1103 4th St SE, LLC, a Minnesota limited liability company, Relator,

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A21-0684

1103 4th St SE, LLC, a Minnesota limited liability company,
Relator,

vs.

City of Minneapolis, a Minnesota municipal corporation,
Respondent.

Filed April 4, 2022
Affirmed
Smith, John, Judge*

City of Minneapolis

Stuart T. Alger, Faegre Drinker Biddle & Reath LLP, Minneapolis, Minnesota (for relator)

James R. Rowader, Jr., Minneapolis City Attorney, Mark Enslin, Assistant City Attorney,
Minneapolis, Minnesota (for respondent)

Considered and decided by Connolly, Presiding Judge; Cochran , Judge; and Smith,
John, Judge.
NONPRECEDENTIAL OPINION
SMITH, JOHN, Judge
We affirm the City of Minneapolis’s decision to designate three properties owned
by relator as “historic” because the designations were not arbitrary, capricious, or
unsupported by substantial evidence.

* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
2
FACTS
The three properties (the homes) at issue in this case were built in 1901 in
Minneapolis’s Marcy-Holmes neighborhood. The homes were designed for Mary Lochren
by master architect William M. Kenyon, who also designed three other homes on
neighboring parcels although they are not part of this litigation. Relator bought these three
homes, seeking to demolish them and construct a 65-unit apartment building.
In February 2019, relator submitted a preliminary land-use application to respondent
City of Minneapolis. The city’s planning staff reviewed the application and requested that
relator apply for historical review of the homes because the homes may qualify for historic
preservation. Relator engaged a development consultation firm which produced a
determination of eligibility study on the homes in June 2019. The study suggested that the
homes met the historic preservation criteria as “a small group of speculatively-built houses
designed by Kenyon.” Relator then submitted a demolition-of-historic-resource application
for the homes.
The Minneapolis Department of Community Planning and Economic Development
(CPED), however, also conducted a study and concluded that the homes were not eligible
for historic preservation. The CPED study recommended that the city approve relator’s
application.
Two weeks after the CPED study was issued, the Minneapolis Heritage Preservation
Commission (HPC) denied relator’s application “[n]otwithstanding staff recommendation”
to approve it. The HPC concluded that demolition was not appropriate because there were
“reasonable alternatives to demolition”; “[d]emolition is not required to correct an unsafe
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condition”; and the homes’ relationship to each other might merit designating them as an
example of century- old “non-high style residence[s] designed by William Kenyon.” The
HPC established interim protection of the homes and directed community planning staff to
prepare a historical designation study.
Relator appealed the HPC’s decision to deny its application to the Minneapolis City
Council. The council approved the HPC’s decision to deny relator’s application and the
Mayor of Minneapolis endorsed the council’s approval.
Seven months later, the Minneapolis City Planner submitted the historical
designation study to the State Historic Preservation Office (SHPO) for comment. The
historical designation study extensively analyzed the history of the homes and
neighborhood. It recommended that the city designate the three homes as a historic district,
concluding that they met historical preservation criteria. The SHPO reviewed the study and
concurred that the homes are “a good candidate for local designation” under three historical
preservation criteria.
In March 2021, the HPC held a public meeting on whether the homes should be
approved as a historic district. At the meeting, HPC received several letters from
community groups, the historical designation study, a report from the city planner
recommending approval, as well as commentary from relator, his attorney, two community
groups, and several members of the public. The committee voted to approve the historic
district designation of the homes and in April 2021, the city council approved designating
the homes as the “Mary Lochren Student Rooming Homes Historic District.”
Relator appeals the designation on a petition for a writ of certiorari to this court.
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DECISION
Relator challenges the city’s designation of the homes as a historic district.
As a threshold issue, the parties disagree on this court’s standard of review of the
city’s historical preservation designation. Relator argues that this court must determine
whether the denial was arbitrary, capricious, and unsupported by substantial evidence. The
city argues that this court should use a reasonableness standard of review. We conclude
that under either proposed standard, the city’s designation was both reasonable and neither
arbitrary, capricious, nor unsupported by substantial evidence.
The parties agree that the city’s historical preservation designation is a quasi-judicial
determination. When a municipality conducts a quasi-judicial proceeding before rendering
its decision, this court determines whether the municipality’s decision was unreasonable,
arbitrary, or capricious. See Handicraft Block Ltd. P’ship v. City of Minneapolis, 611
N.W.2d 16, 20 (Minn. 2000) (“[T]he three indicia of quasi-judicial actions can be
summarized as follows: (1) investigation into a disputed claim and weighing of evidentiary
facts; (2) application of those facts to a prescribed standard; and (3) a binding decision
regarding the disputed claim.” (citation omitted)); see also Big Lake Ass’n v. St. Louis Cnty.
Plan. Comm’n, 761 N.W.2d 487, 491 (Minn. 2009). When an appellate court reviews a
quasi-judicial decision, separation of powers principles impose a deferential standard of
review. Big Lake Ass’n, 761 N.W.2d at 491.
On certiorari review, this court reviews the evidence “only to determine whether it
supports the findings of fact or the conclusions of law, and whether the municipality’ s
decision was arbitrary or capricious.” In re Application of Dakota Telecomm. Grp., 590
5
N.W.2d 644, 646 (Minn. App. 1999). This court exercises judicial restraint to avoid
substituting its judgment for that of an administrative body. In re Excess Surplus Status of
Blue Cross & Blue Shield of Minn., 624 N.W.2d 264, 277 (Minn. 2001). Decisions of
administrative bodies are reviewed for “substantial evidence.” Tischer v. Hous. &
Redevelopment Auth. of Cambridge, 693 N.W.2d 426, 431 (Minn. 2005).
“The functions of factfinding, resolving conflicts in the testimony, and determining
the weight to be given to it and the inferences to be drawn therefrom rest with the
administrative board.” Quinn Distrib. Co. Inc. v. Quast Transfer, Inc., 181 N.W.2d 696,
700 (Minn. 1970) (quotation omitted). Without manifest injustice, inferences drawn from
the evidence by an administrative body must be accepted by a reviewing court “even
though it may appear that contrary inferences would be better supported or that the
reviewing court would be inclined to reach a different result were it the trier of fact.” Ellis
v. Minneapolis Comm’n on Civ. Rts., 295 N.W.2d 523, 525 (Minn. 1980). When an
administrative body contemporaneously states reasons for its decision, the burden is on the
challenger to show that the decision was unreasonable, arbitrary, or capricious. Billy
Graham Evangelistic Ass’n v. City of Minneapolis, 667 N.W.2d 117, 123 (Minn. 2003). A
city’s historical designation is unreasonable, arbitrary, or capricious only if the city
(1) relies on factors not intended by the ordinance; (2) entirely fails to consider an
important aspect of the issue; (3) offers an explanation that conflicts with the evidence; or
(4) it is so implausible that it could not be explained as a difference in view or the result of
the city’s expertise. Rostamkhani v. City of St. Paul, 645 N.W.2d 479, 484 (Minn. App.
2002).
6
The HPC’s planning director reviews all applications for building demolitions to
determine whether the property is a “historic resource.” Minneapolis, Minn., Code of
Ordinances (MCO) § 599.460 (201 4). A “historic resource” is a property that has
“historical, cultural, architectural, archaeological or engineering significance” and meets
one of the historical designation criteria. MCO § 599.110 (20 21). If the HPC concludes
that a property is a historic resource, it must deny the demolition permit and direct the
planning director to prepare a historical designation study, unless the applicant shows that
demolition is necessary to correct an unsafe condition on the property or there are no
reasonable alternatives to demolition. MCO § 599.480 (2016).
The historical designation study then evaluates seven criteria to determine whether
a property should be designated a historic district:
(1) The property is associated with significant events or with
periods that exemplify broad patterns of cultural, political,
economic or social history.
(2) The property is associated with the lives of significant
persons or groups.
(3) The property contains or is associated with distinctive
elements of city or neighborhood identity.
(4) The property embodies the distinctive characteristics of an
architectural or engineering type or style, or method of
construction.
(5) The property exemplifies a landscape design or
development pattern distinguished by innovation, rarity,
uniqueness or quality of design or detail.
(6) The property exemplifies works of master builders,
engineers, designers, artists, craftsmen or architects.
(7) The property has yielded, or may be likely to yield,
information important in prehistory or history.
MCO § 599.210 (2009).
7
Once the historical designation study is published and the SHPO reviews and
comments on it, the HPC must hold a public hearing to consider the proposed designation.
MCO § 599.270 (2014). The HPC will then make findings and a recommendation on the
designation, which it submits to the city council for approval. MCO §§ 599.280- .290
(2014).
In this case, the HPC denied relator’s application to demolish the three homes,
determining that the properties are historic resources and that relator failed to show that
demolition was necessary or that no reasonable alternatives to demolition exist. The HPC
ordered a historical designation study to be prepared. The resulting study extensively
analyzed the history of the homes and the neighborhood and recommended designating the
homes as a historic district. In making its recommendation, the study reviewed relator’s
application materials, the development consultation firm’s eligibility study, newspaper
archives, Minneapolis city directories, Minneapolis permit indexes and records, historical
maps, and prior nearby historical district surveys. The study also discussed the homes’
historical significance, describing Kenyon and his architectural impact, the Lochren
family, the development of the University of Minnesota and surrounding student rooming
homes, and Dinkytown’s neighborhood identity.
The study then explained its rationale for the proposed historical designation,
referencing the seven criteria from section 599.210 and concluding that the homes meet
three criteria: (1) the homes are “among the best identified grouping of dwellings that retain
their original architectural identity and historic integrity”; (2) the homes “are significant
for neighborhood identity as collectively among the best examples of late nineteenth and
8
early twentieth century dwellings that have served as student rooming homes”; and (3) the
homes “are among the best examples of a collection of dwellings that retain cohesive
identity to communicate Kenyon’s skill” as a master architect. MCO § 599.210, subds. 1,
3, 6.
Relator argues, however, that the city’s decision was arbitrary and capricious
because it did not apply the historical designation criteria to three other properties designed
by Kenyon that are on parcels neighboring the homes. While relator is correct that
“[d]isparate treatment of two similarly situated property owners may be an indication that
the local government is acting unreasonably or arbitrarily,” Billy Graham, 667 N.W.2d at
126, here, only relator submitted a demolition application and thus only relator’s homes
were subject to a historical designation evaluation based on the seven criteria. The city did
not treat the two Kenyon-home owners differently because it only needed to consider
relator’s application in its historical designation decision.
For that reason, we are unpersuaded by relator’s argument that Northwestern
College v. City of Arden Hills, 281 N.W.2d 865 (Minn. 1979), supports its position. That
case is inapposite. There, Northwestern sought a special-use permit to build a fine arts
center on its campus, which the city council denied. Id. at 866- 67. Bethel, a similarly
situated private college, also applied for a special-use permit to build an addition to its fine
arts center, which the city council approved. Id. at 867. The city council did not provide
reasons for treating these two colleges’ applications differently. Id. at 869. The supreme
court held the city’s disparate treatment of the colleges was arbitrary and capricious. Id. at
868. Here, on the other hand, the city considered only whether relator’s homes were subject
9
to historical designation because relator’s application was the only one it received. The city
need not evaluate all homes designed by Kenyon if there are no applications triggering the
historical designation evaluation process and the property owners are not on notice of the
potential historical designation of their homes. We therefore conclude that the city’s
decision was not arbitrary and capricious.
Relator next challenges the city’s determination that the homes meet historical
designation criteria 1, 3, and 6. We address each challenge in turn.
We group criteria 1 and 3 together, as the parties do. The historical designation study
found that the homes met criteria 1 and 3 because the homes are linked to significant events
exemplifying broad patterns of cultural or social history and distinctive elements of
neighborhood identity. The study found that the homes are
among the best identified grouping of dwellings that retain
their original architectural identity and historic integrity to
fully communicate their significance as late nineteenth to early
twentieth century student rooming homes— a type and use of
building emblematic of residential Dinkytown and the
University of Minnesota area. The collection and location of
the dwellings and their shared development and residential
history is strongly tied to the growth of the University of
Minnesota and Dinkytown in the beginning of the twentieth
century. The dwellings have retained their historic use as
student rooming homes for over 100 years.

. . . .

The properties retain original Kenyon- designed
architectural detail, use and location which directly associate
them to the residential identity of Dinkytown, a recognizable
and storied sub -section of the Marcy-Holmes neighborhood.
The properties do not retain identity solely representative of
the city of Minneapolis.

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Relator argues that the designation of the homes as emblematic of Dinkytown is
unsupported by substantial evidence because “Dinkytown is an unofficial neighborhood
with no clearly defined boundaries.” Relator contends that the city’s failure to define
Dinkytown’s boundaries shows that “there is no substantial basis to identify” the homes as
“emblematic of the Dinkytown residential district.” We disagree. The historical
designation study extensively detailed the history of Dinkytown, its relationship to the
University of Minnesota, and explained how the neighborhood exemplified student
housing in the area. The study found that the homes were two blocks from the four- block
heart of Dinkytown and further that “[s]tudent rooming homes have been historically most
synonymous with this area of the City and remain as a residential type of building more
ubiquitous and recognized in the area including and surrounding Dinkytown than other
areas of Minneapolis.” While it may be true that there is no clear boundary defining
Dinkytown, the city’s reliance on historical records supports its determination. We
conclude that the city’s determination is therefore supported by substantial evidence.
Relator also argues that the city’s reasoning is arbitrary and capricious because there
is no “independent basis for identification of the period of significance—late 19th Century
and early 20th Century student rooming homes.” The argument is unpersuasive. The study
explained that the concept of student homes was not fully actualized until 1900. The
University of Minnesota did not construct a dormitory until 1910 and from 1900 to 1910
student enrollment increased by more than 65%. The study then detailed the homes’
tenants, which included individual students as early as 1902, and later, a fraternity and a
sorority. The study also specifically identified the period of significance as 1901 -1944.
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During that time the homes were owned by Mary Lochren in her individual capacity. The
study noted that it was unusual for a woman to be the owner of property and that women’s
roles in property ownership have long been underrepresented in locally designated
properties. Thus, Mary Lochren’s ownership of the homes, the homes’ novel use as student
rooming homes, and the homes’ student occupants provide the basis for the period of
significance. And in any event, the city’s decision is neither arbitrary nor capricious
because it is based on the ordinance’s factors. We turn next to criteria 6.
The study concluded that the homes met criteria 6 because they are among the best
examples of a collection of homes retaining “cohesive identity” and exemplify Kenyon’s
work as a master architect. Relator argues that there is no evidence that the homes are the
“best examples of Kenyon’s architectural palette,” pointing out that the study determined
the homes were “more modest and practical interpretations” of Kenyon’s work. It contends
that, because there are other Kenyon buildings that have been previously identified as
historic resources, without a comparative analysis to these other properties, there is no basis
to conclude that the homes are the best examples of Kenyon’s work.
But the study examined other Kenyon homes in Dinkytown, Mount Curve, and
Lowry Hill. The study then stated why the homes were different than Kenyon’s other work.
It explained that “[i]t was unusual for Kenyon to construct neighboring properties that were
directly adjacent” like the homes. It then stated that “there is no current record of an
occurrence like this for Kenyon anywhere else in the city where six properties were
completed within the span of five years in one location, let alone for a single owner, by the
same builder.” And, it explained, all the Kenyon buildings previously historically
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designated by the city were different. None had the “more modest, common scale” that the
homes exhibit. The study found, and the record supports, that the homes are unique given
their historic use, location, and grouping as neighboring properties. The study’s conclusion
is bolstered by relator’s eligibility study, which also found that the homes met the historic
preservation criteria as “a small group of speculatively-built houses designed by Kenyon.”
The city’s decision is supported by substantial evidence and is neither arbitrary nor
capricious.
Relator’s final claim is that the city’s decision is arbitrary and capricious because it
overlooked whether the homes’ historic designation is compatible with the city’s
comprehensive plan under MCO § 599.260 (2001).
Under MCO, the City Planning Commission must consider these factors:
(1) The relationship of the proposed designation to the city’ s
comprehensive plan.
(2) The effect of the proposed designation on the surrounding
area.
(3) The consistency of the proposed designation with
applicable development plans or development objectives
adopted by the city council.
MCO § 599.260.
The designation study examines all three factors and its examination spans three full
pages. The study determined that the proposed designation would comply with three
policies from the Minneapolis 2040 plan. It examined the effect of the proposed
designation on Dinkytown, concluding that preserving the homes “will serve as an example
of high-quality housing preservation through sustainable practices” and that the
designation will preserve a valuable piece of Dinkytown’s residential history. And finally,
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it concluded that the proposed designation would align with the Marcy-Holmes
Neighborhood Master Plan completed in 2014.
Relator contends the study’s consideration of the first factor was inadequate because
the only policies it identified in the Minneapolis 2040 Plan related to preservation. Relator
argues that by focusing on preservation, the city ignored “other important 2040 Plan
policies.” Although the city did not explicitly consider the policies that relator points to,
the record reflects that the city did consider the relationship between the propo sed
designation and the city’s comprehensive plan. Because the city need not consider all the
policies within the comprehensive plan, and the record supports that the city considered
some policies, the city’s decision is not arbitrary or capricious.
Relator also argues that the study ’s consideration of the second factor improperly
concluded that the designation will positively affect Dinkytown. It argues this was an error
because the buildings require significant renovations to maintain suitable use. It contends
that preserving “poor- quality housing” neither benefits the neighborhood nor honors
Dinkytown’s history and character. The study, however, determined that the homes exhibit
good integrity to the original Kenyon designs for the buildings. Relator’s eligibility study
corroborates this determination similarly finding that, although the homes’ exteriors have
somewhat deteriorated, the exteriors each retain fair to good integrity. Because the city is
in the best position to weigh the evidence and the record reflects that the homes’ exteriors
retain good integrity and show historic architectural styles, the city’s decision is not
arbitrary and capricious. See Quast Transfer, Inc., 181 N.W.2d at 700.
14
For these reasons, we conclude that the decision to deny relator’s application for
demolition was reasonable, supported by substantial evidence, and neither arbitrary nor
capricious.
Affirmed.