Grant funds could kickstart Superior's Carnegie Library co-working space

With support from the city of Superior and eyes on a possible $3 million state grant, the Carnegie Library on Hammond Avenue could soon be transformed into a co-working space.

The Superior City Council on Tuesday, Nov. 2, unanimously approved an application to the Wisconsin Department of Administration seeking up to $3 million from the Neighborhood Investment Fund Grant Program for Library Superior LLC to rehabilitate the building.

“We think it fits the criteria for the grant dollars,” said Jason Serck, economic development, planning and port director.

It’s a great building on a pivotal corner that is important to the city’s history, he said. The funding, even if it’s not the full amount, could raise the viability of the development project and attract investors so restoration work can get underway.

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The state has $200 million available through the program, which is funded by federal American Rescue Plan Act dollars. The competitive grants are focused on capital projects that will help neighborhoods recover from the pandemic and address equity gaps.

Application forms for the program went live Sept. 30, with a short turnaround time. Applications were initially due Nov. 4, but the deadline has been extended to Nov. 11. Program criteria limit the grants to projects that can be completed by Dec. 31, 2024. The Carnegie Library fits the parameters, Serck said.

“These are things that are ready to go and can immediately be done and kicked off next year,” Serck said, projects often referred to as “shovel ready.”

The only way to apply for the grant is if a municipality sponsors it, he said, but the process does not carry any financial obligation for the city.

The Carnegie Library building at 1204 Hammond Ave. was purchased by Library Superior LLC in 2017, and architectural drawings and the permitting process soon followed.

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“We jumped in with what we knew, and what we knew was how to design a building and do permitting,” said architect Andy Osterlund, president of Library Superior LLC.

The building permit, zoning and site plan were approved quickly, he said, but progress slowed when the initial investors backed down. When the COVID-19 pandemic hit in 2020, the group took a step back.

“We knew it was no time to be trying to market the building or trying to get tenants,” Osterlund said. “The concept of co-working is all about being close to other people. We couldn’t pitch that very well when you’re telling people to stay away from each other.”

Co-working is still a viable business model, Osterlund said. Small businesses are taking off in Superior, something that was highlighted at last month’s Superior-Douglas County Area Chamber of Commerce business awards.

“You see those businesses, you see how much people love the city and see how supportive businesses are of each other,” Osterlund said. “And that’s what reminds me that this can and should happen.”

The Superior Business Center, a business incubator a few blocks away from the library, has continued to provide a launching pad for entrepreneurs through the pandemic. Osterlund said the library development would provide a similar space for more technology-heavy businesses such as graphic designers, software development and other professional services. Even established businesses could benefit from the co-working space.

“You can work from home, and then you quickly realize that you need a place to meet somebody. You realize you need a better printer, you need faster internet, and you realize you need other people to be around you who are trying to do what you’re trying to do,” Osterlund said. “It’s lonely to work at home.”

The project is shovel-ready. What it needs is financial backing. Osterlund said the bank the group had been working with decided to pull out of the project a few weeks ago due to concerns about the co-working model.

Initial construction costs for the building were estimated at $3 million in 2017. That has grown to an estimated $5 million today. Funding could take the form of an investor. It could also be a major tenant — a big corporation or national company that needs dedicated office “touchdown” space and could take advantage of available tax credits. Funding could also come through grants, such as the Neighborhood Investment Fund Grant Program.

"Andrew Osterlund is determined and really wants this project to go. He loves the community, and we're wanting to back it 120%," Serck said. "It's kind of one of our goals to get that project done."

Osterlund, who runs an architectural firm with his wife in Raleigh, North Carolina, said he's considered writing a column for the Telegram.

"Just to tell people 'Look, we're stuck. We know how much you care. We care just as much,'" he said.

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One of the building's future tenants, Red Mug Coffeehouse, remains committed to the project. The business has been operating seasonally out of a "canned ham" trailer at the site since September 2020. It closed for the winter Oct. 30, with plans to reopen in the spring of 2022. Manager Brecken Kenner said they will wait for the library to be restored.

"We haven't been looking anywhere (else)," she said. "We'll be in the building."

Serck said he expects grant recipients to be announced by early 2022.