Sherman Associates breaks ground on Ladder 260 and O2 apartments delivering affordable and market-rate housing to Minneapolis

New Minneapolis Fire Station 1 completed as first phase of the redevelopment

 
{MINNEAPOLIS, MINN, July 11, 2022}—Sherman Associates broke ground on two apartments in its multi-phase redevelopment in the Mill District neighborhood of Minneapolis. Ladder 260 is a 6-story, 90-unit affordable low-rise apartment located at 260 Portland Avenue, and O2 is a 22-story, 240-unit market-rate apartment tower located at 250 Portland Avenue.

Sherman also celebrated its completion of the new Minneapolis Fire Station 1 for the City of Minneapolis located at 285 5th Avenue South. The fire station is the first phase of Sherman’s $161 million redevelopment of the majority of the city block.

The redevelopment is on an approximately 1.75-acre site in Minneapolis, which was formerly a vacant surface parking lot and the former Minneapolis Fire Station 1 that was built in 1909. Ladder 260, O2, and Minneapolis Fire Station 1 are three separate projects that were simultaneously developed.

Sherman acquired the parking lot from a private seller and in working with the City of Minneapolis learned that Minneapolis Fire Station 1 was outdated and too small to serve the growing needs of the Mill District. In a public-private partnership, Sherman and the City of Minneapolis collaborated to develop a new and larger Minneapolis Fire Station 1 to serve the needs of the neighborhood and optimize the layout of the city block for Sherman’s Ladder 260 and O2 projects.

“Our partnership with the City of Minneapolis on the redevelopment of this under-utilized city block was critical to achieving our goal of delivering high quality affordable and market-rate housing to downtown residents,” said Chris Sherman, president of Sherman Associates.

The new Minneapolis Fire Station 1 is approximately 19,500 square feet and consists of an apparatus bay to house fire trucks and a connected two-story structure providing office space, sleep areas, common areas, locker rooms, and rooftop patio. The $12 million fire station was financed by American National Bank and the City of Minneapolis.

Last month, the Minneapolis Fire Department moved into its new station after the City of Minneapolis purchased it from Sherman. Sherman will acquire the old fire station from the City of Minneapolis later this month and will demolish it to prep the site for Ladder 260.

Prior to the demolition, Firefighters For Healing will retrieve significant elements from the building to incorporate into its new Transitional Healing Center opening in early 2023, located a few blocks away in Sherman's Moment apartment tower. Sherman will also gather remaining items from the old fire station to incorporate into Ladder 260.

Ladder 260 provides a rare new construction affordable housing product to downtown Minneapolis. Amenities will include a hotel-like lobby and leasing center, fitness room, 6th floor lounge and rooftop deck, bike storage/parking, and available storage units. Walk-up units on the street level offer a unique unit type for the market and will enhance the vibrancy along South 3rd Street. The location has proximity to transit by light rail and bus routes and is highly walkable and bike-friendly.

Seventy-two (72) units will target household incomes at 60% AMI, 13 units at 50% AMI, and 5 units at 30% AMI. There will be 18 units receiving project-based housing vouchers, with 5 of the units reserved for High Priority Homelessness.

Ladder 260 is a $34 million project financed by RBC Community Investments, American National Bank, National Bank of Commerce, JLL, AFL-CIO HIT, Minnesota Housing, and the Metropolitan Council LHIA.

The O2 market-rate tower features smart home technology in every unit including smart thermostat, locks, and lights that allow residents to easily monitor energy usage in their homes. An underground parking garage provides 196 parking spaces, 241 bicycle parking spaces, resident storage, and electric vehicle charging stations. A surface lot provides 26 parking spaces for residents and guests.

O2 provides approximately 5,500 square feet of street-level commercial space along Washington Avenue to build on the activation in the area. The $115 million O2 apartment tower is being financed by a bank group led by Associated Bank.

Energy usage for Ladder 260 and O2 is partially offset by energy production from a solar garden located in Carver County.

This mixed-use, mixed-income development speaks to the environmental sustainability and social impact components of Sherman’s ESG Commitment. Ladder 260 and O2 provide high-quality, long-term, mixed-income housing to the residents of Minneapolis. The location in the Mill District is transit-oriented with proximity to downtown providing residents with access to mass transit, biking, and walking; and will revitalize the neighborhood and create a more vibrant community.

Construction will be completed on Ladder 260 in the spring of 2024 with O2 being completed in the fall of 2024.

Kraus-Anderson is the general contractor and ESG Architecture & Design is the architect for the redevelopment.

“We are excited to be partnering once again with Sherman Associates,” said Stefan Michno, project manager at Kraus-Anderson. “Our companies share a long history of commitment to building projects that enhance our downtown Minneapolis community with vibrant spaces and affordable housing.”

Sherman and Kraus-Anderson are currently working together on the 10-story Moment mixed-use project in Minneapolis’ Elliot Park neighborhood.


Backgrounders:

Sherman Associates

Sherman Associates (www.Sherman-Associates.com) is a growing commercial real estate development and management firm based in Minneapolis with properties throughout the Midwest and Colorado. Sherman develops, owns, and operates its assets with a long-term vision to build neighborhoods, enrich communities, and empower people.

Sherman Associates has developed over 11,700 multifamily units and currently owns and manages over 6,600 multifamily rental units (affordable and market-rate). Sherman also owns and manages over 640,000 square feet of commercial space, four franchise hotels, and two solar gardens; and has three Starbucks locations. Stay connected with Sherman on LinkedIn, Twitter, Facebook, and Instagram.

Kraus-Anderson

Established in 1897, Kraus-Anderson (https://www.krausanderson.com/) is an integrated construction management and real estate development enterprise working independently and in collaboration with a family of companies, including insurance, mortgage and realty operations. For the third consecutive year, Kraus-Anderson has been ranked the number-one contractor in Minnesota by Engineering News Record. Kraus-Anderson, an EOE AA M/F/Vet/Disability employer, is headquartered in Minneapolis, Minn. and has regional offices in Madison and Milwaukee, Wis., Bismarck, N.D., and Duluth, Bemidji and Rochester Minn.