Best of the Midwest: Twin Cities Commercial Real Estate Tops the Ranks

Best of the Midwest: Twin Cities Commercial Real Estate Tops the Ranks

Best of the MidwestMinneapolis is thriving—in more ways than one. The economy is getting stronger by the day, breathing life into the residential real estate market and ushering in a plethora of new job opportunities. The city is focused on its sustainable efforts, which is generating interest amongst people in all age demographics and showcasing that the community offers a high quality of life. All of this has peaked the interest of commercial real estate investors, who are keen to invest in a city that offers both demand and opportunity.

Recently, a report ranked Minneapolis as the top commercial real estate market in the Midwest.

Best in the Midwest: How Minneapolis Earned the Top Spot

Recently, the Emerging Trends in Real Estate Report announced its rankings for the top commercial real estate markets across the country. Not only does it offer a look into the hottest markets across the nation, it also breaks down the country into separate regions. For its 2017 report, Minneapolis took first place out of all the commercial real estate markets in the Midwest. The report cited the community's high demand for commercial space, including that for senior housing, as well as its thriving economy, as the reasons why it was the best commercial market in the Midwest. There were several other factors that stood out as well:

  • Significant capital availability.
  • Interesting and unique redevelopment opportunities.
  • Range of both public as well as private investments.
  • Involvement with local developers and community members.

This outlook survey has been compiled every year for nearly 40 years, and is widely used by commercial real estate investors as they scope out their next opportunity in the industry. To create the report and determine their rankings, the publishers contact more than 1,600 industry professionals to get their insight and feedback. The professionals who were contacted for the 2017 report included developers, lenders, brokers, investors and fund managers.

Minneapolis and the Nationwide Commercial Real Estate Industry

Minneapolis also was considered a standout amongst all of the commercial real estate markets across the country. In the 2017 Emerging Trends in Real Estate Report, the market was considered the 25th best commercial real estate market nationwide. This is a drop from its 2016 ranking of 18th place, but it still signifies that this market is generating interest from developers and investors around the country.

Generally, the report noted that the best markets across the country are actually going to be secondary markets—which is the category that Minneapolis and St. Paul fall into. Primary markets, like New York City, Los Angeles and Chicago, are hallmarked by rising prices and increasing competition. As opposed to these expensive markets, secondary markets are able to offer high demand as well as younger, skilled workers who are looking for jobs in a place that also boasts a high quality of life. In the Midwest, Minneapolis beat out other secondary markets like Des Moines and Columbus, which is further proof that investors who are scouring the nation for affordable yet vibrant secondary markets will set their sights on Minneapolis.

What's Next for Commercial Real Estate in Minneapolis?

Not only did the report rank Minneapolis as the top market for 2017, but it also claims that it may be the hottest emerging market for 2018. The vibrant economy as well as the interest amongst both public and private investors leads industry experts to believe that Minneapolis may quickly become one of the top commercial markets in the Midwest and throughout the entire country.

The report also included the following nationwide rankings for Minneapolis:

  • The third best market in the country for real estate buying recommendations.
  • The fifth best market in the country for development opportunities.

Specifically, one of the best aspects of the commercial real estate market in Minneapolis is the senior housing market. From June 2016 to June 2017, nearly 35,000 new senior housing developments were created throughout the United States. Of those, about 12 percent were located in Minneapolis. Real estate investors who want to know where there will be high demand within the market should take note of these figures, as a senior housing unit may be the next best multi-family housing building to invest in within the Itasca community.

As the year comes to close and investors start to look ahead to the excitement of 2018, it's important for those in the commercial real estate industry to connect with a qualified and experienced real estate agent. A real estate professional that specializes in commercial real estate will be able to help investors identify new opportunities and available properties while also assisting in negotiating all aspects of the real estate transaction. To learn more about what is happening in the Minneapolis commercial real estate market, contact us today.

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