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Market Report

Minneapolis-St. Paul Industrial Market Report

2024 Investment Forecast

Major Industrial Corridors Retain Historically Tight Conditions,
Despite Vacancy Rising Marketwide

Northern submarkets headline local performance. Minneapolis-St. Paul’s industrial vacancy rate trended up 70 basis points last year. Decreasing vacancy, however, was recorded across the Northwest and North Central submakets, which account for one-third of marketwide stock. Considerable absorption prompted these areas’ vacancy rates to decline to record lows. Recent tenant demand here is headlined by Amazon’s move-in to a 140,000-square-foot distribution facility in Centerville, while MAS HVAC and Caribou Coffee are set to occupy a collective 430,000 square feet in Maple Grove this year, exhibiting this ongoing trend. Conditions in the Southern corridor, encompassing Eagan, Farmington and Randolph, are also tight, with a local vacancy rate that held stable in 2023 following two straight years of compression. Sweet Harvest Foods occupying a new facility in Lakeville this May emphasizes the area’s connectivity to the central U.S. Supply pressure east of St. Paul and space relinquishment between the Twin Cities, however, is weighing on marketwide fundamentals. 

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