154th Street W., west of Murphy Lake Blvd., Savage

Type: Single-family housing

Lots: 40

Size: 41.6 acres

Developer: Homestead Partners

Details: The Savage City Council has approved plans for a third addition to the Trace Water subdivision, paving the way for 40 custom homes starting at $400,000.

The Trace Water second addition, which was approved in 2011, has room for 19 lots. Construction is underway. It's south of the Credit River near the Murphy-Hanrehan Park Reserve in northeastern Scott County.

Developer Stephen Bona of Hopkins-based Homestead Partners said the new homes will be tapping into a trend toward smaller lots, which is happening because of rising land costs and a desire to put the savings into higher-end design features.

The original proposal called for 45 lots at a minimum 70 feet wide — too small for the city's planning commission, which rejected the proposal last month. Bona presented a revamped proposal containing 40 lots with a minimum width of 78 feet.

The residences, to be built by JMS Custom Homes, will cost $350,000 to $400,000 — compared with a $500,000 average in Trace Water's second addition.

The third addition will also trigger construction of a bridge across the Credit River along Valley View Drive. The project has been in the city budget for several years but has been awaiting development activity south of the river to trigger its construction, city officials said.

Don Jacobson is a freelance writer in St. Paul. He can be reached at hotproperty.startribune.@gmail.com.