"War zone": Investors avoiding Minneapolis for some reason

Alternate headline: Elections and unrest have consequences. Why should investors put capital into rebuilding Minneapolis when its city council won’t put resources in place to keep the peace? With violent crime exploding in the Twin Cities, the prospects of recovery would normally be slow anyway. However, the council’s efforts to abolish the city’s police department has investors looking for greener pastures, all but ensuring decline in the short run, as the Washington Examiner reports:

Since violent unrest broke out over the summer, local developer Kelly Doran said he estimates around 10% to 20% vacancies in downtown apartment buildings that had just 2% to 3% vacancies in the last five years. Newer, modern buildings in the downtown area are also at 20% vacancy rates.

As the city grapples with rising crime rates, along with droves of police retirements, and a council vote to reimagine parts of traditional public safety, Doran believes a full economic recovery for Minneapolis will be slow.

“They don’t seem to care,” Doran said of the council. “I don’t know why anybody would seriously consider investing in the city.”

Mica Soellner spoke with a number of venture capital figures and developers, including former Minneapolis councilor Steve Minn. Minn was around for the “Murderapolis” years in the Twin Cities, and recognizes the need for investment in law enforcement to create a safe space for critical business investment. The radical-progressive turn at City Hall over the last few years has opened up a costly — and damaging — blind spot, Minn argues.

Minn also warns that the real vote might not be at the ballot box:

Minn believes the contentious relationship between the council and the business community is largely due to a lack of understanding by members, and he believes this budget will follow many to the ballot box next year.

“None of them understand or appreciate the value in the business community, and none of them have outreached a hand to help the business community,” Minn said. “They’re going to get a fairly sobering budget to work with when the business community responds by voting with their feet. They don’t understand the kind of damage they’ve done yet.”

Another former councilor, Don Samuels, sued the city over its lack of police resources since the George Floyd riots. Samuels puts the issue more succinctly:

“[There’s] crime and drug dealing on the street, homicides happening on the street, so people are not looking to the street,” Samuels told the Washington Examiner. “Target was there. Target left [because of] too much theft. … The businesses that are kind of trying to be there, they’re struggling.” …

“If you go to downtown Minneapolis now, it looks like a war zone,” Doran said.

It doesn’t just look like a war zone. Murders have gone up more than 50%, shootings have increased more than that, and most famously, carjackings have increased a whopping 537% year-on-year for November. With the police force down 20% in manpower since June, the Minneapolis PD hasn’t had enough presence on the street to put a dent in the impression of impunity that carjacking rings have felt.

So instead, they put a few more resources in the air, in partnership with the Hennepin County sheriff’s office:

To combat a rash of recent violent carjackings, Minneapolis Police Chief Medaria Arradondo said his department teamed up with the Hennepin County Sheriff’s Office and Minnesota State Patrol in using helicopter surveillance to make more than 40 arrests.

The three-day crackdown last week resulted in 41 felony arrests and the recovery of seven stolen vehicles and five guns, Arradondo said at a Tuesday evening news conference inside City Hall while flanked by Sheriff David Hutchinson.

“We’re teaming up to make sure people can live their lives and not get their car stolen in broad daylight by a few bad actors,” Hutchinson said.

Arradondo said the helicopter hovering over Minneapolis last Wednesday, Thursday and Friday was noticed by many residents and that he wanted to provide an update that it was an intentional strategy and may be used again.

Having grown up and lived in Southern California, I grew used to police helicopters in the air. That was routine even in the suburbs. Here in Minnesota, though, it’s rare enough that people will come out of their houses to see what’s going on. While the increased enforcement is certainly welcome, the helicopters only add to the impression of Minneapolis being a “war zone.”

And it’s not just Minneapolis, either. The violence spills over into St. Paul with deadly consequences:

A man driving on University Avenue in St. Paul was shot and killed late Wednesday, bringing the number of homicides in the city this year to 32.

The driver, whose name has not been released, called 911 about 10 p.m. to report that he had been hit by gunfire near the intersection of University and Snelling avenues, said police spokesman Steve Linders.

Officers found the man inside his car, which had come to rest in the southbound lanes of Snelling Avenue next to the Spruce Tree Center, with a gunshot wound to his chest. He was taken to Regions Hospital, where he died Thursday morning, Linders said. …

The homicide pushed the city past last year’s total of 31 — there also was a fatal shooting by police not counted in that total — and was just two short of the record of 34 set in 1992.

The looting in the summer was bad enough to scare off investors, especially those who wanted to open or maintain family-owned businesses in the Twin Cities. The ongoing explosion of violence is more than enough to have larger capital stakeholders looking for better places to put their money. Perhaps that vote-by-feet outcome will be enough to convince Twin Cities residents to start looking for new leadership. If it’s really “the economy, stupid,” then those voters have a lot of stupidity to flush out of City Hall.