For rent soon: 30 new apartments in Roseau to ease housing crunch

Anyone who wants a job in the northern Minnesota city of Roseau probably will have a few options.

Polaris Industries is almost always hiring. So is the Marvin Windows plant. But for many workers finding a place to stay is the real challenge, according to Todd Peterson, the city's economic development administrator.

Apartments in the city of 2,600 are such a rare commodity that there is often a months-long waiting list for those that do come available.

But the city's housing shortage will soon ease now that the Minnesota Department of Employment and Economic Development has announced its support of a new 30-unit apartment complex. DEED will contribute $325,000 to the $3.28 million Parkland Place Apartments project. The city of Roseau promised another $460,000 for the development, which got underway last week.

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The housing shortage is a long standing issue in Roseau. Peterson said it is such a hurdle that it holds the city back from real growth. The Polaris snowmobile plant alone could use 150 more workers, he said, if workers could find housing.

Polaris, and other employers have a constant stream of applicants from places in rural Minnesota where jobs are not so plentiful — which means a stream of people who want to move to Roseau.

The apartment complex points to a potential solution to the housing crunch. More might be possible, if builders can find financing. But maintaining momentum might be difficult. Local businessman and Parkland Place developer Darrin Smedsmo is the first developer interested in Roseau since the last apartment complex went up in 2004. That's largely due to the rural nature of northern Minnesota, Peterson said.

It costs about the same to build apartments in Roseau as it would in a larger city. But there are more people in larger cities, which means banks are more likely to approve loans.

Smedsmo needed the DEED subsidy and city commitment, Peterson said, to secure a bank loan for the rest of his project.

The DEED money came through the Workforce Housing Grants Pilot Program, approved earlier this year by the Minnesota legislature. Roughly $630,000 was set aside to encourage new housing in Roseau and Pennington Counties. The program is also designed to prompt housing development in Jackson, Marshall and Thief River Falls, all rural cities with too little housing.

As Roseau grows, Peterson wants building housing to become profitable enough to exist independent of state subsidies. He described Roseau as a place not unlike the oil fields of North Dakota, where even low end apartments are taken and factory workers live in tents and trailers just outside of town.

"We have folks who come to Polaris." he said. "They accept a job and just park in the campground or rent a hotel room for a couple weeks 'til they find something. And they just never find anything."

There aren't apartments to find. Roughly half of new hires in Roseau, Peterson said, leave their jobs within a month or two because they can't find permanent housing.

Peterson has been working with Smedsmo to line up funding and the correct approvals.

Smedsmo, who owns the Americ-Inn in town, decided to develop an apartment building when guests started staying long term in his hotel rooms.

The 30 units, set for completion by next spring, will buy the city a short reprieve from its housing problem. But Peterson said Roseau really needs 120 apartments.

"We need to keep the momentum going," he said. "We can't keep waiting 10 years between developments."