People moving, people just deciding they want to live in the area. Sometimes it’s generated by a lot of new housing or housing that you know people are looking for.”

Mary Boujold of Maxfield Research.

Cottage Grove City Hall
12800 Ravine Pkwy S
Cottage Grove, MN 55016
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The Cottage Grove Plan Commission met Monday, March 24 at City Hall. Included in the night’s business was a 2025 Housing Needs Analysis from Mary Boujold of Maxfield Research.
“The approach was to provide a guide and framework to consider key housing priorities and current housing gaps,” Boujold said. “And the deliverables were essentially short- and long-term housing needs and then recommendations to guide future housing development.”
Data collection was done in the second and third quarters of 2024, a draft delivered to the city in October 2024.
“So we identified a primary market area, from which essentially 70 percent of the demand for housing in that market area would be generated,” Boujold said of the study. “And that includes the cities of Cottage Grove, Woodbury, Newport, St. Paul Park, Grey Cloud Island, Denmark, and Hastings.”
With demand called “somewhat fluid” between adjacent communities, 30 percent of demand was generated outside the primary area, affecting realized demand over a given time period.
“And that can include different reasons,” Boujold said. “People moving, people just deciding they want to live in the area. Sometimes it’s generated by a lot of new housing or housing that you know people are looking for.”
Moving to population growth, the largest growth in Cottage Grove had taken place between 1960 and 1970, a second growth spurt taking place between 1990 and 2000. Growth since had been study but at a decelerating pace, deemed to be “consistent with most other expanding Metro Area cities” by Boujold. For sale home prices continue to rise while a low supply and high prices have knocked out entry level buyers.
“We kind of started to see a period of stagnancy in the housing market at this point,” Boujold said. “New construction is also suppressed, due to a slow down in demand again due to higher mortgage interest rates.”
Relying on move buyers to free up housing supply for entry level, the price of land and supply chain challenges had led to people staying put in their present lodging. With few new apartments built in the 1990s and 2000s, meanwhile, demand remained strong for multifamily unit construction,
“A lot of people who are priced out of the housing market often shift to rental properties.” Boujold said for entry level homebuyers. A post-recession construction boom had helped satisfy some of the housing demand, while rents continued to rise for both new and existing construction.
“This has led to an exacerbation of affordability,” Boujold said of the housing market. Demand remained strong but higher interest rates had led to developers trying to balance construction with land acquisition and other costs.
“I will also say we are seeing developments move forward,” she said, “so all is not lost yet.” Among those stepping up to the plate was the state with more housing dollars. Challenges continued on new construction and affordable development, however. More affordable housing without income restrictions would see higher demand for that product, Boujold said.
Among products tried statewide are housing cooperatives and smaller lot size development, with demand for senior housing projected to increase. Many smaller homebuilders had been driven from the market during recession, while those who had come back tended to focus on luxury home construction, Boujold said.
Also heard at March 24 Plan Commission, meanwhile, a medical cannabis company will soon come before the City Council for a conditional use permit.
Clearing the City Plan Commission March 24, Leafline Labs LLC of 8235 97th Street South seeks a conditional use permit (CUP) to “grow, manufacture, and process” cannabis at its facility in the southwest Business Park. The permit as applied would rescind the existing CUP to produce medical cannabis products, approved by Resolution 2022.075 in May 2022.
The application received Feb. 26, 2025 is in the 60-day review period and will head before Council April 16. Motion to recommend council approval was made by Plan Commissioner Jessica Fisher and and seconded by Plan Commissioner, subject to conditions in staff report” as well as a word change.
First approved and constructed in 2014 following Minnesota’s legalization of the production and use of cannabis for some medical purposes, Leafline Labs of Cottage Grove was selected by the Minnesota Department of Health as one of two licensed manufacturers for medical cannabis. The 2022 CUP application and site plan review allowed for construction of structure additions in two phases. Leaflike employs 65 cultivation employees with 250 statewide, while over 55,000 Minnesotans are currently registered to use medical cannabis, the company operating eight statewide dispensaries under the name RISE Dispensary.
The city of Cottage Grove meanwhile updated its ordinances in 2024 to include adult cannabis uses, with Leafline in compliance with applicable city ordinances. Leafline is currently implementing an odor mitigation plan after several odor complaints are made to the city, resulting in a study on how to alleviate these. Actions include taking the economizer mode off of rooftop units and taking the sanitation room exhaust out of service, the company in the process fo acquiring several molecular filtration units to capture and control odor, along with Byers patented water phase odor control unit.
“Odor mitigation is not a one-time fix,” said Tiffany Newborn Johnson, director of government affairs for Leafline Labs and Green Thumb industries. “It is an ongoing effort that requires, monitoring, adjustment, and partnership. We remain committed to this process.”
No expansion of operations at Leafline will take place as part of the CUP, applied for to ensure compliance with state and local statutes rather than due to any operational changes. The statute under which Leafline is currently licensed will be repealed on Dec. 1, 2025.