Norra Skogen: a new housing development underway in Grand Marais

Several housing developments are underway in Grand Marais, each with its own distinct design and structure. 

Though they vary in size, affordability, and funding sources, they share a common goal: addressing the housing crisis in Grand Marais.

Norra Skogen is one of the latest housing developments with a unique structure. 

In early April, the Grand Marais Planning Commission and the Grand Marais City Council approved a proposed 12-homesite common interest community on 2.02 acres of land near East 5th Street. 

Since approval, Developer Jane Penner and General Manager Kim Wolff have been working with contractors and the city to begin groundwork, develop a road, and connect to city sewer and water infrastructure.

Development of road along East 5th Street

Penner, who grew up in the Midwest but lives in California, discovered Grand Marais in 2020. As she was searching for property and a second home, she met TimberWolff Realty owner, Wolff. 

“Four years ago, I, you know, discovered this place, and then pretty quickly, I began to figure out that there was a really serious housing shortage,” Penner said. 

She said she soon learned that many of the restaurants had reduced hours or were closed a couple of days a week due to a shortage of workforce, which stemmed from a shortage of affordable housing. 

After learning more about the various complex factors contributing to the shortage of affordable housing in Grand Marais, Penner—a second homeowner in Cook County—and Wolff, a real estate agent who sells second homes, said they both felt a “moral or social obligation to think about solutions, because we both felt, frankly, like we were part of the problem.”

The duo then embarked on an idea to develop a common interest community that would provide affordable housing to individuals who live and work in Cook County. The community would include a homeowner association (HOA) and restrict second homes and vacation rentals. 

Penner is independently funding the upfront infrastructure costs to get the project off the ground. She recently formed a nonprofit, and, with the advice of the Housing Redevelopment Authority Executive Director, Jason Hale, is applying for grant funding through the Iron Range Resources and Rehabilitation (IRRR) to help with infrastructure costs. 

Before embarking on the process of developing a housing project in Grand Marais, Penner and Wolff agreed that Norra Skogen would include a unique component. 

A “break-even” pricing philosophy. 

“We’re operating on a like a cost-only basis,” Penner said. “So the price of these homes is going to be determined by the cost it takes to build them.”

Penner said she would equally divide the infrastructure cost for each buildable site and add it to the home’s construction costs. Interested homeowners will work with Penner, Wolff, and Sala Architects, based in Minneapolis, to design and build homes. The expected timeline is to begin construction on the first few homes in June 2025.

Sala has designed a two-bedroom, one-bath base model for homeowners if they so choose, Penner said. Homeowners are allowed to build larger homes, but the condition is to keep them within the aesthetic guidelines of the common interest community. 

Given that a handful of unknowns remain, including final infrastructure costs, Penner said she is unsure what the final price of a home will be. However, she said the goal for the base model design is $250,000 or less. 

The median home price in Cook County ranges between approximately $425,00-$440,000.

And she has a creative way to try to keep construction costs down. 

“We’re looking for a model that where the community can participate in this,” Penner said. The newly formed nonprofit will serve as a place for community members, including second homeowners or individuals who run short-term rentals, to “give to this community.”

“When you come to a community, and, you know, are participating in it and expecting that community and relying on its core services, you should be giving back, and you should certainly, especially if you’re someone who’s actually part of the problem,” said Penner. 

WTIP’s Kalli Hawkins sat down with Norra Skogen Developer Jane Penner, and General Manager Kim Wolff to learn more about the housing development. Penner and Wolff talk about the specifics of the project, current status, future goals, and more about the construction and funding structure. The audio from the interview is below. 

Kalli Hawkins November 3, 2024