Minneapolis Approves Zoning Reform, Allocates $28 Million for Multifamily Housing

The Minneapolis City Council voted 8-5 on July 7 to pass Ordinance 2026-45, which revises zoning rules to permit triplex and fourplex buildings on lots previously limited to single-family homes in 12 designated neighborhoods. The measure affects an estimated 18,000 parcels and applies to property owners seeking permits after January 1, 2027.

City records show the ordinance responds to a 2025 housing needs assessment that identified a shortfall of 14,200 units through 2030. Council members tied the timing to federal infrastructure deadlines that require local matching funds for transit-oriented development grants already awarded to the Metro Transit Blue Line extension corridor.

Changes for property owners and renters

Under the new rules, owners of single-family lots in the affected zones can add up to three additional units without a conditional-use permit, provided the structures meet existing height and setback standards. Local housing analysts note this adjustment removes one layer of discretionary review that previously added six to nine months to project timelines. For renters, the change is projected to increase the supply of one- and two-bedroom units within walking distance of existing bus routes on Lyndale Avenue and 38th Street.

The legislation also sets aside $28 million from the city's 2027 capital improvement plan for sewer and water upgrades required to support the added density. According to the ordinance's fiscal note, this amount equals 3 percent of the total public works allocation approved in the 2026 budget. Residents in the 12 neighborhoods will see the work scheduled through the existing five-year street reconstruction program rather than new standalone projects.

Community development staff stated that permit applications under the revised code will be processed through the existing online portal used for accessory dwelling units. The same staff will conduct compliance checks on parking minimums, which remain at one space per unit unless the site is within one-quarter mile of a high-frequency transit stop.

Next steps for implementation

City planning staff will hold three informational sessions in August at neighborhood association offices to explain the application process. The first permits are expected to be issued in the first quarter of 2027 once the updated zoning map is published by the Department of Community Planning and Economic Development. Ongoing monitoring reports will be delivered to the council's housing committee every six months beginning in July 2027.