Des Moines and Krause Group are back at the negotiating table over a mixed-use soccer stadium district planned for the former Dico Inc. industrial site, just two months after the city walked away from the deal over budget concerns. The Des Moines City Council is scheduled to vote Monday on whether to set a public hearing for a new proposed development agreement, reopening a process that has dragged on for years.
The renewed talks come after the city announced in August that it had ended negotiations with Krause Group, according to Business Record. That breakdown followed seven years of on-and-off discussions between the city and Krause Group dating back to 2019, when talks for the project first began. Des Moines has also reported the story, noting the project may be back on in downtown Des Moines at the former Superfund site, per The Des Moines Register.
Why the City Pulled Out in the First Place
The city formally ended seven years of negotiations with Krause Group on August 26, citing a new state property-tax law that caps revenue growth from property taxes at 2%, according to the City of Des Moines. That law was projected to create a $12 million budget gap for the city in fiscal year 2028, with another $5 million shortfall the following year, leaving officials unwilling to commit further funding to the project at the time.
Even as those talks collapsed, a separate development agreement with the Iowa Soccer Development Foundation remained in place and was unaffected, the city noted in its August statement. The nonprofit has continued its push to bring USL soccer to Des Moines, the city's report on that decision indicates.
What's Different This Time Around
Under the newly discussed terms, Krause+ — the Krause Group's real estate development and property management arm — would purchase a parcel known as the Wabash parcel at market value and lease the Dico parcel, also at market value, the same Business Record report states. The agreement would still rely on city incentives, including direct incentive payments and Tax Increment Financing, but City Manager Scott Sanders said the revised terms would save Des Moines taxpayers more than $20 million in city contributions compared with what was discussed a year earlier.
The project under discussion has included a professional soccer team in the USL league along with a professional women's soccer franchise, environmental remediation of the EPA Superfund site, and a global plaza intended for city festivals, according to the city's August announcement. A feasibility study cited by the project's backers projected the broader Stadium District could generate $8.8 billion in total economic activity over 20 years, per the USL Pro Iowa project.
A Competing Bidder Steps Aside
As part of the renewed process, the council is also weighing whether to approve a competitive process allowing other developers to submit their own proposals for the Dico site, with a deadline of 4:30 p.m. on December 4. If a competing proposal is deemed to warrant further evaluation, it would go before the Urban Design Review Board at a public meeting on December 15, pushing the public hearing on Krause Group's plan back to December 21, the same Business Record reporting shows.
At least one potential challenger has already bowed out: a Hometown Holdings spokesperson said the company would not be submitting a proposal for the Dico site. Meanwhile, the city has been exploring a separate alternative entirely — an MLS NEXT Pro option tied to a team affiliated with Sporting Kansas City, according to Axios, which notes Des Moines now has two different professional-soccer options in play.
Numbers Still Don't Fully Add Up
Reported figures around the project have varied significantly depending on the source and the date of reporting. The Des Moines Register has put a $95 million price tag on the larger, 8,000-seat USL stadium tied to the Krause-backed proposal, while Business Record's August report described plans for an approximately 6,300-seat stadium intended to house a United Soccer League franchise. Broader estimates for the full stadium-and-plaza investment have also ranged, with Business Record's latest report citing a $600 million figure expected to create 2,000 permanent jobs and 6,800 part-time jobs.
Funding totals tied to the Iowa Soccer Development Foundation have likewise differed between outlets, with the Register reporting financial commitments from state, county and city government totaling more than $58 million, a figure not reconciled with other reported totals in the dossier's reporting. Axios has noted that when — or whether — construction will begin remains uncertain, even as the city and Krause Group return to the table.
