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gfNDfan   

What's the deal with the new pub style bar and liquor store being built on the old Colony West (Down Under) site? Any details out there?

Nice new apartment buildings...hopefully the sleazeball that ran the old pub and liquor store on the site isn't involved:-/ Great location for UND - they just need a businessman with more ethics. Also good to see the downtown development group is getting going hosting a concert downtown this fall. Rumor also is the old Opera House downtown might fulfill it's recent urban-myth destiny and may soon house more than just apartments upstairs. Stay Tuned...

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jdub27   

Nice new apartment buildings...hopefully the sleazeball that ran the old pub and liquor store on the site isn't involved:-/ Great location for UND - they just need a businessman with more ethics. Also good to see the downtown development group is getting going hosting a concert downtown this fall. Rumor also is the old Opera House downtown might fulfill it's recent urban-myth destiny and may soon house more than just apartments upstairs. Stay Tuned...

There's been a handful of articles in the Herald indicating the Rhombus Guy's owners have been looking to put a brewery in there. Assuming that is what you're referring to?

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jdub27   

Does grand forks have any micro breweries yet? It's kinda late to the party on that one.

I would guess the proposed one by the Rhombus Guy's would be the first I've heard about.

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gfNDfan   

There's been a handful of articles in the Herald indicating the Rhombus Guy's owners have been looking to put a brewery in there. Assuming that is what you're referring to?

Yes - the apartments are full so the building is throwing off cash right now...the retail space is a work in progress.

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gfNDfan   

HOLY CRAP! The wife and I took a drive on the southend after a delightful dinner at jam-packed Olive Garden (I'll thank Marilyn elsewhere - lets move on) The apartment construction south of 32nd Ave is absolutely ridiculous! DOZENS of giant apartment buildings and large townhome developments and now right across from the Middle School on 47th - a GIGANTIC 3 story 250+ DELUXE Apartment complex that looks like the Pentagon. Remember - they're completing a 600+ unit complex near the Alerus for UND students so who is going to live in all these new apartment/townhome units?

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...so who is going to live in all these new apartment/townhome units?

Fair question, especially given the very modest population growth in GF. Some speculate that oil field workers will 'plant' their families in the Forks and deal with the commute every 7-10 days or so. I would say the only realistic answer is mass migration from other high-density, multi-family complexes in town (which would create its own problems), except these new 'luxury' properties are priced much higher. Supply and demand might finally work against the apartment owners and drive rents down.

Only time will tell, but I would say the City and the private developers have both taken a huge gamble, and GF should have capped the permits a couple of years sooner than they did.

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Fair question, especially given the very modest population growth in GF. Some speculate that oil field workers will 'plant' their families in the Forks and deal with the commute every 7-10 days or so. I would say the only realistic answer is mass migration from other high-density, multi-family complexes in town (which would create its own problems), except these new 'luxury' properties are priced much higher. Supply and demand might finally work against the apartment owners and drive rents down.

Only time will tell, but I would say the City and the private developers have both taken a huge gamble, and GF should have capped the permits a couple of years sooner than they did.

Property developers simply do not "gamble" with millions of dollars unless they believe there will be a solid ROI pot of gold at the end of the rainbow. Have you not heard all the stories of the lack of housing in Grand Forks? This is supply trying to catch up to demand and supply still hasn't caught up.

As for the "modest population growth" of Grand Forks, let's remember that the Census Bureau has a long history of undercounting the population of Grand Forks. I think the private sector has finally caught on to that fact and is building apartments to meet actual need instead of assumed lack of need.

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HOLY CRAP! The wife and I took a drive on the southend after a delightful dinner at jam-packed Olive Garden (I'll thank Marilyn elsewhere - lets move on) The apartment construction south of 32nd Ave is absolutely ridiculous! DOZENS of giant apartment buildings and large townhome developments and now right across from the Middle School on 47th - a GIGANTIC 3 story 250+ DELUXE Apartment complex that looks like the Pentagon. Remember - they're completing a 600+ unit complex near the Alerus for UND students so who is going to live in all these new apartment/townhome units?

According to mg2009, probably ghosts since he is always on here talking about the apparent demise of the GF-EGF MSA. :silly:

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Property developers simply do not "gamble" with millions of dollars unless they believe there will be a solid ROI pot of gold at the end of the rainbow. Have you not heard all the stories of the lack of housing in Grand Forks? This is supply trying to catch up to demand and supply still hasn't caught up.

As for the "modest population growth" of Grand Forks, let's remember that the Census Bureau has a long history of undercounting the population of Grand Forks. I think the private sector has finally caught on to that fact and is building apartments to meet actual need instead of assumed lack of need.

As I recall, the vast majority of stories on the lack of housing have focused on affordable (e.g., sub-$200k) single-family housing, not multi-family megaplexes.

And OP's question stands…WHO will be occupying all of these units (new residents, existing residents, students), and if there is this pent-up demand, WHERE are these people living right now? And how many of these people are really excited about $1000-1200 rents for 2BR luxury apartments?

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As I recall, the vast majority of stories on the lack of housing have focused on affordable (e.g., sub-$200k) single-family housing, not multi-family megaplexes.

And OP's question stands…WHO will be occupying all of these units (new residents, existing residents, students), and if there is this pent-up demand, WHERE are these people living right now? And how many of these people are really excited about $1000-1200 rents for 2BR luxury apartments?

Last numbers I heard were that apartment vacancies were still running at 2 or 3% in Grand Forks. At least part of the rate is people moving from 1 apartment to another, so a unit is available for a short time. They have stayed at those rates for the last few years in spite of the new units that have been built during that time. Normal vacancy rates are closer to 5-7%. 1 bedroom apartments were almost impossible to find last winter. There is at least some of your pent-up demand. Increasing population makes up another part of the demand.

The new luxury building is a different demographic. That would be multiple income couples that don't want to own a home. College professors and medical staff are examples where you can often find couples who both earn significant salaries. I know several baby boomers that are looking at moving out of their homes and are thinking about higher end apartments or townhomes because they don't want to spend time on the work of upkeep.

Single family homes under $250,000 is another story. Most homes in that range sell in a very short period of time in Grand Forks because there aren't a lot available. But contractors continue to build higher end homes because a) those homes are still selling at a good rate showing there is demand for them, and b) contractors are booked pretty solid right now so they don't need to look for more work. They can make more money on a high priced house so they are choosing those projects rather than looking for cheaper projects.

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It will be interesting to see the next census numbers for Grand Forks, I think its safe to say they have fully recovered from the flood of 97, and the city has gotten a whole lot better.

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There are a number of Bakken-related companies in Grand Forks that are adding a large number of people. One example is R&R Contracting, which constructs new railroad beds and loading stations. BNSF and oil companies are spending billions on the rails just this year: much of the line from Minot to beyond Williston is being double tracked so trains aren't so congested. A company like R&R has people working on a week on week off schedule, so they have to find a place to live. The UAS park and the coming fertilizer plant will create even more demand for housing.

http://www.prairiebi...9/group/Energy/

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There are a number of Bakken-related companies in Grand Forks that are adding a large number of people. One example is R&R Contracting, which constructs new railroad beds and loading stations. BNSF and oil companies are spending billions on the rails just this year: much of the line from Minot to beyond Williston is being double tracked so trains aren't so congested. A company like R&R has people working on a week on week off schedule, so they have to find a place to live. The UAS park and the coming fertilizer plant will create even more demand for housing.

http://www.prairiebi...9/group/Energy/

You are correct. Another example is the pipeline work being done. The guys that are working on the pipeline in the Walhalla area this summer have been living in Grand Forks and working closer to Walhalla because there is no housing up there. They have a parking lot off I-29 near Oslo where they leave vehicles. A suggestion has been made that they may need to set up a man camp in the Grand Forks area when the fertilizer plant is under construction because they will need so many workers during that period. The UAS park should bring in higher paying workers which will be able to afford the higher end houses and apartments being built.

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Last numbers I heard were that apartment vacancies were still running at 2 or 3% in Grand Forks.

I've been told by more than one developer and more than one contractor that in Fargo-Moorhead you'll keep seeing apartment buildings go up until they hit a consistent ten (yes, 10) percent vacancy rate. At the the current construction costs and interest rates that's the economic viability point.

The large complex going in at Demers and I-29 in Grand Forks, no company is going to undertake that level of investment unless they know they're going to make it. If Grand Forks is really at two percent vacancy, that company, they're laughing all the way to the bank.

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I've been told by more than one developer and more than one contractor that in Fargo-Moorhead you'll keep seeing apartment buildings go up until they hit a consistent ten (yes, 10) percent vacancy rate. At the the current construction costs and interest rates that's the economic viability point.

The large complex going in at Demers and I-29 in Grand Forks, no company is going to undertake that level of investment unless they know they're going to make it. If Grand Forks is really at two percent vacancy, that company, they're laughing all the way to the bank.

I don't question the development or even the need, generally, but it is the massive scale that really gets your attention. The Grove, the large complex which borders the Canad Inn along 42nd near DeMers, is entirely marketed toward students. Walking distance to campus so a no-brainer; an obvious target demographic. Here is a selection of the rest that have recently opened and/or are underway:

- Several large new buildings south of Ray Richards - again, close to campus so not a huge stretch. (Just need to keep them from trespassing on the golf course in the dead of winter.)

- New complex at DeMers & Columbia, will tie into overpass for easy pedestrian access to UND - again, students are obvious target.

- Couple of large buildings on Ruemmele Road south of Target.

- Several (and I mean several) large buildings along 36th Ave S east of Columbia, on both sides of 20th St.

- At least one large building on the north side of 36th Ave S (behind SuperOne), just west of Columbia.

- A monsterplex at 47th Ave S, west of 20th (near South Middle School)(this is the one OP saw).

- Large (horseshoe-shaped?) complex at 38th Ave S, just west of S Washington.

- Several (?) large buildings just north of Aurora Medical Complex.

This is a lot of high-density residential development that will likely outpace the roads/infrastructure in certain areas, at least in the short term. Several hundred units, all of which appear to be in the luxury segment.

If you don't live nearby, or do not frequent any of these areas (esp. on the south side), I dare say you won't recognize the landscape. It really is striking and, as I said above, only time will tell.

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I've been told by more than one developer and more than one contractor that in Fargo-Moorhead you'll keep seeing apartment buildings go up until they hit a consistent ten (yes, 10) percent vacancy rate. At the the current construction costs and interest rates that's the economic viability point.

The large complex going in at Demers and I-29 in Grand Forks, no company is going to undertake that level of investment unless they know they're going to make it. If Grand Forks is really at two percent vacancy, that company, they're laughing all the way to the bank.

That complex is aimed specifically at college students. They are more like college suites than apartments. People rent bedrooms as individuals and share living space. They have 2 and 3 bedroom units. It looks like all are furnished. They include washers and dryers in the units, along with other amenities. They have indoor and outdoor recreation facilities and hold community events. It is about building a community for college age students. It has worked for them in other states, although I have heard that there were some locations that had issues with things like building quality and hard to work with management.

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Walll Street money, in the form of Real Estate Investment Trusts, is moving into North Dakota. There's a Minot based listed company that is building the huge complex near South Middle School. It's a rather large REIT that provides a pretty good dividend. It's no longer mom and pop outfits building apartments in ND. REITs have bought up a big portion of Williston and Minot.

http://portfolio.iret.com/north-dakota/grand-forks-east-grand-forks/cardinal-point/

Campus Crest, an REIT out of North Carolina, builds campus apartments throughout the US. Again, you can invest in the company if you think its a good buy. It pays alot more than the bank will on savings.

http://campuscrest.com/student-housing/

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I checked out the new Walmart on the west side and it's nice, is there any plans for more stuff going in on the north side or the west side towards the airport?

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Cratter   

I've been hearing about where are all these people going to come from that will live in all these new apt for over ten years now (and I hear it all the time being a contractor).

If gf grew by a modest 1% a year it would take 6 "average" apartment complexes a year to house them all.

Houses are still in incredible demand. Just completed a spec home for an investor behind Target. Average One level house with finished basement. Sold in two days, two offers, $2,000 below asking at $347,000.

It seems like some here were born yesterday: "I can't believe all the construction." It's called a city, they grow over time. Fifty years ago gf had a population of 35,000.

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mg2009   

I've been hearing about where are all these people going to come from that will live in all these new apt for over ten years now (and I hear it all the time being a contractor).

If gf grew by a modest 1% a year it would take 6 "average" apartment complexes a year to house them all.

Houses are still in incredible demand. Just completed a spec home for an investor behind Target. Average One level house with finished basement. Sold in two days, two offers, $2,000 below asking at $347,000.

It seems like some here were born yesterday: "I can't believe all the construction." It's called a city, they grow over time. Fifty years ago gf had a population of 35,000.

People of Grand Forks: what you are currently seeing is something other places call reasonable growth. What you saw before was stagnancy.

As for the "modest population growth" of Grand Forks, let's remember that the Census Bureau has a long history of undercounting the population of Grand Forks.

I'm sure you have stacks of evidence for that.

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jdub27   

People of Grand Forks: what you are currently seeing is something other places call reasonable growth. What you saw before was stagnancy.

 

If you think the pace that multi-family units in town are being constructed at is considered reasonable growth, you're delusional or just uninformed.  As 82Sioux said, vacancy rates are running around 2-3% which is way too low.  There will end up being a slight overbuild and vacancy rates will fall, probably to near 10%, which is a bit higher than any developer, lender or the city would like to see but is to be expected in a market situation like that one Grand Forks is currently in.  Prices on the new units will end up adjusting down slightly as they are significantly higher than existing rates and in the end, the market will end up stabilizing in the 5-7% vacancy rate over the next few years once the population catches up with the new units being built and a balance is found.

 

 

And turns out it takes a while to recover from a natural disaster that wipes out a good chunk of a city.

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