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Student-housing operator asks Pine City Housing Authority for three-year loan extension
Summary
Brent Stelter told the Housing Authority he needs a three-year extension on HA and EDA loans, citing lower-than-expected occupancy and ongoing operating losses despite roughly $1.2 million in capital improvements. Board members asked staff to collect updated financials and form a subcommittee to review the request.
Brent Stelter, operator of a student housing project in Pine City, asked the Housing Authority on Thursday for a three-year extension of loans from the HA and the EDA, saying the project’s revenues have fallen short of projections.
Stelter told the board he and his partners have invested roughly $1.2 million in improvements — about $400,000 in a recreation center and about $800,000 in student housing — but currently house only about 40 students. "If the original market study had been accurate, we would be having a different conversation," he said, adding that the project ran a minimal profit or broke even in the January–March quarter because of heavy utilities costs.
The request for an extension is intended to give the operator time to stabilize occupancy and cash flow. Stelter said he and his team are not taking salaries or management fees and that they are exploring modest rent increases for the coming academic year to improve the margin. "We're probably going to be pricing a little bit different for this fall, a little higher ... to help with all this," he said. He also described frequent calls for mental‑health response among residents and said the operation is not equipped to provide clinical services.
Board members pressed for more data before committing to an extension. One member suggested an alternative: a housing‑assistance or scholarship program targeted to students who cannot afford housing. Another urged standard loan due diligence, requesting updated financial statements and a joint review with the EDA. The board agreed to ask staff to gather the operator's updated financials and to convene a subcommittee with EDA representatives to vet the extension request; the transcript does not record a formal vote on the extension itself.
Stelter said a tax abatement that was projected did not proceed, and he described difficulty recruiting students who prefer to live at home or avoid roommates. Current double‑occupancy rents were described in the meeting at about $550 per month, with a target of $750–800 for single rooms next fall to improve revenue. The authority will continue the review at a future meeting after staff compiles the requested financial materials.
