A third new luxury apartment tower could be poking into the downtown Minneapolis skyline.
An architectural firm hired by Mortenson Construction presented a preliminary plan for a high-rise to the Downtown Minneapolis Neighborhood Association (DMNA) at a meeting Tuesday night.
Renderings show a tower with retail on the first floor and rentals on the upper floors to be built on a former surface parking lot at 400 Marquette Av. S. Mortenson and UrbanWorks Architecture aren’t discussing details of the high-rise, but the proposed project would be next to a $100 million, 26-story luxury apartment tower called Nic on Fifth, and a nine-story building that will house the Xcel Energy headquarters. Both buildings are under construction by Opus Development Corp. Several blocks away in the Loring Park neighborhood, a Chicago developer is building a 36-story apartment tower slated for occupancy in late 2014.
DMNA chairman Gerry Ewald said the group’s reaction to the tower’s design was positive. “We love the idea of more people living downtown,” he said.
The project comes at a time when there are already more than 2,000 apartments under construction in downtown Minneapolis. While the apartment vacancy rate in downtown Minneapolis has been near record lows, there’s concern that too many market-rate units will come online within the next couple of years.
Still, it has been decades since downtown has had any significant new rental construction, let alone a new apartment tower, and such projects will help advance the Downtown Council’s goal of doubling downtown’s population by 2025.
The Downtown’s Central Business District — where the proposed high-rise would be built — has garnered considerable attention among apartment developers because of its direct access to a light-rail transit stop and the sprawling downtown skyway system. Public records show that the owner of the parcel at 400 Marquette is LST Properties, which paid $6.55 million in 1984. The estimated market value of the one-third acre site is $1.5 million.
Construction is well underway on several significant apartment buildings that will attract several hundred new residents to downtown. The Soo Line Building City Apartments, a former office building, is being converted into 254 luxury units with a rooftop park. On Friday, Todd Phillips of TruCore Realty detailed his plan to convert the historic Plymouth Building at the corner of 6th Street and Hennepin Avenue into 252 rental apartments. That project is just blocks from 222 Hennepin, a $70 million mixed-use housing/retail development by Ryan Cos. that will include a Whole Foods store.
Phillips presented details of his plan for the Plymouth Building to DMNA board members, including Andrea Christenson, a vice president at Cassidy Turley Commercial Real Estate, who said such projects will help satisfy growing demand for urban living.
“I think you’re going to see a lot of people say, ‘We have a cabin up north and the kids are out of the house, and I don’t want to take care of this big house.’ ”
With the supply of for-sale condominiums in downtown Minneapolis dwindling, there’s been speculation that one or more of the proposed apartment buildings could be converted into condos. Only one downtown developer, Jim Stanton, has been willing to build condominiums. Financing such projects requires considerable advance sales before construction can begin. By contrast, apartment developers don’t pre-lease units before construction begins.
Stanton has already presold 32 units at StoneBridge Condominiums in the Mill District, which is scheduled for occupancy in late summer 2014.
Staff writer Janet Moore contributed to this report. Jim Buchta • 612-673-7376