The turn-of-the-century brownstone at 627 E. Fourth St. has undergone a $4.3 million renovation by Heirloom Property Management. The public can tour the 20-unit building during an open house Tuesday, May 26. (Photo by Mark Nicklawske)

A once stately turn-of-the-century brownstone neglected for decades and widely considered one of Duluth’s biggest eyesores has received a complete top-to-bottom restoration and begins accepting tenants this summer.

Heirloom Property Management, owners of Brewery Creek Terrace, 627 E. Fourth St., celebrates the completion of its five-year, $4.3 million rehabilitation with an open house from 4:30 to 6:30 p.m. Tuesday, May 26. The building now features 20 new studio, one-bedroom and two-bedroom apartments. Rents start at $1,029 a month.

Opened as the Brook Terrace in 1903, the original three-story, seven-unit townhouse had been sliced into low-rent apartments and disfigured by a motel addition as it deteriorated across from the Whole Foods Co-op Hillside store. The city of Duluth condemned the structure following a 2021 fire.

Widely considered one of Duluth’s worst eyesores, the former Brook Creek Terrace fell into disrepair decades ago and was disfigured with a ground-level motel addition in the 1960s. The building suffered a fire in 2021, shortly after this picture was taken. (Photo by Mark Nicklawske).

The Duluth Preservation Alliance added the building to its Most Endangered Properties list just months before the 2021 fire. With the reopening this month, it will become the only property from that list to receive improvements. The Pastoret Terrace, Esmond Building and First Baptist Church, all listed in 2021, no longer exist.

The Duluth Preservation Alliance recognized Heirloom Property Management with a preservation award at its May 19 annual meeting.

“It’s a beautiful old building,” said Bob Berg, who helped found the preservation group in 1978. “It’s just amazing what they’ve done to it.”

Berg said he hopes the Brewery Creek Terrace project will inspire other restoration projects across the city. “We lost the Pastoret Terrace, of course, but it’s wonderful to see what they did here. It can be done.”

Mike Schraepfer is the president of Heirloom Property Management. (Photo by Mark Nicklawske).

Heirloom Property Management President Mike Schraepfer told the annual meeting audience his company specializes in maintaining standard residential and vacation rental buildings but its heart lies in restoration work. He said tackling full scale renovations is different and exciting.

“This was kind of a passion side of what we do,” he said. “It’s really fun to be a part of Duluth history and a part of the story and preserve that … it’s meaningful work for us.”

Heirloom Property Management has been rehabbing old homes and buildings for about 10 years. Other projects include the Joseph & Louise Cotton House at 2309 E. First St., and company offices at the corner of First Street and Second Avenue East.

The apartment building sat vacant for months and was trashed by vagrants and squatters before Heirloom Property Management purchased the building in 2022. (Photo courtesy Heirloom Property Management)

Schraepfer said he would frequently drive by the dilapidated building and see its potential. But no one was taking on the work.

“It was: ‘If not us then who?’” he said. “I like fixing things. I had a vision for it — it’s an old building and all old buildings look good when they’re done.”

Like all building rehabilitations, Schraepfer said the most difficult and expensive work is unseen. For example, workers repaired foundation damage on the building’s west side likely sustained during a 2012 Brewery Creek flood. In another case, a four-story wall was constructed behind a compromised east exterior wall to stabilize the structure. None of the work is visible now.

The most obvious improvement is the removal of a 1960s motel addition — seven squat, ramshackle units that fronted Fourth Street. The units were designed to host guests visiting the nearby St. Mary’s Hospital.

The renovated Brewery Creek Terrace includes 20 studio, one-bedroom and two-bedroom apartments. Rents start at $1,029 with occupancy available in July. (Photo by Mark Nicklawske)

“It was a motel. It was called the ‘Hospitel.’ It was disgusting, pretty bad.” said Schraepfer. “We probably shoveled out 50 dead rats. It was vacant and we didn’t own it yet and a lot of people got in here and then left. The kitchens were full of food.”

The renovation saw the old motel addition demolished and replaced with green space, sidewalk and small front decks for middle-floor apartments.

Heirloom gutted the entire building, cleaned the stonework and exposed the brick walls. All new utilities were installed along with a sprinkler system. The basement was lowered and waterproofed which created additional living space. New rooms were constructed inside the upper shell similar to the previous apartment building layout but with some space-saving changes.

Small front decks replaced a 1960s motel addition to the historic building. (Photo by Mark Nicklawske)

“We kept the same unit division but we cleaned it up a lot.” said Schraepfer.

Indeed, all the new apartments are furnished with modern kitchens, spacious bedrooms and comfortable living space. Upper apartments feature lake views and new back deck space. The building retains its historical character with several oval windows, decorative brick work and Craftsman-style trim.

“It turned out pretty sharp,” Schraepfer told the annual meeting audience.

Upper levels of the Brewery Creek Terrace feature Lake Superior views. (Photo by Mark Nicklawske)

Brewery Creek Terrace is one of just three turn-of-the-century, terrace-style buildings still standing in Duluth. Munger Terrace at 405 Mesaba Ave., and Chester Terrace at 1224 E. First St., are the other two. The Pastoret Terrace, 129 E. First St., was demolished in 2025 after years of neglect and litigation.

While Brewery Creek Terrace is Heirloom’s biggest renovation to date, the company is currently working on a much larger project. Schraepfer said the company is renovating the former Nettleton Elementary School at 108 E. Sixth St. The building was constructed in 1905 with additions in 1945 and 1987. It closed and has been vacant since 2013. The project will turn the school into a 97-unit apartment building. The new apartments are expected to open in the fall.