Beyond the Big Cities: Unlocking Profits in Minnesota’s Suburbs

35.1% average annual return

Minnesota projects have an excellent track record of providing high investor returns

Over the past seven years, Roers Companies has built a portfolio of 28 developments in Minnesota. In those 28 projects, Roers Cos. investors have seen an average annual return of 35.1% on sold properties and 9% annual income on existing operating assets.

18% rent-to-income

The industry standard for rent-to-income is about 30%

Year-over-year increases in wage growth, according to the Bureau of Labor Statistics, has surpassed rent growth in Minnesota. From an investor perspective, anytime renters’ incomes are increasing faster than rents are increasing, it provides upside for future rent growth going forward.

21% higher average annual household income

In 2022, Minnesota’s median household annual income was roughly $90,390 vs. the United States median of $74,580

Minnesota’s above-average income base indicates potential for higher rents compared to national averages, boosting potential returns. This income advantage positions Minnesota as a stable and lucrative market for multifamily investors seeking healthy cash flow.

2.7% unemployment rate

This rate of unemployment is well-below the overall US, which is at 3.8%

The Twin Cities has some of the lowest unemployment rates in the country at 2.7% as of the end of September 2023. Minnesota is still seeing a very tight labor market, strong job growth, and an even stronger or tighter market than the overall United States.

Invest in Minnesota

Roers Companies is proposing the new construction of a high-quality 150-unit, market-rate apartment building located in the first-ring suburb of Maplewood, Minnesota surrounded by parks and across the street from the Gateway State Trail. This five-story project will help meet the demand for new housing in the long-underserved suburb by offering a mix of housing types ranging from alcove to three-bedroom homes. We anticipate high demand and a fast lease-up. The apartment building will feature premium amenity spaces including a pool, fitness center, rooftop deck, and club room.

Project highlights:

Pent-Up Demand

There is a lack of new-product available in our primary market area, minimizing competition; according to an area market study, there is an unmet demand of 500 multifamily units. 

TIF Financing

The city has provided redevelopment TIF to the project which will be monetized as a source of funds to the project during construction and ultimately lead to stronger investor returns.

Prime Suburban Area

Maplewood is a first-ring suburban community with a population of 42,000. The site of this project is positioned perfectly amongst immense outdoor activities – such as lakes, parks, golf courses, and trails – and has great highway accessibility to help residents travel around the metro area. 

Premium Amenity Spaces

The apartment building will feature top-tier spaces including a pool, fitness center, rooftop deck, and a club room.

All in all, Minnesota presents a compelling case for multifamily investment. Its impressive track record of high returns, favorable tenant demographics, and vibrant economy are the cornerstone for investor success. If you have questions about current investment opportunities in Minnesota with Roers Cos., contact our investor relations team or take a closer look at the investment hub on our website: www.roerscompanies.com/investment. 

Date published 12/21/2023

NO OFFER OF SECURITIES; DISCLOSURE OF INTERESTS: Under no circumstances should any material or information contained herein be used or considered as an offer to sell or a solicitation of any offer to buy an interest in any investment. Any such offer or solicitation will be made only by means of a confidential offering memorandum relating to the particular investment. Access to information about investments with projects undertaken by Roers Companies LLC, Roers Companies Project Holdings LLC, or any of their respective affiliates is limited to investors who qualify as accredited investors within the meaning of the Securities Act of 1933, as amended. Investment outcomes vary. Past success does not guarantee future results.

NO OFFER OF INVESTMENT, LEGAL OR TAX ADVICE. Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment. Prior to making any investment you should consult with a licensed investment, financial advisor, legal and tax advisor.

Sources: U.S. Census Bureau, CoStar, LinkedIn, iSourceOut, The Shimberg Center for Housing Studies, CBRE