controversy over footprint, views, and other issues. The city created a special mixed-used zoning district a few years ago, amid working on McNally’s permit, to encourage his and others’ downtown retail and commercial developments. McNally worked with the city for years on rezoning and other issues to secure the ability to launch the project, and regularly expressed optimism about its success.
But sales were poor for the 16 units, which started at $229,000 and were offered with the possibility of custom designs. In 2011 the estimated value of the condominiums was about $4.5 million, a figure that has since dropped by two-thirds.
Winona city manager Judy Bodway said she plans to meet with River Bank representatives to discuss its plans for the property.
“We certainly believe it’s an important piece of the downtown area,” Bodway said. “We don’t want to see that building left empty.”
Mayor Mark Peterson said he hopes a buyer will step in and finish the project. He said the space could perhaps provide an alternative location for some businesses, like AmericInn, that will be required to move when construction begins on Winona’s new two-lane interstate bridge.
“I try to be optimistic that something positive is going to happen there,” Peterson said.
Residential developments alongside the Mississippi River in Winona are rare, according to Jonelle Moore, a broker/owner at Coldwell Banker in Winona. Moore said River View Condos’ proximity to the industrial properties that have historically occupied the majority of the city’s riverfront real estate may have been connected to its slow development.
“I think the fact that it wasn’t residential around it might have had something to do with the fact that it didn’t take off real fast,” Moore said.
Moore said strict building codes and parking issues create some the obstacles developers face in building condominiums or other high-density retail projects downtown.
Bodway said city sees value in those types of developments and will continue to encourage them.
“I think it’s important to have housing in the downtown area, because it brings 24-hour usage to the area,” Bodway said. “You have people there all the time.”