DULUTH – Essentia Health is tearing down housing to build a parking ramp to serve the overhaul of its downtown campus.

To compensate for the lost homes while the city endures a crisis of affordable housing, Essentia is donating $1.4 million to One Roof Community Housing for its 52-unit affordable housing complex in the Central Hillside neighborhood, which is expected to cost $18.5 million.

The new ramp, across the street from an existing ramp at the corner of E. 1st Street and E. 4th Avenue, will be city-owned and paid for with $36.4 million in state money.

Last fall, Essentia bought five properties on the site that contain 18 units, according to county records, and Essentia officials said at the time they were helping residents relocate.

The health system also said it was tearing down an existing 483-space parking ramp to make room for the new hospital and clinic it is building. The new ramp will have at least 800 spaces, according to development plans that go before the Duluth City Council on Monday.

Parking for patients and employees is already at capacity, and the ramp will "relieve parking problems and traffic congestion in our neighborhood," Jon Pryor, president of Essentia Health's East Market, said in a statement.

"The new city parking ramp is another example of how Essentia Health and the city are working as partners to improve the Central Hillside neighborhood and boost economic development in downtown Duluth," CEO David Herman said in a statement.

Essentia Health is spending $800 million over the next several years on a new hospital tower and other improvements to consolidate its sprawling Duluth campus.

Construction on the parking ramp is expected to take about two years.

Brooks Johnson • 218-491-6496