Few rental properties in the Twin Cities can compete with the amenities and finishes at The Lakes Residences.
Arguably none can compete with the location.
For about $2,300–$14,600 a month, people can live in a building with views of Lake Calhoun, Lake of the Isles and the Downtown skyline and amenities such as black walnut hardwood floors, coffered ceilings and floor-to-ceiling windows. The eight-floor, 90-unit building, located at 2622 W. Lake St. in the Cedar-Isles-Dean neighborhood, also features an outdoor pool, an outdoor terrace with an unobstructed view of Lake Calhoun, on-site maintenance staff and a concierge.
“The amount of thought and detail that went into developing this asset, I think they’ve crossed every T and dotted every I,” said Robby Mailatyar, senior director of real estate for Greystar, the firm that owns and developed the building. “It’s that next level of living in this city.”
The Lakes opened this past October and was 55-percent leased as of March 30, Mailatyar said. He said he expects the property to be leased up this summer.
“For 90 units, we’re on track,” Mailatyar said.
He said the property is generating interest from people from all demographics and locations. People are looking for the flexibility that renting provides, he said, and The Lakes offers that with a luxury product.
He said the spacious floor plans differentiate The Lakes from other apartment buildings. The units are 1,628 square feet on average and go to nearly 4,000 square feet in the penthouses.
“You can’t find that anywhere from a leasing standpoint,” Mailatyar said.
Mailatyar said this type of luxury apartment is a new product type nationally. Greystar is starting to replicate it in other places, he said, noting similar models in Austin, Texas, and Denver.
He said everything at The Lakes was completed to the highest level and that Greystar wanted to create a “wow factor” with the building.
“We make experiences at this asset,” he said. “From the move-in experience to maintenance coming into work on something, we’re going beyond the expectation of that resident.”
Average rent at the building is $4,800, Mailatyar said. One-bedroom apartments start at $2,260 a month and two-bedroom apartments start at $3,990 a month. The five penthouse units, which have two bedrooms apiece, range from $9,349 to $14,603 a month. Two are available, according to The Lakes website.
The penthouses come with a separate wet bar area, fireplaces, a full-size study with built-in shelving, a separate water-closet area in the master baths and more. Community amenities include a guest suite and a resident clubroom with a kitchen as well as grills on the rooftop terrace, a fitness center and a pet-grooming dog spa.
Mary Bujold, president of Maxfield Research & Consulting, said that in the Twin Cities, only a few units in Downtown Minneapolis rent for more than units at The Lakes, and those are usually penthouse units. Bujold said a building such as The Lakes is probably weighted a little more heavily to empty nesters and people in middle age.
“A lot of the features in the units are things you would find in a single-family home — a nice single-family home I should say,” she said.
She said she is seeing more people 55 and older deciding they don’t want to own homes anymore. People want to travel more, she said, and they don’t want to deal with the upkeep and maintenance of a single-family home.
“When they’re not working, they want more leisure time and more flexibility,” she said. “… When you own a home and want to go somewhere for two or three months, you have to find someone to take care of it.”
Every place in the Twin Cities has a pretty low vacancy rate, Bujold said, but Southwest Minneapolis is “very low” at 1.8 percent, according to fourth quarter 2016 data. She said The Lakes’ 55-percent leasing rate was very good.
Gina Dingman, president of NAI Everest, a commercial real estate firm, said The Lakes has arguably the nicest amenities in Minneapolis.
“You really couldn’t ask for much more in an apartment building,” she said. “It’s not surprising that it’s leasing up well.”
She said she expects there will be more of these boutique-luxury buildings built in Minneapolis.
The Twin Cities market has seen more units than normal come online in the past few years, Dingman said. The metro averaged about 1,200 units delivered a year from 2000 to 2012 but has averaged 3,000–5,000 units a year since. The metro-wide vacancy rate has stayed at 3 percent or below despite the increased construction, she said.
“I think that we’re seeing continued strength in the number of units that can be absorbed,” Dingman said. “The renter pool is just deeper than most people thought it was.”