In a quiet neighborhood of squat brick apartment buildings on the south edge of downtown Minneapolis, Magellan Development Group is building a sleek, 36-story apartment tower with a raft of hotel-like amenities, including an indoor dog park and pet wash.
Ten blocks away, in the shadow of the 57-story IDS Center, the Opus Group is busy building its own luxury apartment building, a 26-story tower that will have direct access to the city's skyway system.
By late 2014, both buildings will make the downtown skyline shine a whole lot brighter, but the biggest impact will be at street level. The developers are betting a combined $200 million-plus that these buildings — the first high-rise downtown rentals in decades — will bring hundreds of well-heeled residents to parts of the city where luxury housing has been scarce, and will serve as a catalyst for new shops, restaurants and services that cater to downtown residents.
"This will have a huge impact on the city," said Tom Fisher, dean of the University of Minnesota College of Design. "But it's going to bring a lot of changes on the ground."
In a city where developers already are worried that the rental market is nearing saturation, the backers of these projects hope to set themselves apart by going skyward with the kind of luxury rental housing that's common in New York and Chicago, where Magellan recently completed a 87-story residential tower. All of it is geared to the growing number of renters by choice, including young professionals and empty-nesters who favor the flexibility that comes with renting.
"If we're going to compete with other major cities for talent, we have to have product and living options for people that are like what they'd find on the coasts," said Tom Lund, vice president of real estate development for Opus Development Corp.
Indeed, high-rise rental housing is nothing new for the Twin Cities. In the early 1970s, a 39-story public housing complex now known as McKnight Towers was built, and was followed by several others, including Marquette Place and 110 Grant.
The developers of projects say that the latest generation of high-rise rentals is radically different — they've been designed to feel more like a high-end hotel rather than a rental.