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Ten01 workforce housing project remains viable but faces roughly $1M funding gap
Summary
Staff reported Ten01 has been revised to a 40-unit design with total estimated development costs of about $8.5M; state and local pledges exist but a roughly $1M funding gap remains and construction timing is contingent on securing additional funding, likely in 2027.
The Ten01 workforce housing project was updated to a 40‑unit configuration to maximize scoring for Minnesota Workforce Housing grants. Community Development Coordinator Todd Peterson said the revised design (studio, one‑bedroom and two‑bedroom units) keeps the total unit count at or below 40 to improve grant competitiveness; total development cost is estimated at $8.5 million.
Peterson reported the city has secured $123,000 in Minnesota Housing State Housing Aid from the county and a Tier II grant; local partners including Polaris, Karl Manufacturing, Citizens State Bank and LifeCare MC have pledged assistance. D.W. Jones and city staff continue to seek options to close a remaining funding gap of approximately $1 million even if a $1 million workforce housing grant were secured.
Peterson said deferring to the 2027 grant round may be advantageous because anticipated program funding will be larger and the project will no longer lose points for receiving a recent award. Projected construction is tentatively scheduled for 2027, subject to grant success and closing the funding gap. The council received the update and no binding financial commitment or award was recorded on June 1.
Staff will continue to refine financing options, pursue grant opportunities and report back to the council as the funding picture develops.
