Multifamily housing development is dominated by a handful of big players, but a small, family-run firm with Minnesota roots is using a unique business model to emerge as one of the “regulars” in the field.

Long Lake-based Roers Cos. has quietly carved out an impressive footprint during the apartment boom. Initially, it served as an equity partner with some of the well-known local players, such as CPM Cos. and United Properties. Now, it’s expanding into its own development projects.

In just six years since its founding, Roers has participated in $400 million of mostly multifamily residential projects across the Upper Midwest. The projects ranged from senior and student housing to luxury, urban apartment homes to affordable rural housing.

The firm is led by a pair of siblings who grew up near Marshall, in southwestern Minnesota farm country. Kent Roers, 41, and brother Brian Roers, 39, co-founded the firm along with high school friend Jeff Koch in 2012, seeking to convert their residential real estate “hobbies” into a full-fledged business.

Until then, Kent Roers was a financial planner for the likes of Claymore Securities and American Express Financial Services, while brother Brian was a certified public accountant with this own firm, Maple Grove-based Anderson & Roers. In their spare time, they owned and managed a handful of rental properties near the University of Minnesota.

The pair said the knowledge and experience they gained by working on a small scale in the multifamily market convinced them there were plenty of individual investors out there looking to get into the increasingly lucrative apartment business. The investors were mostly people seeking to diversify their holdings from stocks and willing to invest an average of around $100,000 per project.

The problem for them is that the Twin Cities market is notorious for its short supply of existing multifamily buildings for sale, while the marquee new-construction developers usually tap institutional capital for equity rather than small investors.

The Roers’ answer was to develop a system of financing new-construction projects by personally recruiting and organizing hundreds of such small-scale investors, a process they call the “direct investment model.” They have succeeded in raising $115 million in equity.

“A lot of people who want to do stuff in real estate start with friends and family, but they might only be able to do one project a year that way,” said Kent Roers. “Our objective was not just to find these kind of investors, but to keep on finding them. We do six projects per year, all with investor financing. I don’t know of another group in the Twin Cities who’s doing anything like that.”

Their investment model has earned Roers equity partner status on such high-profile local multifamily projects as Spectrum, a 118-unit apartment and townhouse project in Minneapolis’ Marcy Holmes neighborhood. The firm partnered with CPM on that effort. Other recent partnerships have included United Properties’ mixed-use project in Chanhassen called Venue, and the Mezzo Apartments in northeast Minneapolis, another project with CPM.

Now, Roers is also doing its own projects, including Confluence on 3rd, a 211-unit luxury building in downtown Des Moines that is 90 percent filled eight months after its opening.

Brian Roers said the firm’s plans for 2018 show no signs of slowing down, although the housing types and locations will be more diverse to follow shifts in the multifamily market.

“We’ve got two senior housing, one student housing and one market-rate apartment project on the agenda for 2018,” with the market-rate and senior buildings likely to be built outside the Twin Cities metro area.

“We are also definitely looking at condominiums at this point,” he added, with an emphasis on “more affordable units” as opposed to the multimillion-dollar condos that are now generally the rule in that long-subdued sector.

Don Jacobson is a freelance writer based in St. Paul. He is the former editor of the Minneapolis-St. Paul Real Estate Journal.