Interest is growing in Cottage Grove around what’s slated to be the state’s largest industrial park, and Norhart is jumping at the opportunity with a nearby multifamily development of its own.
The Forest Lake-based developer is traversing city entitlements for a five-story, 299-unit apartment building at the southwest corner of 100th Street and Hadley Avenue. It’s the first multifamily proposal near Northpoint’s planned 3.4 million-square-foot industrial park, a project that has extended infrastructure to the edge of Cottage Grove and set the stage for further development.
“We like the area. Our COO lives in that area and speaks highly of the growth that we’ve seen in that part of the state,” said Mike Kaeding, CEO of Norhart. “It’s an area that’s looking to expand and grow, which is a valuable asset to us.”
The building will have a glass front façade as Norhart looks to create a more consistent branding across its developments.
It’s a market-rate project on the higher end of quality and amenities, Kaeding said, and will include studio, one-, two- and three-bedroom units. The site will have 476 parking stalls, 283 of which are underground and the rest in a surface lot.
It will include luxury amenities like a game room, movie room, coffee area, fitness center, pet spa, pool and electric charging stations — “the whole nine yards,” Kaeding said.
He said the company is trying to change the game and solve housing affordability, mostly through driving down construction costs. “We’re already achieving about a 20% to 30% reduction in cost,” Kaeding said.
He said the company applies innovations found in other sectors, like agriculture and manufacturing, and has brought all the components in-house — supply chain aspects, trades, manufacturing capabilities and leasing.
He said people in the manufacturing world would say construction stakeholders are crazy for separating all the operations. Things get delayed and costs increase. He said the methods have helped Norhart build one apartment unit every five hours, driving timelines from 15 months down to nine.
“We’ve been — not quite — but nearly doubling in size every year,” Kaeding said. He hopes the company can produce 60,000 units a year in a decade, which could flood the market and drive housing costs down. The company has about 250 employees, 15% of which are international.
Norhart isn’t the only company interested in the area around Northpoint’s Cottage Grove Logistics Center. MWF Properties is eyeing some land, and some national single-family homebuilders are also scoping the area.
Norhart is heading to City Council on May 17 for further approvals and could break ground toward the end of the year. Kaeding said it will be a phased development to avoid flooding the market too quickly, with about two years expected for the construction cycle.
City Administrator Jennifer Levitt said single-family residential has been booming throughout Cottage Grove, but the city is “always looking” to diversify its housing stock and provide lifecycle housing.
The project’s proximity to jobs, freeway access and a 200-acre nature preserve make it “the perfect equation for this parcel,” Levitt said. “That’s why it’s really exciting for us to see a high-density apartment complex come in and be successful.”
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