Office vacancy rates in the Twin Cites by the end of 2011 fell to a three-year low, according to a new report released by the Minneapolis office of Cassidy Turley.
According to Cassidy Turley’s 2011 year-end office market report, the overall office vacancy rate for the Twin Cities metro area fell to 17.4 percent. The metropolitan area saw 978,211 square feet of office space absorbed in 2011. Of this figure, 757,859 was in the Class-A product.
The news was not all good, of course. According to the report, Class-C office properties struggled last year. This sector’s vacancy rate actually rose in 2011 to 21.7 percent.
What does these numbers mean? Only that the office market in the Twin Cities area is improving, but still has a ways to go before hitting equilibrium.
Overall, Class-A office vacancy rates for the Twin Cities metropolitan area stood at 13 percent at the end of the fourth quarter of 2011, an improvement of 2.5 percent from this sector’s 15.5 percent vacancy rate in the fourth quarter of 2010.
Class-B office vacancy rates hit 21.1 percent by the end of 2011. That’s a slight improvement — 0.5 percent — from the vacancy rate of 21.6 percent in the fourth quarter of 2010.
Finally, Class-C office space saw its vacancy rates jump 3.2 percent from 18.5 percent in the fourth quarter of 2010 to 21.7 percent in the fourth quarter of last year. Last year, 169,513 square feet of vacant office space was added to the Twin Cities’ Class-C office sector, according to the Cassidy Turley report.
— Dan Rafter