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Tips for multiple offers on Minneapolis Lofts

Minneapolis Lofts for Sale are gaining steam in the market.

Let’s be honest–Minneapolis Lofts in 2013 are selling at fast paced speeds and often the listings that are priced to sell and move in ready are the first to go.  More often than not it is these properties which are garnering multiple offer situations, whether it’s the time of year, a very desirable home or an appealing listing price.
We are seeing an interesting phenomena begin to emerge in the market: the highest purchase price doesn’t necessarily translate into an accepted offer–Sellers of Minneapolis Lofts are looking for short closing timelines, non-contingent offers, zero financing contingencies and short inspection timelines.  We have assembled a handful of helpful tips to make your next offer float to the top of the Sellers list!

HIGHEST OFFER

The winning buyer in a Minneapolis Lofts multiple offer situation is often the one who makes the highest offer, pure and simple. Learn as much as possible about local market values. Look at comparable properties. Ask your REALTOR® to prepare a comparative market analysis (CMA) of the property that will tell you recent selling prices of comparable properties. When market values are rising, there may be a bit of guesswork involved in pricing. You may need to pay more than yesterday’s comparable sales in order to be the successful bidder.

CONSIDER A PRE-INSPECTION

Home buyers who know they have competition will often have properties inspected BEFORE an offer on a Minneapolis Lofts is made. Ask your REALTOR® to find out if other buyers are having condo inspections done. If so, you may want to ask the sellers for permission to complete a home inspection, and any other inspections you believe necessary. This will enable you to make an offer that doesn’t include an inspection contingency.

EARNEST MONEY DEPOSIT

Putting as much of your down payment into your earnest money deposit makes a very strong impression when you write the offer. The “earnest money” is part of your down payment which you simply put down a month earlier. This lets the seller know of your intentions because if the seller accepts your offer and you break the contract, you would lose your earnest money deposit.

CLEAN OFFER

A clean offer means that it has few contingencies, which means certain conditions that must be satisfied in order for the sale to go through. Typical home purchase contract contingencies include financing, inspections and the sale of another home. Put yourself ahead of the crowd by limiting as many conditions as possible before presenting your offer, however, do not forego important – and expensive – things that need to be fixed, e.g. a cracked foundation or leaking roof.

MONEY DOWN

If you can put 10 to 20 percent down, the sellers will be more impressed with that amount than a five percent down payment. You may be able to change your financing terms later but what matters is the money is at the table at closing.

TRUST AN EXPERIENCED REALTORS RECOMMENDATION

If you are working with a good Minneapolis Realtor who knows the loft and condo market take note.  Your real estate agent has the ability and knowledge to influence and impact your decisions throughout the offer process and presenting the offer itself. Trust your Realtor’s advice and guidance. We do this for a living and are working for your benefit.

LITTLE KNOWN SECRET: PERSONAL APPEAL

Find out as much as you can about the Minneapolis condo and loft sellers and their situation.  Writing a letter about why you would love to live in the property can go a long, Long, LONG way!  Some sellers are influenced by emotional appeal, particularly if they’re looking at multiple, similar offers. Find out when the seller wants to close, and offer post-occupancy agreements in case the sellers need to stay while they find a new place to live. These steps will help you stand out from the rest.

  These are a few ways to try to win a multiple bidding situation on a Minneapolis Lofts.  If you are in need of a seasoned Realtor to guide you buying or selling reach out to Ben Ganje at Lakes Sothebys International Realty at 612.460.5638 or ben@yoururbanlife.com.

Choosing a Minneapolis Loft vs Condo?

Buying a Minneapolis Loft or Condo?

For most prospective urban dwellers, the idea of buying a Minneapolis loft or condo is complex.  Many buyers begin their search for a particular type of property on the web which can make understanding the difference of a loft and condo somewhat confusing.  Here’s a rundown of the differences:

Lofts can come in an array of sizes and layouts.  True lofts are going to be rehabbed buildings of the early 1900s transformed into urban residential living spaces.  Over the past decade plenty of new buildings designed to look like the older loft buildings have come into the market most notably within the North Loop real estate market.  For the most part, what defines lofts are: larger windows, exposed ductwork, pillars, concrete floors, and an open layout.  Buildings that feature lofts are going to be Bookmen Lofts, Rock Island Lofts, Sexton Lofts and Bridgewater Lofts.

Not everyone looking to purchase a Minneapolis condo or loft is inclined to this type of feel-some Buyer clients are looking for something much more finished and refined.  This type of buyer typically defaults to a condo versus a loft.   Minneapolis condos typically feature finished ceilings with soffits to conceal all of the ducts, plumbing and wiring in the unit.  The layout of a condo typically has clearly defined spaces–bedroom walls go to the ceilings, doors create privacy in the unit.  Some examples of condos in the Minneaapolis real estate market include: The Carlyle, 5th Ave, Phoenix on the River and Grant Park.

Cool modern loft in Minneapolis Navigating through this maze of options can be tough–and there are benefits to both types of product out there.  At the end of the day it is critical to have an agent that can articulate the value of each as well as give you insight on the good, the bad, and the ugly when it comes to the realities of Minneapolis downtown real estate.  Give Ben Ganje a call at 612.460.5638 or email him at ben@yoururbanlife.com today for a market update or to schedule a tour!

What Is A Minneapolis Loft?

What is a loft?

Lofts are cool, sexy, dramatic fun spaces bristling with character and rich in visual appeal – and that’s why the term is used so loosely by real estate agents. Not everything that’s called a loft is a loft.

Strictly speaking, a loft is a large, open, flexible space in an older industrial, warehouse or office building that has been converted to residential use. Over time the term has been applied to smaller (often very small) spaces, and spaces in which the functional living areas are separated by walls, much like traditional apartments. Units designed in this manner are sometimes referred to as “soft lofts.”

The loft phenomenon began, most say, in Manhattan in the 1960s. Loft development in Chicago began to take hold in the 1970s and lofts proliferated in the late 80s and early 90s. Over time lofts evolved from low-budget spaces in sketchy neighborhoods to sophisticated, amenity-rich buildings and spaces.

Most recent lofts have been of the soft loft variety, with well-demarcated living and sleeping spaces. Balconies and other outdoor living spaces, once rare, have become almost de rigueur in newer developments. Beginning in the mid-90s some of the larger buildings also began to offer services once unheard of in lofts: door staff, concierges, fitness rooms and more.

Not all loft buildings are adaptive reuse conversions. Developers have built new buildings that exhibit many of the features of lofts and thus merit the use of the term.

Loft building construction

Most loft buildings in Chicago are between two and seven stories tall, of either mill timber or concrete construction, with brick exteriors. Some buildings have terra cotta facades and many feature terra cotta ornamentation.

Older loft buildings are usually overbuilt with regard to residential use. They were designed for heavy machinery, storage of weighty materials and more intensive uses.
Loft buildings vary widely in their configuration. More rectangular buildings lend themselves to more desirable floor plans, with more exterior walls and windows and less space devoted to traffic flows. Square buildings and buildings with deep floor plates are often configured to maximize the number of units per floor, resulting in what some have called “bowling alley” floor plans, i.e. long and narrow. The city of Minneapolis amended its light and ventilation requirements in the mid-90s to enable the adaptive reuse of these buildings.

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Loft characteristics

Most true lofts share a number of features that define the loft look.

High ceilings. Most lofts have ceilings heights of 10 feet or greater. It’s not uncommon to find spaces that soar to 20 feet or more.

Open, flexible space. Residents, rather than fixed walls, define the functional living areas. Armoires, bookshelves and entertainment units are sometimes used to separate one living space from another.

Large windows. Most loft buildings were built between the 1880s and 1940, a time when builders were sensitive to maximizing natural light, and often insensitive to energy costs.

Timber or concrete ceilings. The exposed wood and concrete ceilings in industrial buildings add warmth and texture to loft units.

Hardwood floors. Many of Minneapolis’ loft buildings were built with maple flooring. In most cases the flooring became damaged over time and new hardwood flooring was installed when the building was converted to residential use. The better developments have a layer of lightweight concrete over the original floors, to level them and remove unevenness, and also to help dampen sound transmission.

Exposed structural elements. Timber and concrete columns and beams are exposed rather than wrapped within walls or masked by dropped ceilings.

Exposed mechanicals. Electrical conduit, sprinkler system piping, heating and air-conditioning ducts are open to view rather than concealed.

Exposed brick walls are another element that adds warmth and texture. Brick is a poor thermal insulator, but excellent for sound insulation.

All lofts don’t exhibit all of these characteristics. The fewer you find in a unit, the less likely it is that the unit deserves to be called a loft.

Loft issues

The elements that give lofts their aesthetic appeal often give rise to issues that loft buyers need to consider.

Sound transmission between units is a problem experienced by many loft residents. Sound transmission through floors tends to be more of an issue in timber than in concrete buildings. Lateral sound transmission between units can also be an irritant. Most recent developments have taken steps to minimize noise issues, but some have largely ignored them. Make a thorough investigation before purchasing.

Utility costs. Comfort levels. High ceilings, exposed brick walls and large windows can result in high heating and cooling bills. Brick and glass have little insulating value. Exposed ductwork high above the floor may translate to low comfort levels and uneven distribution of heat. Ask your developer to provide a heating cost estimate from the utility company, or ask to see the current owner’s utility bills.Ceiling fans can be very effective at increasing perceived comfort levels, especially in the winter, and are likely to reduce overall utility costs.

Dust. The brick, timber and concrete in loft buildings are usually sandblasted or acid-washed to create a newer, cleaner look. If these surfaces haven’t been properly cleaned or sealed, dust is inevitable and can linger on for quie a while. Rubbing your fingers over the walls should give you a good idea of what to expect after you move in.

Brick, especially brick that has been sandblasted, is susceptible to spalling, i.e. flaking. Brick is porous and absorbs moisture from humidity and from condensation caused by temperature differentials between exterior and interior surfaces. If you have exposed brick walls you can almost certainly expect to be cleaning up brick dust.

Parking. Different parking requirements apply to new and converted structures. The result is that parking is frequently scarce to non-existent with many loft developments. This may or may not be an issue for you, depending on your personal needs and the availability of parking in the immediate area.

Deferred Maintenance. It’s not unusual for loft buyers to find themselves saddled with large special assessments to correct conditions that a developer bypassed The most common defects have involved roofs and facades.

Loft neighborhoods

Residential loft conversions can be found in most of all Minneapolis neighborhoods, where industrial and office uses once flourished.

The earliest loft developments were near downtown (North Loop, St Anthony Main and Mill District.)

Do your research

It’s easy to be distracted by the sex appeal of loft living. Don’t be. Work with a real estate agent, home inspector, attorney, lender team all of whom have experience with lofts in the area you’re considering.

If you’re purchasing a loft, you’ll find every development in Minneapolis at Search Minneapolis Condos—a helpful site dedicated to the downtown urban market.

Loft development has been an activity with low barriers to entry. That’s good for developers, but not good for buyers. Look for a developer with a lengthy track record in lofts and talk to residents at the developer’s previous projects. If your developer is a first-timer at lofts or has only a limited portfolio, pay attention to the architect and the contractor. Their experience can compensate, to some extent, for a developer’s inexperience.

Focus on the basics that are important to resale value for any type of property: location, neighborhood amenities, access to public transportation, the uniqueness (non-commodity aspect) of the property, and its flow and livability. If you’re in love with it, that helps – someone else will be too. And, it’s easier to love a loft than a run-of-the-mill condo.

Point Capital buys Sexton Lofts in Downtown Minneapolis

An East Coast private equity group is scooping up distressed and bank-owned condominiums in bulk in the Twin Cities, saying it’s so confident in the area’s economy that it will roll out its own mortgage program to make loans to qualified borrowers wanting to buy.

Point Capital Partners, based in Chatham, N.J., said it’s sinking about $70 million into four Twin Cities condo deals, two of which already have closed.

“We’re making a big bet on Minneapolis,” said Drew Preston, who manages Point Capital’s real estate fund. “The underlying economic trends that we’ve seen in Minneapolis are some of the strongest we’ve seen in the United States.”

In its most recent acquisition, Point Capital Partners bought the 77 remaining condos in the Sexton Lofts in downtown Minneapolis from owner Andy Chase. That deal closed March 24.

Chase, president of Burnsville-based Chase Real Estate, bought 74 of Sexton’s unsold units — more than half the building’s 123 units — out of foreclosure one year ago for about $4.5 million. He then bought three more units, added a new heating system and has been finishing off the conversion of the old commercial building, including completing the Sexton’s nine rooftop penthouse units. The work should be done in two months.

“We got a lot of stuff accomplished and now I think it’s time to go to the next level,” Chase said.

Preston wouldn’t say what he paid for the Sexton units, but said “we paid a significant premium” over the $4.5 million Chase paid.

The sale marks a bold new chapter for the Sexton, which has been clouded by the mortgage-flipping scheme that surfaced there in recent years. The scandal produced multiple convictions. Brett Thielen, a first-time developer who tried to complete the project, is serving a 27-month sentence for helping orchestrate the swindle.

The Sexton was Point Capital Partners’ second Twin Cities buy.

On March 17, the private equity group bought the 90 unsold units at the Gramercy Club of Edina — another well-known project with a tortured past — from Beal Bank Nevada. Point Capital plans to convert the senior co-op into condos, he said.

The group is scheduled to close next week on another bank-owned condo building in the Twin Cities, and has a fourth investment lined up, one that Preston called the largest. He declined to name the other two developments.

Little has been written publicly about Point Capital Partners. But according to its website, it’s a family of merchant-banking companies founded in 2003 and its private equity unit makes alternative investments in areas such as energy, health care technology and distressed real estate. It is principally owned by two classmates from West Point, from which the firm takes its name, Preston said.

Banks are generally unwilling to make mortgages for condos in buildings with heavy concentrations of units in foreclosure or that are sitting unsold or rented out, Preston said. The group aims to stabilize the troubled condo projects by providing financing so they can get the units sold at market rates.

“I’m not a fire-sale guy,” Preston said. “The value of the properties is dependent on the financing.”

Preston said his group will start listing five to 10 of the Sexton units next week.

“Minneapolis has great underlying demographics,” he said. “There’s a demand out there for this product.”

Mary Bujold, head of real estate research firm Maxfield Research Inc. in Minneapolis, said Point Capital’s type of financing play isn’t unheard of, but it’s the first time she’s seen it in the Twin Cities during this boom-bust cycle.

“Ultimately, I think it’s a smart move on their part,” she said. “It’s not really speculative as much as it’s kind of opportunistic.

By JENNIFER BJORHUS, Star Tribune

What Is Motivating Downtown Buyers?

As the momentum of the downtown market starts to pick up spring of 2011 we thought it was pertinent to check out what some members of the investment community are saying.

The Wall Street Journal

Jim Woods wrote an article earlier this year for Market Watch, part of the Wall Street Journal’s digital network. Its title: Why your best investment is a house. Mr. Woods compared the investment potential of real estate against other asset classes such as stocks and precious metals. Here was his conclusion.

One reason your best investment right now could be a home has to do with the relative upside of getting in on an asset class while it’s at the bottom versus buying into other asset classes that could be near a top. Consider for a moment the tremendous upside we’ve seen in stocks, precious metals and agricultural commodities over the past 12 months…

If you’re a long-term investor looking to put money to work, now is not really the best time to get into any of these three asset classes. However, with home sales starting to improve, and with prices now possibly forming a bottom, real estate could well be the asset class that represents the best low-risk buying opportunity out there today…

Mr. Woods went on to talk about the financing portion of the purchase:

Yes, mortgage rates still are near historical lows, but if we see these rates rise, then the cost of a new home could climb significantly. So, now could really be the best time to pull the trigger on that home purchase — and it could also be your best investment right now.

Fortune Magazine

Shawn Tully, senior editor at large for Fortune penned an article last week which was titled: Real estate: It’s time to buy again. In the article, Mr. Tully explained:

Forget stocks. Don’t bet on gold. After four years of plunging home prices, the most attractive asset class in America is housing.

Let’s state it simply and forcibly: Housing is back. Two basic factors are laying the foundation for dramatic recovery in residential real estate. The first is the historic drop in new construction … The second is a steep decline in prices, on the order of 30% nationwide since 2006, and as much as 55% in the hardest-hit markets. The story of this downturn has been an astonishing flight from the traditional American approach of buying new houses to an embrace of renting. But the new affordability will gradually lure Americans back to buying homes. And the return of the homeowner will start raising prices in many markets this year.

Bottom Line

Neither of the two media sources mentioned above has ever been accused of cuddling up to the National Association of Realtors. However, both have come to the same conclusion. It’s time to buy real estate. Perhaps we should listen to them.

Minneapolis Loft Living

For true loft and condo living, it doesn’t get any better than this. Minneapolis has an ideal market for them, with a boom of housing centered around the convenience of Minneapolis’ new light rail or impressive renovations of old riverfront factories and working-class brownstones often being the hottest properties next to the new construction condos along the riverfront. The city is alive and classic styles, structural integrity, and prime location are the biggest draws here, and developers have worked hard to fill the demand.

Minneapolis Lofts and Condos Search

In addition to Sexton Lofts there are a number of buildings in the downtown market.  The reason we built this this website: to help you understand lofts versus condos and highlight some attractive lifestyles and price points for sale within Sexton Lofts.

About Downtown Resource Group

We are a unique group of Realtors focused on the Loft and Condo market, Downtown Resource Group is on top of the local real estate market, and you can access our resources right here. Whether you’re a buyer or seller, our custom Minneapolis Loft and Condo Search will help you compare prices across the city and get acquainted with sale trends.

To learn more about neighborhoods, and the interesting variety of condos and lofts available for sale on the Minneapolis market, see our comprehensive area information pages. When you’re ready to enter the market, please have a look at our many services for Buying, Selling, Financing, and Minneapolis Relocation. We’re ready to help with any Minneapolis loft or condo transaction.

Feel free to contact Ben Ganje with any questions, and enjoy our sites.