Luxury housing boom transforms student life at U of M

  • Article by: JIM BUCHTA , Star Tribune
  • Updated: June 15, 2013 - 5:01 PM
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University of Minnesota senior Ashley Gilles, left, and her friend Chris Lacourciere folded towels in her upscale unit in the 412 Lofts.

Photo: Jerry Holt • jerry.holt@startribune.com,

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As a freshman, Ashley Gilles and three roommates squeezed into a teensy dorm room in one of the University of Minnesota’s oldest residence halls.

There was no elevator, no kitchen and doing laundry required a five-minute walk.

“It was like an insane asylum,”said Gilles, describing the building’s white block walls and narrow halls. “It didn’t have air conditioning and all the basic things that I grew up with.”

Gilles now shares an upscale apartment two blocks from campus at 412 Lofts, one of the student apartment buildings sprouting up around the U. Not only is Gilles loving her new kitchen with granite countertops, she no longer has to schlep her laundry around campus because a washer and dryer are in the unit. “It feels more like home,” said Gilles, now a senior.

Gilles is part of a generation of 20-somethings fueling a housing boom around the U, where mostly private developers are building more than 2,500 upscale apartments and have approvals for another 1,800 units. The new housing has transformed campus living, offering students upper-crust amenities like yoga studios, heated garages and rooftop party rooms.

“There has been a flight to quality,” said Mary Bujold, president of Maxfield Research Group.

Experts say the trend reflects changing demographics and higher expectations among young people. Studies show that a growing number of students, mostly Gen Y-ers aged 18 to 34, want to live close to work and school. Bujold said that just in the past decade, the number of campus commuters is down 20 percent. Those students are more than willing to sacrifice space for high-end finishes in well-appointed apartments.

Brent Wittenberg, a market expert with Marquette Advisors, calls it a desire for “shared luxury.” But such upscale living has been in short supply around the U, where student housing has been more synonymous with keggers and code violations than fancy digs.

Kelly Doran of Doran Companies is trying to raise the bar. He is starting construction on his fifth and most ambitious student housing project, an 11-story concrete and glass tower called The Bridges. The building at the corner of 10th and University avenues SE. next to Interstate 35W promises views of downtown Minneapolis and the Mississippi River, along with a yoga studio and an outdoor kitchen for its student renters.

“It will be an iconic building as you enter campus,” Doran said. He expects it to be ready for occupancy by fall 2014.

Daniel Oberpriller, co-founder of CPM Development, said there has been a dearth of construction around the U, compared with what’s happening across the country. The U is “just catching up to where other markets are now,” he said.

Opus Development Corp., which has done student housing around the U, has more than 700 units in development in other Midwestern cities.

Fears in Dinkytown

Competition for undeveloped sites near the U — mostly surface parking lots — is stiff, so Oberpriller and others are focusing on finding redevelopment opportunities. That means tearing down existing buildings, which raises the hackles of some who believe those neighborhoods will lose their character.

That tension has been especially strong in Dinkytown — the eclectic commercial district just north of campus — where a new group called Save Dinkytown has a slogan that says, “It’s Dinkytown, not Megatown.”

“It’s been really exciting, and the U of M is seeing a lot of change,” said Gilles. “But a lot of people are feeling like there are already too many new buildings and they don’t want to see high-rises in the heart of Dinkytown.”

Oberpriller recently announced plans to build WaHu, a 333-unit apartment building that will replace an Arby’s and CSL Plasma at Huron Boulevard and Washington Avenue SE.

In Dinkytown, Chicago-based GEM Realty Capital Inc. plans to build more than 300 apartments on the former site of Marshall University High School. Across the street, Opus has created a stir with its plans to build a 140-unit apartment building on several parcels, including one that’s home to the House of Hanson grocery store.

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  • The Bridges apartments at 950 University Av. SE. will have a yoga studio and views of the Mississippi River.

  • Ashley Gilles checked the view from her window at her apartment. “The U of M is seeing a lot of change,” Gilles said.

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