Housing plan by private interests with public backing holds promise on North Side

May 29, 2016 at 7:00PM
Minneapolis realty agent Constance Vork
“I’ve seen nice manufactured product and this sounds fantastic.” Minneapolis realty agent Constance Vork (The Minnesota Star Tribune)

The brass at Thor Construction is tar­get­ing north Minneapolis.

For commercial development, jobs and hous­ing.

And that's a good thing. Because the North Side, with the highest proportionate concentration of minorities and lowest incomes, is the weak link in the Twin Cities economy. De­spite pock­ets of new com­mer­cial devel­op­ment along W. Broad­way and Low­ry Avenue, and a sprin­kling of new hous­es, the core neighborhoods are still plagued by crime, high un­em­ploy­ment, board­ed-up hous­ing and resident flight thanks to the 2006-09 mort­gage cri­sis.

Yet that dour theme since the 1980s is contradicted on some blocks and com­mer­cial cor­ners. And there is hope of bet­ter days a­head.

Thor, the larg­est black-owned busi­ness in Minnesota, is ne­go­ti­at­ing for land with Hennepin County and plans to move its head­quar­ters next year from Fridley to a va­cant lot at Plymouth and Penn ave­nues. Thor prin­ci­pals also are form­ing a new com­pany, Sm+rt Homes. It will site and sell high-qual­i­ty, urb­an-style manu­fac­tured hous­ing at up to 25 percent less than the cost of site-built hous­ing to help fill at least some of the 500-plus va­cant lots created when gov­ern­ment razed a­ban­doned, tax-for­feit­ed prop­er­ty.

Home valu­ations are ris­ing through­out north Minneapolis amid the hous­ing short­age.

"I've seen nice manu­fac­tured prod­uct and this sounds fan­tas­tic," Constance Vork, a North Side res­i­dent and re­al­ estate a­gent, said of Sm+rt Homes. "The North Side mar­ket has come back. There ha­ven't been as many teardowns. Housing prices are ris­ing. Last week­end, my group had three list­ings sell af­ter multi­ple offers in the Homewood and Old High­land neighborhoods. All three sold for over their list­ed prices of $150,000. We just don't have en­ough hous­es to sell."

The prin­ci­pals of Sm+rt Homes, Thor CEO Ravi Nor­man and con­struc­tion man­ag­er Gary Findell, say their hous­es will dem­on­strate that mod­u­lar hous­ing, de­signed with an ur­ban look and mod­ern-day ameni­ties, and high en­er­gy efficiency and gar­ages, can be de­liv­ered, in­clud­ing lots, for $180,000 to $240,000 — a significant dis­count to the $300,000-plus hous­es that have been de­vel­oped at sev­er­al North Side sites by oth­er devel­op­ers.

Jeff Washburne, a vet­er­an busi­ness­man and North Side res­i­dent who runs City of Lakes Community Land Trust, which last year helped 40 North Side fami­lies gain homeownership, is hope­ful of the in­itia­tive. He re­mem­bers at least one for­ay by a de­vel­op­er in the early 2000s with manufactured hous­ing. How­ever, they were cheap mod­els, built on slabs with no base­ments or garages.

"There is still this area in north Minneapolis where there is a great op­por­tu­ni­ty … for current resi­dents to live in permanent housing who of­ten other­wise can't af­ford to stay in the city," Washburne said. "If they can pull this off, work­ing with or­gan­i­za­tions like mine that get peo­ple ready through fi­nan­cial ed­u­ca­tion, and raise some 'af­ford­a­bil­i­ty gap' mon­ey … be­cause even $180,000 is still too expensive for many fami­lies on the North Side.

"It will help to see the fin­ished prod­uct and look at the num­bers. If some­bod­y has fig­ured out this ani­mal, then we are all for it."

The new homes in­itia­tive ev­olved from a se­ries of meet­ings head­ed by Council Member Barb Johnson, who represents the area, and of­fi­cials of the city devel­op­ment a­gen­cy, who are frus­trat­ed with the pace of re­de­vel­op­ment. Nonprofit out­fits like Hab­i­tat for Humanity, which has built doz­ens of new hous­es with new own­ers and sells them at a dis­count, have to raise money to sub­si­dize each prop­er­ty.

Thor's Nor­man said he hopes to achieve an a­gree­ment with the city and Hennepin County soon to build a new, $30 mil­lion headquarters. Thor has 150 employees and revenue of more than $150 mil­lion. Thor Chairman Richard Copeland grew up in north Minneapolis and found­ed Thor 36 years ago.

Nor­man said the hous­ing in­itia­tive, which will be op­er­at­ed separately from Thor, "is just an­oth­er part of the vision that I have for eco­nom­ic de­vel­op­ment. Part of it is things we can do at Thor, in­clud­ing pri­vate in­vest­ment in north Minneapolis. And [Sm+rt Homes] is try­ing to do some­thing with need­ed hous­ing in an ur­ban area, with a qual­i­ty prod­uct that is more af­ford­a­ble."

The homes will be built by Dy­nam­ic Homes, a De­troit Lakes mod­u­lar homebuilder. Nor­man hopes one day to open such a fac­to­ry on the North Side.

We've seen the 20-year commercial re­bounds of E. Lake and E. Franklin ave­nues on the near South Side, areas once the city's top po­lice hot spots. There are fewer gin joints and drug dens. And more small busi­nes­ses, housing, shop­ping, art and res­tau­rants.

Commerce trumps crime, former Minneapolis Police Chief Tim Dolan, another North Side native, long has said.

Here's hoping the Thor headquarters and Sm+rt Homes initiatives are part of a safer, more prosperous North Side.

Neal St. Anthony has been a Star Tribune busi­ness col­um­nist and re­port­er since 1984. He can be con­tacted at nstanthony@startribune.com.

about the writer

Neal St. Anthony

Columnist, reporter

Neal St. Anthony has been a Star Tribune business columnist/reporter since 1984. 

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