Matt Pelikan is no stranger to living in downtown Minneapolis. The 33-year-old attorney at Robins, Kaplan, Miller & Ciresi has lived in and around downtown for about a decade. On Sept. 1, he moved into the LPM Apartments, a new 36-story apartment building recently completed in the Loring Park neighborhood of downtown Minneapolis. He couldn’t be happier.
“I love being downtown, especially on the southern end,” says Pelikan. He walks to work every day. He likes being close to restaurants, grocery stores and other downtown amenities. “I’ve driven, honestly, 3 to 4 times in the last month,” he says.
At the other end of downtown, Susie and Chris Carlson, who own and operate Carlson Printing on Chicago Avenue in South Minneapolis, are enjoying their new life at the 26-story Nic on Fifth at 465 Nicollet Avenue. They lived and raised a family in Bloomington for 30 years, then decided they were ready for downtown living.
Like Pelikan, Chris Carlson says the walkable nature of downtown played a role in the couple’s decision to move downtown, along with access to restaurants, light rail and bike paths. “We’re big walkers and bike riders,” he says.
Pelikan and the Carlsons represent the two main demographic groups — millennials and empty nesters — flocking to downtown living not only in Minneapolis and St. Paul, but also in cities across the country. The trend has Steve Cramer, president and CEO of the Minneapolis Downtown Council and the Downtown Improvement District, excited about the two new towers.
Together, LPM and Nic on Fifth, he says, represent a significant marker in reaching the city’s 2025 Plan, which set a goal of having 70,000 residents downtown by 2025. For Cramer, adding more residents is key to building a thriving and commercially vibrant downtown.
“I think having a more robust, larger downtown residential population will lead to other positive developments,” he says. “I think it will help shore up our retail sector in downtown, and it will help enliven and activate Minneapolis so we can move toward being a 24-7 city. I also think it will give momentum toward building out a regional transit system that really has downtown as its epicenter.”
Just the beginning
The two towers are the first high-rise rental apartment buildings built in downtown Minneapolis in decades. Together, they add more than 600 rental units to the downtown area. Nic on Fifth and LPM also offer residents amenities befitting a luxury rental. Swimming pools, state-of-the-art fitness centers, lounges with kitchens, game rooms and private dog runs are all part of the package. The apartments have tremendous city views, 9-foot ceilings, spacious closets, stainless-steel appliances, and granite counter tops. Both buildings are LEED certified. “We just love it,” says Susie Carlson of Nic on Fifth. “It’s like being at a resort.”
The amenities come with a price tag, of course. But the two luxury apartment towers have also seemingly ignited a boom in new high-rise rental projects in the urban core.
“We believe the downtown Minneapolis market is poised for residential growth,” says Joshua Taylor, vice president of marketing, Magellan Development Group, the company behind LPM, “and that the market demands high-end residential housing.”
Just down the block from Nic on Fifth, M.A. Mortenson has begun construction on the 30-story, 262-unit 4Marq apartment project at 400 Marquette Avenue. Meanwhile, Opus is in the beginning phases of planning for two 30-story residential buildings on the Ritz block, on Nicollet Mall between 3rd and 4th Streets. Those two projects will add more than 700 new residential units, and will be part of a transformation that is taking place in the north end of Nicollet Mall, an area currently characterized by surface parking lots.
Just across the river, on the other side of downtown, Minneapolis-based Alatus Partners has plans to build a 40-story residential tower at the site of the Washburn-McReavy Funeral Home. The developer is also currently building a 13-story apartment building with street-level restaurant and retail space at 301 Washington Avenue South, slated for completion in Summer 2015. Then there’s a planned $400 million mixed-use development for Downtown East, which will reshape the area between City Hall and the new Vikings stadium.
Urban living on the rise
Minneapolis isn’t the only city witnessing this boom in high-rise apartment buildings. According to the Wall Street Journal, the number of rental towers being built in downtowns across America is the highest since the 1970s. Spurring that construction is a wave of young professionals and empty nesters wanting to experience urban living.
“A generation ago, a lot of young people, when they got out of school and got their first real job, the first thing they wanted to do was buy a house in the suburbs,” says Herb Tousley, director, Shenehon Real Estate Center at the University of St. Thomas. But that’s changed, he says. A lot of young people now want to live closer to the downtown core, and renting provides them with flexibility. Baby boomers and empty nesters are also looking to downsize and relinquish some of the responsibilities that accompany homeownership.
One of the people riding the wave is Nick Murnane, who manages Nic on Fifth for Opus Development Co. “Urban living is very big across the country right now,” says Murnane, who also notes that the city’s historically low rental vacancy rate made Opus bullish on building downtown. “We’re making a bet on Minneapolis, and we’re excited about it.”
Communities for the creative economy
For Tom Fisher, dean, College of Design at the University of Minnesota, the two towers indicate a larger shift that’s taking place across the country. Millennials and aging baby boomers, the two demographic groups driving the trend in urban living, want to live in denser, more walkable communities.
According to recent Nielsen study on the millennial generation, 62 percent of respondents said they preferred to live in mixed-use urban centers where they can be close to where they work, where they shop and where they eat. If Minneapolis can’t provide that type of environment, says Fisher, young professionals will choose other cities.
Fisher also sees the shift toward urban living as linked to the nature of the creative economy. “We’re quickly moving into an economy of mass customization, in which people have the ability to work anywhere, make things almost anywhere,” he says.
“We’re finding that people actually want to move closer together, rather than being thrown further apart, because in this new economy creativity is one of the key differentiators of products and services. And creativity needs the kind of stimulation that cities provide.”
David Graham, principal, ESG Architects, who designed Nic on Fifth, sees a philosophical shift in the way people live toward a more sustainable lifestyle. That lifestyle includes smaller dwellings that are more connected to activities, restaurants, culture, sports and transit. Graham believes that higher-density, walkable, transit-oriented cities are both a more sustainable model and a better business model.
More people, more amenities
If you build it, so the saying goes, they will come. So the question is, will the increase in downtown residents be accompanied by an increase in commercial activity?
Fisher thinks it will. Downtown commercial activity has long struggled, he notes, because of the 20th century model in which Minneapolis and many other American cities existed. In that model, most people lived outside of downtown or in the suburbs and commuted to work, so there was little commercial activity or street life outside of the lunch hour. An influx of downtown residents could change that.
“As more people live downtown, they’re going to be looking for things to do in the evening, they are going to be looking for things to do on the weekends, and that’s going to populate the retail space that we had, and maybe open up space that couldn’t support retail in the past,” says Fisher. “So I think it’s going to change the street life and the character of downtown in good ways.”
The new apartment towers are another step in the evolution that downtown Minneapolis has undergone over the past two decades. The condo boom that began in the late ’90s brought a new influx of residents, which in turn spurred more commercial activity. The Lunds and Whole Foods grocery stores, scores of new restaurants and several boutique stores have transformed downtown Minneapolis from a place where people work to a place where people live, work, shop and eat.
As a result, says Cramer, there are segments of downtown retail that are stronger than ever. But he also says downtown isn’t quite the 24-7 city he believes it can be. He hopes the two towers and subsequent housing developments will help achieve that goal by creating a need for new convenience services that will “shore up a stronger retail presence downtown.”
“A benchmark will be our first hardware store — retail that people need for their ordinary, daily lives,” Fisher adds. “I think that shows there is a healthy downtown.”
Activating urban streetscapes
Another sign of a healthy downtown is an active street life. With Nic on Fifth, Graham created an experience for pedestrians by setting the tower back an additional 15 feet from the street, which opened up space for wider sidewalks and arcades. The wider sidewalks, Graham notes, tie into the eventual widening of Nicollet Mall between 5th Street and the Mississippi River, another element of the Downtown Council’s 2025 Plan. There are also outdoor seating areas for future retail space, and the base of the building includes a light-rail station.
“Activating the streetscape is the primary object of any of these projects, because we don’t want to create isolated towers that bring nothing to the street,” says Graham. “It is essential that the street be transparent and vibrant and add a lot of activity to give back to the public realm, and create the very ambience and energy that will help promote more people moving into the downtown area and into these residential buildings.”
Fisher believes the boom in downtown rental construction, along with the planned redesign of Nicollet Mall, will have a beneficial impact on street life. “We’ve so long thought of streets as just moving vehicles and people,” says Fisher. “But streets in fact used to be places that people gathered, and I think we’re going back to that.”
Putting the city back together
Fisher says the future of Minneapolis and other urban centers rests on the idea of putting the city back together, and bringing in people to feed and sustain creativity.
“We’re reintegrating the city,” he says. “We’re taking things that have been spread apart in the 20th century and bringing them all back together in denser living, working, and making environments.”
Pelikan is one downtown resident who embraces that vision. While he thinks good things are happening downtown, he wants more. “I would like to see more development,” he says, noting that that there are still too many surface parking lots in downtown. He believes more development will lead to more interesting places to walk, more density, and more shops and businesses to make street life engaging.
That, in essence, is what the Downtown Council’s 2025 plan is all about. And as each new residential tower rises, downtown Minneapolis gets a little closer to that vision.
This article is reprinted in partnership with The Line, an online chronicle of Twin Cities creativity in entrepreneurship, culture, retail, placemaking, the arts, and other elements of the new creative economy. Chris Dall is a freelance writer based in St. Louis Park.