Montevideo supports $3.9M apartment project, county approval needed next for tax abatement

Montevideo City Council members support a tax abatement to help make possible a 38-unit, market rate apartment project in the community. The city has a need for more rental and owner-occupied housing of all types, a study found

Workers work March 20 on replacing the roofing on Home Front First, an assisted living facility on Lincoln Avenue on the east side of Montevideo. The city is working to address a need for more housing for a wide range of people, from young professionals and families to seniors. The assisted living facility is located near the site for a planned 38-unit apartment facility. Tom Cherveny / West Central Tribune

MONTEVIDEO — Alek Schulz accepted the job of community development director for the city of Montevideo and immediately faced head-on the problem the community is looking to solve.

He couldn’t find an apartment in the community to rent. He arrived in July, and things are no different today. The apartment vacancy rate in the community is at 1 percent, he said.

The city is taking its first big step to address the need for more housing. Montevideo City Council members approved an agreement at their meeting March 16 to provide a tax abatement for a project to erect a 38-unit, market-rate apartment facility in the community.

INH Properties of Waite Park, Minnesota, doing business as Montevideo Multifamily LLC, is looking to develop a mix of one-, two- and three-bedroom apartment units on land near the Runnings store on the city’s east side. The company intends to break ground on the estimated $3.9 million project yet this year, Brittany Lindberg, regional property manager with INH Properties, told the West Central Tribune.

The developer is seeking an annual tax abatement of $38,000 for 10 years to make the project viable. The developer’s request for a tax abatement must also be approved by the Chippewa County Board of Commissioners. The county is expected to consider it in early April.


The need for additional housing in the community has been on the front burner for city officials ever since the Minnesota Legislature approved funding to help build a Minnesota Veterans Home in the community. Once it is operating, the veterans home is projected to create the equivalent of 105 full-time jobs.

While the veterans home project is a year or more down the road, the need for housing is now, Schulz said. A study conducted for the city by AdMark Resources and completed in January 2019 identified a need for both rental and owner-occupied housing.

“At a minimum,” the study stated the city should work to attract 24 to 32 units of one-, two- and three-bedroom apartments as well as four to six two- and three-bedroom town homes.

The study pointed to the need for apartments for young professionals and young families. It also cited a need to provide options for empty nesters and seniors as well as people looking for units with modern amenities.

The housing shortage means that many people who work in Montevideo live outside of the community, Schulz said. The housing study looked at 2015 data that showed 3,883 persons employed in the Montevideo market area, with 2,297 employed in the area but living outside of it. Many large employers in the community cited the housing shortage as adversely affecting their ability to attract workers, according to the study.

The new apartments will be available for people of all ages. Schulz said one of the hopes is that it will attract some seniors and empty nesters who have remained in their homes due to the lack of suitable apartments. If so, they might put their homes on the market and help meet the need for affordable homes for young families.

It’s also hoped that the new apartments will bring more competition to the rental market in the community, according to Schulz.

If it all works, it might just make it possible for him to find an apartment and end his need to commute.


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