After unfinished Dinkytown apartments left renters in limbo, a proposal offers a way out of leases

Prospective tenants who sign leases for Minneapolis apartments under construction would have an escape clause if the buildings aren't finished on time, under a proposal going before the City Council this week.

Council Member Robin Wonsley says she'll suggest a change to city ordinances that would provide that out for renters, citing the case of Identity Dinkytown, an apartment building that opened a month late and refused to release hundreds of tenants from their rental agreements. The delay left students scrambling, and some of them sued developer CA Student Living, accusing the company of a bait-and-switch.

"Identity was a wakeup call," Wonsley said during a news conference outside the building Wednesday.

Representatives for CA Student Living said the company would not comment on pending litigation or Wonsley's proposal.

"CA Student Living acts in accordance with all local regulations and policies," a spokesperson said.

When the Identity Dinkytown building wasn't finished on time, CA Student Ventures offered to either pay renters $150 per day if they found their own temporary housing or $80 per day if the property owner paid for their hotel room.

According to Minneapolis city ordinance, landlords typically need to have a rental license in order to sign contracts with their tenants. But two exceptions to that city ordinance allow developers to sign leases on unfinished buildings if they're new construction.

Larry McDonough, a policy attorney with the tenants rights organization HOME Line, told a state Senate panel in mid-September those exemptions were meant to guarantee developers a revenue stream as soon as those new buildings opened their doors.

University of Minnesota junior Elena Mathern signed her lease with Identity in 2022. She was preparing to move in earlier this month when the landlord said construction crews still needed to address a few issues in the unit.

Mathern is still paying rent at Identity while she leases another short-term rental near campus. She took out additional student loans to afford it.

"I'm really fortunate that I can pay two rents at once," Mathern said.

Wonsley wants to add language to the city ordinance to allow tenants to break a lease if their unit isn't finished by their move-in date.

"Frankly, this is a very low bar," Wonsley said.

It's unclear whether the proposal has the support of other City Council members. Wonsley, who is running unopposed for re-election in the ward that includes the University of Minnesota, plans to introduce it at Thursday's meeting.

Still, student government officials say they're hopeful and count Wonsley's proposal as a win.

"It's really rewarding," said Katie Smithberg, city government and legislative affairs coordinator for the U's undergraduate student government. "It's always nice to see that things students are passionate about are being heard. Oftentimes, as young people, our voices are overlooked and that hasn't been the case in this situation."

Identity renters began approaching University officials in early August when the property owners first told leaseholders the building wouldn't open on time.

But many U students just wanted out of their rental agreement, Smithberg said.

"This was a luxury building that was supposed to open before the academic year," Smithberg said in an interview Tuesday. "And then we got there and it wasn't even done."