2040 Comprehensive Plan: Envision Shakopee

HOUSING: MULTIFAMILY MARKET MULTIFAMILY CONSTRUCTION HAS BEEN HAS BEEN STAGNANT IN SHAKOPEE SINCE 2005, AND VACANCY RATES HAVE STEADILY FALLEN. FIGURE 3.4 - RESIDENTIAL DEVELOPMENT TRENDS

HOUSING: TENURE WHILE RENTING HAS INCREASED IN RECENT YEARS, HOMEOWNERSHIP REMAINS MORE COMMON IN SHAKOPEE COMPARED TO THE REGION. for multifamily housing. Recent multifamily projects now under construction or recently finished are not anticipated to fully absorb the current demand for new multifamily housing. Vacancy rates for multifamily peaked in 2005 at 8.6% and declined to 3% as of 2017. Shakopee multifamily rents have grown steadily since 2010, rising by 15% to $1.14 per square foot (“PSF”), or an average of $1,025 for a one- bedroom apartment. 1 Within the region, Shakopee’s rents and vacancy rates were on-par with the broader suburban markets in the region, but lower than the average rents in Minneapolis and other areas of the Southwest submarket, in part due to the new construction that has taken place in these areas and increased demand region-wide. Most recently, market-rate multifamily units have an asking rent of $1.4 PSF. FIGU E 3.3 - HOUSINGTENUR C MPAR SON MULTIFAMILY REAL ESTATE TRENDS Multifamily construction has slowed since 2010 while vacancy rates have steadily fallen and rents have risen, indicating continued demand

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100 150 200 250 300

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0%

76% Running Header Place Holder 2 1 3 4 6 7 8 5 21% 76% 20% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2000 2010 Shakopee Running Header Place Holder Running Header Place Holder Housing Running Header Place Holder Running Header Place Holder Running Header Place Holder

The Addison Apartment Homes 88 units

Vacancy Rate

(50) - 50

Square Feet

2000

2004

2008

2012

2016

Deliveries

Net Absorption

Vacancy Rate

In addition to this summary data the 84 unit All Saints Senior Living community

was delivered in 2013. HOUSING: MULTIFAMILY WITH FEW MULTIFAMILY DELIVERIES MULTIFAMILY RENT HAS SEEN STRONG GROWTH SINCE 2010 AND IS NOW APPROACHING THE SUBMARKET AVERAGE. FIGURE 3.5 -MULTIFAMILYUNIT PRICES

Housing Tenure

Shakopee Multifamily Asking Rent PSF

Asking Rent

Submarket Shakopee Southwest

Vacancy

Renter

Owner

2.9% $1.14 3.7% $1.20 2.9% $1.10 2.7% $1.10 2.1% $1.00 3.4% $1.20 2.9% $1.50 3.1% $1.20

Twin Cities Region

$0.50 $0.60 $0.70 $0.80 $0.90 $1.00 $1.10 $1.20

$1.14

East

Southeast

North West

23%

28%

28%

30%

Minneapolis (Non-Downtown) St. Paul (Non-Downtown)

N

73%

70%

66%

65%

W

E

SW

SE

2015

2000

2010

2015

1 CoStar trend data of all multifamily product.

79 ENVISION SHAKOPEE | SECTION III: COMMUNITY ENVIRONMENT