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Duluth Housing Can't Keep Up With Job Growth

Updated: 02/13/2014 10:13 PM
Created: 02/13/2014 9:46 PM WDIO.com
By: Maarja Anderson

Growing businesses and new jobs is great news for the Northland, but people need a place to live and right now in Duluth, that can be tough.

City officials are calling it a housing crisis and Thursday, nearly 200 people met to discuss possible solutions in the first-ever Duluth Housing Summit.

Officials said hundreds of units of workforce housing are needed right now in the City of Duluth. Workforce housing isn't low-income but rather housing for full-time working professionals.

The lack of workforce units is making it tough for growing businesses, such as AAR, to recruit.

"We have probably close to 50 of our employees that are staying at local hotels waiting on some place to open up so they can get a reasonable apartment," said Mark Ketterer, VP of Operations.

Ketterer said they employ nearly 300 people and have plans to add 50 more in the fall. But the housing just isn't there, of if it is, it's expensive.

"They're looking for a very basic apartment, nothing like the Taj Mahal. They don't need the saunas or pools and all that. They just want a nice, safe apartment they can live in and that's been a whole paycheck," he said.

Warren Hanson is the president of the Greater Minnesota Housing Fund.

"They're not talking about creating low-income or affordable housing. Duluth has been very great at that," he explained.

Hanson said Duluth needs middle-income, market rate housing in order to bring in the career-minded young professionals employers want. Right now, he said the housing is older or, because of the shortage, overpriced.

Minnesota Housing Commissioner Mary Tingerthal said the shortage goes back to the recession.

"A lot of developers either lost a lot of money or went out of business as a result of the recession and now everybody is a little gun shy," she explained.

The goal of the summit is to find ways to get developing again and assure builders homes will be filled if built. The Greater Minnesota Housing Fund offered the city a challenge.

"We will bring half a million dollars to the table if Duluth employers will raise, through a capitol campaign, a million dollars," Hanson explained.

Hanson said that $1.5 million would be enough to provide low-cost cost construction loans to home builders to build 30 new homes over three years.

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