Dutchtown neighborhood thoughts

[Paul Brockland]

Hello BP St. Louis, 

My wife and I currently invest in South City and Dog Town and we were looking at different areas of St. Louis. We've seen some properties in Dutchtown that have some cash flow potential but we're investing from out of state and aren't all that familiar with the area. The crime maps show that there is a good amount of crime in the area but I've also seen there have been some beautification and rehabilitation efforts in the area. I know it's close to Soulard which has been turning around so we were wondering if this is an up and coming area. Please let me know your thoughts. 

[Max Householder]

Hey Paul, I live in south city (Lindenwood Park) and my wife and I own a 4-family in Northampton, about 2 miles west on Chippewa from Dutchtown.

Like most of south city, Dutchtown seems to have some pros and cons. Pros are that it's an inexpensive entry point to the south city rental market. When I "run the numbers" on south city properties that pop up on the MLS, those in Dutchtown seem to work on paper more often than not. In the hot neighborhoods like Shaw and Tower Grove South & East you're starting to see some out of whack valuations that don't make any sensible numbers work on paper IMO, but there isn't nearly the same demand for Dutchtown properties.

I believe in St. Louis City long term, but I think Dutchtown will be toward the back of the line as far as gentrification goes. Areas that have "come up" over the last 5-10 years like Forest Park Southeast (Forest Park & The Grove business district), Tower Grove South & East (Tower Grove Park & South Grand business district), Shaw (Botanical Gardens) all have a significant anchor (noted in parens) that people want to live near. Benton Park and Gravois Park are still very block to block but they have anchors points as well like Cherokee Street business district and some nice areas along Sydney Street. Unfortunately Dutchtown doesn't really have an anchor point like that to draw in hipsters and the usual demo groups that move in first and start turning around a rougher neighborhood. IMO Dutchtown has some historic charm so it will eventually gain some interest if for no other reason than it's well-situated between other desirable areas, but it's much more residential so I think it'll end up more like Bevo with a mix of low-income and blue collar residents that make it very stable, but without much appreciation. That's a good mix for rentals though if you get in at a fair value! 

Cons are that there is a little more crime and it's definitely block to block. There is a little triangle north of Chippewa, west of Grand, and with Gravois as the hypotenuse that you'll see some very cheap properties in, but you drive down the streets and it's a rough few blocks. South of there around like Meramec and Spring Ave and along Gustine is pretty decent. North of Meramec is okay but gets rougher as you go toward South Grand. 37th Street down by St. Mary's High School is a really decent block, but Spring between Neosho and Itaska has a couple really rough properties. Keep going on Spring Ave though and between Itaska and Delor on the west side is a string of nicely remodeled properties. I'm rambling, but point is you'll need boots on the ground to get the best feel for Dutchtown. These are just my observations from looking at maybe a half-dozen properties in the area and driving around a decent amount.

My PM @Peter MacKercher owns and manages properties in Dutchtown and could give you more insight to types of tenants, rents, and typical repairs or if there is any loss due to crime, etc. I thought pretty hard about offering on one or two properties in Dutchtown, so it's definitely an area I'm open to, but just haven't found the right fit yet. Good luck!