St. Paul Apartment Loans
Loans from $1 Million to $25 Million+

St. Paul Apartment Loan Rates - Rates updated June 26th, 2022

St. Paul Apartment Loan Rates Over $6,000,000 Rates (start as low as) LTV
Apartment 5 Year Fixed Loan Rates 4.59% Up to 80% Get Free Quote
Apartment 7 Year Fixed Loan Rates 4.65% Up to 80% Get Free Quote
Apartment 10 Year Fixed Loan Rates 4.73% Up to 80% Get Free Quote
St. Paul Apartment Loan Rates Under $6,000,000 Rates (start as low as) LTV
Apartment 5 Year Fixed Loan Rates 4.72% Up to 80% Get Free Quote
Apartment 7 Year Fixed Loan Rates 4.78% Up to 80% Get Free Quote
Apartment 10 Year Fixed Loan Rates 4.86% Up to 80% Get Free Quote
St. Paul Apartment Building St. Paul
Apartment Loan

Select Commercial has excellent St. Paul Apartment loan products and options available for owners and purchasers of multifamily properties throughout the city of St. Paul. Whether you are looking to finance a small apartment building, a complex with hundreds of units, or a co-operative, we can help you find the optimal financing solution to meet your Apartment mortgage loan needs. While we lend across the entire continental US, we are able to give our best rates and loan programs to certain areas that we feel are strong markets. St. Paul is one of the cities that we consider to be a premium market and we actively look to originate good quality loans here for our clients. We have a diverse array of many available loan products to help qualified St. Paul MN borrowers looking to purchase or refinance an apartment property. We offer apartment loans with terms and amortizations up to 30 years, recourse and non-recourse, and many options for prepayment. We typically approve Apartment building loans within 1 day and usually close within 45 days of application. Our clients love our simplified application process, 24-hour pre-approvals with no-cost and no-obligation, great rates and terms, fast closings and personalized service. If you are looking to purchase or refinance an apartment building, don't hesitate to contact us. For more information on multifamily loans, check out how to get the best rate on a multifamily loan and how to get the best rates on an apartment refinance.

St. Paul Apartment Loan Benefits

St. Paul Apartment Loan rates start as low as 4.59% (as of June 26th, 2022)
• A commercial mortgage broker with over 30 years of lending experience
• No upfront application or processing fees
• Simplified application process
• Up to 80% LTV on multifamily financing 
• Terms and amortizations up to 30 years 
• Multifamily loans for purchase and refinance, including cash-out 
• 24 hour written pre-approvals with no cost and no obligation

Recent TRUSTPILOT Reviews

Select Commercial Funding Reviews from TRUSTPILOT

A three year journey
"Thanks Stephen for all of your hard work in getting our deal closed! I appreciate your professionalism and patience throughout a complicated process. You always were there for my partner and I whenever we had questions and needed answers quick. It was a pleasure to have worked with you and Select Commercial!"


St. Paul Apartment Loan Types We Serve

If you are looking to purchase or refinance a St. Paul apartment building, don't hesitate to contact us. We arrange financing in the city of St. Paul for the following:

  • Large urban high-rise multifamily buildings
  • Suburban garden multifamilycomplexes
  • Small multifamily buildings containing 5+ units
  • Underlying cooperative multifamily building loans
  • Portfolios of small multifamily properties and/or single-family rental properties
  • Other multi-family and mixed-use properties

 

St. Paul Apartment Loan Helpful Articles

How to Get the Best Rate on a Multifamily Loan
Fannie Mae and Freddie Mac 2022 Update
How To Get The Best Rates On An Apartment Refinance
What Do Underwriters Look for When Evaluating Apartment Loans?
What You Need to Know About Freddie Mac SBL Multifamily Loans
How to Calculate Debt Service Coverage Ratio for Apartment Loans
Apartment Occupancy Levels – Concern in Some Major US Markets
How to Invest in an Apartment Building
Are You Shopping for an Apartment Building Loan?
How to Buy an Apartment Building
What Are Commercial Mortgage Lenders Looking for These Days
Uncomplicated Underwriting
How to Qualify for a Great Rate When Refinancing Your Apartment Building

Recent Closings

St. Paul Vacancy and Rents St. Paul Rent and Sales Trends

2022 St. Paul Apartment Loan Outlook

The Suburbs are Preferred by Tenants - Rent Control in St. Paul Affects Investment

Covid-19 leasing trends change the market for apartments. Since beginning of 2020, renters have chosen the suburbs for roughly 82% of net rental absorption. This is an increase from the 68% suburban rate recorded during the time period prior to 2020. There are several reasons that renters are showing a preference for the outlying areas. Many renters are looking for larger apartments in more spacious areas, along with fear over the rioting and civil unrest in the urban areas. Additionally, work from home schedules are making it easier to live further away as commute times are now less important to many. Suburban submarkets including South St. Paul-Eagan, East St. Paul and Burnsville-Apple Valley had apartment vacancy rates in the low 2% range in 2021 due to declining availability. Economic conditions are expected to remain tight in these submarkets as demand factors continue and the three submarkets total less than 25% of the new units coming online in 2022. On the other hand, almost 1,600 new rentals are scheduled in Downtown Minneapolis-University, where vacancy rates have been above 5% in 2021.

Rent control regulations and strong suburban performance drive investor sentiment. The response to Covid-19 and current supply concerns in Downtown St. Paul have lowered sales volume activity in that area. Many purchasers are refocusing their attention to the suburbs around the Twin Cities, where apartment fundamentals are improving, and the creation of new households increases. In the meantime, new, stricter rent control regulations in St. Paul in 2021 produced a temporary increase in sales activity in St. Paul. The new regulations limit annual rent increases at 3% and includes new construction. Submarkets of St. Paul that witnessed an increase in sales volume as a result include the section north of Interstate 94 as well as the southwest segment containing several colleges such as St. Thomas and Concordia. Some purchasers are altering their investment plans and selling pre-1950 garden-style apartments as they await a likely slowdown in development in St. Paul.

2022 St. Paul Multifamily Forecast and St. Paul Apartment Loan Economics

St. Paul has a National Multifamily Index of 30. The effects of the pandemic on the employment figures and an active rate of building result in a ranking in the lower end of this year’s survey.

Employment is up 3.4%. About 78,000 positions are needed to return to the levels seen before the pandemic. That number will drop to approximately 10,000 jobs in 2022.

New construction adds 8,100 apartment units. The yearly number of newly added apartments is in line with the numbers from 2020 and 2021 as market inventory grows by 2.6%. Anoka County leads suburban areas with 1,060 units completed.

Apartment vacancy rates are up 10 basis points. Market vacancy increases to 3.4% as apartment completions stay ahead of demand in some areas the downtown market. The suburban vacancy rate, however, should remain closer to 3%.

Apartment rents are up 4.3%. Rent growth is steady, with the average rent growing between 3% and 6% in all but two of the past 10 years. In 2022, expected rents will average up to $1,465 per month.

Investment in apartments. Areas in the west suburbs around Interstate 494 like Plymouth and Maple Grove are expanding rapidly, aiding multifamily fundamentals and causing investors to consider these areas for investment.

St. Paul apartment loan rates will start to increase in 2022 as the Federal Reserve starts raising rates to slow the rate of inflation. We will be watching to see if the apartment loan rate increases will affect market activity in 2022.

All data provided by Marcus and Millichap

2021 St. Paul Apartment Market and Trends

Over the last nine years there have been about 40,000 new apartment completions in the Minneapolis- St Paul metro. Astonishingly, deliveries are set to reach a new peak in 2021. Over the past decade there has been incredibly high renter demand in the metro. Vacancy was at or below 4 percent for all but two quarters until COVID-19 hit. When the pandemic hit, many people lost jobs and others looked for more affordable rent. This drove many renters out of the city to look for rental space in the suburbs.

Employment is expected to get back on track in St. Paul in 2021. 54,600 jobs are slated to be created as vaccines become more widespread. Even with these gains, employment will still be over 100,000 jobs under the pre-pandemic total in the city. Construction of new apartment units is set to increase in 2021 as well. 8,000 new units are slated to be delivered to the St. Paul market in 2021. This will increase inventory 2.7 percent during the year. The suburban submarkets are set to receive over 5,000 new apartments in 2021. As many new apartment units are completed, vacancy rates are expected to rise in 2021. Experts suggest that the vacancy rate in St. Paul could rise to 4.9 percent by the end of 2021. This is an increase of 60 basis points and would be the highest year- end vacancy rate in the city since 2009. Rents are expected to hold pretty steady in 2021. They may decrease 0.1% to $1,344 in effective rent.

- Data provided by Marcus and Millichap

2021 Multifamily Outlook

  • Employment in the US is expected to show a 4.6% year over year increase with the creation of 6.5 million new jobs in 2021 which represents the largest annual increase in over three decades.  This is the result of businesses emerging from the Covid-19 pandemic.  Unfortunately, the US lost close to 9.4 million jobs during the pandemic.
  • Strong demand for apartments, as a result of increased employment rates, is expected to push national vacancy rates down to 3.9%, down from 4.4% in 2021.
  • Construction of new apartments in 2021 are expected to top 385,000 new units, an increase of 2.1% over last year’s record pace.  Rising labor and construction costs are starting to have an effect on new construction, however.
  • Following rent declines during the pandemic, average rental rates are expected to rise 6.8% in 2021 to $1,507 per month.  Landlords are able to raise rents dramatically due to decreased vacancy rates and the strong demand got rental housing.
  • The COVID-19 pandemic affected the ability of young graduates to find jobs and move into apartments of their own.  The demand for apartment rentals is usually fueled by young graduates entering the workforce and moving into rental apartments.  Many young adults lived with their parents or friends during the pandemic and into early 2021.  As 2021 progressed, many companies reopened their offices and began hiring again which generated record levels of new apartment rentals.  This trend should continue through late 2021 as more new workers are able find jobs and move into their own apartments.  Many of these new multifamily units are in metro areas of the sunbelt states as workers have been moving out of colder urban areas in favor of more suburban warmer climates.

    The tight market in 2021 for new home purchases has caused many would be homebuyers to continue renting.  Prices for existing homes have risen due to lack of inventory and the cost of construction has skyrocketed due to increased costs for raw materials.  The high cost of purchasing a new or existing home is keeping the demand for rental units very strong in 2021.

    During the pandemic, when workers were either out of work or working from home, many people moved out of densely populated urban areas in favor of suburban locations.  In 2021, as more employees are returning to their offices, we are seeing demand pick up once again for rental apartments in urban locations.  In addition, as more and more retail and dining locations reopen in downtown areas, we expect to see a return of employees to these areas.

    During the pandemic, the CDC and local governments instituted a moratorium of evictions.  This caused many landlords to suffer economic losses and depressed the value of apartment properties.  In 2021, as these moratoriums start to expire, we expect to see strong demand from investors for these properties.

    Nationwide, the first half of 2021 saw more than 175,000 new apartments completed and a total of 363,000 for the previous 12 months.  A high percentage of these new units were in Texas and other sunbelt states, as more and more people are relocating to warmer climates.  Occupancy rates and asking rents have been lower in larger urban markets in the Northeast and other colder climates, while occupancy rates and asking rents have been increasing in these warmer sunbelt climates.  These 2021 trends have definitely been driven by the COVID-19 pandemic and we are watching these trends closely to see if these trends persist after the pandemic is over. Check out our low commercial real estate loan rates and use our commercial mortgage calculator to calculate monthly principal and interest.

    What Happened with Apartment Loans in 2020

    St. Paul Economic Trends St. Paul Economic Trends

    Out-of-State Buyers Pursue Trades in the Twin Cities, Drawn by Low Vacancies and High First-Year Yields

    Headwinds mounting as demand drivers shift. For most of the past decade, St. Paul has maintained one of the tightest multifamily vacancy rates among major U.S. metros. This trend will continue into 2020, although a surge in apartment construction amid a softening employment sector will nudge the vacancy rate higher and slow rent growth. The metro’s tight labor market is making it more difficult for employers to find workers. Last year, the region posted the weakest job growth since 2009, leaving many jobs unfilled, which will likely suppress household gains in the quarters ahead. While demand drivers are not as robust as in previous years, multifamily deliveries in 2020 are poised to reach the highest level in more than 20 years, with nearly every submarket receiving new apartments. The additional inventory of market-rate multifamily units should assist in easing the shortage of rental options; however, the need for low-cost apartments will remain acute. Investors looking to purchase property in the Saint Paul market should definitely look into taking out an apartment loan to finance their acquisition.

    Investors focus on major transit arteries in Minneapolis-St. Paul. Owners are taking advantage of the robust interest in local apartments and listing assets, providing buying opportunities. Yield seeking multifamily investors will find average returns in the metro are up to 200 basis points above larger coastal markets. Cap rates higher than the metro average can be found in older Class C apartment buildings with less than 50 units in neighborhoods surrounding the downtown cores or in outer-lying counties. More out-of-state investors are searching throughout the market for a limited supply of value-add multifamily properties. First ring suburban 1980s- and 1990s-built apartment complexes along major transit corridors and in need of upgrades are especially desired. Institutions, syndicates and high-net-worth individuals are also drawn to the region’s large supply of new multifamily inventory, especially in trendy neighborhoods including the North Loop near the Saint Paul core. Apartment buildings with more than 100 units in these locations can trade above $300 per unit at a cap rate in the 5 percent range. Saint Paul is a great market for investors to finance their next apartment purchase with a multifamily loan.

    2020 St. Paul Apartment Market Forecast

    St. Paul Completions vs. Absorption St. Paul Completions vs. Absorption

    The Saint Paul National Multifamily Index Rank is at 7, down 6 places. Saint Paul drops from the top spot in the 2020 Index as employment continues at a slow pace and vacancy rises.

    Employment in St. Paul is up 0.6%. Low unemployment will hinder job growth this year as skilled workers are hard to find. Employers will add 11,800 positions in 2020, well below the previous five-year average of 20,500.

    Construction is expected to exceed 6,300 apartment units. Deliveries advance to the highest level in at least 20 years as 6,300 units are placed into service. The city of St. Paul will receive more than 4,000 of these rentals.

    Vacancy in St. Paul is up 40 bps. After rising 10 basis points last year, vacancy will increase to 3.5 percent in 2020, still among the lowest rates in the nation.

    Rent in St. Paul is up 4.9%. The average effective rent in 2020 will be $1,426 per month, rising slightly slower compared with last year’s 5.4 percent gain.

    Investment opportunities in St. Paul remain strong for those looking to finance their next purchase with an apartment loan. As deliveries accelerate throughout the metro, owners should evaluate their portfolio strategy as new competitive properties open nearby, potentially impacting their assets’ NOI. We highly recommend any investors looking to buy in the St. Paul market to reach out to us regarding a multifamily loan.

    Data provided by Marcus & Millichap.

    St. Paul Vacancy and Rents St. Paul Vacancy and Rents

    Apartment Loan Trends in 2020

    At the start of 2020 the market outlook did not indicate any significant factors that would cause major trouble in the multifamily market. Market indicators suggested that demand for housing, especially for apartment rentals, would remain healthy, thus continuing to generate new construction of multifamily buildings. Both the high number of permits and starts over the past couple of years led experts to believe that developer confidence is very high in the multifamily market. Market experts predicted an annual completion of 340,000 apartment units over 2020, way above the 300,000-annual average for the past five years. Over the last couple of years, the multifamily market has seen absorptions outperform expectations due to both changes in lifestyle and demographic preferences and new supply has consistently taken longer to be built. These two factors have helped the market to perform stronger than expected in the past and should continue throughout this year. Market data indicated that rent growth would remain strong in 2020, growing 3.6% (which is above the historical average). In terms of mortgage origination, low interest rates and strong multifamily performance were expected to help loan volumes grow. Experts predicted that the origination volume in 2020 will increase by 5.7% to $390 billion. Market data indicated that cap rates have more room to decline, which would lead to increasing property values and should drive up origination volume. However, with the current outbreak of Covid-19, the overall economy has been in flux. The stock market has crashed and commercial mortgage interest rates have been severely impacted. Huge metros such as New York have all but shut down much economic activity and entertainment. In this unsteady climate, many investors are scared to purchase commercial real estate and to take out commercial mortgages and apartment loans. Additionally, the oil industry has taken a big hit. Not only are people traveling less due to the pandemic, foreign countries like China and Russia are involved in a huge price war which is driving the price of oil way down. Experts are hopeful that as the weather warms up and public health policy learns how to handle this pandemic, the economy should revert back to its pre-virus strength.

    St. Paul Apartment Loan Options

    St. Paul Freddie Mac Apartment loans

    St. Paul Freddie Mac Multifamily Loans provide mortgage capital in the secondary market for apartment building loans. Together, Fannie Mae and Freddie Mac control a very large portion of the multifamily loan market. Freddie Mac has a very aggressive program for small balance apartment loans (from $1,000,000 to $7,500,000). Some features of this program include:

    • Market size driven. Freddie Mac classifies loans by the size of the overall market: Top, Standard, Small, and Very Small. Rates are best in top market locations (major metropolitan areas).
    • Capped costs. Freddie Mac lenders often cap the closing costs at a fixed dollar amount, thereby lowering the overall cost to borrow money.
    • Flexible pre-pay penalties. Freddie Mac offers many options for pre-payment penalties, from yield maintenance to step-down to “soft” step-down.
    • Interest-Only (I/O) loans. Freddie Mac will allow payments consisting of only interest and no amortization of principal.
    • Fixed rate terms. Freddie Mac offers fixed rates of 5, 7, and 10 years, followed by an adjustable period. These loans are called Hybrid/Adjustables. Loans have a 20 year term and a 30 year amortization schedule.

    Freddie Mac Loan and Rate Information


    St. Paul Fannie Mae Apartment loans

    The St. Paul Fannie Mae multifamily loan platform is one the leading sources of capital for St. Paul apartment building loans in the US. Fannie Mae is a leader in the secondary market – meaning they purchase qualifying apartment loans from leading lenders who originate these loans for their borrowers. Fannie Mae purchases loans secured by conventional apartments, affordable housing properties, underlying cooperative apartment loans, senior housing, student housing, manufactured housing communities and mobile home parks on a nationwide basis. The Fannie Mae platform has many benefits, including:

    • Long term fixed rates and amortizations. Fannie Mae allows terms and amortizations of up to 30 years. Most banks offer only 5 or 10 year fixed rates and 25 year amortizations.
    • Non-recourse options. Most banks will require the borrower to sign personally for the loan. Fannie Mae offers non-recourse apartment loans.
    • Lending in smaller markets. Many national lenders do not like to lend in rural or tertiary markets. Fannie Mae is a good option for these loans.
    • Assumability and Supplemental Financing. Fannie Mae allows their loans to be assumed by a qualified borrower. They also have a program which allows borrowers the ability to come back and borrow additional funds during the life of the loan (subordinate financing).

    Fannie Mae Loan and Rate Information


    St. Paul FHA HUD Multifamily Loans

    HUD (Department of Housing and Urban Development) and FHA (Federal Housing Administration) insured multifamily loans are some of the best financing options for real estate investors and developers. While HUD does not directly make these loans, they do insure multifamily loans made by third party lenders to real estate investors. The third party lender will process the loan in accordance with the FHA HUD guidelines and HUD will underwrite the loan in order to provide the insurance. There are two primary types of HUD insured loans that multifamily investors can take advantage of.

    Learn More About FHA HUD Multifamily Loans

    St. Paul Apartment Lending with Banks and Other Programs

    While the agencies (Fannie Mae, Freddie Mac and HUD) offer some excellent programs, not every apartment loan applicant qualifies for these programs. We have many excellent choices for these loans with our correspondent banks, credit unions, insurance companies and private lenders. Some examples of these loans include:

    • St. Paul Multifamily loans that require flexible underwriting or those that don’t meet standardized criteria.
    • Properties in less than desirable markets, or those that require repairs or updating.
    • Properties that don’t cash flow according to industry guidelines or lack stabilized cash flow.
    • Borrowers with past credit issues, including foreclosures, short sales, or judgements.
    • Borrowers who are not US citizens.

    Whether you are purchasing or refinancing, we have the right solutions available for your multifamily mortgage loans. We will entertain apartment loan requests of all sizes, beginning at $1,000,000. Get started with a Free Commercial Mortgage Loan Quote.

    St. Paul Apartment Building Loans

    Select Commercial provides apartment loans and multifamily loans throughout St. Paul, Minnesota including, but not limited to, the areas below.


    • Payne Phallen • Greater Eastside • North End • Highland • Battle Creek • Macalester-Groveland • Daytons Bluff • Thomas Dale • Summit-University • Merrlam Park • West Side • Como • Midway • West 7th • Saint Anthony • Downtown • Summit Hill