State announces $87 million for affordable housing.

Byline: William Morris

Minnesota Housing is investing more than $80 million in projects expected to support 1,700 affordable housing units across the state.

The state agency announced Thursday that 55 construction or renovation projects, including 25 for multifamily housing, will receive $87.5 million in deferred loans and other financial assistance. The projects were chosen through a competitive process, Housing Commissioner Mary Tingerthal said in an interview.

"As the demand for more housing has increased over the years, we've tried to respond by encouraging developers to submit new construction projects, and a lot of the new construction will be workforce housing," Tingerthal said. "A lot of that will be either in Greater Minnesota or suburban areas. We're pleased there will be nine developments with more than 500 units that will be in suburban areas out of these selections."

The lion's share of funding, about $84.2 million, comes from sources administered by Minnesota Housing, including state legislative appropriations as well as several federal programs. The remaining $3.3 million comes from the Greater Minnesota Housing Fund and the Metropolitan Council.

Minnesota Housing uses a common application for multiple state and federal funding programs, with the successful projects announced every year in October or November. The total announced Thursday is down from $126 million in 2017, but Tingerthal said that largely was due to an accounting change to exclude bridge financing and other items from this year's total. In an apples-to-apples comparison, she said, this year's funding dipped by about $6 million from 2017.

The projects funded this year will have a combined total development cost of more than $364 million, up from $346 million in 2017.

This year's projects range from large urban apartment buildings to small single-family infill sites. St. Paul-based CommonBond Communities, which will get funding for five of its projects, plans to build or renovate more than 300 units in St. Paul, Shakopee, Eden Prairie, Mankato and Le Sueur.

"[Minnesota Housing] funds a significant part of the projects, but more importantly it leverages private capital to come into the development," said Cecile Bedor, executive vice president at CommonBond, who added the state's support will help secure the remaining financing needed for the projects. " We've gotten emails from other funders saying 'congratulations, we're so excited this is going to happen.'"

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