Research and speed pay off for ESG, the architecture firm designing so much Twin Cities real estate

At the most recent of dozens of meetings on the remaking of a Minneapolis institution, Nye's Polonaise Room, the city's preservationists and a developer were at an impasse over heating and air conditioning vents.

After a word with the developer, architect Aaron Roseth stepped to a microphone and firmly told the preservation commission that the change they wanted cost too much. Besides, Roseth said, "You've approved this type of system on other projects in the same historic district."

He would know. Roseth and his colleagues at Elness Swenson Graham Architects Inc., simply called ESG, dominate the Twin Cities market in the design of new housing and hotels, and they shepherded dozens of difficult projects in historic districts in recent years. With about 100 people, ESG isn't the largest architecture firm in the region, but it is arguably the most influential, responsible more than any other for the look of the cities and their suburbs over the past decade.

From low-income rental apartments in struggling neighborhoods to multimillion-dollar lakeside condominiums, ESG is known for getting projects designed, approved and built as quickly as possible. It won accolades for championing "city-building," a concept that discourages suburban sprawl by creating high-density, urban-style communities with gathering spaces, easy access to mass transit and amenities that are within walking distance.

Its buildings are typically a mix of contrasting materials and bold colors, leading to criticism that its designs look too much alike. Roseth, one of eight principals at ESG, said the tension between volume and distinctiveness of work never ends. "Our job is a constant convincing of communities and neighbors, and, sadly, sometimes the conversation about high design gets lost," he said.

The Twin Cities is brimming with decorated architecture firms, some of which focus on medical, office and industrial buildings. While the size of those types of buildings dwarfs residential and hospitality projects, new hotels and apartments outnumber the others and are often positioned in higher-traffic areas, elevating their visibility.

ESG has a reputation for knowing what the market wants and designing project concepts quickly — sometimes in just a weekend — using what the company calls a "starter kit" that serves as a template to determine the feasibility of a building. That includes floor plans, renderings, unit layouts.

"We operate more like an ad agency than a design firm because of our speed," Roseth said.

ESG researches and keeps spreadsheets on design details — everything from countertop materials to number of bike racks — for every housing and hotel project in the Twin Cities, even ones that are not its own.

"They've been really good at helping us develop a good project and good investment thesis," said Grady Hamilton, a principal with Trammell Crow Co. in Chicago. "They are incredibly prescient to details of design for markets around the United States."

ESG now has more than 50 design projects underway, most of them in the Twin Cities. It's designing the interior and/or exterior of nearly every hotel project currently in progress in downtown Minneapolis, including the Radisson Red, AC Hotel by Marriott, and Hyatt Centric, as well as the two historic renovations: The Hewing Hotel and Embassy Suites at the Plymouth Building.

It's also involved in some of the city's most contentious projects, including the Nye's redevelopment and a 40-story residential tower at the Washburn-McReavy Funeral Home site at the corner of Central Avenue and 2nd Street SE. Both projects are in a historic district that puts strict limits on the height of new development, so when the developers decided to pursue those projects they went directly to ESG. After fierce opposition to the height of the Nye's tower, the firm pivoted and swiftly produced renderings of a completely redesigned building that's shorter and more in line with what neighbors wanted.

The firm is also responsible for the Seven Corners Hardware site design in St. Paul and the mixed-use project adjacent to Kraus Anderson's new headquarters building in downtown Minneapolis, which includes a hotel, Finnegans brewery, a business incubator, restaurants and apartments.

When the city of Minneapolis last year sought proposals for a thin piece of land at 800 Washington Avenue S., two separate developers approached ESG to design their proposals. The company took on both clients and created separate teams that were walled off from one another. They produced strikingly similar ideas for a midsize hotel with retail.

ESG founders Mark Swenson and David Graham's first project in 1984 was a 270-room Radisson convention center hotel in Lansing, Mich. They expanded their practice into residential, designing an innovative student housing project at the University of Minnesota in 1989. The project was a hit and the design pipeline started to fill, but the economic downturn in 2008 put an end to that momentum.

"When Lehman Bros. collapsed, we literally got called the next day to halt projects," Roseth said.

The firm, like every company associated with construction, cut staff immediately. With 18 hotel projects halted, the company went from 91 employees to a couple of dozen. Ann Fritz, vice president and director of interiors, was six months pregnant at the time and witnessed her team go from nine people to one — herself.

In the waning days of the downturn, with the memory of the housing crash still fresh and baby boomers downsizing by the millions, demand for rental housing soared. Swenson and Graham saw an opportunity to tap into that growing appetite for urban living. They promoted their city-building concept more actively to developers.

"We didn't see a market and chase it," said Robert Loken, a partner. "The market just finally came around to our point of view."

Though ESG has been praised for its role in rebuilding the Twin Cities' urban population, the company has also become associated with a particular look — a complex palate of materials and bold colors that some say is too repetitive.

"They're just playing by the rules they've had to work under," said Tom Fisher, director of the University of Minnesota's Metropolitan Design Center.

The design process is shaped in large part by forces out of the firm's control. Codes govern height, density and other structural elements, especially in historic districts. And then there are the budget constraints of developers who are constantly watching the bottom line.

"There's an interesting tension between those who want buildings that stand out and the developers who are more focused on whether they can rent their units," Fisher said. "Design is about resolving internal conflicts and processes in various situations and they do that pretty well."

Graham said it's not always appropriate for a building to make a bold architectural statement. Leave that, he said, for more important public buildings and cultural institutions, like theaters, museums and libraries.

"Avant-garde for its own sake has gotten ridiculous," he said. "Residential should never replace the Walker Art Center."

Paul Mellblom, a principal at MSR, a large Minneapolis-based architecture firm, said that while there is a familiarity from project to project, it's as much the result of the materials and technology that are available today as it is about the quality of the firm's work. "It's a valid complaint, but that same complaint can be made about other time periods," he said.

Having worked through several development cycles, the principals at ESG know that maintaining their focus on housing and hotels makes the company vulnerable to the next economic downturn, one they believe is on the horizon. "There's still a little room to go, but the cycle is reaching maturity," Graham said.

The firm's answer is to push into cities outside of Minnesota. ESG isn't planning to open satellite offices, but it is capitalizing on its partnerships with several national developers, who are carrying them from Twin Cities projects markets elsewhere.

More than 80 percent of the company's clients are repeat customers, including Trammell Crow, which has hired ESG to bring its city-building model to other states, including Illinois and Arizona.

"This product type doesn't exist in other cities," Fritz said. "Our clients are growing with us and they're taking us national."

Kristen Leigh Painter • 612-673-4767

Jim Buchta • 612-673-7378