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Construction again topped $1 billion in Minneapolis during 2017

Sixth year in a row of brisk development likely to continue, officials say.

February 3, 2018 at 4:02AM
Construction work continued along Nicollet Mall, Tuesday, August 22, 2017 in downtown Minneapolis, MN. The reconstruction project is going to cost $2.1 million more than expected, after crews worked extra hours this winter, utility designs changed and additional mulch was brought in for the downtown Minneapolis project. ] ELIZABETH FLORES ï liz.flores@startribune.com
Construction work continued along Nicollet Mall, Tuesday, August 22, 2017 in downtown Minneapolis. (The Minnesota Star Tribune)

For the sixth year in a row, Minneapolis gave the green light to more than $1 billion in construction in 2017, the city announced Friday.

People are itching to live in the city, a news release said, and residential vacancy rates are scant. More than 2,000 new dwelling units got permits last year, and there's a craving for new office space — especially in the North Loop and Uptown.

In 2017, the city locked down nearly $1.5 billion in construction permits, which came in under 2016's almost $1.8 billion building permit valuation.

"Making the most of our opportunities to develop underutilized space and expand our tax base will be key to creating a more inclusive local economy," said Mayor Jacob Frey in the news release. "Another year of strong growth means we are moving in the right direction."

The Downtown East area near U.S. Bank Stadium has long needed re-energizing, the release said. Roughly $91 million in public funds attracted $569 million in private investments there, with more than 5,000 jobs, plus new housing, hotels, restaurants, retail and green space. And more investments — like the new Kraus-Anderson headquarters, apartments and brewery — are drawn there.

The hotel industry was readying itself along with the city for Sunday's Super Bowl. In 2016, 1,050 new hotel rooms made their entrance. In 2017, 196 new rooms were added. New hotels in 2017 included the luMINN Hotel at 219 S. 4th St. and the DoubleTree University at 511 Huron Blvd. SE.

More are coming this year. The city said that 1,643 rooms will be added from 10 hotel projects, including the Elliot at 823 5th Av. S., the Four Seasons at 301 4th Av. S. and the Hilton Tru & Home Suites Hotel at 317 2nd Av. S.

"It is no surprise that we continue to see significant investment in our amazing city, which is providing needed housing and tax revenue that we have been able to invest in infrastructure, parks and racial equity investments," City Council President Lisa Bender said in the news release.

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In recent years, the highest total building permit valuation was in 2014, when the number hit $2 billion.

Some of 2017's top-valued building permits included Legacy Condominium at 1240 2nd St. S. ($123 million), the Kraus-Anderson stretch in the 800 block of 5th Avenue S. ($91.4 million) and the mixed-use building Ironclad at 240 Chicago Av. ($74 million).

Development is likely to continue at last year's robust pace in 2018, the release said.

Beena Raghavendran • 612-673-4569

about the writer

about the writer

Beena Raghavendran, Star Tribune

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