City looks at extending approvals for stalled developments

A proposal to extend city approvals for stalled residential projects could give developers some breathing room as the housing market continues to stagnate.

The City Council directed staff in December to look at lengthening compliance deadlines for delayed projects, and a draft proposal was presented at the Planning Commission’s March Committee of the Whole meeting.

“This is in response to significant changes in the economy. … There are a number of projects that are going to be facing this challenge in the upcoming time period, and we should have a way to examine that,” said City Council Member Betsy Hodges (13th Ward), who introduced the staff direction.

Existing zoning regulations give developers one year to start construction before their approvals expire, at which time the zoning administrator could grant a one year extension “for good cause shown.” The staff proposal would create an amendment allowing the zoning administrator to extend approvals another two years for projects with five or more residential units if unforeseen market changes delay
construction.

Developers that have begun demolition or partial construction would have to submit a site maintenance and improvement plan to be eligible for an extension. The zoning administrator could impose conditions or completion deadlines on those plans or deny an extension altogether.

“Whatever the process is, we want to make sure if an extension is given that it is given to someone who has proven to be a good neighbor,” Hodges said.  

Jason Wittenberg, a Minneapolis planning supervisor leading the amendment’s development, said it would only apply to projects approved within a certain time period, which hasn’t been determined. The amendment would probably be stricken when the market rebounds and additional extensions are no longer necessary, he said.

While in place, the amendment would help bring faster resolutions to vacant or partially developed sites because developers wouldn’t have to go through the lengthy application process a second time,
Wittenberg said.

“This actually provides the opportunity for something to happen a little quicker than would otherwise happen at an empty site at this point,” he said.

Michael Lander, president of local development firm Lander Group, said a further extension would be a big help for his stalled project at 2626 W. Lake St. The site was demolished in late December 2006, but the 46-unit development never generated enough sales for construction to begin, so it was put on hold in October of this year.  

Lander’s project was already granted its extension, which expires this month. He said he would wait to see where the market goes and what the property owner wants to do before going through another application process — a process he would avoid if he could.  

“There was a huge amount of time invested by all of the stakeholders, the neighborhood group, the city staff and the development team in the creation of that project,” Lander said. “The stalling of that project is market driven, so it seems to me it would be appropriate to extend those approvals rather than put everybody back through that process again.”

Another stalled Southwest project, one that prompted
Hodges to look into the issue citywide, is the Bancroft Condominiums near 50th Street & France Avenue. Only nine of the Bancroft’s planned 52-units have sold. The site is vacant, and the project received its extension late last year.

John Finlayson, a Fulton Neighborhood Association board member who also serves on the city’s Zoning Board of Adjustment, said he would personally like to see the project built. He said the developers are reputable and have worked well with the community.

“In this instance, I see absolutely nothing wrong with giving people in planning and zoning the ability to extend (approvals for the project),” he said.  

But delayed projects don’t bother everyone.

Allen Luciow, who lives across the street from the Bancroft site, said he was never an advocate for the project and would rather see it not built.

“I personally don’t care,” he said of the empty lot. “I wasn’t looking forward to having 50 new neighbors across the street, especially the rich ones on the top floor looking down on my yard.”

Planning Commissioner Lara Norkus-Crampton, who lives in East Calhoun, said with the number of projects in Southwest and throughout the city, it’s time to have the discussion about what to do when things don’t go as planned.    

“If there’s a way to constructively move forward on a development project and there’s a demonstrated good faith effort to make that happen, then it’s fair to at least ask for a plan on how mitigating processes can go into effect to keep it from having a negative impact on surrounding communities,” she said.

What’s next?

A public hearing about the extension proposal is scheduled for the next regular Planning Commission meeting on April 28 at 4:30 p.m. in room 317 of City Hall, 350 S. 5th St. 

Reach Jake Weyer at 436-4367 or jweyer@mnpubs.com.