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Housing for homeless project sees $8M in state support

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Plans to build 30 rental units for homeless and disabled residents suffering from mental illness received an $8 million boost this week.

"That’s a big deal," Olmsted County Board Chairman Jim Bier said of the Minnesota Housing funding approved Thursday.

The state investment will be used to create a planned 30-unit supportive housing complex on a portion of the land the county owns at 1025 Mayowood Road. Plans call for the county to sell the land to Center City Housing to develop the $8.38 million project.

Rick Klun, Center City’s executive director, said work on financial closing for the project will likely extend into the summer, which will be followed by an expected nine-month construction period.

When complete, the apartment complex will provide 30 one-bedroom units, as well as services to support residents’ mental health needs. Center City will work with the county and its Housing and Redevelopment Authority on the project.


The Duluth-based company already has similar agreements for the Gage East and Silver Creek Corner projects, which provide specialized housing for formerly homeless residents.

"We’re really excited that we were selected," Klun said.

The funding is part of $245 million approved to create and preserve more than 2,665 homes throughout the state.

"This investment means more Minnesota families will be able to live in a home they can afford in a community of their choice, and more businesses will be able to attract and retain the employees they need to thrive," Gov. Tim Walz said in a statement announcing the funding. "While this funding puts us on the right path forward, we still have work to do. I look forward to our continued conversation on how to provide housing options that meet the full spectrum of needs of Minnesota’s growing population."

In addition to the Olmsted County partnership with Center City Housing, the state housing department also approved $7.3 million in investment and $10.3 million in tax credit equity for an $18.2 million housing project planned by Joseph Development in Northeast Rochester.

The proposed 76-unit complex near the intersection of East Circle Drive and Viola Road will provide apartments for households earning approximately $42,000 to $58,000 a year. Eight units will be set aside for people who are homeless, and four will be designed for people with disabilities.

A third local effort being funded by Minnesota Housing will help area residents invest in their own homes.

Three Rivers Community Action was awarded $200,000 from Minnesota Housing and $170,000 from the Greater Minnesota Housing Fund for a gap-financing program to help 20 Southeast Minnesota households afford downpayments on homes.


The program aims to reduce the state’s racial and ethnic homeownership disparity and will benefit families with incomes up to 80 percent of the area median income, or $70,900.

Bier, who serves with fellow commissioners on the Olmsted County Housing and Redevelopment Authority Board, said combined state support for local housing efforts is good to see.

"To me, that shows they think we are on the right track," he said.

Related Topics: FINANCE
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