A planned apartment building in Ramsey was derailed last month when the City Council refused to extend a purchase agreement with nonprofit developer Aeon.

Aeon had agreed to pay the city $123,368 for a lot in The COR, Ramsey’s mixed-use city center district, on which it planned to construct an apartment building. It would have been the second apartment building owned by Aeon in The COR.

The city’s purchase agreement with Aeon expires Jan. 13.

In a split vote Dec. 10, 2019, the council voted 4-3 to deny an extension of the agreement, with Mayor John LeTourneau and Council Members Mark Kuzma and Jeff Menth dissenting.

The extension would have pushed the expiration to Feb. 28 to allow for time to renegotiate the agreement or to meet the existing requirements. It would have been the third amendment to the purchase agreement, according to council documents.

Part of the reason for the request was that Aeon was unable to secure funding from the Minnesota Housing Finance Agency in its low-income tax credit program, Community Development Director Tim Gladhill said.

Securing that funding was a requirement of the purchase agreement, as were requirements for approval of the site plan and plat, according to council documents.

Council Member Chris Riley said he was in favor of letting the purchase agreement expire and allowing other types of development in The COR grow before further additions of apartment buildings.

“I agree with Council Member Riley’s position, and I continue to hear the same thing from residents; they’re tired of apartment buildings in The COR,” Council Member Nadine Heinrich said.

Kuzma voiced support for extending the deadline, considering the $30,000 in nonrefundable good-faith money the company has already paid the city. He also said there was clearly demand for the project and wanted to allow the project to continue because it was a market-driven decision.

LeTourneau argued that despite hearing opposition to apartment buildings from residents, the city does need more residents to get the shops and restaurants Ramsey citizens want.

“What we continue to hear is that these shops and restaurants are contingent upon customers, and the customers are what we’re actually developing with these apartments and the housing that’s going into our community,” LeTourneau said.

The purchase agreement would have allowed Aeon to build a second apartment building as phase two of its construction project. Greenway Terrace was phase one of the project. The 50 units in the apartment were mostly leased before construction finished, and there is a 300-person waiting list for the second building, according to council documents.

Gladhill addressed reports about an elevated number of calls for the police and fire departments, pointing out that a few units were causing issues.

“Some of these residents were calling for non-emergency because they weren’t getting feedback from their management staff,” Gladhill said.

The apartments have employed a new manager who can perform maintenance, which allows them more access to residents’ apartments to look for rule violations, Senior Project Manager Leslie Roering said.

“That little bit of being able to go in as a manager and as a maintenance person does allow you to catch some things that if you aren’t going into residents’ units on a regular basis you wouldn’t be able to catch,” Roering said.

Service calls to Greenway Terrace have decreased after a specific resident, who wasn’t properly housed, was dealt with through the courts, Roering said.

Aeon may attempt to negotiate a new agreement with the city. The location is zoned for multifamily housing, and because the city currently owns the site, the city will have greater oversight of future projects at the location.

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