Housing plan by private interests with public backing holds promise on North Side

The brass at Thor Construction is tar­get­ing north Minneapolis.

For commercial development, jobs and hous­ing.

And that's a good thing. Because the North Side, with the highest proportionate concentration of minorities and lowest incomes, is the weak link in the Twin Cities economy. De­spite pock­ets of new com­mer­cial devel­op­ment along W. Broad­way and Low­ry Avenue, and a sprin­kling of new hous­es, the core neighborhoods are still plagued by crime, high un­em­ploy­ment, board­ed-up hous­ing and resident flight thanks to the 2006-09 mort­gage cri­sis.

Yet that dour theme since the 1980s is contradicted on some blocks and com­mer­cial cor­ners. And there is hope of bet­ter days a­head.

Thor, the larg­est black-owned busi­ness in Minnesota, is ne­go­ti­at­ing for land with Hennepin County and plans to move its head­quar­ters next year from Fridley to a va­cant lot at Plymouth and Penn ave­nues. Thor prin­ci­pals also are form­ing a new com­pany, Sm+rt Homes. It will site and sell high-qual­i­ty, urb­an-style manu­fac­tured hous­ing at up to 25 percent less than the cost of site-built hous­ing to help fill at least some of the 500-plus va­cant lots created when gov­ern­ment razed a­ban­doned, tax-for­feit­ed prop­er­ty.

Home valu­ations are ris­ing through­out north Minneapolis amid the hous­ing short­age.

"I've seen nice manu­fac­tured prod­uct and this sounds fan­tas­tic," Constance Vork, a North Side res­i­dent and re­al­ estate a­gent, said of Sm+rt Homes. "The North Side mar­ket has come back. There ha­ven't been as many teardowns. Housing prices are ris­ing. Last week­end, my group had three list­ings sell af­ter multi­ple offers in the Homewood and Old High­land neighborhoods. All three sold for over their list­ed prices of $150,000. We just don't have en­ough hous­es to sell."

The prin­ci­pals of Sm+rt Homes, Thor CEO Ravi Nor­man and con­struc­tion man­ag­er Gary Findell, say their hous­es will dem­on­strate that mod­u­lar hous­ing, de­signed with an ur­ban look and mod­ern-day ameni­ties, and high en­er­gy efficiency and gar­ages, can be de­liv­ered, in­clud­ing lots, for $180,000 to $240,000 — a significant dis­count to the $300,000-plus hous­es that have been de­vel­oped at sev­er­al North Side sites by oth­er devel­op­ers.

Jeff Washburne, a vet­er­an busi­ness­man and North Side res­i­dent who runs City of Lakes Community Land Trust, which last year helped 40 North Side fami­lies gain homeownership, is hope­ful of the in­itia­tive. He re­mem­bers at least one for­ay by a de­vel­op­er in the early 2000s with manufactured hous­ing. How­ever, they were cheap mod­els, built on slabs with no base­ments or garages.

"There is still this area in north Minneapolis where there is a great op­por­tu­ni­ty … for current resi­dents to live in permanent housing who of­ten other­wise can't af­ford to stay in the city," Washburne said. "If they can pull this off, work­ing with or­gan­i­za­tions like mine that get peo­ple ready through fi­nan­cial ed­u­ca­tion, and raise some 'af­ford­a­bil­i­ty gap' mon­ey … be­cause even $180,000 is still too expensive for many fami­lies on the North Side.

"It will help to see the fin­ished prod­uct and look at the num­bers. If some­bod­y has fig­ured out this ani­mal, then we are all for it."

The new homes in­itia­tive ev­olved from a se­ries of meet­ings head­ed by Council Member Barb Johnson, who represents the area, and of­fi­cials of the city devel­op­ment a­gen­cy, who are frus­trat­ed with the pace of re­de­vel­op­ment. Nonprofit out­fits like Hab­i­tat for Humanity, which has built doz­ens of new hous­es with new own­ers and sells them at a dis­count, have to raise money to sub­si­dize each prop­er­ty.

Thor's Nor­man said he hopes to achieve an a­gree­ment with the city and Hennepin County soon to build a new, $30 mil­lion headquarters. Thor has 150 employees and revenue of more than $150 mil­lion. Thor Chairman Richard Copeland grew up in north Minneapolis and found­ed Thor 36 years ago.

Nor­man said the hous­ing in­itia­tive, which will be op­er­at­ed separately from Thor, "is just an­oth­er part of the vision that I have for eco­nom­ic de­vel­op­ment. Part of it is things we can do at Thor, in­clud­ing pri­vate in­vest­ment in north Minneapolis. And [Sm+rt Homes] is try­ing to do some­thing with need­ed hous­ing in an ur­ban area, with a qual­i­ty prod­uct that is more af­ford­a­ble."

The homes will be built by Dy­nam­ic Homes, a De­troit Lakes mod­u­lar homebuilder. Nor­man hopes one day to open such a fac­to­ry on the North Side.

We've seen the 20-year commercial re­bounds of E. Lake and E. Franklin ave­nues on the near South Side, areas once the city's top po­lice hot spots. There are fewer gin joints and drug dens. And more small busi­nes­ses, housing, shop­ping, art and res­tau­rants.

Commerce trumps crime, former Minneapolis Police Chief Tim Dolan, another North Side native, long has said.

Here's hoping the Thor headquarters and Sm+rt Homes initiatives are part of a safer, more prosperous North Side.

Neal St. Anthony has been a Star Tribune busi­ness col­um­nist and re­port­er since 1984. He can be con­tacted at nstanthony@startribune.com.