MANKATO — From enormous apartment complexes to rental housing targeted at student pilots, residential construction is accelerating across Mankato.
That’s a marked change from 2025 when Mankato, despite steady population growth, saw new apartment construction grind nearly to a halt.
“Unique to our community last year is that we did not permit any apartments,” City Manager Susan Arntz said earlier this week, referring to the issuance of building permits. “Those that you saw constructed last year were permitted in prior years.”
After rapid-fire rental housing development over the past decade, the plunge in new construction was a major factor in the total value of all construction projects in the city dropping from nearly $420 million in 2024 to less than $278 million in 2025.
“It’s less primarily because we didn’t have apartment buildings,” Arntz said.
In 2025, the focus was almost entirely on construction of houses and duplexes. Permits were issued for 40 new single-family homes, nearly quadruple the 11 in 2024. The number of new units in duplexes and townhomes more than doubled from 45 to 107.
So far in 2026, the trend is reverting to bigger multi-family developments. Permits have been issued for construction of six apartment complexes and 12 duplex units. Through the same Jan. 1-March 25 period last year, none had been issued.
Following are some of the projects that are rising, or soon might be, across the community.
Victory Dr. complex underway
Foundations are being constructed on Victory Ridge Apartments, a $21.5 million development that will bring a four-building complex totaling 180 units along the east side of Victory Drive midway between Adams Street and Highway 14.
Plans show two 52-unit apartment buildings, each totaling 65,000 square feet, and a pair of 38-unit 41,000-square-foot buildings on a 15-acre lot that was previously mostly agricultural land. The market-rate apartments, ranging from studios to two-bedroom units, will be available for lease in 2027, according to Prairie Lakes Management LLC, a rental housing management firm.
The developer of Victory Ridge is Steve Kuepers, president of Brainerd-based Kuepers Construction, who told the Mankato Planning Commission in 2025 that the complex would match the designs he used for Augusta Park Estates on Mankato’s north side in 2022-23. Units at Augusta Park Estates are currently being marketed for between $1,300 a month for a studio apartment to $1,745 for a two-bedroom, two-bath unit.
Much farther south along Victory Drive, two 36-unit apartment buildings are under construction just southeast of the Victory-Stadium Road roundabout. The property owners are Ryan Evenson, CEO of APX Construction Group, and Kyle Smith, one of the founders of the development company Tailwind Group.
The complex is being called The Hangar, and not just because Smith, a former corporate pilot, is fond of aviation-related terms. The property is designed to attract students in the pilot-training program at nearby Minnesota State University.
“Welcome to The Hangar, where future pilots live!” the property’s marketing page trumpets. “LIVE YOUR AVIATION LIFE 24/7 IN THE CLASSROOM, THE SKY & AT HOME. … You’ll be surrounded by people who speak your language — checklists, airspace, weather, and flight hours.”
The apartments — “a modern, aviation-themed student community … with clean lines, aviation-inspired finishes, and subtle aviation nods” — are scheduled to be available just before the start of the 2026-27 school year, with two-bedroom units listed at $1,600 and four-bedroom options at $2,800.
Public Works redux done soon
After more than 20 years of planning, the final component of the transformation of the old Mankato Public Works Department site near Cub Foods West could be completed within six months.
The complicated redevelopment process first required the Minnesota Legislature to finance a new regional headquarters for the Minnesota Department of Transportation. When that facility, after being rejected by state leaders multiple times over several years, was finally completed in 2010, Mankato was able to move its Public Works Department to the old MnDOT facility at the corner of Victory Drive and Hoffman Road.
That opened up the former municipal site near downtown for new uses. The City Council provided a vacant bus garage to the Children’s Museum of Southern Minnesota and gave the Southwest Minnesota Housing Partnership the first crack at turning the rest of the site into a hub of affordable housing. But when SWMHP was still struggling to secure financing two years later, development rights were transferred to the Cohen-Esrey Development Group for its Sinclair Lewis-themed residential development in 2020.
Two affordable-housing apartment buildings were constructed — Sinclair Flats in 2024 and Lewis Lofts in 2025. The third piece of the plan was Main Street Townhomes, a row of townhouses along the northern edge of the parcel between the apartment buildings. The 10 townhouses were the only part of the project that was targeted at residents willing to pay whatever prices the market would bear, and Cohen-Esrey ultimately sold that part of the project to Max DeMars of DeMars Construction, based in Mankato.
DeMars has now been issued a land-disturbance permit to prepare for construction, and the townhomes are already listed for “pre-leasing for Fall ‘26” on the website of Factor Property Management.
The homes will offer ground-level garages, a second-story living space with a kitchen and half-bath, topped by two bedrooms and a full bathroom on the third floor. Priced at $1,850, the units would be available as soon as Oct. 1, according to the online listing.
One thing that’s changed is the name. The original theme paid tribute to Lewis’ brief residence in Mankato in 1919 when he was writing “Main Street.” DeMars has renamed the project Dewey Townhomes, in a nod to the short Dewey Street that was eliminated as part of the development.
Growing east-side subdivisions
Streets and utilities are now going in for the mammoth subdivision being developed on 105 acres on Mankato’s far eastern edge by John Mesenbrink of Prior Lake. The developer signed an agreement with the city last fall to finance $4.1 million in municipal infrastructure, including the extension of Hoffman Road past Blue Earth County Road 12, to serve the hundreds of apartment building units and single-family homes planned for the area.
Although as many as eight retail stores and a convenience store are being contemplated, the project is primarily focused on housing and is expected to eventually be home to about 2,130 residents. Plans provided to the city in May showed 106 single-family homes and 11 apartment buildings containing 671 units.
Just to the north of the Mesenbrink Subdivision and further along in construction is the Groh Farm Subdivision being developed over several years by Mike Drummer and partners. Many of the townhome and duplex permits issues in the past year were for construction in that subdivision, located just south of old Highway 14 (Madison Avenue) and just east of County Road 12.
The Groh Farm Subdivision has nearly 200 lots platted with the vast majority sized for single-family homes and twin-homes. About 30 additional acres await platting when the developers are ready for future phases of construction.
And a few affordable homes
Drummer and his partners joined with the local Partnership Community Land Trust to mix some lower-cost homes for income-eligible first-time homebuyers into the development.
Eight more land trust homes are coming to the Tourtellotte Park neighborhood this year, constructed by Southwest Minnesota Housing Partnership, which administers the land trust. The homes and three more planned for 2027 are being built on the former pasture that was part of the Good Counsel campus purchased from the School Sisters of Notre Dame last year by SWMHP for redevelopment into a variety of residential housing.
Final approvals are also working their way through City Hall for construction of the initial phase of the Jefferson Quarry redevelopment, which is to include at least three land-trust houses among the 11 twin-homes planned for a 2.5-acre site on the lip of the tapped-out stone quarry. The City Council this week agreed to turn over a never-constructed piece of Lind Street, west of Eighth Avenue, to provide additional land for the project.
“Through the Community Land Trust model, these homes will remain affordable over time, ensuring long-term stability for homeowners and lasting community benefit,” SWMHP announced last month.