Since the economy’s crash in 2008, more than 50 projects, most of them condo towers, have stalled or vanished from the skylines of downtown Minneapolis and St. Paul. With them, expectations of livelier streets and new urban-style neighborhoods have quickly faded as both cities hunkered down to wait for better times.
Now, clearly impatient, St. Paul Mayor Chris Coleman has announced a “Rebuild St. Paul” initiative aiming, as he put it, “to put cranes in the air and shovels in the ground.”
Coleman’s bet is that $15 million in city money, coupled with bonding and other financing tools, will leverage $100 million in private investment to jumpstart 15 projects across the city. That would put 3,000 people to work, mostly in the construction trades. It would also link directly to major rail and bridge projects already under way, and it would show private lenders that St. Paul is, in Coleman’s words, “open for business.”
Nowhere, perhaps, in either city are the redevelopment stakes higher than in Lowertown, the bundle of majestic brick warehouses that form the eastern edge of downtown St. Paul.
Lowertown has all the makings of an urban boomtown: A redeveloping Union Depot, the Central Corridor light-rail line now under construction, a commanding view of the riverfront, a superb collection of historic buildings, an exquisite public square (Mears Park) and a thriving farmer’s market, a budding arts and music scene. Still, the district often has the lonely feel of an Edward Hopper painting, of a place that has yet to reach its potential.
Coleman’s initiative, however, could push Lowertown over the top. The key ingredient is an urban-style Lunds supermarket at 10th and Robert streets, part of the long-delayed Penfield project. The 30,000-square-foot market, slightly larger than the urban prototype that Lunds opened on the edge of downtown Minneapolis in 2006, would offer the best evidence that Lowertown and the adjoining Northeast Quadrant are moving onto the Twin Cities’ main stage.
Penfield is scaled back
It’s disappointing that a Hyatt hotel will not accompany the supermarket, as first planned, and that 33 floors of luxury condos will be replaced by 253 units of midrise, market-rate rental apartments. But that’s the new normal.
“Lowertown is one of the great destinations in the Twin Cities, and people are starting to recognize that,” Coleman told me on Tuesday. “It just needs a couple of sparks.”
Assuming that the Department of Housing and Urban Development (HUD) agrees, the $55 million Penfield/Lunds project would benefit from $44 million in Build America municipal bonds, part of President Barack Obama’s stimulus package.
The city will also help restart the $13 million Lofts at the Farmer’s Market project, 56 rental units and 2,400 square feet of retail at 5th and Wall streets, on the west side of the St. Paul Farmer’s Market.
Both projects are being developed by Minneapolis-based Alatus, which built the Grant Park and Carlyle luxury condo towers in downtown Minneapolis and recently purchased Block E.
“I’m very bullish on residential development in downtown St. Paul,” said Bob Lux, a partner in the Alatus firm. The prospect of Chicago-Twin Cities high-speed rail terminating at the Union Depot is particularly exciting, he said. Lux sees a good chunk of the real estate moving toward attractive city districts like Lowertown.
Lux said it’s important for St. Paul to show private lenders that a large-scale project like Penfield/Lunds can succeed. “There’s a herd mentality among lenders. Once they see a major project succeeding, they’ll be inclined to support others.”
A new phase for Lowertown
Coleman sees Lowertown as entering its third phase. First came artists to occupy the old warehouses. Then came the new residential towers on the Northeast Quadrant. Trains and groceries will validate the neighborhood, he predicts.
The mayor’s initiative is hardly large-scale by historic standards. Still, it’s significant that St. Paul has taken a leap into the development business at this critical point. Cecile Bedor, the city’s planning and economic development director, has been “unwilling to take no for an answer,” Coleman said, complimenting her staff for cobbling together a package of development incentives that, he hopes, can get construction moving again.
St. Paul’s redevelopment record has been far from perfect. “We do two things pretty well — infrastructure and housing,” he said. “Retail is tricky. I can’t change people’s retail patterns.”
Coleman and Lux said that the most important thing at this point is to get housing units into downtown to match the big infrastructure investments, especially in rail. Restaurants and entertainment often follow. And other retail could follow that. Coleman also sees a new St. Paul Saints ballpark in Lowertown’s future.
“All of these things are coming together — finally,” he said. Impatience can be an attribute in a mayor. St. Paul just plain got tired of waiting for the recession to be over.