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Twin Cities apartments: Short supply despite thousands of new units

  • Blog Post by: Jim Buchta
  • March 4, 2014 - 10:42 AM
The Brunsfield North Loop apartment building on the edge of downtown Minneapolis was one of several luxury buildings that hit the market during 2013.

The Brunsfield North Loop apartment building on the edge of downtown Minneapolis was one of several luxury buildings that hit the market during 2013.

Despite thousands of new apartments that have come on line in recent years, Twin Cities landlors are still in the driver's seat. A year-end report from Marquette Advisors says the average apartment vacancy rate across the metro held steady at 2.5 percent through the end of 2013 . That was the 11th consecutive quarter of sub‐3.0- percent vacancies in the region. A full 43 out of 54 submarkets surveyed by the group reported vacancy rates of less than 3.0 percent during the 4th quarter even though 3,108 new rental units hit the market in the 2013 compared with 1,428 units during the previous year.

Strong demand and low vacancy rates continue to drive steady rent growth. The average market rent at the end of the year was $981 per month, a 2.5- percent increase from a year ago, though rent gains were even stronger in downtown Minneapolis.

We'll have a full report, including predictions for apartment construction this year, in the Wednesday paper.

- Jim Buchta

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