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Enclave to begin demolition of south Fargo Kmart next week for senior housing, commercial redevelopment

Beyond Shelter plans to build 88 units of low-income senior housing on the west side of the site, while Enclave's plans include six buildings for retail and commercial businesses.

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Heavy construction equipment is queued up on the north side of the Kmart building at 2301 S. University Drive on Thursday, March 3. West Fargo-based developer Enclave plans to start razing the 60-year-old big box store next week, company officials said.
Helmut Schmidt / The Forum

FARGO - Demolition will begin next week on the former Kmart big box store on South University Drive, making way for 88 units of low-income senior housing, and commercial and retail development.

Heavy construction equipment is parked just north of the 60-year-old building, standing ready to rip down the walls at 2301 S. University Drive.

West Fargo-based developer Enclave is in charge of the Kmart demolition to prepare that part of the site for senior housing.

“We soon plan to start work on Kmart,” Enclave spokeswoman Christina Graalum said in an email Thursday, March 3. “We really look forward to the redevelopment of this site and positive impact it will have on the area.”

Tim Gleason, a developer for Enclave, said that asbestos abatement has been completed. He expects the building part of the site will be clean and ready for new construction by affordable housing developer Beyond Shelter between mid-April and early May.

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Enclave has plans for six commercial building sites on the east side of the property, closer to University Drive.

Gleason said Enclave’s first phase of construction will be a retail center.

“We’re really excited to finally build some new construction in this area of town and support south University business and bring some new commercial and housing to the area,” Gleason said.

Beyond Shelter will start construction on the senior housing component of the development late this summer or early fall, once it locks up its financing for the two buildings that will make up the $20.5 million endeavor, the nonprofit’s Development Director Lisa Rotvold said Thursday. The target for completion is fall 2023.

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The Kmart at 2301 S. University Drive, Fargo, pictured Thursday, March, 3, 2022, has been closed since December 2019. West Fargo-based developer Enclave will begin razing the building Monday to start redevelopment of the site.
Helmut Schmidt / The Forum

Rotvold said having Enclave ready to raze the Kmart is “definitely a step in the right direction.”

Rotvold said Beyond Shelter is “just working through some details to get the plans finalized” for the project.

She said that once the project is built, there should be no problem renting the apartments. Beyond Shelter currently has a 2% vacancy rate at other properties it has built.

“We have a lot of demand for those units,” Rotvold said. There’s “real strong demand for affordable senior housing with some amenities. We really take pride in creating communities for our tenants. That’s what we intend to do with that project.”

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Originally, it was thought the housing would have to be built in two phases, stretching the completion of the project two years or longer. Fortunately, the North Dakota Housing Finance Agency approved federal low-income tax credits for both buildings. One building will have 43 units for low income seniors over 55, and the second will have 45 units for those over 62.

The Kmart was built in 1962, and the big box store occupied most of the building for nearly 60 years, closing in December 2019.

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Construction equipment is staged outside the south Fargo Kmart on Thursday, March 3, 2022. West Fargo-based developer Enclave plans to start razing the former big box store next week to begin redevelopment of the site for senior housing and retail and commercial businesses.
Helmut Schmidt / The Forum

Enclave first announced its plan to develop the Kmart site in early 2021, though over time that plan has evolved.

In December, the City Commission approved Tax Increment Financing and a renewal plan for the development. Enclave will receive up to $1.4 million in tax savings over 15 years to assist with the costs of removing the massive building and providing some infrastructure for the site.

Related Topics: REAL ESTATE
Helmut Schmidt is a reporter for The Forum of Fargo-Moorhead's business news team. Readers can reach him by email at hschmidt@forumcomm.com, or by calling (701) 241-5583.
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