The city of Albert Lea has received three formal proposals for the redevelopment of the Freeborn National Bank and Jacobson Apartments buildings.

Two of the firms were from out of state and the third was from the Albert Lea Art Center, said City Manager Chad Adams. The Art Center’s proposal was for the first floor of the Freeborn National Bank.

The two buildings, on the southeast corner of Broadway and East William Street, have been under city ownership since 1998. City officials hoped the buildings would be a key to revitalizing Albert Lea’s downtown business district.

“One of our top priority goals for the community is to increase tax base,” Adams said. “We see the project as an anchor for not only the downtown.”

He said once completed the buildings would bring increased tax revenue to the city and would bring more people downtown.

“These are two beautiful buildings that have a great deal of historic character that will be general attractions,” he said.

Adams said the two out-of-town proposals were for the complete development of both buildings.

They came from Cohen-Esrey Affordable Partners of Kansas City, Mo., and Williamson County Investments Corp. of Austin, Texas. Both proposed a mixture of residential and commercial or civic use.

“Both firms are very qualified in these types of historic rehabilitation projects,” Adams said. “They know a lot about all the different tools out there to make these projects work. We’re happy that we have two very qualified developers, and we’re also happy that we got a local proposal for a user.”

Though it has not been determined what would be on the first floor, it would generally be for commercial or civic purposes, he said. On the other floors, residents have indicated in a citizen survey conducted in 2012 that they would like more diverse options for housing, including market rate rentals.

City officials hope to complete their review of the proposals and select a developer by the end of the month or beginning of March.

In 2007, the city spent about $2 million to restore the exterior of the Freeborn National Bank, including tuckpointing, a new roof, a skylight and new water, sewer and electrical service to the buildings, among other improvements.

Inside, crews have cleaned out asbestos, filled in the basement and taken out a majority of the plumbing.

A developer would need to replace electrical, plumbing and heating and air conditioning, among other improvements.

At one point, city officials estimated renovations would cost another $4 million to $6 million.

There is about 22,000 square feet of developable space in the Freeborn National Bank and about 6,000 in the Jacobson Building, not including Prairie Wind Coffee, which in the last few months signed a three-year lease. Adams said he was unsure whether the city would continue to own that space or whether it would be turned over to a new owner.