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BDPI Grant Application- Mayes Drive and Utility Extension
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The City of Luverne recently submitted an application to the Minnesota Department of Employment and Economic Development (DEED) for funding through the Business Development Public Infrastructure (BDPI) Grant Program. The application requests funding to construct the public infrastructure necessary to support the proposed development of Luv Modular, LLC, a new modular housing manufacturing facility in the Luverne Industrial Park.
The proposed project includes extending Mayes Drive approximately 1,550 feet south and west from its current termination point near West Koehn Avenue. The roadway will be constructed as a 36-foot-wide industrial street with 8-inch Portland Cement Concrete (PCC) pavement designed to accommodate heavy industrial traffic and provide long-term durability. The project also includes approximately 800 feet of 10-inch sanitary sewer, 850 feet of 12-inch water main, storm sewer infrastructure, and subdrain systems necessary to provide access and utility service to the development site while supporting future industrial growth within the industrial park.
The total estimated cost of the public infrastructure improvements is $1,766,640. The City is requesting $830,820 in BDPI funding and has committed $935,820 in local matching funds. This local investment demonstrates the City's commitment to supporting business growth and expanding economic opportunities within the community.
Luv Modular has committed to constructing a 117,600-square-foot modular housing manufacturing facility on approximately 17 acres, along with a 4,000-square-foot maintenance and storage building on an adjacent 1.5-acre parcel. The company manufactures high-performance, net-zero-ready modular housing designed for the multifamily housing market. The project represents approximately $39.6 million in private capital investment and is expected to create up to 75 new jobs. Construction is anticipated to begin during the fourth quarter of 2026, with completion expected by the fourth quarter of 2027.
The Estimated Market Value of the proposed building on the large parcel is $17,071,700 with annual estimated property taxes of $447,905. The Estimated Market Value of the second building on the smaller parcel is $222,200 with annual estimated property taxes of $4288.
The requested public infrastructure is essential for this project to move forward. The development site currently lacks the roadway and utility infrastructure necessary to support industrial development. Without these public improvements, the proposed manufacturing facility cannot be constructed. In addition to serving Luv Modular, the infrastructure has been designed to support future industrial development throughout the remaining acreage of the industrial park, making additional sites development-ready and increasing the City's ability to attract future employers.
Additional preliminary site work is expected to happen this fall in order to provide temporary access to the site prior to Luv Modular's construction project. The scope of work includes constructing a 12" aggregate subbase and establishing a temporary rock construction entrance, installing a detention outlet control structure and storm intakes, and extending sanitary sewer and water to the property line to meet the short-term construction needs.
This project aligns well with the objectives of the BDPI program by providing publicly owned infrastructure that directly supports a qualified manufacturing project. If awarded, the grant will leverage nearly $40 million in private investment while expanding the City's industrial tax base, creating new employment opportunities, and positioning the Luverne Industrial Park for continued long-term growth. The application has now been submitted and is under review by DEED. If awarded, the project would be bid and awarded in early 2027.