St. Paul Affordable Project Lands $33M Construction Loan
The financing package included LIHTC equity and a bridge loan.
Project for Pride in Living has secured a $32.9 million construction financing package for East 7th Street, a 60-unit affordable housing development in St. Paul, Minn.
Merchants Capital provided $18.9 million in 9 percent LIHTC equity and secured a $14 million bridge loan issued by Merchants Bank.
Construction is already well underway, having kicked off last December. Completion is expected in 12 months. Cuningham Architects designed the project.
Upon its debut, East 7th Street will include 17 units income-restricted for residents earning up to 30 percent of the area median income and 43 units catering to individuals who earn no more than 60 percent of AMI.
What’s more, seven of the apartments will be set aside for residents living with disabilities, while another seven units will be reserved for people experiencing homelessness. Ramsey County will facilitate the latter through its Housing Support Program and Coordinated Entry System.
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Located at 892 E. Seventh St., the construction site is about 5 miles southwest of downtown St. Paul and roughly 9 miles southeast of Minneapolis’ city center. The Mississippi River and Recreation Area are less than 4 miles from the site.
The community will encompass one- to five-bedroom apartments. Common-area amenities are set to include a gym and wellness room, storage units, a conference room and a playground, among others.
Minnesota’s take on state tax credits
Minnesota’s new State Housing Tax Credit Program and Contribution Fund that passed in 2022, allowing taxpayers to invest in housing projects of their choice across the state, was instrumental in East 7th Street’s financing.
This development wasn’t the sole Project for Pride in Living community eligible for the program. Union Park Flats—a 60-unit affordable community in St. Louis Park, Minn., that debuted just last month—and Opportunity Crossing, a 110-unit affordable housing redevelopment transforming a former Wells Fargo bank site, also qualified for the credits.
Project for Pride in Living owns and manages 1,762 affordable housing units throughout the Twin Cities. Tackling the affordable housing supply challenges, the developer expects to bolster its footprint by an additional 212 such apartments by year’s end.
Twin Cities’ affordable deliveries to slow down
The Twin Cities market’s construction pipeline reached $1.8 billion square feet in January. Four months later, developers had roughly 8,000 multifamily units underway, including about 2,000 apartments inside fully affordable projects, Yardi Matrix data shows.
Last year, north of 2,360 affordable units came online throughout the metro, the same source shows. Though income-restricted unit completions are set to reach a peak this year across the country, the Twin Cities are bucking national trends with just 1,822 affordable apartments on track for delivery in 2025, marking a 22.9 percent decrease year-over-year.
