Vesta Unchained housing project shows promise of breaking ground in Grand Marais this summer

The first housing project in Grand Marais is moving forward.

Local developer Chris Skildum attended the March 29 city council meeting to provide an update on the proposed 24-single-family lot subdivision located on 15.24 acres on County Road 7. The proposed development is within city limits and less than a mile from Cook County North Shore Hospital. Skildum purchased the property in 2021 under his company, Vesta Unchained, LLC.

Following the city council’s approval of the preliminary plat for the subdivision on June 29, 2022, Skildum has been working with the city to establish a developer’s agreement. While the 15-acre property is within city limits, the property does not have municipal water or wastewater infrastructure. 

In order to connect the subdivision to city infrastructure, considerable construction will be required from existing lines on Lupin Lane, directly behind Aspen Inn on Hwy 61.

“If the city is going to be involved in either the financing or owning or operating of the utilities that are being constructed, then we have this developer’s agreement that talks about the different requirements,” Mike Roth, the city administrator, said during the meeting. “As you can see, it’s a beast. It has a lot of requirements.”

The city of Grand Marais and Skildum have been working on the terms of the developer’s agreement for the past eight months. The root of the complexities behind the agreement is the developer will construct the infrastructure but then revert to public responsibility. 

Roth said the city’s primary concerns include ensuring the infrastructure is up to city standards, as the city will own and operate after completion. Also, to make sure the developer has a realistic and viable project. During the eight-month process of fine-tuning the developer’s agreement, the city and developer compromised on various requirements that allowed the developer to hire local contractors while still ensuring multiple engineering checks by the city. In addition, the city requires financial securities.

Skildum shared during the March 29 meeting that he needs the approval of the developer’s agreement to secure financing and move the project forward. His initial commercial appraisal of the property expired two months ago. However, fortunately, he was able to get an additional six-month grace period. 

“Time is of the essence. Time kills deals. If this was to take much longer, all that momentum and that appraisal and people willing to finance this thing would lose their attention spans,” Skildum said. 

After much discussion, the city council approved the developer’s agreement. Skildum said the next step is to move forward with nailing down financing. Once he has that secured, he could break ground on the property in late spring or early summer. He intends to stake off the lots, build a road, and begin the construction of municipal infrastructure. 

“With a project agreement in place. This allows Chris to move to the next step,” Tracy Benson, the mayor of Grand Marais, said. “He can get moving forward to getting the financing he needs so that he can begin to break ground.”

The developer’s agreement is a requirement for the submission of the final plat application. Skildum intends to submit a final plat to the city council as soon as possible. 

“I’m hoping now, with this hurdle clear, that things will move a little bit quicker for Chris,” Benson said. “I’m hoping the larger community has been watching this because it’s a great example to show the difficulties of putting together a housing project.”

Arrowhead Animal Rescue

Discussions continued regarding the potential construction of an animal shelter in the Cedar Grove Business Park. The former animal shelter was officially removed from the recreation park in 2021. Since then, lost or surrendered pets have been temporarily housed in the Cook County Law Enforcement Center garage. 

During the March 29 meeting, Arrowhead Animal Rescue requested the city of Grand Marais take the lead on the project and initiate the construction process so they could focus on funding and financing. 

“We don’t know the wherewithal of how to work with contractors. That’s why we need the city to help us on this,” Mary Kronzer, the treasurer of the Arrowhead Animal Rescue, said.

The Arrowhead Animal Rescue, a nonprofit that helps care for lost or surrendered animals, has raised $55,000 in funds. In addition, the city and county have each earmarked $25,000 in their budget for the project. While $105,000 has been allocated for the project, additional funding is needed to complete the project. 

The nonprofit received a quote in 2021 of $257,000 for site preparation, excavation, and construction of the project. However, the quote has since expired. The Arrowhead Animal Rescue did not provide an updated cost estimate during the meeting.

Before moving forward, the city council requested an updated quote and detailed building plans. Arrowhead Animal Rescue said they have building plans that Mark Peterson designed that have been recently revised. They will supply the city with updated plans. In addition, the nonprofit will provide a list of fundraising ideas to the city council. 

The city decided to explore the possibility of taking the lead on the project. “We’re going to have to sit down, meet, and plan that out,” Benson said. “To outline the exact steps that need to be taken and how we’ll do that.”

The Economic Development Authority (EDA) approved a location for the animal shelter in the business park during the June 8, 2021, meeting. The EDA board approved to transfer of ownership of Lot 7, Block 5 in the Cedar Grove Business Park to the city of Grand Marais to be used as an animal shelter. 

However, during the March 29 meeting, City Administrator Mike Roth said the EDA still owns the land. He added, “The city should own it. If we’re going to own the building, we should own the land.” Paperwork still needs to be filed to finalize the transfer of ownership. After that, the city can create a license agreement for Arrowhead Animal Rescue to operate the shelter.

In other city news, the EDA will attend the April 12 city council meeting to give a presentation and discuss the potential merger with the Housing Redevelopment Authority (HRA). Benson said she doesn’t anticipate the city council will vote during the meeting but said, “I think it’ll just depend on the questions and the information.”

WTIP’s Kalli Hawkins spoke with Grand Marais Mayor Tracy Benson following the March 29 meeting. Audio from the interview is below. 

Kalli Hawkins April 5, 2023