Downtown Minneapolis could be getting its THIRD high-rise luxury apartment building.
An architectural firm hired by Minneapolis-based Mortenson Construction shared its plans for the tower last night at the monthly meeting of the Downtown Minneapolis Neighborhood Association (DMNA).
Renderings showed a high-rise tower with retail on the first floor that would be built pending a variety of approvals on a surface parking lot at 400 Marquette Avenue. The site is next to a 26-story luxury apartment tower called Nic on Fifth and the nine-story Xcel Energy headquarters building, both of which are being built by Opus Development Corp. That hotbed of development is just several blocks from where aa Chicago developer is building a 36-story apartment tower that will soon rise above the Loring Park neighborhood, .
Gerry Ewald, DMNA's chair, said that the group's reaction to the tower's design was favorable. "And 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 bouncing around record lows - right now it's only 1.8 percent - there's some concern that there too many market-rate units will come on-line within the next couple years.Still, it's 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 the population by 2025.
Downtown's Central Business District, long known for its high-rise office buildings, has been the subject of considerable attention among apartment developers because of its proximity to a light rail transit stop and the sprawling downtown skyway system.
Other nearby developments include one by Village Green Properties, a national apartment that's based in Michigan, which is transforming the former Soo Line Office building into 254 luxury apartments with a roof-top park called the Soo Line Building City Apartments. On Friday, JustListed reported that Todd Phillips plans to convert the Plymouth Building along Hennepin Avenue into 252 rental apartments. Phillips was also at the meeting to discuss his plans.
With the supply of for-sale condominiums in downtown Minneapolis at the lowest level in more than a decade, there's some speculation that one of or more of the apartment buildings that are being developed could be converted into condominiums. Even as the housing recovery gains steams, developers have been shy about starting a condominium project because financing those projects requires consirable pre-sales before construction starts. Financing a rental building only requires that the developer can prove that there's demand in the market. In fact, marketing of those rental units typically doesn't begin until 6 to 12 months before the estimated completion of the project. At this point, StoneBridge Condominiums in the Mill District is the only condominium project that's under construction.
In October 2011 JustListed said that the owners of the parking lot at 400 Marquette were hoping to cash in on the rental housing boom by selling the third-acre parcel to an apartment developer. At the time, Gina Dingman, president of Everest Real Estate Advisors, said that she's received both local and national interest in the lot. Public records show that the owner of the lot is LST Properties, which bought it in 1984 for $6.55 million. The estimated market value of the site, according to those records, is now about $1.5 million.