New housing could change city

Two housing projects currently in the works have the potential to make an impact on Pine City for decades to come.

Timber Pines

Summit Development plans to put 103 units of senior housing on the south side of Northridge Avenue just north of Welia Health System (formerly FirstLight) in Pine City.

Pine City Community Development Director Lezlie Sauter said the completed project will be called Timber Pines Senior Living Facility, and will be a three-story building with indoor parking. The development will include independent, assisted and memory care facilities. Summit Development has partnered with Walker Methodist to provide the services.

“They are still finalizing their building plans,” Sauter said. “The start date keeps getting pushed back, but that’s typical in construction. Drawings and plans always have to be revised.”

She said that groundbreaking is now expected to take place in December with construction continuing through the cold and snow of winter. The buildout is expected to take between 18-24 months.

“We toured the one in Cambridge. It feels like you’re entering a hotel,” Sauter said. “They have a welcome desk, and that’s typically where their restaurant or their cafeteria is. It’s not set up like a cafeteria you’ve seen typically in an institution like that. The public is welcome to come in during their operating hours and have lunch. They want it to feel more like it would be at a home. There’s a kids’ menu. I think they develop a really good-quality product.”

She described the development process for the project as, “very, very smooth.”

“So the last month [the city council] approved the tax increment financing for the project, which helps cash flow it,” Sauter said. “Housing is a risk, but this is a need.”

Sauter noted that the project is far from finished (“It’s not a done deal until they get their certificate of occupancy and moving people in.”), but said she is excited about what such a development could mean for Pine City.

“It’s kind of cool that this big of a development is coming,” she said. “It will be a big deal for our community because it is going to keep people in our town. It is going to free up some housing for people that want to move in.”

Hilltop Cottages

Since 2017, Commonwealth Development Corporation has been working at putting 35 units of affordable housing in Pine City. The units in Hilltop Cottages would be wood-framed townhome-style buildings, and the project would be built on 5.85 acres of land located south of the Minnesota National Guard Armory on the west side of Highway 61. That land is currently owned by Pine City.

Sauter said that the project has taken a long time since it had to be approved for tax credits from the Minnesota Housing Finance Agency.

“We had to prove that we were a worthy community for the funding,” she said. “Low income tax credits are really hard to get. They’re really hard to make the numbers work too.”

She said Commonwealth has submitted several proposals, making small improvements each time until the project was finally funded. She said it is more challenging to get affordable housing projects in a rural community.

“Developers make more on their investment when they do more units, but smaller communities can’t just plop in 100 units of affordable housing,” Sauter said. “You can do that with senior housing, but not affordable housing in smaller communities, just with the demographic trends. So it’s a complicated project for sure.”

The project was originally scheduled to start in 2019, but had to be put on hold after bids for the work came back about $500,000 over budget.

“They had to go back to Minnesota Housing Finance Agency for additional funding,” Sauter said. “The numbers have to work.”

She said that the project would open up affordable housing options in Pine City.

“Typically, people moving in will be making $12-$15 an hour, so it’s not super-low income housing,” she said. “It’s definitely affordable housing for people just starting newer jobs. If you’re a personal care attendant, that would be where you could afford to live on those wages.”

Sauter explained that the unit has a fixed rent for the lifetime of the resident living there.

“You just have to meet the income requirements to move in, and then that rent never goes up,” she said. “It doesn’t fluctuate like other ones do. It sticks at that, because that’s how the tax credit subsidizes it.”

Construction is now planned for the spring of 2020.

“They’re lucky they have a partner with the city,” Sauter said. “We’re the ones that own the land. We will happily hold it for them and keep extending their purchase agreement. It’s a good partnership. We’re moving forward in a very positive direction.”

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