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The Aerial Lift Bridge is seen from East 7th Street in Duluth on Thursday. Ben <br />Hovland I MPR News <br />Compact dwellings <br />Duluth has made several changes to its zoning and building policies to <br />foster the development of more "compact dwellings," as Stolpestad <br />prefers to call them. <br />The goal is to meet a huge demand for housing of all types, in all sectors <br />and all categories, said Adam Fulton, Duluth's planning and economic <br />development director. <br />"When you're trying to shape an economy that's good for the entire <br />population, you've got people in different parts of their lives that want <br />different sizes of houses," he said. <br />"And we don't have that in Duluth. Our houses tend to be a little bit <br />older, and a little bit more uniform. Many constructed pre -World War <br />II. And so, our goal here is to create as many opportunities as possible to <br />expand the housing stock." <br />One way the city has done that is to allow developers to build narrower <br />homes on city lots. <br />Three years ago, the city also changed its zoning code to allow what are <br />known as "cottage home park developments," essentially clusters of <br />compact homes grouped together on a single parcel of land. <br />Earlier this year, the city's Housing and Redevelopment Authority broke <br />ground on a project called Fairmount Cottages on the western side of <br />Duluth. It includes 18 small one and two bedroom homes, or "cottages," <br />620 and 720 square feet, clustered together in two groups of homes, <br />divided by a ravine that's crossed by a pedestrian bridge. <br />It's designed to be a mixed -income development, geared toward <br />families making between 50 and 100 percent of the area median <br />income, up to nearly $80,000 for a family of three. <br />"It really promotes a sense of community," said executive director Jill <br />Keppers. <br />"These houses will actually face inwards; their porches will face the <br />interior of the development. There'll be trails that interconnect them to <br />each other. It'll just be this nice little community where people can <br />really develop that sense of being of being neighbors." <br />A tiny home Duluth's East Hillside neighborhood is seen on Thursday. They are more <br />affordable and efficient in helping the housing crisis. Ben Hovland I MPR News <br />Fulton said the concept is similar to the Milwaukee Avenue Historic <br />District in the Seward neighborhood in Minneapolis. <br />But this type of development is not allowed under many city zoning <br />codes around the state, which encourage more suburban -scale <br />residential development. Fulton said a typical development approach <br />would have only allowed for three or four houses on the site. <br />Aaron Schweiger, managing director of the Duluth -based real estate <br />development company Zenith Asset Management, said there's a stigma <br />around so-called tiny homes that still needs to be overcome. <br />Schweiger said he's approached Twin Cities bedroom communities <br />with projects similar to Duluth's Fairmount Cottages, and said, "`Hey, <br />we'd like to build in your community, we've got this really cool concept: <br />And they tell us 'Thanks, but no thanks."' <br />Schweiger had planned to build a cottage development on a rocky <br />outcropping in Duluth known as the Point of Rocks, but that project is <br />on hold because of an easement dispute with neighbors. <br />He's now working on a different project in Hinckley. A different <br />developer has proposed a similar development in the works in Willmar <br />in west -central Minnesota. <br />Schweiger said developers are increasingly intrigued by tiny home <br />developments because they're less expensive to build than a more <br />traditional apartment building and so they can offer more amenities. <br />"If we build a typical shoebox-style building," he said, "you're talking <br />$250,000 a unit in today's prices — if you're lucky, being cheap — <br />where we could build a tiny home, at cost, for $150,000 a unit." <br />Schweiger believes cities around Minnesota should start to think of <br />compact, smaller homes as creative, affordable workforce housing that <br />can help grow their communities. <br />"You can start a family there. It's not going to break the bank. You get a <br />yard." It's the "American dream" again," he said. <br />