Near St. Paul's restored train depot, a new apartment rises, aiming fit the neighborhood

Anyone choosing to build next door to the impressively restored St. Paul Union Depot is inherently accepting a design challenge.

The Depot's $243 million renovation, completed in 2012, set a high bar in building standards for the Lowertown neighborhood.

There's also the fact that the Depot area is part of St. Paul's Lowertown Heritage Preservation District, which means all new construction there must follow rigorous standards to blend with the surrounding 100-year-old buildings.

Veteran Minneapolis-based apartment developer Norm Bjornnes, however, was not deterred by those challenges in launching his latest project — a boutique, 70-unit multifamily building called Oaks Union Depot. It's now under construction just across Wacouta Street from the historic train station.

Bjornnes, founder and president of Oaks Properties LLC, has teamed with Kaas Wilson Architects on the effort, which will transform the southeast corner of Wacouta and East Fourth streets from an unsightly sunken parking lot into a what the developer predicts will be a landmark residential property for the buzzing Lowertown scene.

"Because of the Depot restoration and some of the other exciting things happening around there, we felt we needed to step up our game on this one," he said. "It's going to be a small-but-dressy building on a nice prominent corner. We felt it was important for us to continue the momentum of what's been happening in the neighborhood."

That momentum of new housing and retail business creation has not slowed since the restoration of the Depot began in 2010.

Much of that growth has been fueled by the conversion of older Lowertown buildings into residential units, such as Sherman Associates' Rayette Lofts and the Custom House, an ambitious effort from Exeter Realty to rehab the former downtown Post Office which opened last year.

But there has been no new residential construction in Lowertown since the 58-unit Farmers Market Lofts opened in February 2012. Thus, Oaks Union Depot will be testing what the neighborhood market will now bear when it comes to upscale, new-construction product.

Bjornnes said he's aiming for a price point of $2.25 per square foot, which puts it in line with some of the other prime Twin Cities urban rental markets such as the North Loop.

"It's going to be interesting because even though it's a smaller building, we'll have a wide mix in unit sizes, from large to compact, so we're going to have a 'natural' range of residents," he said. "We're not trying to just target millennials or just baby boomers. It'll be attractive to anyone who wants the Lowertown lifestyle in a brand-new building with the nicest amenities."

Its biggest amenity, like other multifamily buildings that Oaks Properties has developed, is access to light-rail transit. Its location is directly across from the Union Depot Station, the last stop (or first, depending on the direction) of the Green Line. Bjornnes previously built the Oaks Station Place Apartments in Minneapolis, a uniquely designed building directly integrated into the Blue Line's 46th Street Station.

And as with most downtown construction, Bjornnes faced higher costs due to the unique circumstances of the site. The sunken parking lot at 4th and Wacouta has been there since 1940, when an older building on the spot was demolished. But parts of the demolition debris remained under the lot undisturbed for 76 years. They had to be removed by a special process.