Duluth is again offering free land to would-be developers of affordable housing. In the second round of its Rebuild Duluth initiative, designed to promote infill development, the city is taking proposals for eight available sites.
Last winter, when the program launched, the city received more than 30 proposals for 13 available sites. But of the 13 projects ultimately approved, only seven are still moving forward, according to Ben VanTassel, manager of Duluth's planning and development division.
He said some projects were canceled because developers encountered unforeseen site challenges not evident when the properties were covered with snow, and other plans have been derailed by the economic hardships of the COVID-19 pandemic.
VanTassel expressed optimism that this time around, with the process beginning before the arrival of snow, people will have a better opportunity to walk the sites and flag any potential challenges.
The pandemic also has caused the cost of building materials to soar. With more people spending large amounts of time at home, efforts to socially distance have given rise to a large number of home improvement projects.
Just ask Josh MacInnes, director of development for 1LLC. His company still plans to move ahead with its plans to construct a 500-square-foot home in Lincoln Park as part of the Rebuild Duluth initiative. He said the current cost of the lumber required to build the diminutive dwelling is 75%-80% greater than what it was last year.
"And that's just on the lumber side of things, but it sounds like there have definitely been supply issues," he said.
As a result of those higher prices and an already busy schedule this construction season, MacInnes said he and his partners have decided to push off plans to build a one-bedroom studio loft home on Restormel Street until 2021.
Under program guidelines, developers were to finish construction before 2022, but VanTassel said it's likely that will be a somewhat flexible deadline, given some of the complications people have encountered since the COVID-19 outbreak occurred.
The vacant lots being offered up were assembled with the help of the city, the Duluth Economic Development Authority and the Housing and Redevelopment Authority. Many of the properties were tax forfeited.
VanTassel said he was impressed by the response to the first round of Rebuild Duluth.
"There was a great mix of plans, but it was pretty clear that the people putting these proposals together put a lot of work and effort into them. As best they could, they worked to adjust their plans to what the site called for," he said.
The proposals were evaluated and scored by the city with an eye toward affordability, sustainability and innovative design. While there was no cap on proposed spending, VanTassel said the city encouraged developers to see if they could hold costs to no more than $150,000 per housing unit.
The proposals included single-family homes, some with accessory dwelling units attached, duplexes and even townhomes.
"It was a good mix of different structures," VanTassel said.
"The prospect of a free lot — often worth $5,000 to $10,000 — proved an attractive incentive.
"What it also did was it got people excited and kind of thinking about: What could we do with this lot?" he said. "It gets people dreaming a little bit."
MacInnes gives the Rebuild Duluth initiative high marks for that.
"We think it's an incredible program that the community is doing, and we're really excited to see all the creativity it has drawn out for these various lots," he said.
To learn more
For more information on the second round of Rebuild Duluth and available lots, visit duluthmn.gov/planning-development/housing/rebuild-duluth. Proposals are due by Oct. 16.