Sections

Weather Forecast

Close

Hawk Ridge Estates nears completion

These homes line North 52nd Avenue East in Hawk Ridge Estates, a Duluth Housing and Redevelopment Authority project. The project has just 12 available lots left. Bob King / rking@duluthnews.com1 / 3
Homes in Hawk Ridge Estates are nestled in the forest below Skyline Parkway. Bob King / rking@duluthnews.com2 / 3
A new home for sale stands side by side with a completed home on Bald Eagle Trail in Hawk Ridge Estates. Bob King / rking@duluthnews.com3 / 3

Duluth and subdivision are rarely seen together in the same sentence. So here's a rare sentence: A Duluth subdivision is nearing completion after a dozen years sprouting homes one at a time.

Hawk Ridge Estates, a Duluth Housing and Redevelopment Authority project, has just 12 available lots left out of 126 that either have been built or have purchase agreements.

"We put in all the streets and curbs and utilities and platted the lots, and we let private builders work with private citizens to build houses that they want," said Jill Keppers, executive director of the HRA. "We don't need that same immediate return a private developer does, so we can hold things a long time and let the private market do its job out there."

There certainly is a market need for new housing stock these days, as the city says 750 new homes for all income levels are needed to keep up with demand — that's in addition to the 2,300 rental units needed.

But the price of building new and the availability of ready land in city limits often stifles potential development. Between 2010 and 2015 an average of 33 building permits were issued every year for single-family homes.

"I know the city would really like to have a production builder come through and try to build houses faster than we do, but ... private developers have a hard time doing subdivisions here," Keppers said.

Using the Hawk Ridge model — which included some lots set aside for One Roof Community Housing and incentives for affordable development — the HRA hopes to help spur more mixed-income development and encourage homeownership around the city. Next up, Keppers said, is a chunk of land in Morgan Park across from the school site.

"We plan to subdivide that piece into 11 parcels and do the same thing — help individual buyers."

Building a boom

At the top of 52nd Avenue East sit some of the newest houses in town, along with a rare sight in a city where half the homes here were built before the suburban sprawl days following World War II — cul-de-sacs.

A new home for sale stands side by side with a completed home on Bald Eagle Trail in Hawk Ridge Estates. (Bob King)Around the curvy roads, unique homes following homeowner association guidelines perforate the remaining wooded lots — poplars and some hardwoods fill in the formerly clear-cut area — in a fairly suburban scene on the edge of a much older neighborhood.

"We're finding ways to make this happen here instead of in the suburbs," said David Peterson, director of development and redevelopment at the Duluth HRA. "New houses like this create comparables, create life in a neighborhood economically. Seeding these into the neighborhood is a tremendous boost."

In that same vein, the HRA charges market rates for the land in most cases to support, rather than deflate, the values of neighboring homes. Where added affordability comes back into play is through down-payment assistance from the agency.

"What a normal developer would call profit we loan back to the family buying in at no interest for up to 30 years," Peterson said. "We help leverage them in with part of their down payment."

While the development helps plenty of current and would-be Duluthians find a place to live, the economic engine that is homebuilding can't be understated.

"If you followed one dollar throughout the home being built, you would see that it is spent upwards of eight to 10 times within one community," said Chelle Eliason, executive officer for the Arrowhead Builders Association. "All business benefits from new construction."

Governments benefit, too: Taxes from the subdivision have gone from $3,500 when the project was launched in 2004 to $412,440 from the 88 houses built at Hawk Ridge.

With homes selling faster and prices rising in the area, new construction also helps homebuyers who are facing one of the toughest local markets in years.

"We look forward to seeing more housing added and our older housing stock renovated and updated to keep the market strong which helps strengthen our economy," said Lake Superior Area Realtors president Michelle Lyons.

Elsewhere

While the original goal for Hawk Ridge was 60 percent market rate and 40 percent below, a scan of county sales data in the development shows few homes have sold for less than $300,000 to date, though a few One Roof projects are in the works this spring.

 Homes in Hawk Ridge Estates are nestled in the forest below Skyline Parkway. (Bob King)But rather than haggle over the proper price of a brick, Peterson said, the price of these new homes should become more accessible to different income levels.

"What it costs is what it costs, and we need to work with the community and the buyers and making it work for them. Affordable for you is what you can afford to buy," he said. "There are lots of people doing well, and moderate incomes should be able to buy too."

The city's Housing Action Framework adopted earlier this year also shows higher-end homes remain in demand — about 140 are needed — in addition to the 165 homes needed at more entry-level prices below $140,000.

Building new is just one way the city can address its housing crunch, as there is still room for infill and redevelopment and meeting rental needs as well. But Keppers says the HRA is onto something that should be replicated elsewhere.

"After Morgan Park, we're working with the city looking over the Irving Fairmont plan — there's some land up there and we're trying to figure out how to structure that," she said. "This model out at Hawk Ridge, where a housing authority can help with infrastructure costs and help hold lots for private builders to come in, is a model for them to utilize at that site as well."

Brooks Johnson

Brooks covers business and the economy for the Duluth News Tribune.

(218) 723-5329
Advertisement
randomness