6 months after arson at downtown St. Paul hotel, investigation continues amid plans to restart construction

7February 2021

A multimillion-dollar hotel across from the Xcel Energy Center in downtown St. Paul was supposed to open next month, but an arson at the site sent those plans up in flames six months ago.

The case, which came during a busy year for arson investigators in the Twin Cities, remains unsolved.

Developer Carl Kaeding, who plans to start construction on the hotel anew, said he continues to look for answers about why someone would have set the Seven Corners Gateway development project ablaze.

“I wish we knew more, but I’m sure everybody wishes they did,” he said recently. “… I’d like to know what the reasoning for it was, if there was a reason.”

The case is among more than 160 fires in the Twin Cities investigated last year by the federal Bureau of Alcohol, Tobacco, Firearms and Explosives’ St. Paul field division.

Terry Henderson, special agent in charge of the St. Paul Field Division of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) , talks during an interview in his office in St. Paul on Thursday, Jan. 28, 2021. (John Autey / Pioneer Press)

“It was an unprecedented year for this division when it comes to fire investigation and arson” investigation, according to Special Agent in Charge Terry Henderson, who added that agents “worked around the clock for months to handle these scenes.”

Most of the arsons happened during the riots that followed the death of George Floyd in Minneapolis police custody in May. Separately, the Aug. 4 arson in downtown St. Paul caused most of the under-construction, five-story Courtyard by Marriott Hotel to collapse.

“Sometimes these investigations are complex and it takes time to get through all the evidence and conduct all the follow-up that needs to occur before we get to a resolution,” Henderson said.


Firefighters responded to the construction site blaze on Aug. 4 at about 4:20 a.m. The fire sent flames shooting into the air and debris was found miles away. Not only did it cause the hotel to mostly collapse, it was hot enough to melt plastic on nearby stoplights. Even the Xcel Energy Center sign atop the building across the street was slightly damaged because of the blaze; it has since been repaired.

Fire crews reported seeing at least one person fleeing the fenced-in site, according to a search warrant affidavit filed in Ramsey County District Court after the fire. The ATF said in August that there were “persons of interest” they were looking into.

Because the probe is ongoing, the ATF says it can’t release additional information. Investigators will work on the case “as long as possible to bring it to a successful conclusion,” Henderson said from his St. Paul office.

Arson investigations combine traditional law enforcement work — such as tracking down leads, interviewing witnesses or suspects, and looking for surveillance footage — with the science of fire investigations, including analyzing how the fire started and determining whether an accelerant was used.

The U.S. attorney’s office of Minnesota has filed federal charges against more than 20 people in arsons in the Twin Cities that happened during civil unrest in May and August.

The ATF continues to ask anyone with information about the hotel fire or other arsons to contact them at 888-ATF-TIPS (888-283-8477).


It’s not unusual for the ATF to get involved in fire investigations, and it usually happens when local or state public safety agencies request their assistance, Henderson said.

“A lot of times, we will bring to bear our resources to assist them if there’s something in particular that they need,” he said.

A special agent assigned to the ATF’s St. Paul office is a certified fire investigator and the agency can call on more ATF investigators as needed. They’re also able to bring in a regional ATF canine trained in detecting accelerants, along with sending evidence for testing at one of the ATF’s forensic laboratories.

Because the hotel fire was a large-scale investigation — involving a big building, extensive fire damage and a number of investigative leads — the St. Paul Fire Department and ATF’s St. Paul office requested the assistance of the ATF’s National Response Team. They came to St. Paul with about 20 members.

The team includes certified fire investigators, electrical and fire protection engineers, and chemists from the ATF’s Fire Research Laboratory, among other experts, said Henderson, who joined them at the site.

It was the fifth National Response Team call-out to Minnesota last year — including two teams that responded after the series of arsons during the unrest in St. Paul and Minneapolis at the end of May. Before 2020, the national team had last been in Minnesota in 2004.


St. Paul has worked for years to develop the Seven Corners Gateway area. It was a surface parking lot in a prime spot across from the Xcel Energy Center.

The St. Paul City Council, meeting as the St. Paul Housing and Redevelopment Authority, agreed to sell the 2.4-acre city-owned parcel — bounded by Kellogg Boulevard, Smith Avenue, and West Seventh and Fifth streets — to the Kaeding Development Group in April 2019 for $5 million.

The Kaeding Group is privately funding the $68 million project. The hotel comprises about 40 percent of the cost and most of the rest is for a 144-unit apartment building. A 40,000-square-foot plaza is also planned for public and private events — it’s intended to draw fans on game and event days at the Xcel Energy Center when they can return after the coronavirus pandemic.

“This Gateway site is going to fundamentally change the way people experience downtown — it’s where people enter, it’s where people leave,” said council member Rebecca Noecker, who represents the area. “This kind of development is exactly what we need on the site. To have a developer make that investment and then to have that devastating arson happen is just awful.”

Noecker said she’s grateful that Kaeding is sticking with the project and she’s been excited to see construction on the apartment building continue.


The apartment building sustained very little damage and the apartments are on track to open in September, said Carl Kaeding, principal of Kaeding Development Group.

When the fire struck, they were about nine months into construction of the hotel. The roof was on and most of the windows were installed. Now, the hotel’s construction will essentially have to start from scratch. The process has been slower than Kaeding expected.

The insurance company has already made some payments and they’re finalizing other details with them, he said.

“With everything going on around here and across the country, (the insurance company has) been just inundated,” Kaeding said. “I think they’re doing their best. It’s just taking awhile.”

Kaeding is looking at restarting hotel construction this spring and estimating it will take a year.

Between the hotel and apartments, about 14,000 square feet of retail space is planned — it’s expected that it will be food and beverage establishments, Kaeding said. The original retail partner wasn’t able to proceed, due to economics during the pandemic, but Kaeding said they’re close to finalizing a deal with a local group.

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