Developers eyeing sites, building along Southwest light rail line

While the proposed Southwest Corridor light-rail line sits in limbo amid a dispute over its route, developers are already eagerly eyeing sites along the line's west metro cities — and some aren't waiting for it to get the green light.

The nearly 16-mile line, which faces a key vote on its route from the Metropolitan Council on Wednesday, is the longest of the three Twin Cities light-rail lines and the first to incorporate development planning into the engineering of the line from Minneapolis through the western suburbs of St. Louis Park, Hopkins, Minnetonka and Eden Prairie.

"We're essentially setting the table for development," said Peter McLaughlin, a Hennepin County commissioner.

Nearly 14 million square feet of new office space, 1.2 million square feet of retail and more than 13,000 new residential units are projected to go up along the line, according to the county. And while final approval and construction of the line is still far off — it's projected to open in 2019 — the cities that will host it are already seeing a boost in development near the 16 proposed stations.

St. Louis Park, for instance, has had an influx in condos, apartments and senior housing near a proposed station, and in Hopkins, a 163-unit apartment building is slated to open in May a block from a station.

Other developers are holding off to see if the line is approved.

"It's hard to plan if you have no idea if the line is going to happen and when," said Colleen Carey, president of the Cornerstone Group, a Richfield-based real estate company, which has talked to west metro cities about possible development along the line. But, she added: "It doesn't feel like there's any big rush."

Reshaping the area

As controversy swirls over the light-rail line's exact route, many city and county leaders have been working on a related but far-less-public effort — planning development and community changes.

In fact, it's one of the only light-rail projects in the country that has included planning of all 16 stations at once, said Katie Walker, who oversees light-rail community planning for Hennepin County.

Officials have been discussing everything from adding bike connections to improving sidewalks for pedestrians near stations, helping make the suburbs less car-oriented and more walkable, which could in turn boost ridership, she said.

"It's really reshaping the area," Walker said.

Also, nearly a dozen small changes were made to the engineering of the line to boost development — a strategy that wasn't part of the metro area's other two light-rail lines.

Park-and-ride stations were cut from 15 to seven so there will be fewer parking facilities and more space for development. Planners also shifted the station platforms slightly at Blake Road in Hopkins and along Shady Oak Road, on the border of Hopkins and Minnetonka, to open up larger parcels of land for redevelopment. That translates, Walker said, into less land acquisition needed for the line, which can save money and increase space for development.

"We're trying to optimize the cost-effectiveness of the line and development along the line," McLaughlin added. "We're trying to walk and chew gum at the same time."

Hennepin County already has invested $28.5 million along the Southwest line, largely for environmental cleanup, affordable housing and transit-oriented development — more than was spent along the Green Line that goes from Minneapolis to St. Paul.

"There's a recognition that LRT is a game-changer and will be for that corridor," said Jan Callison, a Hennepin County commissioner for the area that includes Eden Prairie, Hopkins and Minnetonka. "We can't predict what private development would come in. But we know these lines are catalysts for development."

While some developers are holding off until light-rail plans are more concrete, others are building projects near proposed stations, encouraged by the possibility of a line that's projected to average 30,000 rides every weekday by 2030.

In Minneapolis, city leaders say they're hearing from developers interested in sites near four of its stations such as the Royalston station near the farmers market. And an analysis is being done on the potential for development near the Van White station area.

A neighborhood transformed

In St. Louis Park, the area of Hwy. 100 and W. 36th Street, once a tired industrial area, has been transformed with an influx of apartments and condos near where the proposed Wooddale station would be, Community Development Director Kevin Locke said.

"It's an added point of interest from them," he said of the light rail. "We'd expect that once light rail is committed or built, there will be even more development opportunities."

In fact, a proposal for the former McGarvey Coffee building off Hwy. 7 won't get approval, he said, until the line and stations are finalized because it's so close to a station.

Next door in Hopkins, construction is underway now for a 163-unit apartment building one block from the city's proposed downtown station, while an affordable apartment building project next to the planned Blake Road station is going through the proposal process.

In Minnetonka, a proposed medical building off Shady Oak Road and Excelsior Boulevard also includes transit-friendly housing because it's near the station. And a medical-technology firm just moved to the city in part because it's near a future station, Community Development Director Julie Wischnack said.

Line was a draw for health titan

Light rail also was an attraction for UnitedHealth Group, which is building a $250 million, 1.5-million-square-foot office development between Hwys. 62 and 212, near where a station will go.

But the big spike in light-rail-influenced development, Walker said, may not come until after the project is approved. A recent analysis of the Hiawatha, or Blue Line, showed that light rail caused almost no increase in the likelihood of new development near rail platforms in its first six years. Yet, even researchers said development has taken off since 2010 — after the years they studied — likely because of an improving economy and the effects of light rail taking time.

Proponents like Locke, in St. Louis Park, say Southwest development is likely to be different because it's a longer line built after the economy rebounded and includes a lot of potential development sites.

"With the Southwest line being really the third element in the system, you start to see more potential," he said. "The more extensive our light rail is, the more possibilities for development."

Kelly Smith • 612-673-4141