MNCAR Focus/Central Corridor–related development is taking off

Central Corridor–related development is taking off



Written by Liz Wolf

 

Met Council estimates more than $1.7 billion in new private development is complete or underway – and that’s conservative

 

 

 

It’s been a long haul during the past several years for the 1,400 businesses impacted by the construction of the 11-mile Central Corridor light-rail transit line, dubbed the Green Line. When completed, the $957 million project will link downtown St. Paul and downtown Minneapolis, running from the Union Depot to Target Field. It will include 18 news stations, plus five stations shared with the Blue Line (Hiawatha LRT) in downtown Minneapolis.

 

The project, which started in late 2010, took its toll on some businesses as patrons had difficulty navigating through the construction. The Metropolitan Council reports that approximately 90 businesses closed, 24 relocated within the corridor, and 28 moved elsewhere during construction.

 

However, 90 new businesses opened, and now that construction of the light-rail line is 96 percent complete and service is scheduled to begin next July, many businesses that survived are reinvesting and expanding. Also, development and redevelopment are taking off as more developers recognize the opportunity with the thousands of future commuters.

 

Approximately 100 construction projects totaling more than $1.7 billion in private investment have been completed or are underway, according to the Metropolitan Council. “And that’s pretty conservative because there are a number of projects that the developers have not announced the value of,” says Laura Baenen, communications manager for the Central Corridor LRT project. “This is all private money, so developers have privately put in nearly twice what the LRT project cost.”

 

“It’s a very exciting time,” says Shoua Lee, senior community outreach coordinator at the Metropolitan Council. “All of these great commercial and housing opportunities are popping up for the community.”

 

 

Projects include everything from market-rate, senior and affordable housing to retail and commercial development. While much of the construction is occurring along St. Paul’s University Avenue, both downtowns are also seeing development activity related to the light-rail line.

 

 

Hotbed for development

“This new line goes all the way to Target Field so we’ve also counted projects in downtown Minneapolis as well,” Baenen explains. “The area around the Nicollet Mall station is just a hotbed of commercial development. It includes some of the first new apartment buildings and there are plenty of office/apartment loft conversions. There’s also new development in downtown St. Paul, including office rehabs into apartments and lofts.”

 

 

For example, large downtown Minneapolis residential projects include Opus Group’s $100 million, 253-unit Nic on Fifth luxury upscale apartment tower, being built near the LRT station between Marquette Avenue and Nicollet Mall.  

It’s the first high-rise, luxury apartment development in downtown Minneapolis in nearly three decades. Also, Mortenson Development has plans for 4Marq, a 30-story apartment tower at the corner of South Fourth Street and Marquette. 

 

 

Great real estate story

“The Central Corridor is becoming a great real estate story,” says Denise Currie, principal at St. Paul-based Suntide Commercial Realty. “There’s a lot of stuff happening and on the drawing board up and down University Avenue. A lot of developers are now taking interest in the Green Line corridor.”

Suntide is renovating a 100-year-old, 40,000-square-foot office building at 1000 University Avenue in St. Paul’s Frogtown. The site is one block east of an LRT station at University and Lexington avenues.

 

“When we were looking at the Green Line and where it’s going and what’s going to happen, this building came up for sale about four years ago; it was a bank repossession,” Currie says.

Suntide purchased the building from University National Bank. At one time, a printing company occupied the site, and the city of St. Paul also formerly had offices there.

 

“We totally gutted the building and we’re putting underground parking in the basement,” Currie says. “We put in all new windows. It has all new electrical, HVAC and a new roof, so it’s going to be like a brand-new building… We’re pretty excited about it.”

 

She says the renovation exposes the building’s brick-and-timber structure and plays up its high ceilings. Suntide added a glass tower with an elevator and staircase. Suntide will begin marketing the office space in November and target creative groups, nonprofits and medical users.

 

 

 

Light rail spurring redevelopment

Currie points to other projects occurring due to light-rail transit. Developer Jim Stolpestad, chairman of Exeter Realty, recently completed the $19 million C&E Lofts on the corner of Raymond and University. It’s a redevelopment of the Chittenden and Eastman Building into 102 market-rate rental units. Stolpestand has said he would not have redeveloped the site had it not been for the future light-rail line.

 

 

Also on University, Episcopal Homes is expanding and redeveloping the former Porky’s drive-in site into senior housing, and Habitat for Humanity broke ground on a new $9.5 million headquarters at the former site of the Zimmerman Building.

The 27,000-square-foot, three-story building should open early next year. At University and Prior avenues, the Beacon Interfaith Housing Collaborative is building Prior Crossing, a $9 million, 44-unit homeless youth housing project. Meanwhile, Midway Commons was developed on the north side of University and includes a new Culver’s Restaurant and 10,000 square feet of additional retail.

 

 

Project for Pride in Living plans to break ground in spring on the $23 million Hamline Station, an affordable housing project along the light-rail line across the street from the Midway Super Target. It’s the site of the former Midway Chevrolet car lot.  

Another developer busy on the corridor is Peter Remes of First & First, who has acquired two buildings on the Green Line. One is the nine-story, 100,000-square-foot Central Medical building, off of Lexington Avenue near University. He has major renovation plans for the building. He also purchased a multi-building complex on Vandalia Street in St. Paul’s Midway, which he has dubbed Water Tower Place and is investing millions in renovations.

 

There are also plans for the Old Home Dairy site at University and Western avenues. Aurora St. Anthony Neighborhood Development Corp. acquired the property and partnered with the Sand Cos. to develop mixed-income housing and commercial space. And there are plans to redevelop the Sears building at the end of University near the Capitol into retail, office and housing.

 

“All of this is happening at break-neck speed,” Currie says. “Now that the light-rail construction is done…all the businesses along the Green Line are kind of settled down. It was hard on some of the businesses. We’re starting to see the vacancies along University fill up again in terms of the small retail shops.

 

“I think that University is starting to come alive,” she continues. “If you drive down it, you still see some old, tired stores and what not. But if you drive down that street five years from now, you’re not going to see that anymore. The land has become too valuable. Not everything is going to get knocked down and it shouldn’t, but people will start to take better care of things. This is some of the highest priced land in the Twin Cities.”

 

 

Small businesses reinvesting

Isabel Chanslor agrees. She’s project manager for the U-7 University Avenue Business Preparation Collaborative and has been working with businesses along University for the past four years.

 

“There are small businesses that survived construction and are going to continue,” she says. “Many have become so fortified and are saying, ‘I’m staying and there’s an opportunity here and the landscape has changed.’ There have been businesses that for the first time in their history made significant improvements to their building and business.”

 

One is Ha Tien Grocery Store at 353 W. University Ave. “We helped them with a façade and energy-efficiency project, which involved thousands of dollars of new energy-efficient equipment, and they expanded their deli,” Chanslor says, adding that it was nearly a $1 million renovation.

 

“Now they have new customers and their sales have increased like 30 to 40 percent,” she says. “This is an amazing story… The owners deserve a lot of credit for taking such a risk and putting so much of their own money into this project.”