Chad and Andrea Hanson plan to restore the building the houses Josephson's, a local clothing store. Photo by Kate Josephson/RiverTown Multimedia.

RED WING -- Goodhue residents Chad and Andrea Hanson wanted to invest in Red Wing, the city that Andrea Hanson had worked in and graduated from while she was a teenager. So, they created a plan to buy and renew the building that houses Josephson’s in downtown Red Wing and build four apartments above the store. The space has not been lived in for over 100 years, so it needs some work.

“I can’t even rewind back and think of the very first moment that the idea came into our heads,” Andrea Hanson said. “But, the more we dug into it, it was just this exciting adventure that we wanted to dive into.”

While the couple plan to close on the purchase of the building in the coming weeks, the city of Red Wing and the Housing and Redevelopment Authority will help to fund the renovation project.

On Monday, March 9, the Red Wing City Council voted to approve a $50,000 10-year deferred loan to CMA Properties -- owned and run by Andrea and Chad Hanson. According to Dan Rogness, the community development director, the loan will fund:

  • The construction of a new internal stairway to the second floor apartments, as the only way to access the second floor currently is via an exterior staircase.

  • The demolition of a building behind Josephson’s for tenant parking.

  • The connection and new sewer and water lines within Bush Street.

According to Rogness. the funds will be taken from the Downtown Investment Partnership account.

Rogness explained that this fund “supports downtown redevelopment projects, especially those that fill vacant spaces.”

Rogness added, “The council also approved an allocation up to $100,000 from this fund to pay for additional sewer manhole and piping costs in Bush Street that will also provide opportunities for other sewer connection upgrades in that area. This is the first project to use this new city funding source since it was approved by the council in January of 2018.”

Red Wing’s Housing and Redevelopment Authority will provide a $100,000 forgivable loan for the project.

“The HRA and city created an incentive program for developers to utilize under-developed spaces, blighted property and unused lots in the aforementioned areas for the creation of new housing units," Director Randal Hemmerlin said.

“When Andrea and Chad applied for the funding, their proposal was doing exactly what we wanted in our RFP, that is, creating new units in an under-utilized second story space. The funding requires two of the four developed units to be made affordable to households at 60% of the area median Income for 15 years. This rental rate will be about $100 per unit less than the remaining two units at the market rate level. So, our AHTF deferred and forgivable loan provides $100,000 in development money to bring new four units to the Downtown with two of the units designated as affordable,” Hemmerlin said. 

As Andrea and Chad Hanson worked through the process of creating the plan for the Josephson’s building Downtown Main Street offered assistance. Megan Tsui, the executive director of the organization, told the Republican Eagle:

“Downtown Main Street has been working with the Hansons to help shepherd them through the process of obtaining funding and to offer support, guidance, and encouragement. Our hope is that this amazing project leads to more second and third story development in our downtown.”

While the idea for the building has evolved into an intricate, fully thought-out plan, the genesis of this project was simply a want to invest in Red Wing.

“I just felt called to that building,” said Andrea Hanson. “It wasn’t even for sale. We approached the owners just had many conversations with them and figured out a purchase price and then we started the process of getting bids and what it would actually cost to make this happen.”

The Hansons said they hope that the renovation of the commercial building and the construction of the apartments will be completed by the end of 2020.

CMA Properties has created a Facebook and Instagram account so people can follow along with the building's construction.

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