Stalled by a lack of funding for years, plans to redevelop the abandoned Piccadilly restaurant site into affordable senior housing in Mahtomedi took a step forward Tuesday.

The Washington County board of commissioners unanimously voted to approve an application for a $250,000 grant from the Department of Employment and Economic Development. County engineer Wayne Sandberg said DEED will announce the winners of the grant this week.

An absence of funding for the planned three-story, 79-unit apartment complex for residents 55 or older halted redevelopment of the 3.5 acre lot where the Piccadilly restaurant, closed in 2005, remains standing. Initial plans estimated the cost at $14 million.

"We thought last year by this time we'd be tearing down the building this year, but we're not close to that at all," Mahtomedi Mayor Judson Marshall said.

The complex along Mahtomedi Avenue and Stillwater Road, being referred to as "Piccadilly Square," will be split roughly half and half between one- and two-bedroom units. The cost: $750 a month plus electricity for one bedroom. Two-bedroom units will be from $900-$975 plus electricity.

An underground parking garage will house one car per apartment, with outside parking for additional vehicles.

A shortage of affordable senior housing in the area prompted the Washington County Housing and Redevelopment Authority to change course from market-priced condos they initially planned to the lower-income senior apartments, Marshall said.

"[Switching to senior housing] played a factor in us getting $1 million from the Met Council to purchase the property with," Marshall said.

The Metropolitan Council's grant to the county was awarded more than two years ago, but further funding is needed to clear up asbestos from the former restaurant as well as buried hazardous debris left over from when the property held a streetcar powerhouse up until 1947.

St. Cloud-based multifamily developer Sand Cos. was chosen in July to lead development.

Although there is no timetable in place for construction, Sandberg said acquiring additional funding will move along a project he said is in a crucial location for developing the area.

Washington County District 2 Commissioner Ted Bearth said the redevelopment of Piccadilly Square is "key to improving Mahtomedi," a town many claim lacks a centralized downtown.

The site is located on Mahtomedi's portion of Stillwater Road, which is essentially Main Street for the adjacent community of Willernie. Marshall said once the affordable senior living complex is up and running it should, optimistically, cause others to build on Mahtomedi's side.

"Hopefully it will embarrass some of the other people to reach into their billfolds and do something," Marshall said.

Andrew Krammer is a University of Minnesota student journalist on assignment for the Star Tribune.