Q3-2022 Industrial Market Update
The Twin City area industrial leasing market continues its spectacular performance with total quarterly net absorption of 2,189,981 SF and Year to Date total net absorption of 4,856,996 SF. Current market activity remains robust with approximately 60% of new construction pre-leased before building completion. We expect the remainder of 2022 to be one of the best on record; however, 2023 is less clear with some clouds on the horizon. The Federal Reserve’s recent escalation of benchmark interest rates combined with the now sustained 8%+ inflation rate, stock market volatility and difficulty of attracting new employees present substantial challenges to the continuing record setting performance of the industrial market.
MARKET RECAP:
Total Inventory: 271,326,059 sf
Total # of Buildings: 3,117
Absorption: 2,189,981 sf
Vacancy: 3.3%
Asking Rate Low: $7.37 NNN
Asking Rate High: $10.77 NNN
Under Construction: 8,254,782 sf
Multi-Tenant Properties
Total Inventory: 141,019,275 sf
Total # of Buildings: 1,757
Absorption: 810,520
Vacancy: 5.0%
Asking Rate Low: $7.29
Asking Rate High: $10.73
ECONOMIC OVERVIEW:
MARKET HIGHLIGHTS:
MPLS-ST. PAUL AREA EMPLOYMENT STATS:
MARKET OVERVIEW:
The Mpls-St Paul industrial market consists of 271 msf in eight counties across the metro. There was just shy of 2.2 msf of positive absorption overall for Q3 2022 increasing YTD to over 4.8 msf. Multi-tenant only properties posted 810,000 sf positive absorption with YTD of 2.8 msf. The overall vacancy rate for the market dropped to 3.3% and multi-tenant vacancy dropped to 5.0% for Q3 2022. To date, there are 54 construction projects throughout the market totaling 8.2 msf and 28 properties have been delivered YTD with 4.1 msf.
Q3-2022 Industrial Market Report created by Minnesota Commercial Real Estate Association. For more information you can reach them at: www.mncar.org
Industrial Market Experts
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