Delays could mean changes for Heights of Chaska

The past, present and future of Chaska lies in hundreds of acres of undeveloped land just south and west of the downtown.

A few years ago, when times were good, plans were rolled out for a whole new community, the Heights of Chaska -- about 3,500 housing units to be built on 700 acres near downtown Chaska.

Today, the land sits idle, another victim of a slowing economy. But city officials and developers are still busy discussing the future of the project, which once promised to transform Chaska by adding as many as 9,000 residents. Some say the delays could allow time for changes that will better meet future demand.

"It's been brought to a grinding halt," said Rob Wachholz of Tradition Development, the biggest property holder in the Heights of Chaska area. "There's just no understanding this market right now. The next year it will still be quite slow."

The current economic problems, especially the real estate meltdown affecting the entire country, are being felt in Carver County. "It's a tough market," said Gina Ciganik, vice president of housing development for Aeon, a nonprofit homebuilder that last month opened Clover Field Marketplace, a 117-unit apartment complex with almost 8,000 square feet of retail on the first level, in Chaska.

While most of the affordable housing apartments have been renting, Ciganik said the market-rate apartments are moving much more slowly. More troubling, not one tenant has been signed for the retail space.

"People are having trouble getting capital right now," Ciganik said.

"It's certainly more challenging now than previously," said Kevin Ringwald, Chaska's director of planning and development. "It's just waiting for the market to recover."

Changes under consideration

The economic problems have already forced planners and developers to tinker with the master plan while working hard to keep the original concept, Wachholz said.

He estimates that the size of the project will probably be scaled back by about a third or a half, to between 1,000 and 2,000 housing units.

Tradition Development's plans, he said, now call for 500 to 700 units on the 200 acres the firm owns instead of the 800 to 1,000 units planned prior to the economic slowdown.

"It's not really drastic changes we see," he said. But one thing Wachholz believes definitely needs to change is the location and size of the commercial elements of the Heights concept.

Current plans call for retail to be in the center of the Heights plan to create a village feel. But Wachholz said if the density of the project is reduced, then there won't be enough traffic near the retail locations.

As a result, he is pushing to relocate the retail away from the centers to the edges of the development, possibly closer to downtown Chaska, so the businesses can benefit from more vehicle traffic passing nearby. But that decision is something that has to be negotiated with the city because the Heights project is based on a master plan that the city developed several years ago.

The plan is actually an outgrowth of a Metropolitan Council effort to plan smart growth for the area. The Met Council hired a consulting firm at a cost of $1.2 million to help Chaska and five other cities develop detailed plans for such opportunities across the Twin Cities. The result was the master plan that Chaska is asking the handful of developers involved in the Heights project to follow.

"It's challenging to deal with a plan that is controlled by somebody else," Wachholz said.

The concept behind the Heights of Chaska involved a planned community that would be more walkable than most suburban subdivisions, with emphasis on sidewalks and front porches. Within walking distance of most homes would be two village centers, which could feature such things as office or retail development. There were also plans for a 70-acre community park and an elementary school between the village centers.

Ringwald, who helped develop the original idea for the Heights of Chaska, said the city would still like to keep those core concepts as it moves forward.

He said the delay in building the project might actually prove beneficial because it allows the city and developers time to reassess and refine their plans in light of the changing economy.

Another thing Chaska has going for it is that it has experience in creating entirely new large neighborhoods. In the 1960s, the Jonathan neighborhood, among the first planned communities in the nation, was started by wealthy developer Henry T. McKnight. Most recently, Clover Ridge was created with about 1,000 homes providing higher density buildings and traditional homes within walking distance of parks, transit and stores.

City officials believe that experience will help them weather the economic storm that is buffeting the Heights of Chaska.