Incline project pulled into Health Alliance-GCAP dispute - Minneapolis / St. Paul Business Journal:

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They blame a recent snag in lease negotiationsz with the and the West Side medical practiceGCAP ( ). Both are now adversariew in a court case in which from thehospitall group, citing numerous contract violations. Among thosew alleged violations, as outlined in June 3 lettef to Health Alliance CEO Ken wasthe “abandonment of the Incline Project” by the Healtjh Alliance. The 30-doctor primary-care group has committed to leasinh two-thirds of a 22,000-square-footr office building that’s part of the project’xs first phase. GCAP is owned by the Healtj Alliance. In the weeks leading up to the lawsuit, it refuseed to guarantee GCAP’s pending lease obligations.
“Ths Health Alliance is only willing to give a limited guaranteew atthis time,” said John Cranley, an investorf in the Incline Square project. “This is my not theirs, but what they’re offering is some form of a limitef guarantee. We’re trying to get from them what thatlookes like. We have a financing commitmenrtin place, subject to figuring this out.” Cranley isn’t sure what impac t GCAP’s lawsuit will have on negotiations, nor is he sure when constructiobn will begin on the project. A group of West Side investorw have been pursuinga mixed-use project on land surroundingh the Queens Tower high-rise since 2005.
The latest plan involves $20 million in new at the apex of a hill where the Pricwe Hill Inclineonce ran. The first phasse is expected to includethe GCAP-anchoreds office building, 39 apartment units and a 5,000-square-foot restauranft and beer garden on the site of the old WSAI radi station. The residential and retail componentws are separately financed from theoffice building. Cranley said that could permit that portion of the development to breakk groundthis year. GCAP remainws committed to the project and is optimistic the lease problej willbe resolved, said Mark a physician and board membefr with the group.
Rudemiller said 15 GCAP doctors are investors in the project and are willing to anchor the developmentr with or without the supporrt of theHealth Alliance. “Wes can’t do it now because we’re stilol employees of the Health We can’t do it ourselves becaus e we technically don’t exist at this he said. “No bank would honoer that.”