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• CBRE <br />I <br />FIGURES I MINNEAPOLIS INDUSTRIAL 103 2021 <br />Absorption and construction at decade <br />highs and matched by leasing activity <br />4.2% <br />Vacancy Rate <br />Note: Arro\NS indicate change from previous quarter. <br />2.OM 5.1M $6.53 PSF <br />SF Net Absorption <br />SF Under Construction Average Asking Rate (NNN) <br />MARKET OVERVIEW <br />Q3 2021 absorption was nearly 2 million sq. ft, with nearly 6 million sq. ft. under construction. <br />— Leasing activity was up 25% over Q2 with a balance across industry type including Retail, <br />Manufacturing, Life Sciences, and Transportation/Warehousing. <br />— New investors continue to be attracted to the Minneapolis market, as evidenced by Nicola <br />Wealth Real Estate's $225 million purchase of the Blackstone Minneapolis Industrial Infill <br />Portfolio. <br />Vacancy continues to decline amidst increased leasing volume and an all-time high of nearly 15 <br />million sq. ft. of demand from tenants in the market. This has led to a boom in speculative <br />development, with 3.5 million sq. ft. under construction for delivery in 2021 and 2022 and an <br />additional 3 million sq. ft. planned that could be delivered in 2022. <br />FIGURE 1: Quarterly and Annual Net Absorption vs. Vacancy <br />Net Absorption (MSF) <br />5 <br />4 <br />3 <br />2 <br />1 <br />0 <br />(1) <br />Vacancy (%) <br />8 <br />2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 <br />YTD <br />0 <br />01 02 Q3 04 Total Annual Net Absorption (L) Vacancy Rate (R) <br />Source: CBRE Research, 03 2021. <br />1 CBRE RESEARCH © 2021 CBRE, INC. <br />