Did Metro Commercial real estate demand bottom out in 2010?

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Twin Cities commercial real estate market likely bottomed out during 2010, according to NorthMarq Real Estate Services’ annual Compass report issued Monday.

The report estimates there was 15.8 percent combined vacancy for all types of commercial office, industrial and retail properties at the end of 2010, down 0.5 percent from where it was at the end of 2009. It’s a big difference from 2008 to 2009, when overall vacancy jumped 3 percent.

Despite the results, NorthMarq reports that “fundamentals are still very weak across the office, industrial and retail leasing markets. Recent economic indicators such as the unemployment rate have not been overly encouraging, setting the stage for a slow rebound in 2011.”

The Twin Cities office market improved in the second half of 2010 for landlords, resulting in “modest, but encouraging” positive absorption of 202,000 square feet. Absorption is a change in the amount of total leased space from one point in time to another.

The vacancy rate for the office market was unchanged in the second half of the year at 19.9 percent, with four of the seven sub-markets in the Twin Cities maintaining vacancy rates over 20 percent.

Read the entire article at Minneapolis / St. Paul Business Journal.

Read more: NorthMarq: Metro real estate demand bottoms out |

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