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Rents in trie townhouse projects are <br /> generally$1.00/sf/month.There will be a <br /> few projects started in 1996 of less <br /> than 100 units and senior housing in r" r <br /> in-fill locations. The 108-unit Scandia r <br /> Shores senior apartments in Shoreview `+ ' <br /> is an example. High construction costs, <br /> high property taxes and high land costs <br /> are other barriers (in addition to rents) <br /> to new construction. Marty apartment ♦ Evans Meadows Apartments,a Class A project ♦ Century Court Apartments East and West,totaling <br /> developers are active buyers and will located in Elk River sold in 1995 2,300 units sold in 1995 <br /> continue to buy as long as they can make <br /> better investments than developing. <br /> Sales activity in 1995 has been RENTAL RATES <br /> strong,over 20 properties of 100 units or <br /> more have been sold in the metro area. MINNEAPOLIS/ST.PAUL METROPOLITAN AREA <br /> These include many large properties NUMBER AVERAGE <br /> such as Century Court Apartments 2,300 UNIT TYPE STUDY DATE OF UNITS RENT RENT RANGE <br /> units; Eden place Apartments 496 units; STUDIO <br /> and Class A projects such as Edina 1993 7,461 $370 $288-S447 <br /> Towers 193 units; and Chasewood Gates 1994 7,952 5380 5299-S551 <br /> 394 units. Most of the buyers are local 1995 7951 S396 S303-S566 <br /> investors with some institutional buyers <br /> like GE, Prudential and RREEF. ONE BEDROOM <br /> Capitalization rates for Class A 1993 61,573 S478 S394-S572 <br /> apartments are 8.5-9.0%; Class B'9.5%- 1994 61,937 5487 S390-S640 <br /> 10.5%;and Class C 11% and up. Fueling 1995 63,228 S506 S426-S660 <br /> buyer demand is: TWO BEDROOM <br /> • Abundant, low interest rate 1993 56,185 S601 5467-S748 <br /> financing 1994 56,357 S612 S473-S842 <br /> 1995 56,608 $639 S506-5868 • <br /> • Steady population growth, THREE BEDROOM <br /> household formations and 1993 4,492 S761 S555-S975 <br /> job growth 1994 5,044 $788 S567-$1200 <br /> • Prices below replacement costs 1995 5,357 5813 5600-S1235 <br /> ©Towle Real Estate Company <br /> • Real "upside" over the already <br /> acceptable going-in yield <br /> • Inability to replicate good <br /> locations. AVERAGE RENT <br /> Apartment owners are now MINNEAPOLIS-ST. PAUL METROPOLITAN AREA <br /> required by law to perform criminal ©Towle Real Elate Company <br /> background checks on their property $580 <br /> managers. Some property owners are <br /> also doing this on their tenants in addi- $570 $570 <br /> tion to the normal credit investigations. <br /> 562 <br /> $560 S55s <br /> $550 <br /> $540 <br /> 5531 <br /> $530 <br /> 9/94 3/95 6/95 9/95 • <br />