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Developers broke ground Tuesday on a massive new housing development in Duluth that city officials have called “transformational,” on the crest of the hilltop overlooking downtown and Lake Superior. 

The $500 million project has been dubbed Incline Village, and when complete is expected to include nearly 1,200 market rate condos and apartments in several different buildings, 80,000 square feet of retail space and public amenities including a trailhead and pavilion. 

The project is on the former site of Duluth Central High school, which has sat vacant for the past 13 years. 

“Today, this site again becomes a source of great pride,” said Duluth Area Chamber of Commerce President and Duluth Central graduate Matt Baumgartner. “We celebrate the building of a new neighborhood and a location of economic and recreational activity.”

A New York-based family-owned real estate company headed by Luzy Ostreicher purchased the 53-acre site last year from the Duluth public school district for $8 million. 

At the groundbreaking ceremony he presented Duluth Mayor Roger Reinert with a Hanukkah candleholder — a symbol, he said, representing the years his family has been in Duluth. 

The family has also purchased two apartment buildings in Duluth for a combined price of about $77 million.

Ostreicher said when they first came to Duluth, they found a “unique city” with “good people.” 

“We see people who are community minded, who are really ingrained in their heritage, uniquely ingrained in their history,” he said.

The city of Duluth gave the developers a $26 million tax subsidy known as a TIF to help bring infrastructure to the site. 

Some have criticized the city council for not requiring the developer to provide affordable housing when giving the subsidy. 

Reinert said the project, with a difficult, rocky site to build, was a good candidate for the financing tool. 

“It’s taken years to get here, and the site itself was part of that challenge. So this is why you do TIF,” Reinert said. 

The first building to be constructed is a 70-unit condo building located on the former high school football field. It’s scheduled to be completed in the summer of 2026. 

Lead designer Brian Mortemore, an architect with DSGW in Duluth, said the project would have a very “Duluth-y vibe and spirit.” He said buildings will feature high-performing windows, insulation and solid structure to withstand the elements on the exposed hilltop. 

And backers emphasize the development will boast some of the best views in the city, with vistas oriented toward Lake Superior.  

“So when these buildings are complete, it'll be incredible to walk down that Main Street with all the shopping on either side facing the Lift Bridge,” said Jeff Schiltz, a local representative for the development company.

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The project, called Incline Village, on the former site of Duluth Central High School, is expected to include nearly 1,200 market rate condos and apartments and 80,000 square feet of retail. 

Developers break ground on $500 million Duluth hilltop housing development

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