Golden Valley leaders have approved what will be one of the city's largest apartment buildings, with dozens of units for lower-income renters.

The City Council signed off last week on the project, which is the first approved under a five-year-old policy that encourages apartment buildings with units affordable to lower-income people.

In the planned building on Golden Valley Road near the intersection of Wisconsin Drive, 46 of 303 apartments will be affordable for people earning 60% of the area median income — less than $75,000 a year for a family of four, or $52,500 a year for a single person.

"We know that in the state there is a great need for affordable housing," said Cherie Shoquist, Golden Valley's housing and economic development manager. "To be economically diverse and provide housing options for a variety of levels of rental density makes sense for us."

The building's affordable apartments will be priced at just less than $1,400 per month for a one-bedroom to $1,938 for a three-bedroom. The building alone would almost completely fulfill the Metropolitan Council's goals of 48 new apartments in Golden Valley at those prices.

The project will be a major change for the site, which now is home to a small Park Nicollet clinic building and a Wells Fargo branch.

During an hourlong public hearing about the development in March, nearby residents were wary of the size of the new building, the potential for heavier traffic and an influx of new neighbors. Some worried more people would mean more crime, while residents of nearby townhouses were concerned they would get less natural light with a six-story building across the street.

The developers, Sentinel Management Co. and Monarch Commercial Real Estate, are using $11.2 million in tax-increment financing (TIF) from Golden Valley for the site. Shoquist said the area has been designated a TIF district for decades, as city officials have long hoped for more apartments and mixed-use development in the area.

"It was an area of the city where we did want to see more density," Shoquist said, especially near Golden Valley's main shopping and restaurant area.

Work is set to start in August with the demolition of the clinic building and the construction of a new Wells Fargo branch. Construction on the apartments will start next year after the existing bank branch is demolished, according to developers; work will last two years.