St. Paul, Minn. — The housing crisis hit certain St. Paul neighborhoods much harder than others, according to a housing report issued last month. The East Side of the city, the North End and the Thomas-Dale neighborhood, also known as Frogtown, have experienced more foreclosures, more vacant homes and lost property value than other areas.

The abundance of vacant properties is attracting interest from housing developers in Frogtown, right next to the Central Corridor light rail line construction.

St. Paul vacant buildings case manager Matt Dornfeld approaches a boarded home in Frogtown. The house sits just a few blocks from the path of the new Central Corridor light rail that will link the downtowns of St. Paul and Minneapolis. Neighbors complained to the city about squatters breaking into the house at night. It’s not the first time.

“We have been out here since July 7 of 2008,” Dornfeld says, “and in four years I’d say 40 times roughly.”

The house is one of roughly 250 vacant buildings in the immediate neighborhood. Dornfeld estimates almost a third of these are foreclosures. Citywide, records show 1,362 vacant properties in St. Paul last year. That’s down 32 percent since 2008.

The Frogtown house is in foreclosure for the second time since July 2008. Dornfeld says the most recent owners started rehabbing the property before they lost their financing and walked away. The grass is tall with weeds. Piles of garbage dot the yard. Two dirty abandoned mattresses sag against the front porch.

Dornfeld inspects the front door and confirms that the house has been broken into. “This obviously has been kicked in,” he says, “because if you look at the framework here, the framework has just been blown apart so this has been illegally entered.”

Inside, the house is gutted. Dornfeld walks carefully through the construction debris, inspecting every room. It doesn’t take long before his flashlight illuminates some serious hazards: gaping holes in the kitchen and bathroom floors.

“That could be a fall to death,” he says.

“No. 1, just for our police and firemen, if they have to enter this property at night it is an absolute 100 percent safety concern with the holes in the floor,” Dornfeld says, “and you could see how that could happen if there are no lights and they are in here we can’t have that, and secondly we can’t have any illegal trespassers in here hurting themselves.”

Based on what he sees, Dornfeld decides to recommend the property for demolition. “Because I deem it as entirely as a 100 percent neighborhood nuisance due to safety concerns,” he says. “It’s obviously being broken into, it’s been broken into, it’s a blight, nobody cuts the grass, people dump on it and it’s unsafe.”

In St. Paul foreclosures have dropped, but Cecile Bedor, director of planning and economic development, says the crisis is far from over. “It really hits our neighborhoods hard because you’re losing some homeowners,” she says. “You have a lot of vacant buildings that are left in the dust.”

Isaiah, a coalition of faith-based groups focused on economic and racial disparities, found the foreclosure crisis has cost the city more than $6 billion in lost home value since 2006.

Frogtown, the North End and the East Side had the biggest drops: Homes in those neighborhoods lost about 50 percent of their value over the last six years.

The city is trying to undo the damage by targeting the hardest hit areas, including Frogtown, with a $30 million program to demolish blighted properties, and rehab and resell homes that can be saved.

One block off University Avenue in Frogtown, children ride bikes down the sidewalk.

Organizers with the Frogtown Neighborhood Association are working to help blocks ravaged by the foreclosure crisis rebound.

Organizer Sam Buffington says the crisis has left its mark on the community. “There are blocks like that where it’s literally almost every house on the block has experienced foreclosure in one way or another,” Buffington says. “Now they are not all vacant still but have gone through that process at some point.”

The group’s director, Tait Danielson Castillo, says rock-bottom housing prices and the prospect of growth along the Central Corridor LRT are attracting an unprecedented number of developers. “That have bought multiple properties in hopes that the values of them will go up once light rail is complete,” he says, “and those are the ones that we are most afraid of.”

Danielson Castillo says he knows of about 20 developers now trying to buy houses or land along the light rail line. That’s far more than the one or two that were common before construction on the light rail began. He says community involvement will be critical during the development boom. “It’s a blessing in the sense that, yes, we want people to be in here investing in this community, without a doubt,” Danielson Castillo. “The question is what is the ownership of the community as that happens and what is the pace in which it happens.”

Danielson Castillo’s coalition is door-knocking and holding meetings with developers and residents. Organizers want the community to have a say in the fate of their neighborhood’s housing stock before the light rail line is up and running.

In St. Paul, officials and developers seek cures for housing blight | Minnesota Public Radio