How do people feel about investing in the twin cities

Question

How do you investors feel about investing and your investments in the twin cities epically after all the riots that happened this year ?

Corey Hawkinson · Answer

@Ty Jackson 2 days ago I submitted an offer that was $40k over asking. I got beat out by at least 7 people. Obviously my competitors haven’t gotten the memo that the Twin Cities area is terrible and they should all stop making offers. :)

Todd Dexheimer · Answer

Twin Cities is slow and steady. Right now it is high priced among multifamily, from a duplex to a 300+ unit. I am staying out of Minneapolis and St Paul for now, due to issues with the cities.

By the way, we are seeing rentals sit on the market right now. We have a 2 bedroom in NE Minneapolis for rent and have dropped rent by $200/month and still no showings. My team just asked if they could drop it another $100/month.

Mack Benson · Answer

I absolutely love the twin cities area and market for investment. That being said, you can separate the twin cities as an area from the twin cities as two individual cities.

Last year, with the ordinances passed by the Minneapolis city council I took that entire city off my list for possible investment. I figured I do not need to invest in a city who is so against landlord rights when I can literally go to the next town over for much more reasonable treatment. Additionally, the overt waste that the city council and parks board participate in gets passed on to the people who own property and I do not agree with the waste of funds in the same manner.

At the time, St. Paul was still on my radar and I was actively looking up until they started talking about worse ordinances than what Minneapolis passed last year. When I heard that I put the breaks on my searches in St. Paul and now that the ordinance passed I have written that city off as well.

I am still looking at properties in both Ramsey and Hennepin counties but not those two cities specifically.

Jordan Moorhead · Answer

@Ty Jackson we still own in the twin cities. The riots were an isolated incident. The twin cities is still a hot market with a tremendous rental demand! Thanks @Russell Brazil

Noah Chappell · Answer

Minneapolis and St Paul, horrible place, don't invest there.. ;) No, in all seriousness I'd focus on the macro, not the micro. Twin Cities still has strong indicators and great long term outlook that you'd hope for in a rental market. Is the game rigged against investors? I don't necessarily think so.. I just think you need to operate within the parameters that exist here. To argue that you wouldn't look at this market due to the riots would be like saying you wouldn't take a 4 plex downtown Portland for great price.. no-one would pass that up (unless it were physically burning.)

Alyssa Strom · Answer

Similar to what @Mack Benson said, the Twin Cities is a large metro area. The most damage was in a small area of Minneapolis. From an investor buyer perspective, prices are still high and there is still a ton of competition. Some investors are exiting the Minneapolis market but there are other ones lining up to take their place. It takes work and patience (and most likely sweat equity) to find the cash flowing deals but it's still a great buy and hold market.

Bruce Runn · Answer

@David Barnett

I'd agree with you.  We are already seeing small landlords sell and bigger players come in and buy.  I personally think it's a loss for MPLS as local ownership is an advantage to a city.

Adam Tafel · Answer

Avoid investing in an auto-parts store and you'll be ok !

Anthony Vicino · Answer

A lot of concessions getting offered these days in Minneapolis, especially within the class-A space. With all the recent tumult, there's been a sizeable exodus of a particular tenant class away from the cities. They'll be back, but things will be rocky in the short-term.

Long-term, Minneapolis and St Paul are never going to win any investor-beauty pageants as the next hot market, but as @Noah Chappell pointed out, the macro-economic situation is solid and will continue to be so for the foreseeable future.

Noah Chappell · Answer

Echoing above, I have a vacancy in both Minneapolis and St Paul right now, and we aren't getting the interest I'd expect. I'm not sure what the answer is. In a few weeks I'll probably fire rent them at a low price or with 1st month free on 6 or 9 month leases just to get through the winter/ pandemic/ recession/ riots, then hopefully renew or rent at market price again next yr.

How do people feel about investing in the twin cities

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