XPost: mn.politics, alt.business, alt.politics.democrats
XPost: alt.fan.rush-limbaugh, talk.politics.guns, sac.politics
Back in November, Jonathan Weinhagen, president and CEO of the
Minneapolis Regional Chamber, wrote an op-ed for the Star Tribune
titled “Business has nothing to fear from DFL dominance.” His
members clearly didn’t get the memo.
Two weeks ago, Axios reported:
CBRE, one of the largest commercial real estate companies in the
country, is closing its downtown Minneapolis office.
Downtown employees are moving to the Bloomington and North Loop
offices.
While the city hasn’t seen a mass exodus of companies that some
predicted during the pandemic, the move isn’t a good sign.
CBRE said in a statement the departure from LaSalle Plaza is a
temporary consolidation while it evaluates its long-term space
needs.
A couple of days later, Axios reported:
Portico Benefit Services is leaving downtown Minneapolis and
relocating to Edina.
…
Portico is leasing 25,000 square feet in the 7700 France building,
which recently underwent a major renovation. The size difference in
the two leases is further proof that companies need less space in a post-pandemic world.
“We found an alternative location that will allow for additional
flexibility as we move to a more agile, hybrid work environment for
the future,” Portico CFO/COO Stacy Kruse said in an emailed
statement.
It’s not clear exactly how many employees Portico has downtown, but
the number is likely in the hundreds based on the space.
One week ago, Axios reported:
AT&T is closing its longtime downtown Minneapolis office and moving
hundreds of employees to its Bloomington facility.
If you thought these were mere anecdotes, last week Twin Cities
Business reported:
With over 21.2 million square feet of vacant office space in the
Twin Cities metro, office vacancy rates in the area are up 12.2%
year over year, according to a recent report by Toronto-based
Colliers International.
…
The Minneapolis and St. Paul office market has continued to show a
“negative absorption” rate in the first quarter of this year. This
simply means the demand for office space is lower than the supply
available. The report points to properties like Voya, Calabrio, and
WeWork, which have all vacated or downsized leased spaces, leaving
around 100,000 square feet each in their buildings. The Twin Cities
is one of only three major markets that continue to post negative
absorption rates every quarter since the pandemic started, the other
two being Baltimore and Chicago.
The Minneapolis central business district (CBD) alone saw a negative
absorption of 300,000 square feet, the largest negative absorption
in the region. In total, the Twin Cities metro reported more than
500,000 square feet of negative absorption in the first quarter.
However, the I-494 Corridor and outlying submarkets both saw overall
positive absorption, with tenants filling Class A space in the I-494
and I-394 Corridors faster than any other submarket, according to
the report.
In short, businesses are fleeing downtown for the suburbs. With all
due respect, Baltimore and Chicago is not company you want to be in.
Intriguingly, the Colliers report looks into the “adaptive reuse of
office buildings into industrial and multi-family buildings,” but
notes that:
…without government incentives, the major determining factors for
such conversions are the amount of leasable square footage on an
individual floor of a building, as well as location and price…
“Government incentives can themselves become strong components to
kick-start adaptive reuse and make possible otherwise impossible conversions,” the report states. “As more obsolete office buildings
are considered for adaptive reuse, potential long-term ramifications
will emerge as to how housing will reshape the neighborhood and
shift the city’s property tax basis.”
Minneapolis can, then, replace these lost business tenants with
subsidized renters and have them make up for the resulting tax loss. Minneapolis has had DFL mayors ever since Charlie Stenvig back in
1979.
https://www.americanexperiment.org/new-data-show-that-businesses- are-fleeing-downtown-minneapolis/
--- SoupGate-Win32 v1.05
* Origin: fsxNet Usenet Gateway (21:1/5)