Outside Minneapolis, a world-traveling designer and modern-minded architect earn extra credit for the ultimate show-and-tell project—turning a former schoolhouse into a chic urban triplex.

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Holleran Home
Credit: Kim Cornelison

Had Forrest Gump been a remodeler, he might have said an old house is like a box of chocolates: You never know what you're going to get—especially behind the walls. Just ask the team who transformed an 1857 structure near Minneapolis. They discovered a sweet surprise wrapped in layers of plaster and lath.

Interior designer Sheila Holleran owns the home in Excelsior, a small community on Lake Minnetonka. Originally a school, the town's oldest building evolved into a busy boardinghouse (nicknamed The Beehive) and—when Sheila bought it—four apartments on three floors. She worked with architect Ben Awes to combine the two main-floor apartments into a single home.

Tearing into walls, demo crews found 150-year-old two-by-fours of old-growth lumber, often packed solid with layers of brick. "We'd never seen a wall with bricks in between the studs like that," Awes says. "Normally that approach would rot out the studs, but they were fine—and it's just beautiful." These walls can talk: They speak to the home's past and have a big say in its new life.

Wherever possible, the old lumber and brick were left in place and exposed. The rest was repurposed. "We saved every single two-by-four and pulled out every nail ourselves," Sheila says. The same philosophy applied to the building's original finished millwork and Douglas fir floors.

The bones provide the perfect foundation for Sheila's richly textured design style. She grew up spending summers with family in the former Yugoslavia and later worked as a flight attendant. "I like to keep things simple, warm and organic in nature, with items that are found or at least with the appearance of being found," she says.

Holleran Home
Credit: Kim Cornelison

Sheila lives on the main floor with son Mihailo and dog Ratko; tenants reside above and below.

Awes' new floor plan turned a rabbit warren into a series of free-flowing spaces better suited to Sheila and son Mihailo's lifestyle. That meant working around an existing chimney and embracing exposed steel beams and columns that went up as walls came down.

The design also had to pass muster with the local Heritage Preservation Commission. Changes to the rear exterior were particularly sensitive. "Because we had a very square, blocky building, we decided to use that same language of different-sized blocks cascading down the hill on the back," Awes says. "It has a reference to the old part of the building, but it creates an entirely new experience."

Sheila believes they struck the right balance. "It was important not to mimic what was there," she says. "I respect the past, but here's what's now."

Holleran Home
Credit: Kim Cornelison

From the street, Sheila's home retains its charmingly boxy schoolhouse shape. Architect Ben Awes modernized the rear exterior with a small addition that plays off the front's straight lines and classic windows (photo at top of story).

Holleran Home
Credit: Kim Cornelison

CREAMY + DREAMY In the serene front living room, a mod light fixture pairs with painted vintage millwork. Sheila found the wall-mounted rug while traveling in Nepal; she and Mihailo pinned it to a backboard and framed it with two-by-fours. The sizable sofa caters to crashing. "As my son can tell you, it's comfortable, and I could swear it can sleep about eight at night," Sheila says.

Holleran Home
Credit: Kim Cornelison

DESK SET A slab of travertine left over from the kitchen island tops an old dining table base to create a striking living room desk. "I love using dining tables as desks," Sheila says.

Holleran Home
Credit: Kim Cornelison

DEN OF ANTIQUITY In the back living area, the den incorporates a section of original 1800s brickwork and studs discovered during demolition, as well as an exposed steel ceiling beam. Sheila paired the rugged elements with a sleek new wood-burning fireplace and a leather sofa that echoes other glossy black finishes.

Holleran Home
Credit: Kim Cornelison

DINE + DASH The dining area's mid-mod light fixture illuminates a whitewashed wood table with a live edge, stainless-steel legs and saddle-leather benches. The painting, one of Sheila's favorite pieces, was a gift from her mother. The colorful rug? "It was actually in my son's playroom when he was little," Sheila says.

Holleran Home
Credit: Kim Cornelison
Holleran Home
Credit: Kim Cornelison

BOLD MEETS OLD The kitchen, dining room and den form a large gathering space in the back of the house, where big windows bring in natural light and views. Walnut cabinetry, travertine countertop and backsplash surfaces, and a custom oil-rubbed steel range hood give the kitchen historic flavor. "The materials were instantly compatible with the old brick and wood and plaster," architect Ben Awes says.

Holleran Home
Credit: Kim Cornelison

WINDOW SEATS The best views in the house may be from this sitting area by the kitchen. Face one way to converse with the cook or turn to take in outdoor vistas. The decor picks up the kitchen's blacks, whites and wood tones.

Holleran Home
Credit: Kim Cornelison

MORTAR BED(ROOM) More of the original brick and framing provides an eye-opening backdrop for Sheila's bedroom, which features nightstands made by Jim Kachel in Lakeland, Minnesota—the same craftsman behind the home's cabinetry. Sheila says the wall can create a draft, but she likes the room cool for sleeping.

Holleran Home
Credit: Kim Cornelison

MASTERED BATH Wanting a luxe aura in the main bath, Sheila chose Alaskan white marble counters for the vanities and Carrara marble in a chevron pattern for the backsplashes. Like the home's other cabinets, these were crafted by Jim Kachel, including wood handles. "I'd sketch it out, and boy he nailed it every time," Sheila says.

Design School: Materials Matter

Creative use of elementary materials moves this historic home to the head of the class.

Brick Crisp schoolhouse red in front creates curb appeal, but several interior rooms dare to bare the much paler unfinished brick hidden in the walls. "That was never meant to be seen," Ben Awes says.

Wood Some of the old-growth two-by-fours were repurposed as divider screens inside and out, such as those wrapping a side porch. And the rear exterior features charred cedar siding—Sheila added the effect by wielding a blowtorch.

Stone Countertops and backsplashes appear to be a similar whitish stone, but a closer look reveals subtle and splendid veining variations among travertine, Carrara marble and Alaskan white marble.

Glass To maximize light and views while adhering to meeting historic district guidelines, Awes took the proportions and style of the front windows and blew them out to jumbo size on the rear exterior.

Steel Instead of hiding the steel structural beams, Sheila left them exposed and let them inspire similar finishes for the fireplace, range hood and a wall of kitchen cabinets. A backyard firepit mimics the style of the indoor fireplace.

Fabric Wherever the vibe could feel too cool, hard or slick, Sheila used fabric to warm and soften the space. Rugs (on walls and floors) are her go-to tender touch, adding color, pattern and reminders of travels.