Quick introduction: I will be moving to the greater Minneapolis area this summer due to a job transfer and wanted to get some local opinions of which areas to check out while I'm visiting this weekend. I'll be working remotely so I'm flexible on the specific area - the only real requirement is that I'm <45 minutes away from the MSP airport. 

I grew up in the Eagan/ Inver Grove Heights area but haven't lived in MN in 10+ years so my current market knowledge is limited. I know the market is hot right now so I'm prepared to spend time finding the right deal - my family has a townhouse in Chanhassen that I'm planning on living while I search for a multi family. 

To get into a little more detail on what I'm looking for: 

• B- area or better
• Within 45 minutes of MSP airport
• Areas with a small town/ neighborhood feel are a big plus
  • Town centers that could be in walking distance are a bigger plus
• Areas with above average school districts are another plus
• 3-4 unit multi family property (small yard and garage are requirements)
• Potential for value add - completely OK with doing a live-in remodel

With that in mind, can anyone suggest a few areas worth exploring this weekend? I'm also open to making some connections with local wholesalers this weekend or next time I'm visiting. 

Thanks in advance for any leads!

Let me know if you’re interested in any property’s south of the metro, I’m a licensed agent and would love to connect and help you out!

John

Multi family inventory is somewhat limited in the twin cities area now-especially if you are limited to what is available on MLS or other listed sources. Most of the 3-4 unit properties you will find will likely be in Minneapolis or Saint Paul, and I am not as familiar with the pockets within those cities. If you are set on a 3-4 unit multi-family, it might be best to start learning parts of the downtown areas to get a better feel for which areas you might be willing to live as most of your options will be there.

I would look around Northeast if you want to be in the cities.

If you're open to being in the suburbs Golden Valley, Robbinsdale and Highland Park of Saint Paul could be fun!

Highland park is probably going to have the best school districts, proximity to the airport and walkable areas. You'll just have to be patient when looking as there aren't a lot that pop up and they go fast!

@Stephen Murdock

I think both @James W. & @Jordan Moorhead make good points. I realize your list is a few wants with several wishes. The fact is that you will have very few choices on the market at any one time. I have been watching small multifamily inside the 494/694 loop for the last 1.5 years and without an exact count, I would speculate that there have been less than 20 3-4 plexes to hit the MLS in that time. Even if I'm really wrong there certainly have not been 36 or 2 per month, my hunch is it could be as low as 12. Of course, there have been some off-market properties but you will still have a very limited selection. That being said, I know Jordan well and while he wouldn't brag I can tell you he is an expert at scaring up off-market stuff, so you should definitely connect with him.

Here are my thoughts on your criteria:

• B- area or better: No problem there are lot's of B- or better areas with duplexes.  Most are in Mpls or St Paul, but you will find some first-tier suburbs with large duplexes.  3-4 plexes are as common as a Vikings Super Bowl outside of the two cities.
• Within 45 minutes of MSP airport: This will be no problem, everything is within 45 minutes of the airport, especially in multifamily.
• Areas with a small town/ neighborhood feel are a big plus: South St Paul would have this feel so would Stillwater but that is probably more than 45 minutes from the airport with any level of traffic or bad weather.
  • Town centers that could be in walking distance are a bigger plus:  This is where NE Minneapolis or Highland park might give you a bit of this feel.   
• Areas with above average school districts are another plus:  This will be the absolute hardest aspect to find in 3-4 units.  If you soften into a duplex you will find better luck here.  Otherwise, you are in MPLS or St Paul, and both are average at best.
• 3-4 unit multi family property (small yard and garage are requirements):  See all comments above
• Potential for value add - completely OK with doing a live-in remodel:  This will be random, if you see 6 properties in 1 year that meet all the other criteria you will be lucky, broaden to duplex and you will have more to choose from and might be able to sort for value-add.  If not you will need to pay a premium to get a 3-4 plex even if work is needed there will be no value play.

A little harsh I realize, but the scarcity of 3-4plex is real and you need to know what you're dealing with so if you find the right one you are ready to lock it up rather than screw around and lose it.

~Tim

Hey @Stephen Murdock  

I live in South Minneapolis near Lake Hiawatha and Lake Nokomis and I think it is an amazing neighborhood to live in. And so do lots of others are houses are selling very fast.  It is very homey and welcoming to new residents and has a mix of young families and, on the flip side, a lot of people who have been in the neighborhood 20+ years.  There are good restaurants (I.E., Northbound), bars, and a lot of development of new corner spots as well. 38th St and 28th Ave and 42nd and 28th Ave are my favorite intersections with things to do. Also close to Minnehaha Falls, airport, MOA, etc.

An area I am interested in for investment purposes is the Midway area of St. Paul. I like the growth going on over there and it is an area surrounded by colleges, affluent areas, and development. The new MN United soccer stadium is going up in Midway. This area is also home to a LOT of small multi-families. 

If you would like to get coffee or a beer when you're in town I would love to connect. If you're busy no worries at all. Good luck in your hunt!

Kurt 

@Jordan Moorhead Thanks for the advice - suburbs definitely are not out of the question. I'll check out Highland Park when I'm in town this weekend and see about making it up to Golden Valley/ Robbinsdale as well! Based off a quick look, Highland Park seems to fit most of my criteria. 

@Tim Swierczek I appreciate the reality check. I'm used to the Boston market but based on what you're saying a 3-4 plex sounds harder to come by in Mpls than out here. I'll keep an eye on this for now and reevaluate my criteria once I move out this summer.

@Kurt Pauley I'll put those areas on my list as well. I'm coming out there with my SO this time but I'll take you up on getting the beer when I'm out there for work in April!

It really isn't that hard to come across a 4 plex in Minneapolis, but many of the ones you will find listed for sale are likely not a deal that will provide much cash flow unless you put a large amount down.  Even if you did that, it would still be a poor return on your money.

For St. Paul I would look anywhere south of hwy 94 and west of downtown, as well as midway, west of Lexington Pkwy. For Minneapolis I would look in Northeast, south Minneapolis west of 35W or south of 36th (it gets shady near Hwy 62). Also east of Hwy 55 is great as well. 

Suburbs: Any thing south of Minneapolis and West of Minneapolis or South of St. Paul. You also have Woodbury, Roseville area, shoreview, mounds View, White Bear, Vadnais Heights. 

Paths of Progress are the Chanhassen area, Midway and West 7th area. You could say NE Minneapolis and St Louis Park, but they're kind of old news. Powderhorn has some potential as well

Great description Todd. Staying out of the high crime and some of the extreme high end areas is our goal, supply is low right now, but plenty of deals to be made especially for those that are house hacking, or have skills such as rehab experience.

@Todd Dexheimer Thanks for the detailed advice and making it simple to map everything out while I'm visiting this weekend.  

I read through some of your blog posts and downloaded your podcast for the commute home tonight - I got some great information from the lessons you learned from closing on an out-of-state apartment; especially around the due diligence process and financing. 

Have you found it easier to work with local banks now that you have a syndication under your belt or does that continue to be a challenge?

Originally posted by @Stephen Murdock :

@Todd Dexheimer Thanks for the detailed advice and making it simple to map everything out while I'm visiting this weekend.  

I read through some of your blog posts and downloaded your podcast for the commute home tonight - I got some great information from the lessons you learned from closing on an out-of-state apartment; especially around the due diligence process and financing. 

Have you found it easier to work with local banks now that you have a syndication under your belt or does that continue to be a challenge?

Thanks for listening to my podcasts! Out of state financing will always be difficult, especially with distressed assets. The more deals you do and the longer you've been in a market, the easier it will become. If you need some local bank contacts in MN, PM me 

Wanted to give everyone that gave me advice a quick update on how my trip ended up going - short story is that is didn't. 

With the massive winter storm we had in the Northeast 1,000+ flights were cancelled last Friday and mine ended up being one of them... I'll try again in April and hope to connect with some of you then! Thanks again for the help.

Let me know when you make it to town, I'd love to meet up and chat about our town. We have a lot of great areas depending on your goals.