Apartment Construction Boom (2011-??)
Re: Apartment Construction Boom (2011-??)
If the Minneapolis apartment market is overheating why did you bid on the Nicollet Hotel block with luxury apartments, Eh Kelly Doran?
http://finance-commerce.com/2015/03/dor ... erheating/
http://finance-commerce.com/2015/03/dor ... erheating/
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Re: Apartment Construction Boom (2011-??)
Guess he wants other people to take that bite.
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Re: Apartment Construction Boom (2011-??)
I read the print edition at lunch today. As I kind of suspected from the way that photo caption was oddly written, Doran was specifically addressing the 1,000 or so units being proposed in the Old St. Anthony area. I think he's not entirely off base there. All of the big 3 proposals in that area (Nyerise, Superior Plating, Washburn-McReavy) are steel/concrete towers, which command the very highest rents. I think Doran could be right that perhaps not all 3 of these projects will pan out as they are currently being presented. That's a lot of top-end units in that area in a pretty short timeframe (assuming all 3 get underway late 2015 or early 2016).
To be clear, Doran was not saying the multi-family boom was about to burst, just that specific area. Sounds like he will focusing his own investments in the burbs.
To be clear, Doran was not saying the multi-family boom was about to burst, just that specific area. Sounds like he will focusing his own investments in the burbs.
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Re: Apartment Construction Boom (2011-??)
I hope that's not true though. I like how Nordeast is transforming right now, including the hi-rises! Having visited the area last weekend on a personal trip I was really taken back by how busy and lively Nordeast, Dinkytown and Seven Corners/Cedar-Riverside were. It certainly felt like I arrived in a bigger city (than Cleveland)!
I'm fine with hi-rises along the riverfront like these, and then stepping down as you pull away from the river (to stay in concert with preexisting infrastructure some). Projects like the Venue in Dinkytown, where the buildings step back as they go above a certain height, would look good and fit in Nordeast. I see no reason however to limit anything along the riverfront.
As far as whether or not 1,000 condos can command rents high enough to support the cost of construction, I guess I don't see why not, if you assume some transfer between luxury apartments and luxury condos, and people taking a permanent space downtown after having tried it for a year or two first. That I can buy....at least to an extent (is it 1,000? 800? 1,200?).
I'm fine with hi-rises along the riverfront like these, and then stepping down as you pull away from the river (to stay in concert with preexisting infrastructure some). Projects like the Venue in Dinkytown, where the buildings step back as they go above a certain height, would look good and fit in Nordeast. I see no reason however to limit anything along the riverfront.
As far as whether or not 1,000 condos can command rents high enough to support the cost of construction, I guess I don't see why not, if you assume some transfer between luxury apartments and luxury condos, and people taking a permanent space downtown after having tried it for a year or two first. That I can buy....at least to an extent (is it 1,000? 800? 1,200?).
Re: Apartment Construction Boom (2011-??)
Here is the apartment prices average in Minneapolis, it expands just click here http://cdn.cstatic.net/images/gridfs/55 ... rent-2.png
Meet me in Wells
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Re: Apartment Construction Boom (2011-??)
The Star Tribune lists the number of unit,s and their average price, weekly in the Homes section.
Q. What, what? A. In da butt.
Re: Apartment Construction Boom (2011-??)
Meet me in Wells
Re: Apartment Construction Boom (2011-??)
http://www.startribune.com/apartment-re ... 303823941/
Metro area vacancy rates are stable or down, but downtown Minneapolis is now up to 8.8% vacancy, the report indicates that the boom may have peaked. Despite all logic, rents are up 6.8% downtown.
Metro area vacancy rates are stable or down, but downtown Minneapolis is now up to 8.8% vacancy, the report indicates that the boom may have peaked. Despite all logic, rents are up 6.8% downtown.
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Re: Apartment Construction Boom (2011-??)
There could be vacant units in new buildings that are slowly leasing out to prevent a rush come move in/move out time, so actual available apartments could be lower. Also is LPM counted in downtown counts?
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Re: Apartment Construction Boom (2011-??)
Doesn't one of these articles come out every 6 months or so? Seems like it.
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Re: Apartment Construction Boom (2011-??)
If rents are rising then 8.8% vacancy is likely not the true metric for the downtown sub-market, if Econ 101 principals of supply and demand have anything to say about it. 8.8% is probably the rate after a bunch of supply hit the market with little/no time for lessees to satiate that supply. I also didn't understand the report's total units coming online metrics, which seem far too low, and must include a certain set of circumstances (e.g. approved plans or under construction, "downtown" doesn't include Loring Park, etc.).
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Re: Apartment Construction Boom (2011-??)
Here's the list of residential projects that are currently under construction in "downtown" (excluding Loring Park and St. Anthony Main):
Project -- Floors -- Units:
4Marq -- 30 -- 262
Latitude 45 (301 Washington Ave) -- 13 -- 320
The Nic -- 27 -- 250
Ceresota Building Redevelopment -- Reno -- 57
Commons DTE Park Apartments -- 6 -- 150
Encore -- 2 -- 122
Mill City Quarter (Phase II) -- 5 -- 150
Mill City Quarter (Stone Arch Apts) -- 6 -- 140
Wells Fargo Residential II -- 6 -- 150
Portland & 8th Condos -- 17 -- 112
Dock Street Apartments -- 6 -- 185
Dock Street Apartments - Liner Bldg -- 4 -- 15
Else Warehouse -- Reno -- 161
Junction Flats -- 6 -- 182
The Cameron -- Reno -- 44
The Natural (District 600) -- 6 -- 78
The Paxon (Three24 1st N) -- 5 -- 140
Velo Apartments -- 6 -- 106
Western Container Condos -- Reno -- 25
Totals: 19 projects for 2,649 units under construction -- fewer would be completed this year. If I add Loring Park and St. Anthony Main to the mix, it adds 6 more projects and 855 more units, not including completed projects like LPM:
520 2nd St SE (Stone Arch 2) -- 6 -- 91
A-Mill Artist Lofts -- Reno -- 255
Grain Belt Terrace I -- 4 -- 75
Grain Belt Terrace II -- 4 -- 75
Mill & Main Phase I -- 7 -- 180
Mill & Main Phase II -- 7 -- 179
Totals: 25 projects for 3,504 units
Project -- Floors -- Units:
4Marq -- 30 -- 262
Latitude 45 (301 Washington Ave) -- 13 -- 320
The Nic -- 27 -- 250
Ceresota Building Redevelopment -- Reno -- 57
Commons DTE Park Apartments -- 6 -- 150
Encore -- 2 -- 122
Mill City Quarter (Phase II) -- 5 -- 150
Mill City Quarter (Stone Arch Apts) -- 6 -- 140
Wells Fargo Residential II -- 6 -- 150
Portland & 8th Condos -- 17 -- 112
Dock Street Apartments -- 6 -- 185
Dock Street Apartments - Liner Bldg -- 4 -- 15
Else Warehouse -- Reno -- 161
Junction Flats -- 6 -- 182
The Cameron -- Reno -- 44
The Natural (District 600) -- 6 -- 78
The Paxon (Three24 1st N) -- 5 -- 140
Velo Apartments -- 6 -- 106
Western Container Condos -- Reno -- 25
Totals: 19 projects for 2,649 units under construction -- fewer would be completed this year. If I add Loring Park and St. Anthony Main to the mix, it adds 6 more projects and 855 more units, not including completed projects like LPM:
520 2nd St SE (Stone Arch 2) -- 6 -- 91
A-Mill Artist Lofts -- Reno -- 255
Grain Belt Terrace I -- 4 -- 75
Grain Belt Terrace II -- 4 -- 75
Mill & Main Phase I -- 7 -- 180
Mill & Main Phase II -- 7 -- 179
Totals: 25 projects for 3,504 units
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Re: Apartment Construction Boom (2011-??)
Somehow I am always surprised by how low these numbers seem. Each individual project seems gigantic when viewed from the street and they are certainly dense but the total number of units just seems much less than I would expect from visual inspection.Totals: 25 projects for 3,504 units
Just one of those strange human perception things, I guess.
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Re: Apartment Construction Boom (2011-??)
So nearly 2 years ago, this article was written (and shared in this very thread) to explain the lack of condo development in the current boom. Basically, at that point in the boom / economic recovery, existing condo sales prices were simply not high enough to warrant new construction.
Also, this MinnPost article explained more of the same: https://www.minnpost.com/cityscape/2014 ... ondos-gone
Flash forward to now, and the economy and apartment market is still hot, but still no condos. Prices for existing units are sky high and inventory is at record lows. According to realtors, the only way nicer/newer downtown condos hit the market is if someone moves out of Minneapolis or dies. Realtors, of course, would like to see lots of new condo units hit the market.
Two (locked) articles in F&C today continued the story. If you're interested in this sort of thing, I recommend grabbing a paper copy downtown or heading to the library.
Condo conundrum: http://finance-commerce.com/2015/07/con ... nneapolis/
Why developers prefer to build apartments: http://finance-commerce.com/2015/07/why ... partments/
Also, this MinnPost article explained more of the same: https://www.minnpost.com/cityscape/2014 ... ondos-gone
Flash forward to now, and the economy and apartment market is still hot, but still no condos. Prices for existing units are sky high and inventory is at record lows. According to realtors, the only way nicer/newer downtown condos hit the market is if someone moves out of Minneapolis or dies. Realtors, of course, would like to see lots of new condo units hit the market.
Two (locked) articles in F&C today continued the story. If you're interested in this sort of thing, I recommend grabbing a paper copy downtown or heading to the library.
Condo conundrum: http://finance-commerce.com/2015/07/con ... nneapolis/
Why developers prefer to build apartments: http://finance-commerce.com/2015/07/why ... partments/
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Re: Apartment Construction Boom (2011-??)
Seems the best fix is to get condo liability matching new house construction liability.
Wood floors in new home construction, 8-years later start creating gaps. SOL. It's what they do.
Wood floors in new condo construction, 8-years later start creating gaps. Lawsuit time.
Wood floors in new home construction, 8-years later start creating gaps. SOL. It's what they do.
Wood floors in new condo construction, 8-years later start creating gaps. Lawsuit time.
Re: Apartment Construction Boom (2011-??)
Looks like downtown is back at 6.6% down from 8.8 last Q.
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Re: Apartment Construction Boom (2011-??)
That's not too surprising, since it's a relatively small (and volatile) submarket. I doubt that many cities in the U.S. don't experience similar peaks and valleys.
Re: Apartment Construction Boom (2011-??)
No, I think that at the time of the last report, many new units had just come on. That 3 point rise had some people/media reporting the sky is falling. The 2 point drop is no story at all of course. Not surprising I was kind of waiting for the Q2 report and betting it would come down again.
Re: Apartment Construction Boom (2011-??)
A question that maybe you will know. How long does an apartment sit uncounted after it is finished and ready for occupancy? With Nic and LPM both dropping units on the market at the same time I can see where the big up would come from and why the rate went down the next quarter generally. Same will happen when Latitude and 4Marq drop units with in 6 months of each other, coming up.No, I think that at the time of the last report, many new units had just come on. That 3 point rise had some people/media reporting the sky is falling. The 2 point drop is no story at all of course. Not surprising I was kind of waiting for the Q2 report and betting it would come down again.
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