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FIGURES I MINNEAPOLISOFFICE 1032024 <br />Leasing and sublease activity stabilize despite <br />continued negative absorption <br />23.9% (301,601) 35,660 $29.03 PSF <br />Direct Vacsncy Rate SF Net Absorption SF Under Construction Average Asking Rate (Gross) <br />MARKET OVERVIEW <br />In the Minneapolis office market, total Q3 absorption was (301,601) sq. ft., a 34% increase <br />from the previous quarter. The largest share of this movement was from downsizing by <br />the State of Minnesota in downtown St. Paul. <br />— Leasing volume year-to-date in 2024 was the second highest since 2020, a 7% increase <br />over the five-year Q1-Q3 average. Two of the top leases in Q3 were expansions into a <br />larger office footprint. <br />CBRE <br />FIGURE 1: Historic Quarterly and Annual Net Absorption vs. Vacancy <br />Net Absorption 01 - Q2 03 04 -Vacancy Rate (%) <br />1.5M 25% <br />1.0M <br />.5M <br />0 <br />— For the first quarter since 2019, total sublease availability in the market decreased. Since <br />it's peak over a year ago in Q2 2023, sublease availability has decreased by 18%. (.5)M <br />Office sales volume totaled over $105 million in Q3, bringing the rolling 4-quarter sales <br />volume to nearly $524 million. Investment sales in suburban markets contributed the <br />majority of Q3 sales activity. <br />(1.0)M <br />(1.5)M <br />• . <br />111 <br />20% <br />15% <br />10% <br />5% <br />0% <br />2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 <br />Source. CBRE Research, 032024. <br />CBRE RESEARCH © 2024 CBRE. INC. <br />