©2023 Real Estate Publishing Corporation February/March 2023 • VOL. 39 NO. 1
Development Showcase: Minneapolis’ RBC Gateway: From a quiet parking lot to a skyscraper filled with life Page 11
Office success stories? They still happen. The E in the Twin Cities market proves it By Dan Rafter, Editor
O
f all the sectors hit by the COVID-19 pandemic, none is suffering more today than office. Companies are still struggling to bring their workers back to their cubicles. Building owners are dealing with sky-high vacancies. And no one knows yet just how much office space companies will need as the work-from-home movement continues.
But these challenges didn’t stop City Center Realty Partners from closing 2022 by signing four new tenants at The E, a 107,000-square-foot office tower in the Twin Cities suburb of Edina, Minnesota.
The new leases brought The E to 75% leased. That’s quite an accomplishment: The office tower, jointly owned by City Center Realty Partners and Contrarian Capital Management, started 2022 completely vacant. OFFICE (continued on page 18
Another rough year for Twin Cities office market? The numbers suggest it might be in the offing
By Dan Rafter, Editor
T
he office sector is struggling across the country. But a new report says that sales and leasing activity in the Midwest office market is especially weak, with the Twin Cities’ office sector in particular off to a sluggish start in 2023.
That’s the news from CommercialEdge’s February National Office Report.
rental rate of $27.80 a square foot), Phoenix ($27.58) and Orlando ($24.75).
According to CommercialEdge, the St. Paul-Minneapolis office market closed January with an average asking rent of $25.85 a square foot, falling 0.8% when compared to December of last year. CommercialEdge said that this rate ranked among the fourth lowest in January in the country’s major markets, along with Chicago (an average office
The Twin Cities’ office vacancy rate was high, too, inching up 0.12% in January to 15.07%. On a year-over-year basis, this rate was up 0.55%. OFFICE STRUGGLES (continued on page 25)