Minneapolis–St. Paul office market report

Q2 2024

In the second quarter of 2024, demand for office space in the Minneapolis–St. Paul office market continued to decline, with leasing activity in the first half of the year down 28% compared to H1 2023. Despite this, high-quality properties remain in high demand, subleasing activity is still above historical norms, and the local unemployment rate is well below the national average.
1.75 msf

High quality space remains in demand

Despite a nearly 700k decline in leasing volume YoY during the first half of 2024, high quality space remains in demand for tenants. Trophy/Class A spaces accounted for 72% of total leased space in H1 2024, 400 bps higher than the pre-pandemic (2014-2020) average H1 leasing share of 68%. Despite this increasing share of leasing activity, Trophy/Class A spaces saw over 34% less total space leased in Q2 2024 from Q1 2024 compared to a 37% decrease in space for Class B/C spaces. 

580,000 sf

Sublet availability declines

Sublet availability in MSP has declined by over 580,000 sf over the past year, primarily driven by increased subleasing activity. Subleasing activity hit a historic high of over 551,000 sf in the third quarter of 2023, and the fourth quarter of 2023 saw the second-largest amount of subleased space ever recorded. This drove down sublet availability during these periods. So far in 2024, subleasing activity has been more modest but remains above historical norms. 

2.6%

Unemployment rate

Unemployment rate in MSP through May 2024 is lower than the national average rate of 4.0%, and peer markets, Columbus and Indianapolis.

Your source for the latest Minneapolis–St. Paul office market report

Get in-depth office market reporting and insights from commercial real estate experts in the Greater Minneapolis–St. Paul (Twin Cities) area. Avison Young advisors look at Minneapolis–St. Paul commercial real estate activities and the latest Minneapolis–St. Paul statistics to provide you expert market research on Minneapolis–St. Paul's office properties.

Explore different topics like the latest office market pricing trends and analysis of Minneapolis–St. Paul's current office real estate market conditions. Gain a better understanding of Minneapolis–St. Paul’s office real estate outlook and stay ahead of current office space trends. Make smart decisions when it comes to investing in office properties in Minneapolis–St. Paul's competitive office real estate market. Avison Young is your trusted source for commercial real estate office market insights in Minneapolis–St. Paul.

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