EXECUTIVE SUMMARY

• 1402 7th St E offers a rare opportunity to deploy capital into a modern, turnkey 12-unit asset without the renovation complexity defining most St Paul investments. Built in 2020 with large family-sized units (6 two-bedroom at 1,200 SF, 6 three-bedroom at 1,675 SF), the property delivers stable operations ideal for recent business sellers, 1031 exchange buyers, and working professionals prioritizing capital preservation over maximum cash flow. Exempt from St Paul's 2021 rent control ordinance and carrying no subsidies or income restrictions, this represents one of fewer than five unencumbered 10-20 unit properties built in St Paul in recent years—a quality deployment opportunity without the operational headaches of typical distressed brownstone renovations.

INVESTMENT SUMMARY

• 2020 Construction—Park Capital Without Repair Risk The 2020 construction eliminates the capital surprises and operational headaches that define most St Paul multifamily investments. No deferred maintenance, no system replacements, no tenant displacement for renovations—just modern construction with warranties active and building systems at the beginning of their useful life. Individual in-unit HVAC and water heaters eliminate central boiler replacement risk ($80,000-120,000) common in older buildings. System failures affect single units at manageable costs ($3,000-5,000), avoiding emergency capital calls. Bottom floor: 4 units with in-unit washer/dryer (1 ADA-compliant) Upper floors: 8 units with shared laundry
• Why this matters for capital preservation: Zero near-term capital requirements beyond routine reserves No surprise six-figure system replacements Modern construction meets current code without compliance costs Warranties protect against unexpected failures Predictable operating expenses without maintenance volatility

Turnkey Operations for Busy Professionals

• This is not a typical St Paul value-add brownstone requiring contractor management, renovation expertise, and weekend emergency calls. It's a stabilized asset for investors who: Recently sold a business or practice and need capital deployment Have a 1031 exchange requiring immediate quality deployment Want real estate exposure without active involvement Prioritize stability and capital preservation over maximum returns Value sleep-at-night operations over high-risk, high-return projects
• What turnkey means here: 95% occupied with stable tenants Modern systems operate reliably without constant repairs Professional management handles day-to-day operations No renovation projects requiring contractor oversight No tenant displacement disrupting income No code compliance upgrades or accessibility retrofits needed

Large Family-Sized Units—Quality Over Density

• Unit mix: 6 two-bedroom (1,200 SF) at $1,710/month 6 three-bedroom (1,675 SF) at $1,795/month Average 1,438 SF per unit These are family-sized apartments averaging nearly 1,500 SF—more than double typical new construction studio/one-bedroom units that maximize density and per-SF rents. The trade-off: lower density but higher-quality tenant base seeking space, stability, and longer lease terms.
• Tenant profile: Families with children prioritizing space Graduate students and faculty from Metropolitan State University (0.8 miles) Community residents near Hmong Village (1.2 miles) Longer average lease terms (18-24 months versus 12 months) Lower turnover reducing vacancy and lease-up costs Three-bedroom apartments in modern buildings represent scarce supply in St Paul—most families face single-family rentals (expensive, maintenance responsibility) or older buildings (1960s-1980s with deferred maintenance).

Exempt from St Paul Rent Control & Subsidy Restrictions

• St Paul enacted rent control in 2021 capping increases at 3% for pre-2021 properties. This property is permanently exempt, preserving pricing flexibility unavailable to most St Paul rental housing. Additionally, unlike virtually every other new construction in St Paul over the past decade, this property carries no affordable housing requirements, no income restrictions, and no compliance obligations. It operates as true market-rate housing without the regulatory constraints common in subsidized developments. Practical advantages: Tenant selection based on credit and payment ability Market rents without regulatory caps or AMI limits No annual compliance audits or agency oversight Exit to unrestricted buyer pool (no deed restrictions) Full operational control without government agency involvement

Ideal for Capital Deployment Without Active Management Perfect for:

• Recent Business/Practice Sellers Just sold your company, practice, or business Need to deploy capital into quality real estate Want passive income without operational burden Prioritize capital preservation over maximum returns 1031 Exchange Buyers Tight timeline requiring immediate deployment Need stabilized asset with in-place income Want modern construction eliminating execution risk Seeking long-term hold without capital surprises Working Professionals Busy career professionals (doctors, lawyers, engineers, executives) Want real estate portfolio diversification No time for contractor management or renovation projects Value predictable operations over sweat equity returns Out-of-State/Passive Investors Want Minnesota real estate without local involvement Need professional management handling operations Prioritize quality construction over value-add opportunities Seek stability and simplicity over complexity
• What makes this different: Not a distressed property requiring renovation Not a value-add project requiring active management Not an older building with surprise capital needs Just modern construction with stable operations and professional management