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Table 5-4
<br />TWIN CITIES AREA OFFICE MARKET; 4TH QUARTER 2011
<br />Submarket
<br />Total Vacant Vacancy
<br />Sq. Ft. Sq. Ft. Rate
<br />Rent Rate
<br />Class A Class B
<br />CBD
<br />Minneapolis 28,299,243 4,074,715 16.0 % $ 23.33 $ 18.06
<br />St. Paul Midway 10,059,518 1,840,810 20.7 23.02 17.84
<br />CBD Total 38,358,761 5,915,525 17.2 % $ 23.27 $ 17.96
<br />Suburban
<br />Northeast 2,387,967 507,669 21.3 % $ 22.20 $ 20.05
<br />Northwest 5,380,557 947,703 17.6 24.99 17.95
<br />Southeast 4,406,797 782,744 17.8 19.33 18.97
<br />Southwest 19,859,628 3,643,585 18.3 24.37 20.27
<br />Suburban Total 32,034,949 5,881,701 18.4 % $ 23.49 $ 19.68
<br />Total Twin Cities Area
<br />So urce: Grubb & Ellis.
<br />70,393,710 11,797,226
<br />16.8 % $ 23.39 $ 18.79
<br />The Northstar Corridor is in the Northwest office submarket, which makes up 16.8 percent of the
<br />suburban submarkets, and about 7.6 percent of the Twin Cities area office market. The
<br />Northwest submarket is the second largest suburban submarket in the Twin Cities area, but is a
<br />quarter the size of the Southwest submarket. The Northwest submarket has approximately 5.4
<br />million square feet of multi -tenant office space. The vacancy rate in the Northwest submarket
<br />was 17.6 percent at the end of 2011, which is lower than the suburban average of 18.4 percent,
<br />but higher than the overall Twin Cities area average of 16.8 percent. The Twin Cities area average
<br />rental rate for Class A office space in the Northwest submarket was $24.99 per square foot, which
<br />is the highest of all the submarkets.
<br />Office rents are well below the Twin Cities area average of $19 per square foot, ranging from as
<br />low as $3.00 to $19.00 per square foot on current listings, as shown in Table 5-5. Due to the low
<br />rental rates, the market does not support speculative office development.
<br />Table 5-5
<br />RAMSEYOFFICE RENTAL RATES
<br />(Per Square Foot)
<br />Net Space
<br />Rent Expenses Taxes Available
<br />7100 Sunwood Drive $425-$825 $ 1.50 $ 1.24
<br />Energy Business Park $3.90-$4.00 $ 1.40 $ 1.72 18,516
<br />McKinley Building $4.00-$8.00 $ 1.02 $ 1.65 4,615
<br />Ramsey Business Park $4.00 $ 1.50 $ 1.76 4,475
<br />Thurston Business Center $3.00-$6.50 $ 0.91 $ 2.02 28,610
<br />Ramsey Office Plaza $19.00 8,762
<br />14391 Azurite $15.00 2,641
<br />Riverview Office Suites $9.50 3,920
<br />Source: Loopnet, Northmarq, and McComb Group, Ltd.
<br />5-4
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