New Berlin - Construction is scheduled to begin in the next few weeks on the affordable housing project in the City Center that sparked controversy and prompted two federal lawsuits against the city alleging racial discrimination.
MSP Real Estate Inc. will start work to extend Deer Creek Parkway and Library Lane, where the 102-unit affordable housing project will be built. It also will install water and sewer lines and other public infrastructure for the project, according to Jacob Klein, MSP's director of development.
MSP also will begin construction on a 34-unit senior housing apartment building on Library Lane, a project that was included in a July agreement that settled a federal lawsuit that MSP filed against the city in March.
Federal authorities also sued New Berlin in June, claiming racial discrimination drove the city's decisions to block the low-income housing development, in violation of the Fair Housing Act. That suit is pending.
MSP originally planned to build three buildings that would house 80 affordable residences, termed workforce apartments, and another building that would house 100 senior apartments, at 14901 Library Lane in the City Center area.
The St. Louis Park, Minn., developer got the go-ahead for the apartments in May 2010, but the city Plan Commission rescinded approval in July 2010 after dozens of residents rallied against the affordable housing component.
Some said the low-income housing would increase crime and did not reflect the original City Center vision of condominiums and retail shops.
In early January, MSP announced that it was taking over the Deer Creek Homes condominium project, which stalled in the City Center in 2006 after only one of four condo buildings was built. It said it intended to complete the remaining 102 condo units along Library Lane, which already had approvals from the city. Many of the units would be rented as affordable housing, MSP had said.
But the city refused to issue building permits.
The lawsuits, alleging racial discrimination and violations of the Fair Housing Act, soon followed and sought to force the city to issue building permits.
In its response to the suits, the city denied race was a factor in rejecting the original project. It had raised objections over 10 issues, including parking, tax projections and storm-water management plans.
The agreement MSP reached with the city in July allows it to proceed with the construction of three 34-unit buildings along Library Lane, for a total of 102 units. Construction is being financed using state-allocated affordable housing federal tax credits.
MSP has said that because the condominiums are being built using tax credits, 90 of the 102 units will be rented to qualified tenants who meet low-income standards. The units will be targeted for those with household income of $24,750 to $45,840, and rents could range from $663 for a one-bedroom unit to $1,100 for a three-bedroom unit.
The remaining 12 units will be rented at market rate with no income requirements.
Klein said MSP anticipates completion of the first building in April, the second in June and the third in August.
The senior housing apartment building, which was approved by the city this month, should be completed no later than August, Klein said.
Thirty of the 34 senior units will be targeted to those with household incomes starting at $24,750 and four units will be at market rates. Rents will range from $663 to $900 for a one-bedroom unit and $795 to $1,350 for a two-bedroom unit, MSP said.
MSP owns and operates Deer Creek Village Senior housing, a 145-unit complex that is across Deer Creek from the parcel on which it will build the new senior apartments to be called Heritage New Berlin.
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