Workforce townhome development could be coming to North Branch

The proposed development would be located south of 400th Street in North Branch, near Cherokee Avenue. Photo by Derrick Knutson
The proposed development would be located south of 400th Street in North Branch, near Cherokee Avenue.
Photo by Derrick Knutson

A developer of workforce housing townhomes has identified an area in North Branch on which it would like to build a 48- to 56-unit development.
The Commonwealth Companies has been eyeing the area, on the southwest quadrant of Cherokee Avenue and 400th Street, since the spring, Erin Anderson, vice president of development for Commonwealth Development Corporation, said.
North Branch Community Development Director Carla Vita said the property Commonwealth is exploring is around 8 acres, and it’s owned by the North Branch Economic Development Authority.
“The first thing that brought me to North Branch was that I looked at the Minnesota Housing Finance Agency’s priorities, and North Branch is identified as a workforce housing community,” Anderson said. “Compared to other towns in greater Minnesota, it’s had more job growth and (residents) experience long commutes, so there needs more housing options for working families.”
Anderson said her company is just in the initial phases of working on the development, and a plan still needs to be brought before the North Branch Economic Development Authority and the City Council. If all goes according to plan, she said that could happen in January, with land acquisition possibly taking place the following month.
“The city plans on issuing an RFP (request for proposal) for this land, so there might even be others that submit for the same land,” Anderson said.
If successful in their venture to obtain the land, Commonwealth would then have to apply to the state for housing tax credits, likely in June 2017.
Anderson said there are distinct differences between tax credit and public housing.
“It’s two things: The way that the program allows us to keep the rent lower is not by providing a direct subsidy but rather it’s an IRS program that provides a tax credit to investors, and the investors then purchase those tax credits and put equity into the project,” she explained. “With public housing that’s just more of a direct subsidy from HUD. The other main difference is that there is a set rent that you have to pay, so even if your income goes down, you’re still going to have to pay rent, but the rents are lower than your typical market. With other programs like public housing and Section 8, you’re paying 30 percent of your income, and that’s not the case with this program.”
Anderson said Commonwealth would plan on offering one, two and three-bedroom, one-level townhomes for rent, and the rent amounts would vary.
“We have two different rent scenarios we are looking at, depending on the type of funding we would be able to obtain, but both would include a mixed income development, with a range of income and rent restrictions, and some units being non-restricted market rate units,” Anderson said. “Two-bedroom units would range from $513 to $910, three-bedroom units would range from $586 to $1,071. The owner would pay for trash, water and sewer, and the tenant would pay heat and electric.”
She also noted some of the dwellings would be set aside for supportive housing.
“Ten percent of the units would be supportive housing for displaced individuals who have experienced homelessness, and we would work with an experienced support service provider to help these individuals as they transition into permanent housing,” Anderson explained. “This is a model that has proven very successful over the last seven years throughout Minnesota. There is a network of providers who manage this process through the regional Continuum of Care. It has been proven that by providing housing first to people in need, they can stabilize other parts of their life, and, for example, reduce the chances of needing expensive medical care down the road. Additionally, the support-service providers provide life skills such as employment assistance to get people back on their feet. By integrating a small percentage of these units within a larger mixed-income development, we are able to meet a broad range of housing needs for the community that are otherwise unmet.”
Anderson also noted Commonwealth would be working with a well-respected property management company in the affordable housing sector.
We would hire MetroPlains Management to provide on-site professional property management,” she said. “MetroPlains Management has built a solid reputation for managing affordable housing communities. They do an excellent job of maintaining properties and enforcing leases so that we may provide the highest quality housing possible. A good example of nearby properties managed by MetroPlains Management are Normandy Townhomes, Legacy Townhomes, and Heritage Townhomes. I would encourage people to visit these properties and contact the local government officials in Cambridge as a reference for how professionally managed affordable housing can be an asset to the community.”

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