The oldest two of the four buildings that form Nye’s Polonaise Room in northeast Minneapolis will be saved and incorporated into a mixed-use development beside a 29-story residential tower, under plans the restaurant’s owner and a developer unveiled Thursday.

A three-story building with a “Harness Shop” sign atop it and a two-story one that curves around a corner, both more than 100 years old, will be preserved, Ron Jacobs, the owner of Nye’s, and representatives Schafer Richardson, the developer working with him, said at a meeting with neighborhood residents and business owners.

The group plans to move the two buildings together and build other retail and restaurants around them and the new apartment tower. For the time being, the project is being called 116 East Hennepin, for its address just across the Mississippi River from downtown.

The two buildings are connected by a one-story building that was built in the 1950s and is fronted by a facade that somewhat resembles a piano. It and another modern building on the other side of the Harness Shop building will be torn down.

“We’re going down the road of making sure that we are doing the right thing, and the responsible thing,” Jacobs said in an interview. “We’re not outsiders coming and saying we’ll blast everything out. We were born in Northeast and have been doing business in Northeast for many, many years.”

His announcement last month that he and his brother Tony were closing the piano bar and restaurant led to an outpouring of nostalgic memories from current and former customers.

The pair approached Schafer Richardson, which is based nearby, earlier last year to explore options for the property at a time when two other major residential projects are underway in the neighborhood.

On Wednesday, Chicago-based Lennar Multifamily Communities got the green light from a neighborhood task force to build an 18-story tower with more than 250 apartments at the Superior Plating site about four blocks from Nye’s.

Alatus LLC, a Minneapolis developer, has been working on plans to build a 40-story residential tower that would replace the Washburn McReavy funeral chapel at 200 Central Av. SE, just two blocks from Nye’s.

For 116 East Hennepin, Maureen Michalski, a project manager for Schafer Richardson, said that positioning the two century-plus buildings next to one another will create a pedestrian-friendly storefront and leave room for the apartment tower.

An initial proposal, endorsed by some members of the neighborhood group, suggested that all of the existing buildings might be razed to make way for the tower.

The Jacobs and Schafer Richardson firm are in the early stages of their project and, along with neighborhood support, will need city approval.

With three towers in the pipeline for Northeast and thousands of new residential units proposed or under construction in the Central Business District and North Loop neighborhoods, developers are feeling competitive pressure.

Peter Chmielewski, Lennar’s senior development manager, said he’s eager to be the first to start construction and would like to begin this fall. “Competition is great, but yes, I am concerned” about timing, he said.

Mary Bujold, president of Maxfield Research, said that Northeast is gaining ground on the North Loop as the city’s hottest new neighborhood for shops, restaurants and new housing. “I think that area is like a mini North Loop, it’s up and coming,” she said.

And while there’s already a good mix of housing along the northeast side of the river, there’s only one new apartment project that’s still in the lease-up phase. That’s the Red 20 apartments, which is also developed by Schafer Richardson.

The firm has renovated several historic buildings in the area, including a luxury condo building called the Phoenix on the River. It attempted to develop the $500 million East Bank Mills condo and apartment project in and around the Pillsbury “A” Mill. But after seven years of planning, the project went into foreclosure.