©2024 Real Estate Publishing Corporation
August/September 2024 • VOL. 41 No. 5
Renters still embracing multifamily living in the Twin Cities By Dan Rafter, Editor
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emand from renters is still far outpacing the supply of multifamily units in the Twin Cities and its suburbs, according to brokers working in this sector. There are plenty of reasons for this. It’s difficult to buy a single-family home today, with the average price of a for-sale home now above $400,000 and mortgage interest rates still averaging more than 6.4% for a 30-year, fixed-rate mortgage. These financial challenges have turned many potential homebuyers into renters.
Current33, an apartment project in Hastings, Minnesota, from Enclave. (Photo courtesy of Enclave.)
And the CRE professionals in Minneapolis-St. Paul and its suburbs say that the demand-supply imbalance for apartment units isn’t about to slow anytime soon, especially considering that high construction costs and interest rates have slowed the development of new multifamily properties in the region. Josh Wilcox, president of development, finance and investments with St. Louis Park, Minnesota-based Enclave, says that his company, an investment firm with in-house development, construction and management
services, focuses on the second- and third-ring suburbs of the Twin Cities. And multifamily leasing activity here? It’s strong. “In the suburbs, we are still seeing healthy demand for all the projects that we are delivering now,” Wilcox said. “There is a slight uptick in some incentives that might be required to keep up the leasing velocity. That is driven by all the new supply that was delivered during the last six months. Renters to page 26
The Opus Group bucks the trend with new spec industrial facility in Minneapolis-St. Paul market By Dan Rafter, Editor
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lame high interest rates, economic uncertainty and slowing demand, but whatever the reason, spec construction has slowed to a crawl in the industrial sector. But there are exceptions. That includes The Opus Group, which is building its own speculative industrial project in Minneapolis’ northwest market. The Opus Group on July 8 began construction on a distribution and light manufacturing facility in Dayton,
Minnesota, about 30 miles from the Twin Cities. The 132,200-square-foot speculative facility is rising at 17600 Territorial Road in Dayton, a 10-acre site easily accessible from the new Dayton Parkway Interchange and Interstate 94. And further bucking the slowdown trend, the new facility has already landed a major tenant. TurbinePROs, a leading North American provider of field services for
rotating equipment manufacturers, has signed a lease for more than 87,000 square feet at the facility. This leaves about 44,000 square feet available for lease. Joe Mahoney, senior director of real estate with Opus Development Company, said that Opus long had confidence in the site’s location. The opening of the Dayton Parkway Interchange, though, only enhanced the location. Opus to page 28