Minneapolis-St. Paul Multifamily
Return to Office Calls for Internal Migration;
Development Shifts in Wake of Rent Control
Demand gravitates back to Minneapolis. The metro experienced its lowest unemployment rate on record at 1.7 percent in the second quarter this year, a positive signal for rental demand. Home to six Fortune 500 companies, Minneapolis has a greater prevalence of higher-paying opportunities and office-based employers than St. Paul. As more firms bring workers back into the office, employees that were taking advantage of remote work will likely seek living options closer to their jobs. This may have contributed to the sharp Class A/B vacancy drops recorded during the first half in Bloomington, South Minneapolis-Richfield and Uptown-St. Louis Park. Conversely, demand for upper- and mid-tier rentals in Central and East St. Paul slowed during the opening six months, as some residents likely migrated across the Twin Cities.