Tiny 'cottage homes' with big views planned for rocky hillside in Duluth

DULUTH – A 32-unit development on a rocky outcropping between downtown Duluth and Lincoln Park is bringing the city much-needed housing in a nontraditional package.

Known as the Point of Rocks Cottage Home Neighborhood, the collection of tiny homes is the largest such development proposed in the area and could break ground next spring.

"We think this is a really unique opportunity for Duluth," said developer Aaron Schw­eiger, managing director of Zenith Asset Management. "The topography of that area is very tricky, but these tiny homes fit the space perfectly."

The one-bedroom units will be larger than a typical tiny home at 400 to 500 square feet and will share a community room, picnic area, fire pit and sweeping views of the harbor and Lake Superior. Each will stand alone and take a bit of creative engineering to accommodate the rocky hill.

Schweiger said he hopes to have a model home up this fall before fully embarking on the $3 million investment early next year.

At about $200,000 each, the homes will be priced below Duluth's median sale price — $236,000 this year as of June, according to Lake Superior Area Realtors (LSAR) data. Per square foot, the units will be costlier than most homes for sale in the area, but traditionally built new homes are typically far more expensive.

Schweiger has been trying to develop the property for several years but found the geography couldn't handle an apartment building or condos without blasting away the rock — which wasn't feasible due to a sewer line in the area.

The property, surrounded by Point of Rocks Park, has more recently been home to a "a large transient homeless population," according to the development application. "We will be working ... to help provide services and options to any displaced individuals of the homeless camp. This will also allow us to clean up all the hazardous items and materials left by the homeless camp, such as hypodermic needles, human waste, large amounts of trash, etc."

Several other so-called cottage home projects have been approved — on Decker Road and St. Marie Street — since the city adjusted its rules on tiny homes in recent years. Some smaller units have been popping up as well. In Duluth, tiny homes need to be permanent structures connected to utilities.

"This adds a bit of middle space between the traditional tiny home product and a really small single-family dwelling," said Jason Hale, senior housing developer with the city of Duluth. "The views will probably be wonderful, and the access is terrific."

The Point of Rocks project could be a test case for the city in terms of how such projects are planned and how buyers respond.

"There may be people in the metro who want an urban cabin, and maybe there will be people who want to live here full-time," Hale said. "I think it's adding to the pie, and it will serve a couple of different niches."

Any additional housing supply is sure to help a strained housing market that in June saw 28% fewer homes for sale compared with mid-2020, according to LSAR statistics.

Partly as a result of the shortage of listings and continued strong demand, the median sale price for the broader Duluth region soared to a new high, nearly $250,000, last month. And for the second month in a row, sellers were getting, on average, more than asking price, which has never happened in previous years in Duluth.

"We're really trying to find creative and new ways to embrace and encourage housing we haven't necessarily seen before," Hale said. "I'm eager to see dirt move and things start to move forward."

Brooks Johnson • 218-491-6496