A 6.85 acres block of land north of Wal-Mart could be sold by New Ulm to Land Haven Development for the creation of storage facilities with the option for including dwelling units. The New Ulm City Council held a public hearing Tuesday on the potential land sale.

NEW ULM – A potential property sale has the New Ulm City Council once again considering the option of allowing residential dwellings inside storage facilities.

Tuesday, the city council held a public hearing on the sale of city property to Land Haven Development. The 6.85 acre property being sold is located at 2211 Jacobs Street, directly north of Walmart. The city is planning to sell the property for $1 and would include a 50% reduction on the outstanding assessment for the lot. Taking into account the land value and the assessment reduction, the city is subsidizing this business by $217,000. A public hearing is required if the amount of the business subsidy exceeds $150,000.

Tony Gulden, president of Land Haven Development, said his intention for the property is to subdivide it into smaller lots for the construction of storage facilities, with the option for creating enclosed dwelling units. It estimated 29 lots could be created on this land.

Community Development Director David Schnobrich said the goal of subsidizing this project is for Land Haven to assist funding of roadways and utility improvements and the approval of a plat with approximately 29 lots.

No comments were received from the public during the hearing, but the council members did have questions about dwelling units being an option with this development.

City Councilor David Christian said a few years ago the city had an issue with individuals who wanted to build residential living space in storage facilities. The council ultimately decided not to allow residential units in areas zoned for storage.

Schnobrich said it was up to the council on whether to continue restricting residential units out of storage facilities, but suggested this could be an alternative option for developing extra housing space in the community.

Christian said he understood the need for different residential options but said if the city approves this, it could lead to other owners of storage facilities coming back to council seeking a variance to create residential spaces in industrial storage zones.

City Manager Chris Dalton said in looking for affordable housing this was another option, but the owners of storage units would still need to go through the permitting process to allow residential in an industrial area.

Councilor Tom Schmitz asked if there were any storage units with residence within New Ulm city limits.

Schnobrich said current regulations do not allow residential units in storage facilities, but said there might be some city residents living in storage facilities.

Schnobrich said the reason New Ulm has forbid residential units in storage facilities is because most storage sheds are located in industrial areas and have higher truck traffic, greater noise and smells that are not deemed compatible with residential living.

Christian said if the city were to allow residential units in industrial zoned locations, the city would not be responding to certain complaints. As an example, he said a resident living in an industrial zone could not complain about truck traffic during later hours. He said truck traffic is permitted use in an industrial zone.

“They have to be aware of that when they move in,” Christian said.

Schnobrich said in the case of Land Haven, they are adjacent to Wal-mart, which has delivery trucks coming along the back of the building near this development.

Councilor Larry Mack asked if this project would limit residential dwellings in storage areas for this development only, or it was open up to other storage development.

Schnobrich said it would only be designated to this property and Land Haven will still need a PUD zoning designation before the development is allowed.

“I appreciate the fact that we are looking creative ways to address housing,” Mayor Kathleen Backer. “This might be one more that could address that major issue.”

Councilor Mack said this could be another avenue for providing housing.

Councilor Eric Warmka said overall the project was a great use of space and there was limited interest.

No further action was taken following the public hearing. The council will formally approve or deny the purchase agreement at a future council meeting.