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A More Gentle Density: The Potential of Accessory Dwelling Units (ADUs) in Minneapolis

ADU in a converted garage

This article is reprinted with permission from the January/February 2016 issue of Architecture Minnesota.
If you’ve been living in the Twin Cities the past few years, you’re likely very aware of the big development happening in the urban core, including condo and apartment buildings, mixed-use towers and blocks, hotels, transit-oriented development, and commercial expansion. But you might not know that, at the end of 2014, the City of Minneapolis took steps to address an equally compelling growth opportunity for the rest of the city—the vast swaths of urban land occupied by single-family homes, duplexes, triplexes, and so on.
Recent work to allow accessory dwelling units (ADUs), and the individual private investment by homeowners that has followed, has moved Minneapolis down the road toward creating a more gentle density, one that expands housing options and provides opportunities for residents to create stable and ongoing economic value within their property boundary.
The ADU defined
An ADU is a dwelling unit that is located on the same lot as a principal residential structure to which it is accessory, and that is subordinate in area to the main dwelling. It can take three forms; it may be detached from the main dwelling, an attached extension of the main dwelling or internal to it. The design of the unit within the parcel envelope and in relation to the principal residence is key to the success of the ADU in its neighborhood context. Architects working with homeowners are playing a significant role in shaping these new spaces and in leveraging the many kinds of value the units can bring to renters, homeowners, neighborhoods and the city.
A crucial, defining element of the ordinance is that the units are crafted for homeowners and do not incentivize speculative development. Either the principal residence or the ADU must be owner-occupied, and only one accessory unit is allowed per zoning lot. In addition, the units are subject to a size minimum (300 square feet) and maximum (800 to 1,000, depending on type).
To ease the process, units that comply with adopted regulations may be permitted as-of-right, and applications are reviewed administratively—not by commissioners or council members. Also significant: ADUs do not generate any additional off-street parking requirement. Last, and perhaps most notable, the City taxes a property with an accessory unit like it would a typical single-family home, adding assessed value only in terms of the additional finished square footage, if any. This means that the homeowner realizes the majority of value created through new rental revenue. In these ways, the City encourages increased (although nearly invisible) population density in neighborhoods by creating a strong value incentive for homesteaded properties to provide ADUs as a housing option while limiting cost and procedural burdens to applicants.
It’s a win-win and homeowners have taken notice. Enabling ADUs led to 13 approved projects in the first 10 months, and 20 more are now in the pipeline. The response from the private sector demonstrates the economic and social value created for property owners through this policy change.
Early adopters
The City of Lakes Community Land Trust, a nonprofit that acquires land to generate affordable home-ownership opportunities, was an early advocate for ADUs. With the senior population continuing to grow, and with more and more families looking for ways to enable loved ones to age at home rather than in an institutional setting, the organization was looking for a path forward for homes that could accommodate multiple generations. Two properties it had already been seeking to build in North Minneapolis had run into permitting difficulties, and the ADU amendment offered them a solution. The two projects were among the first in the ADU pipeline and are now fully built.
Architect Rich Varda and his wife Julie Varda were also early applicants. They built an internal ADU in their home for a number of reasons, including the desire to have someone living on the premises while they are away for part of the year. They also saw it as a way to leverage the value of their home’s proximity to a lake through rental revenue. Finally, they were anticipating the possible need for caregiver space later in life.
The couple wanted their ADU to be “integrated into the house such that a larger family could easily use it as a lower level, with two bedrooms and a rec/game room for teenage kids,” says Rich Varda. “We also wanted to make it all look like a single-family house of appropriate scale for our neighborhood. Making the ADU a walk-out lower level reduced the house mass—yet it has a view and [is a short] walk to the lake.” They rented the unit to an established single professional.
Larry and Laurie Demos were in the midst of buying a single-family home to renovate in 2014 when they saw a Star Tribune article on the City’s interest in ADUs. They were planning to add a garage to their property, possibly with a rec room or storage space above it. But when the City approved the ordinance, the couple “decided to turn that additional space into an apartment, using some of the materials we were removing from the house with the remodel,” says Larry Demos.
Early adopters have included homeowners seeking to expand their household income; families looking for a way to close the gap on financing a home; couples planning ahead for caregiver space or aging parents; and owners of triplexes whose property is finally eligible to be brought into legal compliance, fully inspected and permitted.
Only the beginning
Of course, the ordinance was designed to benefit more than just homeowners. ADUs were conceived to expand housing choices on multiple fronts, including multigenerational housing, a legalization path for duplexes and triplexes with previously unrecognized units, and the provision of affordable rentals within stable homesteaded neighborhoods. And their facilitation of easily absorbable density in existing neighborhoods has positive side effects: increased demographic diversity in neighborhoods and increased efficiency of roads and public infrastructure through the simple math of greater population density within a service area.
The Metropolitan Council projects that Minneapolis will grow in population from an estimated 409,000 today to around 470,000 by 2040. But with young and old alike now leading a migration back to the city, Minneapolis expects even more growth, setting a goal of 500,001. The City will need to consider the demographic characteristics of that growth as it continues to promote expanded housing options to accommodate increased density. The accessory dwelling unit is an important new tool in this effort.
But as the City studies its existing housing inventory and takes steps toward shaping its priorities for the coming years, policymakers will need to do even more to address housing choice across Minneapolis. Architects, landscape architects and urbanists will be key partners in identifying trends and applying design thinking to new needs in housing and urban form.
Kjersti Monson is the director of long-range planning for the City of Minneapolis. To learn more about an architect who specializes in designing ADUs, see this article in The Line about Christopher Strom and Second Suite.
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