Westminster Church buys a piece of Nicollet Mall

The newest expansion on Nicollet Mall doesn't involve a new corporate headquarters or a hip eatery. It's affordable housing pitched by the Westminster Presbyterian Church.

The downtown Minneapolis institution confirmed Thursday that it has purchased 1221 Nicollet Mall, an office building next to the church, from Presbyterian Homes of Roseville. The purchase price was $8.7 million.

The glassy office building along the city's commercial spine will be torn down to make way for the church's ambitious expansion strategy, a good chunk of which involves building affordable apartments at a time when the number of luxury units planned downtown has exploded.

It's unclear what the 1221 Nicollet site will ultimately become, but the church has pledged $3 million to spur construction of 150 affordable units in the south mall area over the next three to five years. In July, the church purchased the Marimark apartment building at 1226 Marquette Av. S. for about $5 million. The historic church building, which dates back to 1897, already has a large footprint in the area at 1200 Marquette Av. S.

The church's project dovetails with other development on the far end of Nicollet Mall, including the $45 million renovation of Orchestra Hall, the $10 million overhaul of Peavey Plaza, and a recently completed $25 million rehab of the Hyatt Hotel.

The news comes as the Downtown Council, a local business association, pushes the city to double its downtown residential population to 70,000 by 2025. Already the number of residents downtown has surged in recent years as baby boomers to millennials snap up apartments in the Mill District and North Loop, shunning the wiles of home ownership in a tough economy.

"Do I like luxury apartments in the city? Yes, of course," said Mark Stenglein, president of the Downtown Council. "But I like having affordable apartments equally as much. This news thrills me."

"We are definitely seeing more attendance from people on both sides of river," Hart-Andersen said. "A number of our people moved into the city from the suburbs, and younger people are moving in the warehouse district or our church's neighborhood."

The church sees the influx as a means to reach residents through its "expanded ministries." However, the move to evict some 60 residents from the Marimark to prepare the site for demolition next year drew criticism last summer from some residents of the building and from City Council member Lisa Goodman. At the time, she said the church's plan will shrink an already-limited supply of low-cost housing downtown. Goodman was not available to comment on Westminster's most-recent purchase on Thursday.

Hart-Andersen said about 58 percent of the Marimark apartment residents have relocated from the site, which will serve as a temporary parking lot until a broader master plan is devised for the area. The church has extended about $350,000 in rent assistance to residents as they move, he said.

The 1221 building was originally part of the Westminster campus in the 1970s. According to Hennepin County property records, the two parcels on the site have a market value of $8.2 million.

The funds to buy the building came from members of Westminster's congregation, which will engage downtown neighbors on a "listening tour" next year to determine how the new properties can best serve the city and its residents.

Janet Moore • 612-673-7752