Planning continues for new apartments on Payne Avenue lot

courtesy of Schafer Richardson Real estate developer Schafer Richardson plans to build a 99-unit affordable housing apartment building, with retail space on the ground-level, on the vacant lot between Kendall’s Ace Hardware and the former Ward 6 restaurant, off Payne Avenue.

The project manager working to create a 99-unit apartment building on the vacant lot at 848 Payne Ave. stopped by a Payne-Phalen Community Council meeting to share a few updates on the project.

While the purpose of the Nov. 27 visit was to get support for a conditional use permit to allow for height variances, there were also a few updates about the state of a possible bike path along Aguirre Street, and some board members voiced concerns about the plans.



An overview

The building is being designed and built by Schafer Richardson, a Twin Cities developer. The company has constructed multiple apartment buildings across the metro, including a similar affordable housing building in the North Loop neighborhood of Minneapolis. 

The project manager from Schafer Richardson, Katie Anthony, said the company has developer rights from the City of St. Paul to build an affordable housing apartment building — also called workforce housing — that will have 5,600 square feet of commercial space at street-level.

The city currently owns the lot but will sell it to Schafer Richardson once the company’s financing is solidified, which will include a series of public bonds and tax credits. 

According to a 2017 St. Paul Housing and Redevelopment Authority board report, the 848 Payne Ave. project was estimated to cost about $17.5 million, with a then-estimated funding gap of $1.5 million. The report also said Schafer Richardson was hoping to buy the lot for $500,000.

The city originally acquired 848 and 844 Payne Ave. from the Richard A. Wybierala Trust in 2007 for $525,000. In 2012, a portion of 844 Payne Ave. was split off and sold to Kendall’s Ace Hardware for $380,000, to construct the new hardware store at Payne Avenue and Phalen Boulevard.

Given its status as affordable housing, income limits for the building will be capped at 60 percent of the area median income. For a family of four, that’s a yearly income of about $57,000.

During a July presentation to the board, Anthony said that while specific rent prices won’t be determined until the building is actually on the market, she said rent could be anywhere from $900 to $1,000 for a studio, $1,000 to $1050 for a single bedroom unit, or $1,200 to $1,250 for a two-bedroom unit.

In total there will be 36 studios, 42 one-bedroom and 21 two-bedroom units. 

Other amenities include a dog pen area, a shared patio and a fitness room. A management office will also be located on site. 

The plan includes 90 parking stalls under and behind the building, in addition to 60 secure bike parking spots, said Anthony, which will be shared with the ground-level commercial tenants.

She said that plans are still on track from her last presentation to start construction in the spring of 2019 and to finish in 2020.


Aguirre bike trail

During the July presentation, board members said they hoped that a long-sought bike connection along Aguirre Street could be completed while the apartments were under construction. 

Following up on those comments, Anthony said during the Nov. 27 meeting that while Schafer Richardson won’t be buying the specific strip of land targeted for a trail — it’s public right-of-way owned by the city and county — a goal has been to get funding for that particular project to have it worked on while crews are working on the apartment building. 

Anthony said the city unsuccessfully applied for Liveable Community Funds from the Metropolitan Council this year for the trail. She said Schafer-Richardson and the city are continuing to discuss the bike trail and are looking for other funding opportunities. She said because of the extensive work to shore up a retaining wall and have adequate lighting for safety, the bike path could cost around $700,000. 

If the bike path comes to fruition, it would connect to trails in Eastside Heritage Park, just downhill and east of the lot. 


Making sure it benefits the neighborhood

Anthony said the company was seeking a conditional use permit for height variances, since some parts of the site will exceed the 35-foot height limit per the zoning of the lot. The building could top out at 47 feet tall in some spots due to the lot’s topography.

Board members brought up general concerns about gentrification and how the project will benefit those who already live on the East Side.

Board member Wintana Melekin, who has lived on the East Side her whole life and is co-owner of the new restaurant Momma’s Kitchen, at Maryland Avenue and Earl Street, said she wants to make sure East Siders get a chance to use the street-level commercial spaces to run their own businesses.

Anthony said the developer is currently connected with the East Side Neighborhood Development Company on that aspect. She said Schafer Richardson hasn’t started actively seeking retailers, but that once construction starts it will rely on the East Side Neighborhood Development Company and it’s understanding of the neighborhood to help find retailers appropriate for the space.

Board member Joe Kuzelka brought up general concerns like whether the project would bring new investment to the neighborhood, if the neighborhood can fill 99 units and if the income limits for the building match what the neighborhood can afford. He also wondered what the new building would mean to the status and rehabilitation of older buildings along Payne Avenue, though he said his biggest concern is the possible bike trail along Aguirre Avenue and creating that access. 

Board President Athena Hollins thanked the board members for their concerns, adding they are issues to consider for future projects in the neighborhood, while reminding them the board already voted to support the project a year ago and that the business at hand was the conditional use permit for the height variances.

The board voted to send a letter of recommendation to the city in support of the permit, with Melekin and Kuzelka voting against it.


–Marjorie Otto can be reached at 651-748-7816 or at Follow her on Twitter at @EastSideM_Otto.

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