We passed the midway point of 2016 and the industrial market continued to be a strong performer. One driving factor was the strength of the Northeast submarket. The Northeast led the Metro in absorption and held the lowest vacancy rate of any submarket by nearly two percent.
Cushman & Wakefield/NorthMarq’s Jason Sell expounds on the robust activity in the Northeast submarket, “Most of the growth has still been off the 35W corridor, stretching up to Blaine and over to Fridley. Northern Stacks in Fridley gained momentum and was one of the most active developments in the Twin Cities over the last six to nine months while filling two buildings and moving on to a third. Midway Stadium Business Center in St. Paul is under construction and has landed the first tenant while negotiating with a second tenant to take a large part of the remaining space.”
Construction activity continued, but the majority of new starts were build-to-suit projects. The Northwest submarket has experienced most of the new construction in the last two years. The combination of new vacant speculative construction completions and build-to-suit projects pulling users out of the multi-tenant universe has, once again, left the Northwest with the highest vacancy rate of any submarket.
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Jason Sell is a Senior Director with the Minneapolis/St. Paul Industrial Team.