St. Croix County showing signs of housing construction comeback

Housing starts in St. Croix County, the presumed beneficiary of a four-lane bridge that opened in August, show signs of recovery after a flood of foreclosures during the Great Recession.

Through September of this year, the county has had 294 housing starts, continuing a modest comeback that became apparent in 2016 when the county had 359.

Now, the question becomes just how much the new St. Croix River bridge will drive housing growth.

"I wish I had a crystal ball that actually worked," said Paul Mayer, president of the New Richmond Area Economic Development Corporation. "What we will see is an increase in residential development first. I suspect that what the bridge will provide is faster commutes back and forth between Wisconsin and Minnesota."

In New Richmond, a city of 8,500 in northern St. Croix County, building permits were issued for 57 dwelling units in 2016. Ninety permits for single-family and twin houses have already been issued this year, said city building inspector Sarah Skinner.

"Things are on the upswing, yes," Skinner said Friday. "I think everybody is generally feeling the effects of a better economy — and the bridge isn't hurting it."

In the pre-recession boom years, St. Croix County enjoyed the fastest rate of growth in Wisconsin. More than 1,200 houses were built in each of three consecutive years preceding the recession. In 2009, housing starts dropped to about a tenth of that number.

"I was surprised that 14 years ago those numbers were over a thousand," said Bill Rubin, executive director of the St. Croix Economic Development Corporation. "We're slowly coming around, but what will happen next is anybody's guess."

The $646 million bridge project, which began in 2014, included funding to update zoning laws to better manage growth resulting from the new bridge. It also paid for a University of Wisconsin study of St. Croix County's economic development potential.

"The trends suggest that it is less likely that St. Croix County will return to growth rates experienced in the 1990s and 2000s, even with the improved crossing," the study concluded.

Before the downturn, advocates of a new bridge cited the county's rapid growth as a major reason for building it. However, a sudden combination of circumstances, including declining interest in exurban living and problems in the mortgage market, curtailed the land rush.

Rubin said "it's hard to pin down" where in the county most new houses are being built. Starts are measured as building permits for single family and twin homes, he said, and come from the Wisconsin Builders Association.

Earlier measurements of growth, including Census reports, projected that most of St. Croix County's future housing and business development would occur along the Interstate 94 corridor through Hudson.

The new bridge crosses the St. Croix River 6 miles north of I-94 at Oak Park Heights. In Wisconsin, it links with rural St. Joseph Township, which has more than 250 undeveloped lots for sale.

Town Chairman Tom Spaniol said recently that many new home buyers can't afford land prices because the town requires at least 3 acres to build houses. Zoning ordinances are written to ensure orderly growth, Spaniol said, and lack of sewer and water lines would discourage sudden upswings in housing.

The bridge project included building a final segment of Hwy. 64 that now allows motorists to drive on a four-lane road from the new bridge to New Richmond, sharply shortening driving times for job commuters.

Rubin said the strategic importance of a new bridge and highway to northern St. Croix County can't be underestimated. They greatly increase the region's access to the "economic engine" of St. Paul and Minneapolis, he said, and strengthen the county's position as part of the 16-county metropolitan market area.

In New Richmond, economic development leaders have worked hard to attract growth the bridge might bring.

Mayer said as more people come, commercial development will follow, and the city already has a busy airport now easily accessible to Minnesotans. Two housing subdivisions that sat stagnant during the recession are showing renewed signs of life.

"They're selling the homes as fast as they can build them," Mayer said.

Kevin Giles • 651-925-5037