Good Timing for Real Estate Investment in St. CloudJune 2, 2016 Residential Development
The St. Cloud Real Estate Summit was held on May 24th in Golden Valley, Minnesota and Westwood sent a group of representatives to find out what the mayor of St. Cloud, Dave Kleis, and the speakers had to say. This year’s presenters depicted a picture of a successful city becoming even more successful in the future, making it a great location for new real estate development. St. Cloud won many awards last year, including a “Best Small City in America”, a “Best Place to Start a Business in Minnesota”, and a “Top 100 Smartest City in America”. Areadevelopment.com lists the city as a “Top Leading Location for 2015” based on its diverse economy and great positioning for further economic growth.
Population and workforce are growing at a faster rate in St. Cloud than in Minnesota as a state, and the city is taking the steps to maintain this trend and also retain more of the great number of college students that floods through the city’s many school campuses. Like many areas, the St. Cloud MSA went into the Great Recession with a glut of single-family homes and lots. During the Recession, and for a couple of years afterwards, we saw a big push in multifamily and apartment housing. With the area offering higher-paying jobs, we see the single-family home market picking up steam again, albeit at a more cautious and prudent rate.
Why St. Cloud is a great place to invest
The MN DEED regional analyst for St. Cloud MSA, Luke Greiner, brought the summit up to date on the numbers and facts. The region added over 15,000 jobs just in this past April, and the overall growth rate for the labor force is double that of Minnesota. With a large number of new jobs opening, there needs to be new commercial real estate to house the offices, manufactories, and other workspaces of these workers. At Westwood, the demand for our surveying and engineering services in each of these segments has increased over the past 12 months.
Gail Cruikshank, talent director at Greater St. Cloud Development Corporation, reports that 14% of the users on St. Cloud’s online Talent Pool job search are from out of state. Clearly the word has spread about St. Cloud’s opportunities. Assuming at least some of that 14% accept jobs in the region, housing will also need to be created. Westwood is currently involved with a couple of residential projects, including Grandview Crossing in Sartell, the Jasmine Lane development in St. Joseph, and River Ridge Estates along the Sauk River. The great thing about living in the St. Cloud MSA is that the cost of living is 30% lower than in the Twin Cities, at about $46,000 for the average family compared to $60,000 in the Twin Cities metro area. Those working in health care or manufacturing – the two leading industries in the region, employing 18.3% and 15.2% respectively – are making on average over $40,000 annually. With that lower cost of living, many residents in the St. Cloud MSA have money to spend, which supports the need for more commercial venues in the area.
Plenty of development opportunities await in St. Cloud
Not only is St. Cloud aware of its recent growth, but it is also prepared and ready for more. Community Development Director, Matt Glaesman, highlighted some of the city’s top priority locations for development. In the downtown area alone are multiple parking lots that are being considered for office, hotel, and retail space redevelopment. There is also prime riverfront area where the city would like to see condos. The city wants to make a riverwalk to rival Duluth’s boardwalk, with great space for recreation. At all of these locations, the city either owns the land or has talked to the owners to be prepared for development opportunities, and its ideas have been approved by the community.
We can see plenty of opportunities arising in the medical and health industry. National trends show that healthcare is an extremely steady and growing segment. CentraCare Health is headquartered in St. Cloud and already has multiple facilities in the region. Westwood is fortunate to be involved with many of these projects to support CentraCare’s growth. We know that partnering on projects, rather than just being a consultant, brings more discussion and ideas to the table, resulting in a better end product.