Skip to content
Twin Cities Cityscape

The Booming Commercial Real Estate Market in the Twin Cities

The Minneapolis–Saint Paul metropolitan area, more commonly known as the Twin Cities, is experiencing extremely robust activity in its commercial real estate (CRE) market recently. This major Midwest region, endowed with a large population of over 3.6 million residents and an immense business community, offers very attractive and promising opportunities for real estate investors, developers, landlords, tenants, brokers, managers, and other CRE professionals.

Analysis of Key Property Sectors

Office space is seeing sky-high demand across the Twin Cities currently. The area has witnessed strong job growth and economic expansion in recent years, especially in sectors like healthcare, finance, technology, manufacturing, education, and more. Large companies continue to lease and build spacious new offices throughout the metro, while co-working spaces and flex office providers have also thrived as remote work trends accelerate. Trendy mixed-use developments are popping up rapidly as well, blending quality office spaces with upscale retail, dining, entertainment, and housing all in one.

Industrial real estate has become red-hot in the Twin Cities right now. With its strategic central location and power as a major Midwest transport hub, the Twin Cities is a vital distribution center for the region. Industrial parks, warehouses, manufacturing plants, and logistic facilities are filling up fast here.

The industrial vacancy rate sank to a historic low of 4.4% at end of 2021 according to Cushman & Wakefield research, signifying extremely tight conditions for tenants. Due to proximity to railways, interstates, and the Minneapolis–Saint Paul International Airport, e-commerce companies, retailers, wholesalers, and third-party logistics firms urgently want modern high-tech logistics facilities near the Twin Cities for their supply chain and distribution needs.

Retail spaces remain fairly stable currently, as new suburban shopping centers and malls take off in the metro’s booming neighborhoods. Multi-family housing development is also very active right now across the Twin Cities, constructing thousands of new upscale apartments annually to cater to the area’s growing population of renters and urban dwellers.

The Twin Cities, including Minneapolis and St. Paul, are experiencing a surge in commercial real estate growth.

Analysis of Minneapolis CRE Markets

Downtown Minneapolis forms the main hub for premier office spaces, high-end retail, fine dining, entertainment, hotels, and more. Trophy office towers see intense demand from prestigious companies seeking the ultimate corporate addresses in the city. Certain areas downtown have transformed into trendy scenes recently, like the North Loop with its booming restaurant and luxury housing growth. Popular retail centers downtown include the Nicollet Mall and IDS Center.

The Southwest quadrant near the junction of Interstates 394 and 494 contains a very strong suburban office market currently, with many newer Class A buildings sought after by large companies. Upscale retail, restaurants, and entertainment thrive in the Southwest metro as well, with mega malls like Southdale Center and Galleria serving as major regional shopping destinations.

Robust Investment Activity

Commercial real estate investment in the Twin Cities set impressive new annual records in 2021. According to Cushman & Wakefield, office sales volume surpassed $2.3 billion while industrial sales topped $1 billion for the first time ever in the Twin Cities metro. Investors, developers, and corporations are extremely bullish on the local market’s stability and upside potential.

With its diverse economy, highly educated workforce, excellent infrastructure, and overall enviable quality of life, the Twin Cities CRE market will continue experiencing strong demand growth across all property sectors. Savvy real estate investors, developers, brokers, and managers are poised to aggressively capitalize on these robust trends in the years ahead. The Twin Cities will remain a top choice for premium commercial real estate opportunities.

A person writing a plan for real estate venture


Investing in commercial real estate demands a strategic approach that aligns with your goals, risk tolerance, and financial capabilities. By carefully analyzing investment objectives, selecting the right properties, conducting thorough due diligence, managing risk, and planning exit strategies, you can navigate the complexities of the commercial real estate landscape and pave the way for long-term success.

For expert guidance on how to capitalize on this thriving market, contact the professionals at North Star Commercial Real Estate Advisors. Their deep knowledge of the Twin Cities metro area can help you find the ideal properties and execute deals that align with your portfolio goals.

Whether you are an investor looking to acquire income-generating assets, a developer seeking new projects, or a business needing commercial space, the team at North Star has the insight and experience to guide you. They stay on top of Twin Cities market trends and have relationships with premier landlords and property managers to access the best options.

Disclaimer: The information provided in this article is for educational purposes only and should not be considered financial or investment advice. It is always recommended to consult with a qualified financial advisor or investment professional before making any investment decisions.

Contact Us Today

Scott Naasz: (612) 819-8285


Kaitlyn Page: (701) 220-5123