Trying to build an ADU in Minneapolis
Minneapolis has loosend it's zoning laws for the purpose of population density and to supply more housing and one of those ideas is to allow attached, remodeling basements and attics and detached ADU's. I've been working deligently with a architect drawer and a landscape designer and have submitted dimensions and site layout drawings, floor plans, along with a permit to build and a permit to build an ADU in the back of my property following all of their setback and distance to primary home, which is a duplex with two units and has been rented since 2014. The city allows a footprint of no larger then 676 Sq feet and some height restrictions. My design is a two story, 1296 square foot, two bedroom, 1 bath and a single garage stall backing up to an Alley, with room for parking. Getting through the red tape has been interesting, but I'm learning. My conservative estimates have me building this ADU at 160k, rent in the area for a brand new, two bedroom, 1 bath with laundry, puts rents somewhere between $1,400 and $1,500 a month. The location is in South Minneapolis, where I've had a lot of luck renting my other tenants, a very desirable area. So, just waiting for the City to review my plans and hopefully it gets accepted.
Being that I've never built anything in my life, some of the questions I have is how to finance this being that it's another building on the same land as my duplex. I owe $152,00 on this duplex that's worth anywhere between $300,000 and $350,000, so the cash flow has been great for me. I valued added this building in many ways, by putting a door on the lower unit so that both units had access to the basement for laundry and locked storage. I also remodeled the upper unit back in 2015. Both value adds have allowed me to rent both for a total of $2,400 a month. The current loan is on a 15 year @ 2.75%. I spoke with my Credit Union and they have never financed anything like this before, so because I've been a member there for over 40 years, he assured me we could come up with something creative. Does anyone else here have some ideas on how best to finance both of these properties that are on the same land?
Lastly, on the same Alley there is a house 3 doors down that built a similar structure on their land, so I went over to introduce myself and they showed me the Garage with an office unit above. Their structure isn't considered an ADU, because no one is living in it. They paid $54,000 for their structure. They gave me the builders name, so I plan on calling them to get an estimate on the cost to build my ADU. Does anyone else have advice on some good GC's in the Minneapolis area? I plan to build next year if everything goes well.