The city of St. Paul has launched a new $5 million Downtown Vitality Fund aimed at supporting housing development and economic activity in the downtown core.

The fund is designed to assist developers, small businesses and organizations working on projects that increase residential density and enhance commercial spaces within the Downtown Improvement District.

City officials said the initiative focuses on two main areas: housing and economic development. Of the total funding, $3 million is allocated for housing projects, including new construction, redevelopment and office-to-residential conversions. The remaining $2 million is designated for commercial improvements such as equipment purchases, capital upgrades and public realm enhancements.

Eligible projects may include upgrades to storefronts, lighting improvements, outdoor seating and public art installations intended to increase foot traffic and improve the overall downtown experience.

Funding structures vary by project size. Smaller projects under $100,000 will receive grants distributed as reimbursements, while larger projects will be supported through deferred forgivable loans with a four-year term, contingent on continued operation or occupancy in downtown St. Paul.

Projects requesting more than $500,000 will require approval from the Housing and Redevelopment Authority board.

If demand exceeds available funding, projects will be prioritized based on readiness to close in 2026 and, for housing proposals, the number of units created.

The program is open to both for-profit and nonprofit applicants located within the Downtown Improvement District, as defined by the St. Paul Downtown Alliance.

City officials said the goal is to create a more vibrant, welcoming downtown environment for residents, workers and visitors while supporting long-term economic growth.

Organizations interested in applying can submit an interest form through the city’s website at stpaul.gov.