The Larkin Hoffman Real Estate Podcast

Megan Rogers recently had the opportunity to talk with developer Johnny Opara, President and CEO of JO Cos., a real estate development company in the Twin Cities that specializes in developing high-quality, affordable multifamily housing. Johnny Opara took an unusual path to starting JO Cos and his career as a developer but as a first-time developer, he was able to get the St. Paul Housing and Redevelopment Authority to unanimously approved bond financing for construction of The Hollows in the Payne-Phalen area of St Paul. Today, the 62-unit workforce housing development is complete with affordable units for low-income renters. For this episode of The Larkin Hoffman Real Estate Podcast, Johnny and Megan talk about his decision to move from corporate America into the real estate development world; what he’s building now; and what he wants to build in the future. ____________ Megan Rogers advises and represents businesses, developers, and property owners seeking favorable government approvals including licensing, zoning, and other regulatory matters. She also provides guidance on bond financing for multifamily projects and real estate transactions including residential and commercial sales and leases, easement agreements, title registrations, and lot splits. Megan advises clients and industry groups seeking favorable determinations from state agencies and licensing boards. Contact Megan Rogers at mrogers@larkinhoffman.com.

On February 1st, the Federal Reserve raised interest rates by another quarter-point. This first rate hike of 2023 follows seven interest rate hikes in 2022. With the rising interest rates in mind, Bill Griffith sat down with a panel of real estate and construction industry leaders last fall at Bisnow’s Twin Cities Multifamily Market Overview to discuss the effect of rising interest rates on their business. In this episode of The Larkin Hoffman Real Estate Podcast, Bill takes the opportunity to review the discussion he moderated and highlight some of the trends, opportunities and forecasts for the Twin Cities construction and real estate markets. Bill discussed the effect of rising interest rates on their business with Traci Thomas, COO of Doran Companies; Sargent Johnson, Managing Director at Hines; Brady Pollard, Vice President - Preconstruction Services Director at JE Dunn Construction; and Johnny Opara, President and CEO of JO Companies. Bill Griffith advises local and national clients on legal and policy issues affecting land use, zoning, real estate, environmental review, municipal law, regulatory matters and government relations. He has been legal counsel to Mall of America in all its phases, and serves as city attorney for the city of Columbus. He is a trusted advisor on real estate development and public funding for both private clients and municipalities. Contact Bill Griffith at wgriffith@larkinhoffman.com

We're coming into year three of the COVID-19 pandemic, with record inflation, global instability, rising interest rates, and game-changing local regulations.  All of these factors are having impacts on the real estate market.  In this episode of The Larkin Hoffman Real Estate podcast, Jake Steen, a real estate attorney with Larkin Hoffman, wraps up a recent opportunity he had to sit down with leaders in the real estate and development market at Bisnow's 'State of the Market’ panel held at the Four Seasons Hotel Minneapolis earlier this fall. 

I recently had the opportunity to sit down with Bill Katter, President of United Properties Development, in the firm’s new offices located in the RBC Gateway, a building he developed.  The 37-story tower sits on a key block linking the downtown Minneapolis core with the bustling North Loop neighborhood and providing tenants with commanding views of the Mississippi River, just a few blocks away. Bill Katter didn’t plan to be a developer when he was recruited to join United Properties almost 20 years ago. He was working for Lutheran Brotherhood underwriting equity investment when Boyd Stofer offered him a job underwriting acquisitions for United Properties. Soon after, Stofer asked him to take on development of the C.H. Robinson Headquarters in Eden Prairie. “It started with Boyd saying ‘you have the qualities of a developer. Why don't we just make you a developer and see where it goes’,” said Katter. Asked what those qualities are, he responded, “I would think drive is the most important thing, wanting to wake up and get something done, and the desire to compete and win business.” Katter talked about what it took to develop RBC Gateway, the largest mixed-use project to open in downtown Minneapolis in many years. “First of all, organizationally we never built something taller than 10 stories in our a hundred plus years history. For us, it was the fortitude and the organizational depth and breadth to pull something like this off. The second thing we learned is how important Minneapolis was to the Pohlad family. The project was a chance to reunite, under one roof, with our owner and contribute meaningfully to Minneapolis.” Landing the Four Seasons Hotel was the special sauce of the project, according to Katter, but it wasn’t clear it would pencil out. “We felt great about the condos, we felt great about the office, but the hotel, we were not sure it would underwrite fully. We all kind of locked arms and said, let's take a shot at this.” Katter said the office component is doing extremely well. “We're about to sign a lease that puts us at 99% leased.” Still, he credits the other components of the projects with driving the success of office leasing. “The Four Seasons Hotel offers a level of amenities with meeting space and dining, and valet parking was important to RBC’s wealth management business. It could also be there is a shift towards the North Loop and out of the core.” We talked about what it will take to make development viable in downtown Minneapolis for the long-term and it didn’t take Katter long to come up with his answer. “The most important thing is getting people back to the office and most of the major employers downtown have not fully commanded a return to office policy.” He said, “until office fully returns, the core of downtown will continue to just feel like it's missing something.” Katter contrasts the downtown core with the success of the North Loop. “The North Loop is primarily a residential submarket with office in it. It has many more people living there and so it’s felt much more vibrant throughout the pandemic and even today.” Shifting gears, we discussed some of the challenges in the marketplace with supply chain problems, interest rate hikes and fear of recession. Katter wouldn’t say the real estate market is in recession, preferring to call it a “cooling off period.”  Continue reading here.