4:00

to getting a gut punch and

4:02

wondering what the future of the project was.

4:07

From one day to the next, a city that

4:09

thought it was on its way to solving a

4:11

housing crisis was no longer building the

4:13

new homes it needed. Hello

4:16

and welcome to Planet Money. I'm Amanda Oronczyk.

4:18

And I'm Kenny Malone. When Minneapolis passed its

4:21

big plan, it became a kind of testing

4:23

ground for lots of new ideas about how

4:25

to fix housing. And if so, could Minneapolis

4:27

be a model for other cities? Today

4:30

on the show, the story of Minneapolis'

4:32

big housing experiment. We'll tell it through

4:34

two buildings and the fight to get

4:36

them built. Capital

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dot org. Truth,

5:35

independence, fairness, transparency,

5:38

respect, excellence.

5:41

This is NPR. When

5:50

Cody Fisher was thinking about how to get

5:52

into this fix the housing crisis real estate

5:54

stuff, he tried to find other

5:57

developers who were also interested in building green

5:59

housing. But he kept running into

6:01

dead ends. I couldn't find

6:03

anybody that was doing stuff the

6:05

way that I would want to do it, which

6:08

is energy efficient, low carbon and smaller scale.

6:11

And so I just didn't think there was a

6:14

career there for me. But then in

6:16

2018, Cody gets word

6:18

of something that changes his mind and

6:20

puts him all in on building climate-friendly

6:23

middle-sized apartments. He hears that Minneapolis is

6:25

working on some set of bold new

6:27

housing policies, and they're all part of

6:30

a city plan called Minneapolis

6:32

2040, which sounds

6:34

like an Olympics bid, but no.

6:38

So what the Minneapolis 2040 plan did

6:40

was lay out exactly how big you

6:42

can build, what shape it can take,

6:44

you know, what the city wants in

6:46

all these different areas. And

6:49

what does the city want and how do

6:51

they plan to get it? Well, for that,

6:53

we went to Nick Erickson. He's a housing

6:55

policy expert who works with developers in Minnesota.

6:58

The first thing I asked Nick when we met up

7:00

was, could he show me a copy of the

7:02

Minneapolis plan? We did not assume that he

7:05

would hear that and think, could you print a

7:07

copy of the Minneapolis plan? The

7:09

printer on the last 15

7:11

pages, 20 pages, got jammed

7:13

and stopped working. It's a massive document. So

7:16

you broke the printer? Broke the printer, yep.

7:19

It is more than 1,200 pages. So

7:22

that would be the equivalent of probably War

7:24

and Peace or Les Mis. I mean, it's

7:27

a large document. It's actually longer

7:29

than War and Peace and Nick. Nick

7:32

talks about the Minneapolis plan as though

7:34

when it was published, it entered the

7:36

canon of great works. It

7:38

didn't just say this is what we're going to do

7:40

and why. It was very clear

7:42

saying this is the roadmap of how we're going

7:45

to get there. The plan was

7:47

a big deal for a lot of

7:49

reasons, but there was one thing in

7:51

particular that really made headlines. Minneapolis became

7:53

the first major city in the nation

7:55

to get rid of single-family zoning. It

7:57

got rid of zoning that stipulates... can

8:00

only have housing for one family

8:02

on this lot. That's it. Right.

8:05

So one way to think about what is happening

8:07

here is that if you do live in a

8:09

bucolic family neighborhood with lovely historic

8:11

homes, well, any of those houses

8:14

could now theoretically be turned into

8:16

a duplex or a triplex or

8:18

in some places, even like a

8:20

middle-sized apartment building. And

8:22

Minneapolis eased up on all kinds

8:25

of other rules and regulations, too.

8:27

They basically gave developers a path

8:29

towards quick and easy approvals, all

8:32

for this one big goal, right? To

8:35

build, to increase the supply of

8:37

housing. Now, this plan, it

8:39

is huge. It includes policies to

8:42

address racial justice and climate change,

8:44

to increase housing density. It has

8:46

big goals. And at the

8:48

same time, as Nick points out, what is

8:51

remarkable is how specific the plan gets. So

8:53

you've got these neighborhood maps that

8:57

you could probably zoom in if you had

8:59

reading glasses off and find your block in

9:01

the city. Yeah. Like, for

9:03

example, if you look at the maps and

9:05

pick a block, it'll say, on this block,

9:07

we want new construction that's between two and

9:10

six stories tall. But on this other

9:12

block downtown, we want new construction to

9:14

be at least 10 stories tall.

9:16

And so broadly, what Minneapolis is up

9:18

to with this approach is

9:21

an idea that became popular in the

9:23

mid 2010s. You know, you may have

9:25

heard about this before, but instead of

9:27

people being nimbies about new developments, not

9:29

in my backyard, people need to become

9:31

yimbies. Like, yes, build things in my

9:33

backyard. We asked Nick to show

9:35

us an example of a new building that could

9:37

only have come into existence because of the city's

9:40

plan. If you

9:43

need to adjust the seat, feel free. Thank you.

9:45

So we are driving

9:47

down a commercial main street. We pass

9:49

a car mechanic, some breweries, a coffee

9:51

shop, and then we take a turn

9:53

onto a residential street. Here's

9:56

the building we're going to see right here, this blue

9:58

and white one. Now in our tale. of

10:00

two buildings. This building came first.

10:02

It's a brand new four-story apartment

10:04

building. They're rentals, and they just

10:06

went on the market in March.

10:09

And for Nick, this is a perfect

10:11

example of the kind of new missing

10:14

middle housing that Minneapolis says it wants.

10:16

This building has 23 apartments,

10:19

and it replaced a small single-family house

10:21

that was built back in the 1970s.

10:25

Really, you know, highlights this

10:28

neighborhood infill project where you're

10:30

taking what was probably a

10:34

home or two and turning it

10:36

into several more units here. Now,

10:38

Nick said infill there, which is

10:40

essentially the housing world's term for

10:43

adding housing by repurposing land in

10:45

the city, as opposed to like

10:47

the sprawl version, where you're building

10:49

brand new subdivisions further and further

10:51

outside of the city on undeveloped

10:53

land. This only exists

10:56

because you can do something beyond

10:58

a single-family home in this neighborhood.

11:01

This blue and white building

11:03

not only has solar panels

11:05

and draft-free triple-pane windows, it

11:07

also has some, you know, fun amenities. We

11:09

walked up and looked inside. You

11:12

have a pet washing station. There is

11:14

a pet washing station. This is the

11:16

most millennial building I have ever seen.

11:19

A bike room and a pet washing station. And

11:21

I think that somebody's vinyl collection over there couldn't

11:23

quite make out if it was a good vinyl

11:25

collection or not. Hope so. No, no,

11:28

no, look, this blue and white building, it

11:30

is exactly the kind of project that the

11:32

city theoretically paved the way for. It's

11:35

increasing the density, check. It's energy efficient,

11:37

check. It's near public transit, check. And

11:40

of course, that meant that it got

11:42

built with zero problems and no controversy

11:44

at all. Yeah, uh, no.

11:47

No. It turned into a messy fight.

11:49

The neighbors hated it. They did not

11:51

like the idea of an apartment building

11:53

going up on their block. We

11:56

were standing outside the building when our tour

11:58

guide Nick for me to

12:00

look at something. I do want to show you

12:02

this real quick. He points

12:05

out a sign staked in the

12:07

yard of the house right next door. So

12:10

this is emblematic of the housing policy discussion.

12:13

They're the sign that says,

12:15

neighbors sacrificing for developers' pocketbooks.

12:17

So this is the least

12:19

catchy slogan

12:22

I've ever seen.

12:24

It is a tiny little sign. It

12:26

is on the gray single-family

12:29

home right next to this brand new

12:31

apartment and it's facing

12:33

the apartment. This is what

12:35

we call Minnesota passive-aggressive. That's just how we

12:37

do things here. We'll put a passive-aggressive lawn

12:39

sign up that our neighbors have to look

12:41

at. This sign is a left over

12:43

from a fight that sounds like it got aggressive-aggressive.

12:48

Yes, regular aggressive. Regular normal aggressive.

12:50

Because what happened here is a

12:52

kind of fight that we have

12:54

gotten used to seeing whenever a

12:56

bigger development is proposed in a

12:58

residential neighborhood. Our

13:00

final discussion item this evening is

13:02

item number 12. When

13:05

the Blue and White building was proposed, there was

13:07

an online meeting of the city's planning commission. And

13:10

people from pretty much every house on the

13:12

block showed up. This is

13:14

just a ill-conceived place to

13:16

put this property. And I

13:19

totally object to it. They said the building

13:21

is going to ruin the cute residential street.

13:24

If this apartment building wasn't built, we

13:26

would only see a wall. That it would

13:28

bring congestion. He is providing no

13:31

parking. And it would cost them money.

13:34

What it's going to do to our

13:36

property values in proximity to that is

13:38

not fair. If

13:40

you were happy living in your residential

13:42

neighborhood, yeah, many of these things would

13:44

be a drag. But also,

13:47

kind of classic nimby situation here. Now,

13:50

that proposal for the Blue and White apartment

13:52

building, it actually came from a developer you've

13:54

already met, Cody Fisher, the

13:56

relentlessly optimistic developer from the very beginning

13:59

of our session. story. Because

14:01

of all the pushback from the neighbors,

14:03

the planning commission initially rejected his proposal,

14:06

which Cody found totally baffling.

14:09

We followed the design requirements that the city

14:11

had to the T and so it was

14:13

supposed to be kind of a rubber stamp

14:15

approval. Like that's

14:18

what was supposed to happen. Yeah.

14:20

You know, the city had basically told him

14:22

to propose this kind of missing middle building

14:25

when they passed that ambitious housing policy. And

14:27

then when the neighbors said they didn't like the building, the

14:30

city's planning commission was like, yeah, you know what?

14:33

No, you're not allowed to build it. Right.

14:36

So we ran this particular situation past

14:38

a housing policy journalist whose work I

14:41

really like. Yeah. My

14:43

name is Jerusalem Demsis. I'm a staff

14:45

writer at the Atlantic. Jerusalem has reported

14:47

on this housing situation in Minneapolis and

14:49

in other places. And she's got a

14:51

book coming out called On the Housing

14:54

Crisis, Land Development Democracy. And her

14:56

observation about what Cody ran into is

14:58

this is a tricky thing about the way

15:00

government works at a local level. Right.

15:03

You know, there are these things that we

15:05

say we want that we idealize like civic

15:07

engagement and people having a voice.

15:10

But when it comes down to the

15:12

need to build more housing, which is more of

15:14

a big collective need, it tends

15:16

to be that the preferences of just a few people,

15:18

you know, like the neighbors can get in the way

15:20

of that. I'm not saying the people on

15:23

that local block don't deserve a say. They do. But

15:25

they're not the only ones affected by these decisions. Jerusalem's

15:27

saying, think about the people who would like

15:30

to live in this neighborhood. Like say there's

15:32

someone who's about to move to Minneapolis for

15:34

a job, but they can't find a place

15:37

to live. That person also has

15:39

a stake in whether this apartment building goes up or

15:41

not. But they are probably

15:43

not showing up to the city planning

15:45

commission and saying that they want the

15:47

building into the microphone there. And so

15:50

Jerusalem says that local governments are in

15:52

a way not asking the right questions

15:54

when they hold these public meetings about

15:56

proposed development. Like they tend to be

15:58

like the mic is open. So, immediate

16:01

neighbors, what do you guys think about

16:03

this new building? We've created

16:05

institutions at the local level where you ask people,

16:07

hey, do you want things to stay the same

16:09

or do you want things to change in some

16:12

unknown way? And of course people are like, no,

16:14

don't change how things are. I feel pretty happy

16:16

with the current way my neighborhood looks, and I'm

16:18

scared of what that change might look like. Instead,

16:21

Jerusalem says that the starting point

16:24

should be there's a housing

16:26

crisis. We have to build 10,000 new

16:29

homes over the next 10 years. Where do

16:31

you want that to go? The question is not yes

16:33

or no to this new building. It's where do you want it

16:35

to go because it's going to have to happen. According

16:38

to some estimates, we need about 5

16:40

million new homes nationwide. Now,

16:43

obviously Cody's blue and white building eventually did

16:45

get built, with a pet washing station of

16:47

course, but he had to

16:49

hire a lawyer and lobbyists, and he

16:52

also had some environmental groups on his

16:54

side. He managed to win that fight,

16:56

but clearly if any new development can be

16:58

derailed by angry neighbors, that

17:01

is an enormous weakness of Minneapolis's

17:03

ambitious plan to fix a housing

17:05

shortage. The other building

17:07

in the story, the apartment building that Cody

17:10

still has planned for the corner of Minnehaha

17:12

and 36th Street, where

17:14

there's currently that big old yellow house,

17:17

that building got stuck in a much bigger

17:19

and much more intractable fight. A

17:23

fight that teaches us something about trying to

17:25

fix not just Minneapolis's housing crisis, but

17:28

the whole country's. That's after the break. Thanks

17:51

for watching. never

18:00

hear this promo again. OK,

18:03

so we promised you a tale of

18:05

two buildings. The first one, the missing

18:07

middle apartment building with the pet washing

18:09

station. That got built

18:11

after a protracted, expensive fight.

18:14

But our story's second building, it still

18:17

has not been built. So

18:21

my building has four floors

18:23

on it. So we are back at the old yellow house

18:25

at the corner of Minnehaha in 36th and we're here

18:28

with the real estate developer, Cody Fisher, again. And

18:30

in theory, the yellow house

18:33

on that lot should not still

18:35

be standing. Cody was planning to

18:37

have it deconstructed already. Right. And

18:40

we are saying deconstructed instead of demolished because

18:42

Cody is trying to build new housing in

18:44

the most environmentally sound way that he can.

18:47

He doesn't just knock down the buildings he's

18:50

replacing. It's much more painstaking than that. So

18:53

taking it apart, board by board, piece by piece,

18:55

basically what you're left with is a concrete

18:58

basement hole filled with

19:00

sheetrock. Pretty much everything else gets

19:03

diverted from the landfill. That

19:05

way, a lot of the materials get recycled or

19:07

reused instead of ending up in the trash. But

19:10

ironically, Cody's very green

19:13

apartment buildings were not allowed to

19:15

go forward, ostensibly for environmental

19:17

reasons. Here's what happened. A

19:20

group of environmentalists sued the city over

19:22

its big plan, saying that the whole

19:24

plan should have gone through an environmental

19:26

review, the same way a lot of major

19:28

new developments would. Right. So

19:31

like not suing Cody's project or another

19:33

project, the entire plan. And what they

19:35

were arguing is that the plan would

19:38

increase housing density in a way that

19:40

could be harmful for the city's water

19:42

and air and ecosystem. Then, last September,

19:44

the judge who was considering the case

19:46

agreed that the city needed to do

19:48

an environmental review and imposed

19:51

a temporary injunction that brought a

19:53

lot of new development to a

19:55

halt. It was a

19:57

massive curveball. At that time, we were working

20:00

towards starting construction in

20:03

April of 2024. And

20:06

then the city was like, nope, we can't issue

20:09

permits completely on hold

20:12

indefinitely. The journalist

20:14

Jerusalem Demsis says this particular

20:16

fight is rooted in big

20:18

generational differences. She says, you

20:21

know, older people like Gen X and

20:23

baby boomers, they often see development as

20:26

bad. And to be fair, they picture

20:28

very disruptive events that happened in the

20:30

past. You know, they

20:32

picture neighborhoods being displaced, highways plowing

20:35

through open land, paradise being paved

20:37

over for parking lots. In

20:39

the past, environmentalism meant green spaces.

20:42

It meant what you need to do is

20:44

be a conservationist in your own right. It

20:46

means that you buy an old home and

20:48

you fix it up. And that's your sense

20:51

of what environmentalism is. That's very different than

20:53

what I think is happening right now, which

20:55

is for people like me, you know, if

20:57

you're born after 1980, how you've been taught

21:00

about the environment is almost entirely about climate

21:02

change. Specifically, fighting climate change by

21:04

reducing carbon emissions. And cities

21:06

appear to do that best in dense places

21:08

where people live all packed together. There are

21:10

a lot of efficiencies, you know, like people

21:12

live in smaller spaces, which means they use

21:14

less energy to heat and cool their homes.

21:17

They use public transit more. And if they

21:19

do have cars, they tend to drive shorter

21:21

distances. Minneapolis isn't the only

21:23

place where plans to increase the density

21:25

of housing are being challenged. There have

21:27

been similar lawsuits in Los Angeles and

21:29

D.C. and San Francisco and other cities.

21:32

Jerusalem says to her, all of this shows

21:34

that there are limits to what a city

21:36

government can do. To me, I

21:38

think the best way to make these decisions is

21:41

to move a lot of the decision-making process to

21:43

the state level and say, we're going to set

21:45

clear standards and rules for what kinds of housing

21:47

can be built where. Some

21:49

state government swooping in is what ended

21:51

up happening in Minneapolis. Eventually,

21:53

the Minnesota legislature came to a decision.

21:56

They limited the legal challenges that a

21:58

comprehensive city plan can do. face. And

22:01

a few months ago in May,

22:03

a giant bill with that detail

22:05

tucked into it was signed by

22:08

someone whose name you've probably heard

22:10

a lot recently, Minnesota Governor Tim

22:12

Walz. Immediately after

22:14

he was put on the presidential

22:16

ticket, he and Vice President Kamala

22:18

Harris were dubbed the first ever

22:20

YIMBY ticket. And Jerusalem

22:22

says that there are a bunch of

22:24

states now trying to step into the housing

22:27

policy discussion, kind of like what happened

22:29

in Minnesota. You're seeing this in

22:31

Colorado, in California, in Washington State, in

22:33

Arizona, in Texas. I mean, a lot

22:36

of states are realizing that you cannot

22:38

leave this in the hands of local

22:40

governments, not because they're bad people, but

22:42

because it's actually too big of a problem for them to

22:44

solve. Her big point is

22:47

that this housing shortage we're

22:49

experiencing is not just a local issue,

22:51

but too often we try to treat it like

22:53

a local issue. For

22:56

Cody Fisher, the developer who's trying to replace

22:58

the big old yellow house with an apartment

23:00

building, he is now finally

23:02

able to get started on his project

23:04

again. But

23:08

with development, it's like the approvals is

23:10

just step one of 100. Again,

23:14

there is no time or desire, I

23:16

guess, I don't know, to drink celebratory

23:18

champagne out of his hard hat. Absolutely

23:21

not. No. It

23:23

would be gross. It would be sweaty, sweaty, sweaty

23:25

champagne. But look, there was no

23:27

time because Cody had to get financing lined up

23:29

and get a whole lot of people lined up,

23:31

too. He's reaching out to his

23:34

architect and structural engineer and mechanical engineer and

23:36

asking if they can be free like right

23:38

now. There's no time to dwell on

23:40

the delays he's faced. He needs to plow ahead. I

23:43

think this is just the work. Very

23:45

optimistic. Tough to imagine

23:47

why after all the setbacks

23:50

I know. But

23:53

I think we're there. Cody

23:56

now, optimistically, expects to start

23:58

building on that corner. lot

24:00

in March 2025, a

24:03

year behind schedule. Today's

24:11

episode was produced by Emma Peasley and

24:13

Sophia Shukina. This episode was, in fact,

24:16

her idea and built on her research.

24:18

It was edited by Molly Messick, engineered

24:20

by James Willits and fact-checked by Ciara

24:22

Juarez. Alex Goldmark is our executive producer.

24:25

If you are like our newsletter writer, Greg Rozalski,

24:27

and you heard this episode and could only think,

24:30

I wonder what else there is to know

24:32

about Governor Tim Walz's economic record, you

24:35

can read about it in the Planet Money

24:37

newsletter. You can also read about J.D. Vance's

24:39

economic record there. Also, while

24:42

you're there, please subscribe

24:44

npr.org/Planet Money newsletter. Thank

24:47

you this week to Tushar Kansal at

24:49

Pew and Mavity, the executive

24:51

director of the Minnesota Housing Partnership,

24:53

Libby Starling and Daniel Cabot at

24:56

the Federal Reserve Bank of Minneapolis,

24:58

Realtor Andrea Voracek, and new homeowners

25:00

Charlie and Hannah. I'm Amanda

25:02

Aronchik. And I'm Kenny Malone. This

25:05

is NPR. Thanks for listening.