If a deal to redevelop the Oak Park Mall property comes to fruition, the city of Austin will be ready.

Austin recently received a $375,000 grant from the Minnesota Department of Employment and Economic Development for a proposed $3 million demolition project for the mall to make way for a 60,000 to 90,000-square-foot Hy-Vee grocery store.

Yet the project was put on hold after the Austin Port Authority called off a purchase agreement last month.

The port authority reached a general purchase agreement with mall owners Oak Park Ltd. Partnership Oct. 9, 2014, to buy the site for $3.3 million.

However, the purchase agreement had several contingencies that needed to be met before the Austin Port Authority would get locked into the redevelopment deal with Hy-Vee and other parties. At issue was the lease agreements with Younkers, CineMagic 7 and Anytime Fitness.

The port authority was also unable to reach an amended occupancy agreement with Shopko, which owns its own building. That agreement controls the configuration of the Shopko site and the mall, along with use of the parking lot.

The deadline for clearing the contingencies was Feb. 13, which gave the port authority five days to give notice that it didn’t wish to proceed with closing the agreement. Mall ownership did not grant an extension to talks at that time.

Yet city officials have been confident the deal could get restarted.

“Our efforts are devoted to continuing to seek to get the project back on track,” Finance Director Tom Dankert wrote in a statement Tuesday. “If we are unsuccessful with that effort, this DEED grant will be withdrawn or returned.”

Dankert said if the project gets back on track, the city will need to figure out what sources may be available to cover more costs.