An ambitious plan to remake a Lake Street block damaged in the 2020 unrest took a big step forward on Feb. 20, when the Minneapolis Planning Commission approved the developer’s land use request.

The technical move paves the way for construction to begin on Opportunity Crossing at 3030 Nicollet, a new six-story building featuring 110 units of housing atop a Wells Fargo bank branch and four commercial condos earmarked for BIPOC owners. Project for Pride in Living, or PPL, expects to break ground on the project in April and wrap up construction in October 2025, said Faith Kumon, project manager for Opportunity Crossing.

The 3030 Nicollet Ave. lot is currently fenced off with Wells Fargo signs as remnants from the former branch that operated before the unrest in 2020. Photo by Melody Hoffmann

The Opportunity Crossing site is one block away from the site of the now-demolished Nicollet Avenue Kmart, which will be redeveloped as part of the New Nicollet initiative in the coming years.

A model for equitable development in Minneapolis?

Opportunity Crossing will rise on a 2.6-acre site that was once a Wells Fargo bank branch, drive-thru, and surface parking lot. The bank was heavily damaged in May 2020 by unrest targeting the Minneapolis Police Department’s nearby 5th Precinct. Wells Fargo demolished the structure in early 2021.

The new development will feature 98 units affordable to residents earning no more than 50% of the area median income, with the remaining 12 reserved for people with disabilities and those experiencing homelessness. More than three-quarters of the units are designed for families, with two- to four-bedroom floor plans.

On the ground floor, four local BIPOC-owned businesses will share 14,400 square feet of retail space with the  new Wells Fargo branch: Afro Deli, Dominic’s Tax Service, clothing shop Novadades Krystal, and BIPOC-focused business incubator The HUB by Makee Company.

In what Lake Street Council Manager for Corridor Recovery Initiatives Russ Adams called a “first” for Lake Street, the local businesses will own — rather than rent — their storefronts.

“A nonprofit developer being willing to give up an ownership stake in part of the building to build wealth for BIPOC entrepreneurs — that is next level stuff,” Adams said. The aftermath of the unrest saw many Twin Cities organizations making anti-racist commitments that ultimately amounted to little, but PPL’s “stake in the ground” shows “we’re capable of changing how we do things,” he said.

Beyond its direct equity-building benefits for business owners,  Opportunity Crossing’s commercial condos test multifamily housing developers’ widely held belief that ground-floor retail doesn’t work anymore. Even with the 2040 Plan guiding for ground-floor retail in new multifamily projects, few developers include it.

Building ground-floor retail to current code specifications can be expensive. It’s more cost-effective for residential developers to add non-retail ground floor uses, like gyms and business centers.

The key may be to treat community-owned retail spaces as public goods similar to affordable housing itself, Adams said. Most affordable housing projects, including Opportunity Crossing, depend on grants, tax breaks, and low-interest or forgivable loans from governments and private funders. Opportunity Crossing’s major funders include Hennepin County, the Metropolitan Council, the City of Minneapolis, and Wells Fargo, which sold the site to PPL at a substantial discount and provided a $2 million grant through the Wells Fargo Foundation.

Opportunity Crossing’s commercial condos got a financial boost from the Minnesota Main Street Economic Revitalization Program, which issues grants and guaranteed loans to commercial properties in areas affected by natural disasters, civic unrest, and other economic disruptions.

“This is something we’re going to have to think about," Adams said. "To preserve cultural corridors that allow new Americans and BIPOC entrepreneurs a chance to build wealth.”

A successful Opportunity Crossing that fulfilled its equity-building mission would create momentum for redevelopment at the much larger New Nicollet site, where the City and community stakeholders hope to achieve similar outcomes on a grander scale. At New Nicollet, “it’s really important that we don’t fumble,” Adams said.

Artwork by MCAD students lines the fencing around the former Kmart lot along Lake Street. In October, the City of Minneapolis collected feedback from residents about designing the “New Nicollet.” Photo by Melody Hoffmann

“Phase one” of the Multi-Neighborhood Affordable Housing Collective

Groundbreaking on Opportunity Crossing was originally set for 2023, but rising interest rates caused a funding shortfall of about $500,000, said Sarah Linnes-Robinson, director of projects for the Lyndale Neighborhood Association. With support from the Lyndale Neighborhood Association board, Linnes-Robinson raised $250,000 from seven Southwest Minneapolis neighborhood associations to partially plug the gap. Kumon said the project is now “fully financed.”

The funding gap that threatened Opportunity Crossing last fall is smaller now thanks to a last-minute assist from seven Southwest Minneapolis neighborhood organizations.

Earlier this year, the organizations — Lyndale Neighborhood Association, West Maka Ska Neighborhood Council, Fulton Neighborhood Association, Whittier Alliance, Armatage Neighborhood Association, Linden Hills Community Council, and Kingfield Neighborhood Association — collectively deployed $250,000 in unspent City funds to help close the $61 million project’s last-minute funding shortfall. Kingfield contributed $100,000; the others gave $25,000 each.

“It was like that final scene in “It’s a Wonderful Life, where everyone pulls whatever change they have out of their pocket” to save Jimmy Stewart’s community bank, Adams said.

Ironically, the fact that the shortfall was but a small fraction of the project’s $61 million budget created an opening for the neighborhood organizations to step up. For PPL, asking project funders for more money would have been a lengthy process with no guarantee of success, and despite a recent $7 million gift from philanthropist MacKenzie Scott, dipping into its own pockets “would not have been a great business practice,” Linnes-Robinson said. “So [PPL was] super grateful for these organizations to invest."

The effort was “phase one” of the Multi-Neighborhood Affordable Housing Collective, a Lyndale Neighborhood Association-led effort to support affordable housing projects and other housing-related needs across the city.

“Phase two” of the project will focus first on the New Nicollet site and could feature an “affordable housing boot camp” that empowers neighbors’ direct involvement in plans for the site.

More broadly, the collective will look for ways to reduce the time and cost of affordable housing development, which tends to be more complicated than market-rate development. For example, the Minneapolis Public Housing Authority’s Family Housing Expansion project, which added 16 modular, deeply affordable sixplexes across the city, cost significantly more than market-rate private housing.

“So [neighborhood associations] need to be present and part of the solution,” Linnes-Robinson said.

Though neighborhood associations can’t directly influence the economics of new housing development, they can provide targeted funding to specific projects while building support for cost-saving measures that have found success in other cities.

That sentiment drew neighborhood leaders like Ray Klahr, president of Fulton Neighborhood Association, to the collective.

Like other Southwest Minneapolis neighborhood associations, Fulton has a substantial cash reserve set aside for housing-related activities, and figuring out “how we can deploy those funds in a meaningful way has been an ongoing challenge,” Klahr said. Previous housing investments were smaller, “one-on-one” efforts.

Opportunity Crossing was a chance for Fulton to make a meaningful impact at a greater scale “given limited opportunities for affordable housing development in Southwest Minneapolis,” Klahr said.