City leaders in St. Paul have a vision of a vibrant and living downtown. Even before the planning phase for the Central Corridor light rail line had begun, the city was committed to ensuring a mix of housing types in downtown. In just the period from 2008 to the present, 300 units of affordable housing were completed in downtown. The addition of 254 units of market-rate housing in the Penfield project, including the only full-service grocery store in the area, will offer an added dimension to central St. Paul and seeds future investment opportunities.
The development at Penfield evolved over decades, but was actively in planning the past eight years. It was first envisioned as a 30-story, 300 unit condominium project developed by the private sector. However, in the end the city acted as developer and major equity investor for the project which will serve the rental market.
The Penfield site incorporates an entire city block. A historic public safety building, dating to the 1930s, will have part of its façade saved and incorporated into the new construction, helping to maintain the distinctive style of downtown St. Paul. Elements of the design, including a 12,000 square foot green roof, the materials to be used, and the proximity to the Central Corridor light rail line will yield a LEED silver level certificate.
The blended financing for the $62 million project demonstrates the city’s creative use of public and private partnerships. A significant innovation was undertaken with help from experts at the University of Minnesota. The city decided to bid for contracts on the basis of “best value” rather than simply lowest price. The nine-point evaluation criteria for the proposal included the following elements:
Funds from the state and county governments (some targeted to contamination remediation), from the Metropolitan Council (Livable Communities Demonstration Account) and from the city’s Housing Redevelopment Authority (HRA) provided a considerable amount of the funding. The HRA, for example, purchased the land from the city valued at $3.5 million. The AFL-CIO Housing Investment Trust will hold a 40-year $40 million mortgage note backed by Ginnie Mae (Government National Mortgage Association).
The St. Paul HRA will own the apartments. Units will include studios as well as a mix of 1, 2, and 3-bedroom apartments. Average rent per square foot is $1.85. Groundbreaking took place on July 16, 2012. Access to apartments is expected by late 2013.
Overall, the addition of the Penfield project to Downtown St. Paul provides several important elements essential to the city’s vision for the district. Boasting a variety of housing options for low, moderate and higher income residents, a much-needed grocery store and proximity to public transit, the city has established the foundation for catalytic investment in a targeted geographic zone.
For detailed information about the project contact Marie Franchett in the city’s community development office (email@example.com). The department director is Cecile Bedor.