Sherman Buys Coon Rapids Sites Next to Northstar Station
By: Matt M. Johnson April 13, 2018 7:12 am
Minneapolis-based Sherman Associateswill end a 25-year apartment construction drought in Coon Rapids this summer when the developer starts a mixed-income project next to a Northstar commuter rail station.
Sherman, which proposed a plan three years ago, is in the home stretch for beginning construction on a total of 251 apartments in two four-story buildings next to the Northstar’s Riverdale Station.
The developer paid nearly $1.5 million in two transactions for the 6-acre project site, according to recent certificates of real estate value.
The city, which sold the sites, expects to issue building permits in time for a June groundbreaking, said Matt Brown, Coon Rapids’ economic development manager.
The Coon Rapids Housing and Redevelopment Authority purchased the land as part of a larger $2.3 million deal in 2003 with the Anoka County Regional Rail Authority, according to county property records.
Sherman plans to construct a 71-unit mixed-income building and a 180-unit market-rate building on the vacant land, which is north of the Riverdale Station and in the southwest quadrant of Round Lake Boulevard and Main Street. A freestanding retail building is also slated for construction on the site.
The market-rate apartments will be the first built in the city in 25 years, Brown said.
“We just hadn’t seen a lot of apartments in some time,” he said Thursday.
Sherman first proposed the $58 million project 2015. But it took about three years to get the financing in place, said Will Anderson, a Sherman Associates developer. The funding mix includes $8.85 million in federal low-income housing tax credits, as well as $2 million in tax increment financing assistance from the city, he said.
The mixed-income building will include 48 apartments that will be considered affordable to tenants earning 50 percent or less of the area median income, which is $94,300 for a family of four. There will also be seven apartments in the building for people who have been homeless, Anderson said in an interview.
Market-rate rents in the two-building complex will be $1,000 per month for studios, up to $1,400 per month for one-bedroom apartments, $1,800 for two-bedroom apartments, and $2,000 for three-bedroom apartments, he said.
The smaller building will open in June 2019. Construction on the larger building will wrap up four months later.
Sherman decided to build at the Riverdale Station site because of the low vacancy rate in the city and to take advantage of access to the 40-mile Northstar line, which runs between Big Lake and Target Field Station in downtown Minneapolis, Anderson said.
The apartment vacancy rate in Coon Rapids is 1.8 percent, according to the most recent Apartment Trends report from Marquette Advisors.
“We think it’s a strong market we’re interested in pursuing,” Anderson said Thursday.
Sherman also has three years to exercise an option to buy another 6 acres of nearby city land that was part of the purchase from the rail authority. The developer would likely build two age 55-plus apartment buildings on the land, Anderson said.