In the Twin Cities, $250,000 buys you an average house. But not in Edina.
That’s why developers behind Estelle, a pair of luxury condo towers near the Southdale and Galleria shopping centers in Edina, have a new plan. The slender towers, the first planned for 24 stories and the second for 20 stories, will house a more economically diverse group of residents than envisioned months ago.
One-fifth of the units will comply with Edina’s affordable housing policy, developers Ryan Cos. of Minneapolis and Arcadia LLC of Edina, said Tuesday. They will present their revision of the $250 million project to the city’s planning commission Wednesday night.
“Edina is not an inexpensive place to live,” said Mike Ryan, market leader north region/president of Ryan A+E Inc.
The city’s affordable housing policy, created two years ago, applies to all new multifamily developments of 20 or more units that require a rezoning or a comprehensive plan amendment. It says that all new rental developments will have at minimum 10 percent of the rentable square footage to be priced at 50 percent affordable rental rates or 20 percent of all rentable area to be rent restricted and occupied by those who earn less than 60 percent of the area median income.
New for-sale developments like the Estelle are required to ensure that a minimum of 10 percent of all livable area is for people who qualify for thresholds set by the Minnesota Housing Finance Agency.
To achieve such a goal, Edina is willing to offer developers a variety of incentives, including density bonuses.
For example, a one- to three-bedroom condo in the Estelle would sell for $250,000 to $350,000. Those buyers couldn’t earn more than $90,400 for a one- to two-person household; for a household with three or more people the maximum income is $103,900.
In some parts of the Twin Cities, those prices are upper bracket, but in Edina houses in that price range are rare. The median sale price of all closings in Edina last month was $470,000, according to the Minneapolis Area Association of Realtors. In the Twin Cities region as a whole, the median sale price was $252,000 and the median price of a condo was $157,000. In the Estelle, the most expensive units will cost several million dollars.
John Wanninger, a sales agent with Lakes Sotheby’s International Realty office in the Galleria, said there are currently just 40 homes and condos for sale in Edina priced under $350,000, which is only enough to last one month at the current sales pace.
“This clearly defines a shortage,” Wanninger said. “The project incorporates a complete wish list of what condominium buyers have been asking for and can’t find.”
In a statement, Arcadia President Luigi Bernardi said the goal is to offer Edina seniors, young professionals, teachers and first responders an option to own a home in a city they might not otherwise be able to afford.
Ryan said that it’s too soon to offer any specifics on the square footage and location within the building of the affordable units.
For the first tower, Ryan and Arcadia now plan 92 units, including 20 affordable units, six brownstones and 12,000 square feet of neighborhood retail, including a restaurant at the corner of France Avenue and 69th Street. Construction of the second tower, which could have 75 units, including 15 at affordable prices, would begin once the first tower is sold out.
Ryan said the project is consistent with the original vision of the architect of nearby Southdale Center, Victor Gruen, who, when the mall was built in the mid-1950s, imagined high-density housing surrounding it.
The planning commission will vote Wednesday on a request to amend the city’s comprehensive plan to allow for more density and taller structures in an area that now limits buildings to just four stories or 48 feet.
The City Council will also have to approve the changes before the proposal goes through the zoning process.
Cary Teague, Edina’s community development director, said that with land and development costs on the rise in the city, such projects are a critical step toward offering a full range of housing options. The Market Street rental development at 50th and France is the first rental project in the city to embrace elements of the affordable housing policy, but the Estelle would be the first to offer a for-sale option.
“It’s becoming harder and harder to get affordable housing in the city,” he said.
The height of the Estelle project is still being debated by neighbors and other residents, Teague said. “We’re getting a lot of feedback on both sides,” he said. “It’s pretty mixed.”