Market for High-End, Luxury Rentals Growing in Minneapolis

Updated: 03/31/2014 10:44 PM
Created: 03/27/2014 12:30 PM
By: Brandi Powell

No doubt you've seen cranes and construction across Minneapolis. With new pitches currently in the works for high-end luxury apartments in Minneapolis, we decided to take a closer to look at the market for renting those expensive units.

According to Housing Link, the average monthly rent for apartments in Minneapolis is $1,200 per month. But, there's a growing market for people willing to pay a lot more.

We went to the construction site of Mill and Main West. To some, it might look like an average construction site. But, it's meeting an important demand: a place to call home for those who want to live in luxury.

"I think the highest end is under-built," said Fritz Kroll, a realtor with Edina Reality.

Mill and Main West opened in February. You can rent an apartment for $8,000 per month. "We're seeing a lot of our higher end apartments are leasing out very early," Mill and Main leasing specialist Pete Simpkins said.

Rental real estate experts say a high desire for these high-end apartment rentals are on the rise. Kroll said, "If you told me today that you wanted to spend between 4 and 6 a month for a rental property, I'd have very few options to show you."

One potential future option: A pitch, right now, for a new eight-story apartment complex, east of Calhoun Beach Club. The units would average 1,600 square feet, up to more than 3,000 square feet. The average rent would be $4,500 per month. Kroll said, "It's interesting how much is being built."

We spoke with the Cedar Isles-Dean Neighborhood Association. It's board is considering the project near Lake Calhoun. It will vote on April 7 for whether or not they'll allow building to begin.

Realtors say often empty nesters and younger professionals are the ones spending $4,000 and $6,000 a month on rent; buying doesn't work with their lifestyle. Kroll said, "A lot of young people like to be mobile, and if they do decide to make a change, they don't want to have to deal with selling a property."

Kroll added, "They will often times be given a housing allowance and with that housing allowance they get a certain amount to spend toward housing, and I don't know that there's any incentive to spend less than they're allocated."

Developers, realtors and leasing specialists say they've been staying busy, and the demand isn't going away.


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