Brooklyn Park Approves $5M Loan for Future Huntington Place Owner
The Brooklyn Park Economic Development Authority took a significant step this week in its efforts to transform the Huntington Place apartments. The EDA, which consists of Brooklyn Park City Council members, approved a $5 million, 20-year loan for nonprofit housing developer Aeon.
Aeon is expected to close on a $74.5 million purchase deal at the end of this month with Plymouth-based Dominium, the current owner of Huntington Place. The assessed value of the property is $80 million. During discussion before the vote, city leaders expressed optimism the massive apartment complex could be turned around.
“For me, I think tonight I feel like celebrating,” said Brooklyn Park Mayor Jeffrey Lunde. “Because it was over a year ago this council [there was] no buyers, no idea what could be possible.”
Huntington Place has a history of crime and unresolved tenant issues. Last summer Brooklyn Park Police Chief Craig Enevoldsen addressed the council expressing concern that crimes at the complex were “getting more serious.” The problem infuriated council members with Dominium drawing the blame.
“I think these people are slumlords and they’ve been sucking money out of people who rent there and then taking it somewhere else,” Lunde said last summer.
“The Beginning of a Journey”
Constructed in the 1960s, Huntington Place is the second largest apartment complex in the state. The 834-unit, six-building complex trails only Cedar-Riverside in Minneapolis. Even though all 834 units are one-bedroom, city officials previously estimated that as many as 2,500 people live there. That’s nearly the entire population of the city of Osseo.
Aeon CEO Alan Arthur says the purchase deal with Dominium is “the beginning of a journey.”
“There’s so much weariness about Huntington Place that just stabilizing it to some folks should be the goal,” Arthur said to the council. “But I believe we can create a neighborhood, a place where neighbors know and trust each other.”
The $5 million loan approved by Brooklyn Park will help Aeon make security and safety improvements once it takes over the property. The most significant improvements tenants will see is cameras in all buildings and electronic locks on all doors, as well as critical maintenance fixes. Rehab of individual units won’t happen until a future phase when more funding is secured.
One of the reasons Brooklyn Park aligned with Aeon was to preserve as much affordable housing as possible. Lunde pointed out a state proposal to spend $276 million for affordable housing that could preserve up to 1,800 units statewide. The mayor called that “disgusting.”
“We’re going to invest $5 million and save 834 [units]. So if you want to talk about bang for buck and leading, I think the city is stepping it up in a big way,” said Lunde.
Lunde believes the state needs to recalculate how it spends for affordable housing.
Aeon Proposes to Keep Rents Affordable
Aeon proposes to maintain rents at no more than 60 percent of area median income, which in 2019 was $1,124 a month. Twenty percent of the units would be for 50 percent of area median income, which was $937 a month last year. Officials say the area median income is $100,000 for suburban Hennepin County. Rents at Huntington Place currently average $916. Existing tenants won’t see rent increases all at once, but will be phased in over time.
“Is that low enough for all the residents in our community? It’s not unfortunately,” said Arthur. “But it’s far better than the alternative.”
Council members are hopeful they will see a return on investment.
“Some of the words that were used when I talk to residents were accountability and results. That’s what they’re looking for,” said Brooklyn Park City Council member Terry Parks.
Parks is confident Aeon can bring improvements.
“I think we have the right team now in place to get this done.”