Market Report
Minneapolis-St. Paul Multifamily Market Report
2025 Investment Forecast
Suburban Demand Intensifying Amid Tapering New Supply;
Policy Uncertainties Reshape Urban Investment
Fewer completions bolster suburban rent growth. Minneapolis-St. Paul faces a construction slowdown in 2025. The pipeline is set to shrink from over 8,000 units last year, nearly double the 2015–2019 average, to just over 3,500 units. In suburbs like Burnsville-Apple Valley and South St. Paul-Eagan — where demand is driven by population growth, the Southwest light rail extension and larger living spaces — the reduced construction will support tightening vacancy. These submarkets had some of the metro’s lowest vacancy rates, at 4.5 percent in the third quarter of 2024, and led rent growth last year. Several other submarkets entered 2025 in a more challenging position. Anoka County and the Plymouth-Maple Grove area began the year with Class A vacancies above 10 percent. With fewer units slated for delivery, the supply pullback will limit competition for recently completed Class A units, potentially aiding leasing at these properties.
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