An investment plan designed to provide solid returns for union pension funds is doing more than that - it's providing hundreds of jobs for union construction workers and helping to ease the Twin Cities' affordable housing crunch.

The AFL-CIO's Housing Investment Trust is financing construction of Sibley Park, a five-story, 114-unit apartment complex on the edge of downtown St. Paul. The project, slated for completion in December, is one of three Housing Investment Trust projects currently under construction in the Twin Cities and one of 60 nationwide.

Furthermore, the trust, more commonly known as HIT, expects to commit $350 million over the next five years to what it's calling the Minnesota Community Investment Initiative. The money will go toward an estimated 4,000 units of family housing and to provide affordable mortgages for union families.

New downtown housing
HIT was established in 1965 as a secure union-investment program for the assets of workers' pension plans. HIT investments of more than $2 billion have since financed more than 50,000 housing units nationwide. These housing projects have provided more than 45,000 union jobs in construction and related industries.

Rod DuChemin, director of labor relations with HIT, says the 'primary goal is a safe, prudent return for pensioner's money. Behind that is job creation, and then such issues as inner-city development and affordable housing.'

Kraus-Anderson, general contractor for the Sibley Park apartments, broke ground on the St. Paul project last October. The project has three phases, the first of which is the 114-unit apartment building on E. 7th St. between Sibley and Wacouta. Other phases include a second apartment building on 8th St., and an adjacent park named Wacouta Commons.

'The next phase in St. Paul's downtown renaissance is housing, and the unions have been a major partner in this step,' said Brian Sweeney, St. Paul's director of planning and economic development.

Sibley Park Apartments is the cornerstone project in what the city calls the North Quadrant Urban Village, the first new downtown housing development in 15 years. Other parts of the 15-acre 'village' are 12,000 square feet of retail facing 7th St., and Essex on the Park - separately financed condominiums that share a courtyard with Sibley Park.

'The North Quadrant is literally creating a new community downtown,' Sweeney said.

Union construction in St. Paul
HIT requires that Sibley Park, as an AFL-CIO-financed project, be built 100 percent with union labor. When completed this December, Sibley Park will have provided 350 to 400 union construction jobs in St. Paul.

'Everything is union,' says Doug Niesen, project manager with Kraus-Anderson, 'from the people who set the foundation to the people who will clean the apartments before they are given over to renters.' At any given time, Niesen said, 80-100 union construction workers are on the job.

Dick Anfang, president of the Minnesota Building and Construction Trades Council, said construction jobs are not the only benefits HIT creates. 'It gives you a much closer partnership with developers, builders and contractors - who know that, in some cases, but for that availability of those union dollars, their project wouldn't go,' Anfang said. 'So it helps solidify that relationship.'

HIT continues to expand its investment in Minnesota. In addition to Sibley Park, the trust is financing a three-building, 364-unit housing development in Maple Grove, and a condominium complex in Bloomington.

The five-year Community Investment Initiative is the next step.

Anfang said Minnesota building trades locals and district councils are active investors in HIT, so it's helpful to see the money come back to benefit the state. 'Our business managers and agents have it in the back of their minds that it's available,' Anfang said. 'When we get in a situation where we hear about a project - especially a project that could be tenuous as far as 100 percent participation - we bring that up.'

'We continue to grow in Minnesota,' DuChemin said, 'and Minnesota has proven to be one of our most fertile areas of investment.'

Jonathan Hulland is an intern for www.workdayminnesota.org and The Union Advocate newspaper.

This article was written for The Union Advocate newspaper. Used by permission. Union Advocate editor Michael Kuchta contributed to this article. The Union Advocate is the official publication of the St. Paul Trades and Labor Assembly. E-mail The Advocate at: advocate@mtn.org

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