Developer chosen for student housing, retail complex east of NDSU

FARGO - Proffutt Limited Partnership beat out two other firms to develop a new student housing and retail complex on the 1600-block of North University Drive, just east of the North Dakota State University campusExecutive governing board members ...
The Proffutt proposal to develop the 1600 block of University Drive North includes student housing and retail space.Special to The Forum

FARGO - Proffutt Limited Partnership beat out two other firms to develop a new student housing and retail complex on the 1600-block of North University Drive, just east of the North Dakota State University campus

Executive governing board members of the NDSU Foundation and Alumni Association voted 7-3 on Wednesday, Dec. 21, to pick the Proffutt plan over two competing bids by Enclave Development and Roers.

Proffutt's $23 million project includes a mix of 103 two- and four-bedroom apartments that can provide 344 beds. The four-story structure also includes 6,230 square feet of retail space planned for the northwest and southwest corners of the block. It will have 258 parking spaces (90 of them below ground), with 25 parking spots dedicated for use by retail outlets, such as a restaurant or coffee shop.

The project includes a 3,847-square-foot "Clubhouse" area for the southwest side of the block near the Bison Court and Stockbridge Hall that is envisioned as a student lounge and social space.

If construction starts this spring, the building should be ready for occupancy by the end of July, 2018, according to a timetable supplied by Proffutt.

The block is bound by North University Drive, 17th Avenue, 12th Street and 16th Avenue.

Consultant Rick Engebretson told the selection committee and the executive board that the Proffutt design was the most aesthetically pleasing, followed by the Enclave proposal.

"What I like about it is it breaks things up" and fits in well with the residential neighborhood," Engebretson said. "Of the three (proposals), this solves the problem best."

The Enclave proposal came with two alternatives offering a mix of apartments from studio to four-bedroom units. Alternative A was a $29 million project that would have 190 apartments providing 426 beds, with 343 parking spots, 265 of them underground. Alternative B was a $32.5 million plan with 213 apartments with room for 402 beds. It would have 402 parking spots, 338 of them underground.

The Roers plan called for construction of a long rectangular five-story apartment complex, with 140 units from efficiency to four-bedroom apartments supplying 243 beds. The complex would have nearly 300 parking spots, about a third of them underground..

The aesthetics and a solid rate of return on the investment sealed the deal for Proffutt, said Steve Swiontek, the board's chairman.

"We want to make sure this is very neighborhood-friendly, that they understand and like it," Swiontek said. "We want to be good neighbors."

Swiontek said that it was important for the nonprofit Foundation to move away from home ownership on that block and focus more effort on the foundation's support of NDSU by raising money for scholarships and endowments.

While the Roers bid offered a higher potential rate of return, Swiontek and others said it was perhaps too speculative.

"Less risk, more solid return," with the Proffutt bid, Swiontek said.

"What we have here is a reasonable rate of return that fits the model of the foundation," Foundation trustee Dave Olig said.

The Foundation will now begin talks to enter into a ground-lease agreement with Proffutt, which means the Foundation will retain ownership of the land. The foundation will receive lease payments from Proffutt, while the developer will design, build, finance, operate and maintain the project. NDSU will not have any financial affiliation or involvement with the project, the Foundation said in a news release.

John Glover, president and CEO of the foundation, said it's time to turn and look to other projects.

"It was an inclusive process from the get-go, and that was our goal," Glover said. "It sure feels good to have a decision."

Glover and other board members said the selection of the Proffutt design is meant to create a building that will help serve as a good northern gateway to the NDSU campus and the city. And, if it proves to be successful, provide a template for future developments when the Foundation, over time, eventually buys up the homes it doesn't already own on the 1500 and 1400 blocks of North University Drive, just east of the campus.

The foundation has managed to buy all the homes on the 1600-block except for one - a white, single-story house at 1638 12th St. N. Current plans call for the project to be built around the house. The foundation had earlier offered homeowner Darik Demarais about $230,000 for the property, but he had not accepted the offer. City records value the property at $170,400.

Glover said other residents on the block, all renters, have been told they must vacate their homes by the end of this month.

The project would help address a growing need for student living quarters near NDSU, which has been growing in recent years and is aiming to increase enrollment by about 3,500 students in the next four years.