MINNEAPOLIS — Kraus-Anderson has broken ground on Exodus, a $24 million affordable housing project in downtown Minneapolis. The developer, Aeon, is partnering with St. Olaf Catholic Church on the project, which involves the rehabilitation and addition to an existing eight-story building adjacent to the church. Once complete, the development will provide 72 studio units of deeply affordable housing, designed to support individuals experiencing homelessness and housing instability. Residents will be referred through Hennepin County’s Coordinated Entry and Behavioral Health Systems. Touchstone Mental Health will provide comprehensive supportive services.
Through a long-term ground lease, Aeon will be the new owner and operator of the building. Constructed in the 1950s, the building was originally designed to provide dorm-style housing for young professional women working downtown. Over time, the property transitioned to providing temporary shelter for unhoused individuals downtown through Catholic Charities and Hennepin County, before becoming completely vacant.
Urbanworks Architecture and Kraus-Anderson will serve as the architect and general contractor. Plans call for the substantial rehabilitation of the building’s interior and connecting a newly built eight-story addition adjacent to the original. There will be community spaces, outdoor green space and a fitness center as well as new mechanical systems.
The project is being financed with nearly $17 million in equity from Low-Income Housing Tax Credits provided by R4 Capital, $7.8 million in Housing Infrastructure Appropriations from Minnesota Housing, over $3.1 million from the City of Minneapolis’ Affordable Housing Trust Fund, $467,000 from Minneapolis and the Metropolitan Council to remove asbestos and other hazards from the existing structure, $3.2 million from Hennepin County’s Supportive Housing program, a contribution of $1.1 million from nearby Westminster Presbyterian Church and $1.5 million in resources directly from Aeon.
The project also benefits from contributions made to Minnesota’s State Housing Tax Credit program, and MinnWest Bank is providing a $12 million construction loan. Rental subsidy on each of the 72 units will be provided by the Minneapolis Public Housing Authority, the U.S. Department of Housing and Urban Development and Hennepin County’s Housing Support program. The contribution of the existing structure and land from St. Olaf Catholic Church was instrumental in ensuring the project’s viability.
Construction is scheduled to last approximately 13 months.