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Minneapolis CBD Class A vacancy is 7.9% for single- and multi-tenant office; Nicollet Mall is 4.0% vacant

Nicollet Mall, the artery of the Minneapolis CBD, runs through a large portion of the submarket’s Class A office space. There are 18.8 million square feet of inventory for both single- and multi-tenant buildings , which includes owner-occupied buildings not typically tracked in JLL’s quarterly statistics. Buildings along Nicollet Mall make up 7.7 million square feet or 41 percent of the entire CBD Class A universe.

Class A office is in high demand in the Minneapolis CBD with a vacancy rate just under 8 percent. As you approach Nicollet Mall, vacancy is halved to 4 percent.  Fully occupied single-tenant buildings like the headquarters for Target and Xcel Energy push vacancy down. Rental rates reflect this lack of supply. All CBD Class A office is marketed at a weighted average of $18.99 Net per square foot. Nicollet Mall office is 5 percent more expensive at $19.96 Net.

The massive $50 million Nicollet Mall renovation will conclude by the end of this year. The pedestrian-friendly corridor will certainly increase interest in office investment. Unless new office is developed in the last remaining parcels along Nicollet Mall, we expect Class A office vacancy to continue to drop in downtown Minneapolis.​​

Source: JLL Research

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