Hope renewed for Headwaters

Mattamay Homes acquiring property in Forest Lake

 

In all, eight homes have been built in Headwaters. Mattamay Homes has pulled three building permits for single-family homes now under construction. The company hopes to build and sell some 60 homes in the next two years. The development is shown in the right-hand side of the picture. (File photo)

In all, eight homes have been built in Headwaters. Mattamay Homes has pulled three building permits for single-family homes now under construction. The company hopes to build and sell some 60 homes in the next two years. The development is shown in the right-hand side of the picture. (File photo)

 

Cliff Buchan
Staff Writer

It was a little more than seven years ago when developers received backing from the Forest Lake City Council for a grand plan called Headwaters Development. And grand it was, promising to add as many as 1200 homes on land south and west of the Forest Lake airport.

That was the fall of 2005 and the grand plan would soon bump head with an economic recession and tumbling home prices that would nearly bring home building to a standstill in Forest Lake.

But all has not been a failure for the public-private partnership. The Headwaters Service Center for Washington County has been built with a library and a full range of county government services. A county transit center was constructed and it serves as a hub for bus routes connecting Forest Lake to Minneapolis and St. Paul and as Jefferson Lines station.

Two senior and affordable housing apartment projects have been built, including Forest Oaks Apartments the county HRA TrailSide Senior Living building, and more apartment units could be coming this year. Two businesses – a bank and a veterinary clinic – have constructed new buildings in the Headwaters commercial area on its eastern border near US-61. One commercial lot remains open.

The completion of the Forest Lake Area Athletic Association Sports Center ice arena and the city-owned Fenway Athletic Field Complex have fulfilled two key areas of the community center dream, that remains for Headwaters.

It is the single-family housing component that continues to lag.

As 2013 opened, only eight single-family homes have been constructed in Headwaters and the bulk of the land south of Headwaters Parkway once earmarked for housing is no longer in the mix and won’t be developed for some time.

Change Coming

But change and progress could be happening soon.

Late last year land under control of Fenway Investments began transferring hands to the Minnesota division of Mattamay Homes, an Ontario-based company that plans to build homes on the remaining lots during the next two years. The land ownership transfer is expected to be completed this year, a company official said this week.

This home under construction in Headwaters will serve as the sales office for Mattamay Homes, which is acquiring some 60 lots in the development south and west of the airport. (Photo by Cliff Buchan)

This home under construction in Headwaters will serve as the sales office for Mattamay Homes, which is acquiring some 60 lots in the development south and west of the airport. (Photo by Cliff Buchan)

The original project for Fenway Investments and Pratt Development of Vadnais Heights was hit hard by the recession, said Mayor Chris Johnson. With the city moving last year to amend the planned unit development to remove the south acreage from the plan and seeing Mattamay enter the picture, Johnson and other city officials are encouraged the remainder of the project can blossom.

“I see that as a positive,” Johnson said. He believes Mattamay has entered the picture at the right time and will move the housing development forward.

“As the economy starts to turn, that’s the next place for development in Forest Lake,” Johnson said. “That’s my sense.”

Doug Borglund, the city’s community development director, is also encouraged.

“We are seeing new momentum,” he said. “There are people talking and people looking,” he said of the potential for homes to be built in Headwaters.

Len Pratt, president of Pratt Homes, did not return phone calls seeking comment for this story.

Mattamay’s View

Steve Logan, Mattamay’s division president in Minnesota, believes his company will succeed in selling lots and building homes in Headwaters in 2013 and 2014. “We think the price is right,” Logan said.

He said the company’s plan is to move forward with homes on 29 lots this year and another 35 lots in 2014. “I thinking the timing is right as the market is improving,” Logan said.

Logan says he likes the property because it is close to shopping, churches and schools, already has a nice mix of multiple housing units, recreational facilities, public services such as the government center, library and transit center and is close to major highways leading to the Twin Cities.

“That’s one of the reasons we bought the property,” he said of the amenities. “It’s a very central site.”

Logan says most of Mattamay’s major competitors in the metro area have turned a blind eye on Forest Lake. “People misunderstand where Forest Lake is,” Logan said.

The company’s inroads into Forest Lake will provide a new area for the company to build homes. Mattamay is building  in Prior Lake, Blaine, Chaska, Medina, Farmington and Woodbury. Mattamay, which is the largest homebuilder in Canada, expects to construct 250 to 300 homes in Minnesota this year, Logan said.

City Eager

City officials are eager to see Headwaters grow in the months ahead. The housing component is a major part of the Headwaters project and will improve the city’s tax base and help encourage more development in the city.

When the plan cleared all city hurdles in the summer of 2006, Fenway Investments paid the city $2.6 million for the property in phase one and escrowed $480,000 for infrastructure improvements including streets, curb and gutter, sanitary sewer, city water and storm sewer. Had Pratt been able to complete both phase one and phase two (phase two was property north of Headwaters Parkway and west of Fenway Avenue) total project costs would have approached $19 million. The developer later dropped plans for phase two.

Ellen Paulseth, city finance director, said the city in turn pumped its land sale dollars into paying off the contract holders that earlier sold the Headwaters land to the city and for acquiring the Forestland Nursery site on the east side of US-61 that was needed for the airport flight pattern easement.

Borglund is also optimistic that the third apartment complex featuring two 36-unit buildings to the north of the library and east of TrailSide Senior Living will be built this year. “There is a possibility it will go this year,” Borglund said.

Mattamay’s Logan says the company has pulled three building permits to date, including one for a model unit that will be used as a sales office. It should open in March and be part of the spring Parade of Homes showcase.

As part of its marketing plan for Headwaters, Logan said base prices will range from $240,000 to $290,000 for complete home packages covering 1800 square feet to 2800 square feet. Larger designs will be available, he said

“It’s well positioned,” Mayor Johnson said of Headwaters. “It’s one of the few big land tracts remaining.”

  • Phil Fishman

    Another example of the City getting involved in what should otherwise be private development. Of course, this comes at the expense of the taxpayers, both in terms of a favorable purchase price, infastructure and improvements and public funds that could otherwise have been dedicated to truly public purposes. When governmental entities get involved in private sector endeavors, be rest assured that taxpayer money will be wasted. While I understand that recessions do happen, the point is that our government entities should not be in the guessing game…leave it to the private sector and save our tax dollars for things that we really need. The Headwaters development is a great example of what government should not be doing. Mayor Johnson’s and Community Development Director Borglund’s glowing enthusiasm about the project is astounding. It continues to be the blind leading the blind.

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