A Hy-Vee grocery store and 190 units of luxury apartments are part of the first phase of a $50 million mixed-use development planned for the southeast corner Minnesota 36 and Manning Avenue near Stillwater.

The project, called Central Commons, is the largest retail development proposed for the city in the last two decades, city officials said Tuesday.

Officials from Hy-Vee, which is based in West Des Moines, Iowa, plan to build a 95,000-square-foot grocery store and 4,000-square-foot convenience store at the site. Construction of the project is expected to start after the new $32 million partial-cloverleaf interchange is built at Minnesota 36 and Manning Avenue in 2021, said Community Development Director Bill Turnblad.

The proposed site, located south of Minnesota 36, is currently in Stillwater Township, but the developer has petitioned for annexation into the city of Stillwater; part of the application for the development includes a request for the city to annex the property, Turnblad said.

The Stillwater City Council is expected to approve the annexation petition at its May 5 meeting as the proposal is consistent with the city’s comprehensive plan, Turnblad said.

Staff would then submit the annexation petition to the Minnesota Municipal Board; Turnblad said he expects the process would take “less than a month” since Stillwater Township officials are not contesting the annexation.

Plans also call for 190 units of high-end apartments, ranging from studios to three-bedroom units, said Mark Lambert, the president of Summit Management, the Stillwater-based company developing the project. Lambert also developed the BlueStone Lofts and Flats in Duluth and the Stillwater Commons office building in Stillwater.

The “Flats at Central Commons” in Stillwater, which are expected to open in 2023, will feature an indoor pool, hot tub, sauna, steam room, massage chair room, music practice room, game room, fitness facility, group fitness for biking and other group activities, a pet spa, bike storage and a bike-repair room, Lambert said.

Other amenities planned: a second-floor outdoor deck with fireplace seating, sun area and grill areas; a fourth-floor entertainment suite with outdoor grilling and seating areas, and a 1,000-foot walking trail around a pond and picnic areas with connections to a future trail system planned by Washington County, Lambert said.

“Present times aside, there certainly has been a lot of momentum for this type of higher-end market apartment,” Lambert said. “We’re hopeful when the current times are past us that there will continue to be a market for this kind of product.”

Hy-Vee officials have wanted to put a store in at the site since 2017. They originally were in discussion with officials in Oak Park Heights to have the land annexed to Oak Park Heights, but that deal fell through. Summit Management acquired the 35-acre site in October 2017.

A spokeswoman for Hy-Vee said in an email Tuesday that company officials “have no new developments to announce and likely won’t until we are through the COVID-19 pandemic.”

The northeast corner of Minnesota 36 and Manning Avenue in Stillwater is the possible future site of a Lakeview Hospital campus.

Lakeview’s concept plan for the site — shared with city officials in 2017 — shows a 96-bed, three-story hospital; a same-day surgery center; senior housing; and a medical office building.