/ST. PAUL MARKET OVERVIEW The Twin Cities is one of the top-performing markets in the nation to work, shop and live.

cushwakenm.com AREA OVERVIEW

Navigating the Minneapolis/St. Paul Commercial Real Estate Market The “Twin Cities” of Minneapolis and St. Paul EXECUTIVE SUMMARY comprise a growing and vibrant metropolis with a diverse economic base, skilled labor pool and PROJECTIONSabundance FOR of cultural 2016 and recreational opportunities that make it one of the most important commercial centers in the United States. NEW CONSTRUCTION ABSORPTION MORE NEW CAPITAL 4.4 msfTwin multi-tenant Cities is the dominantspace financial, manufacturing,2 msf expected in Debt and equity distributionunderway and transportation center betweenfirst half of 2016 Chicago and Seattle, which also makes it a singular magnet for regional talent unlike coastal MARKET QUICKmetropolises FACTS in close proximities. TWIN CITIES METRO DEFINITION The “Twin Cities” of Minneapolis and St. Paul form the core of a metropolitan region encompassing 6,046 square miles and consisting of 13 counties: Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, Washington, Isanti, Chisago, Sherburne and Wright in , as “Nowell as otherPierce and place St. Croix mixes counties affordability, in Wisconsin. opportunity, andHOUSING wealth PRICES so ARE well.” UP The Twin Cities median single-family home price (as— The of Atlantic, fourth-quarter The Miracle of Minneapolis 2015) 2015 is $190,000, up 6% compared with $179,000 in fourth-quarter 2014. Source: Minnesota Association of Realtors A DIVERSE & RESILIENT ECONOMY LABOR FORCE MIX IS CONSISTENTLY SOLID UNEMPLOYMENT RATE IS DOWN LABOR FORCE MIX IS CONSISTENTLY SOLID The Twin Cities represents a broad range of As of November 2015, the Twin Cities unemployment MINING, LOGGING, industries.rate is the The lowest employment it’s been basesince does2000 not rely GOVERNMENT CONSTRUCTION 4% on any single*Not seasonallyindustry, drawingadjusted its strength OTHER SERVICES 13% 10% MANUFACTURING (PRIVATE) from a remarkably diverse business base and an 4% LEISURE & 9% TRADE, economy that is “knowledge-based, globalized, HOSPITALITY 18% TRANSPORTATION, entrepreneurial, IT-driven and innovation-based,” UTILITIES TWIN CITIES EDUCATION 16% 2% according to% Forbes. Such diversity enables this & HEALTH INFORMATION 2.7 8% market to better weather recessions% and economic 4.8 FINANCIAL PROFESSIONAL & 16% ACTIVITIES downturns. BUSINESS SERVICES

No single industry accounts for more thanBUSINESS 20% of STRENGTHS the total employment in the Twin Cities. Major business strengths in the Twin Cities —include MN DEED a2016 highly educated workforce, excellent transportation services, a diverse economic base and available capital. The metro area is home to 16 Fortune 500 companies representing a broad spectrum of industries. The Minneapolis-St. Paul area’s employment base does not rely on any single industry, which allows it to weather recessions and economic downturns in specific industries.

More per capita Fortune 500 companies than any other US metro region Greater MSP Workforce is one of the most qualified in the nation, #1 in workforce participation Greater MSP The 6th most inventive city worldwide Bloomberg Businessweek North Loop ranks as a Top 25 Destination in the World Forbes

ABOUT 2 | Minneapolis/St.Paul Market Overview cushwakenm.com

THE COMPASS REPORT CUSHMAN & WAKEFIELD/NORTHMARQ The report was created by experts using Twin Cities commercial property Cushman & Wakefield / NorthMarq operates the Minnesota business of Cushman & Wakefield, a data from the last six months of 2015. The data used for this report has been leading global real estate services firm that helps clients transform the way people work, shop, obtained from sources which we deem reliable. While every effort has been and live. The firm offers innovative solutions to its occupier and investor clients within the made to report accurate data, Cushman & Wakefield / NorthMarq cannot Minneapolis/St Paul region and around the world. A recognized leader in real estate research, the guarantee the accuracy of this market report. Furthermore, we cannot firm publishes a broad array of proprietary reports. assume responsibility for any omission of data which may occur. It is our intent to provide the best possible information regarding the Ranked #1 Commercial Real Estate Brokerage Firm & Commercial Property office, industrial, land, retail, multifamily and investment markets Management Firm by Minneapolis/St Paul Business Journal while leaving the reader the responsibility of further verification before using this report for business and/or financial decisions. More than $1 billion transactions annually The Compass report includes information for multi-tenant office, industrial and retail projects greater than 20,000 sq. 42 msf of assets under management ft. and multi-family for-rent properties. Not included are owner occupied, government or single-tenant buildings. Not all information and insights we’ve collected can be Top Places to Work by Star Tribune 3500 American Blvd W Suite 200 published in any given volume. Minneapolis, MN 55431 952 831 1000 / [email protected] Employs nearly 500 professionals cushwakenm.com

WANT MORE MARKET INSIGHTS? READ THE FULL COMPASS REPORT AT NORTHMARQCOMPASS.COM 4 AREA OVERVIEW

MARKET HIGHLIGHTS THE LAY OF THE LAND ANCHORS THE NINTH FEDERAL RESERVE More FORTUNE 500 Minneapolis is the head companies (17) per NINTH FEDERAL RESERVE DISTRICT of the Ninth U.S. Federal capita than any other Reserve District and serves US metro region as this district’s commercial — Forbes 2016 center. Comprised of Minnesota, Montana, North Dakota, South Dakota, western Wisconsin, and the Strong work ethic Upper Peninsula of Michigan, & entrepreneurial this region is an important spirit provide a 3.8% global oil/energy player. unemployment rate, lowest in the nation for MSA’s over 1 million

THE STATE Trend setting #1 STATE FOR neighborhoods making BUSINESS

the global map — North — CNBC Loop ranks as a TOP 25 destination in the world — Fodor’s 2016

THE TWIN CITIES 6th most inventive city worldwide... The Twin Cities it’s the birthplace of is located on the gamechangers like Mississippi River, encompassing 6,046 the pacemaker and square miles and supercomputer 13 counties. — Bloomberg Businessweek 2009

30.9 million visitors in Grown from a geographically strategic location 2014, outperforming The birthplace of Twin Cities’ economy most of its peer markets. began in the 1800s when companies like the 609 conventions and forerunners of Pillsbury and General Mills events hosted throughout sprang up along the St. Anthony Falls, the only St. Anthony major waterfall on the Mississippi River and Falls 2015 in Minneapolis, 14% ideal for water-powered mills. higher than 2014

3 | Minneapolis/St.Paul Market Overview cushwakenm.com STRONG CORPORATE PRESENCE

“With 17 Fortune 500 Companies, Minneapolis has the highest concentration

of Fortune 500 per capita nationally” — Fortune 2016

The Greater MSP region is a hub for thriving NATION’S LEADING MEDICAL companies. These companies attract international TECHNOLOGY MARKET recognition every year for their innovation, Known as “Medical Alley,” Minnesota leads in the medical sustainability, ethical leadership, brand value and technology sector, ranking #1 in medical employment, corporate citizenship. The region boasts the highest led by home-grown companies such as Medtronic, 3M and St. Jude in the manufacturing sector. The renowned per capita concentration of Fortune 500 public Mayo Clinic and the University of Minnesota are among company headquarters in the U.S. with 17 firms based local organizations that provide world-class healthcare here. The largest private U.S. company, Cargill, is based services and research, while innovative healthcare financial in Minneapolis along with numerous other multi-billion- companies such as UnitedHealth Group and Prime dollar private firms. Therapeutics provide cost-effective delivery solutions.

HEADQUARTERED IN GREATER MSP FORTUNE 500 COMPANIES FORBES LARGEST PRIVATE COMPANIES

GREATER FORTUNE REVENUE REVENUE MSP COMPANY 500 RANK COMPANY INDUSTRY (in billions) EMPLOYEES RANK RANKING (in billions)

1 UnitedHealth Group 6 $157.1 Farm 1 Cargill Products $120.4 153,000 2 38 $73.7 Hotels, 3 Best Buy 71 $39.7 88 Carlson Restaurants, $4.6 110,000 & Leisure 4 CHS 84 $34.5 115 M A Construction $3.7 2,500 5 3M 93 $30.2 Mortenson

6 U.S. Bancorp 131 $21.4 Holiday Convenience 133 Companies Stores & Gas $3.2 6,000 7 Supervalu 160 $17.8 Stations 8 General Mills 161 $17.6 Rosen’s Food, Drink, 136 Diversified & Tobacco $3.2 4,000 9 Ecolab 206 $13.5 154 Schwan Food, Drink, $3.0 14,000 10 C.H. Robinson Worldwide 208 $13.4 Food & Tobacco

11 Land O’ Lakes 215 $13.1 188 Andersen Construction $2.4 9,000 12 Ameriprise Financial 232 $12.2 223 Taylor Media $2.0 10,000 13 Xcel Energy 257 $11.0 14 Hormel Foods 304 $9.2 Minneapolis-based Cargill earned the top spot on Forbes’ 15 The Mosaic Company 316 $8.8 annual list of America’s largest private companies for most of the last decade. Forbes’ 2016 list of privately held giants 16 Thrivent Financial 318 $8.7 includes eight Minnesota firms, six based in the Greater MSP 17 St. Jude Medical 465 $5.5 metro area.

4 | Minneapolis/St.Paul Market Overview cushwakenm.com SPOTLIGHT: MINNEAPOLIS CBD

Minneapolis’s Central Business District features world-class daytime and evening amenities including restaurants, theaters, shopping and professional sports teams. Its central, accessible location makes it the preferred location for corporate headquarters, financial services firms and law firms.

The CBD is home to the world’s largest Skyway System, which links most of downtown Minneapolis through a seven mile indoor series of walkways and bridges.

Key downtown attractions include , , the Hennepin Avenue arts and cultural district, the vibrant restaurant scene, North Loop neighborhood, Nicollet Mall, and the new US Bank Stadium.

UPCOMING MAJOR MINNEAPOLIS EVENTS 2016: 2017 & 2018: 2018: 2019: 2023: RYDER CUP X GAMES SUPERBOWL LII FINAL FOUR WORLD’S FAIR

(currently a candidate)

2025 PLAN: DOWNTOWN MINNEAPOLIS In 2011, the Minneapolis Downtown Council, the city’s business association for the CBD, announced its objectives for the city’s next 15 years. The plan’s initiatives stem from creating a “thriving, livable, connected, green, exciting and welcoming” Minneapolis through these action items:

• Double Minneapolis’ residential population to 70,000 and emphasize offices on the north end of Nicollet Mall

• Invest in an arts and entertainment district between Nicollet, Hennepin, and First avenues, attracting 5 million visitors annually

• Build the Viking’s US Bank Stadium, renovate Target Center and create a public transportation hub in the new sports district

5 | Minneapolis/St.Paul Market Overview cushwakenm.com SPOTLIGHT: ST. PAUL CBD

Downtown St. Paul is a place where businesses prosper and workers and residents enjoy an unparalleled quality of life, creating a vibrancy of its own. Its urban fabric of corporate headquarters and retail, arts and entertainment, parks and history creates a unique global city on a livable scale.

The historic Capital city is building towards the future. 18,000 new jobs and nine new office buildings have been added in downtown St. Paul in the past 11 years — an investment equaling more than $650 million in construction costs alone. More than 72,000 workers are employed by nearly 1,200 companies, creating a workforce that maintains a sharp focus on current and emerging business needs.

The number of housing units in Downtown St. Paul has spiked more than 20 percent in just five years. The Metropolitan Council expects the downtown population to pass 14,000 by 2020 — that’s an 80 percent increase.

Major attractions in Downtown St. Paul include Xcel Energy Center (Home of the Minnesota Wild), Ordway Centre for Performing Arts, Science Museum of Minnesota, CHS Field (home of the St. Paul Saints) and the Minnesota Children’s Museum; and events like the St. Paul Winter Carnival, which has been a tradition in Downtown St. Paul for more than 125 years.

HEALTHCARE HUB

6 | Minneapolis/St.Paul Market Overview cushwakenm.com THE WORKFORCE

HIGHLY EDUCATED WORKFORCE, STRONG JOB GROWTH

#1 in the nation on Unemployment rate 1.9 MILLION Labor Gallup’s Job Creation (3.1%), which is the Force Index lowest in the nation

10.5% population #1 tech job growth Twin Cities metro area growth (from 2000 home to fast-growing has REGAINED jobs to 2010) outpacing technology-specific FASTER than the U.S. other urban centers companies, since the February (Boston, Chicago, Los e.g., Code 42, SPS 2010 nadir of the Angeles, New York & Commerce and JAMF Great Recession San Francisco) Software

6th most educated Medium household 3rd highest labor region in the country income 7th in the force participation in Approx. 90% have nation with $68,109 the nation. Expected high school diploma; for MSAs over to outpace population 40% have bachelors 1 million growth in next degree or higher. decade.

Sources: Forbes, Gallup 2016, MN Deed 2016, 2014 US Census Estimate, Metropolitan Council 2015

ATTRACTING MILLENNIALS The Twin Cities is a national magnet for young professionals. Its low unemployment rate, high number of Fortune 500 companies and reasonable cost of living make it an attractive destination for newly minted grads, notes Forbes.

The Twin Cities Among residents under th has the highest 35, the Twin Cities place Top 10 city 5 best city for employment in the Top 10 for highest for young new college rate for 19- to college-graduation rate, professionals grads 34-year-olds in highest median earnings — Forbes — Livability 2014 the country and poverty rate lowest

— The Atlantic 2015 — US Census

7 | Minneapolis/St.Paul Market Overview cushwakenm.com THE QUALITY OF LIFE

OUTSTANDING LIFESTYLE The region’s relatively low cost of living contributes to an outstanding quality of life, as do numerous natural and urban amenities as well as the low crime rate, clean air and water, accessibility and access to quality health care.

LOW COST OF LIVING According to Forbes, Twin Cities is the 5th Most Affordable City in America.

EDUCATION Minnesota has 13 colleges and universities, 10 community colleges and technical schools, as well as several private schools offering trade and technical training. SPORTS Minneapolis is home to six professional sports teams.

FOOTBALL BASEBALL HOCKEY BASKETBALL WOMEN’S SOCCER BASKETBALL

With the new US Bank Stadium under construction, the NFL has selected Minneapolis as the host city for the 2018 Superbowl. NCAA has selected the city for the Final Four in 2019.

VOLUNTEERISM

“Twin Cities leads the nation in both volunteerism and civic engagement – two hallmarks of thriving communities.” — Greater MSP

8 | Minneapolis/St.Paul Market Overview cushwakenm.com THE QUALITY OF LIFE

THE CITY OF LAKES The metro area boasts more than 1,600 lakes for residents to enjoy sailing, swimming, fishing, skiing and skating. The Twin Cities has one of the most extensive park systems in the U.S., comprising 136,000 acres. The Minneapolis Chain of Lakes Regional Park is the area’s most visited park.

TRANSPORTATION HUB

SKYWAY SYSTEM Minneapolis is home to the largest Skyway System in the world.

PUBLIC TRANSPORTATION The most recently completed Light Rail line is already exceeding ridership projects by 25%. Two new light rail lines are currently under development, serving 35 new planned stations.

HIGHWAYS ARTS & CULTURE Three major interstate highway systems serve the Twin Cities: Interstate 94/394 (running east/west), Other than New York City, the Twin Cities has more Interstate 494/694 and Interstate 35 (running north/ theater seats per capita than any other U.S. city. south). Several internationally acclaimed museums and theaters, call the area home, including the Walker Art Center, the Minneapolis Institute of Art, the Guthrie AIR TRAVEL Theater and Children’s Theater. The MSP International Airport offers non-stop flights to 114 domestic and 20 international markets. MSP ranked 16th in North America based on 33 million SHOPPING passengers on 500,000 flights annually. Minneapolis is one of the country’s most popular shopping destinations. Its celebrated Mall of America is the largest shopping and entertainment complex MSP is 3rd Best Domestic Airport in World in the nation at 4.2 million sf and boasts 40 million — Travel & Leisure 2015 visitors and $2 billion in economic activity annually.

9 | Minneapolis/St.Paul Market Overview cushwakenm.com SUBMARKET MAPS

GREATER TWIN CITIES METRO

OFFICE SUBMARKETS

169

61

10 94 35W 35E NORTHWEST

69435E 169 94 NORTHEAST 12 394 WEST 94 MINNEAPOLIS CBD ST. PAUL CBD

SOUTHWEST 494

35W SOUTH/ 61 AIRPORT 35E

169

INDUSTRIAL SUBMARKETS

169

61

10 94 35W 35E 169

694 NORTHWEST NORTHEAST 94

12 394 MINNEAPOLIS 94 CBD ST. PAUL CBD SOUTHWEST SOUTHEAST 494

35W 61 35E

169

10 | Minneapolis/St.Paul Market Overview cushwakenm.com 8th Ave NE

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University Ave NE 2nd Ave SE 11th Ave N 6th St N 6th St SE 7th St SE 9th Ave N 1st Ave NE Hennepin Ave E th St9 SE

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Aldrich Ave N Ave Aldrich 1st St N 2nd Ave SE 2nd St N 5th St N Hennepin Ave E

River St University Ave NE 8th Ave N 5th St SE 1st Ave NE Napco Ave Central Ave Hennepin Ave E

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2nd St N 8th St SE 1st St N 5th St SE Main St NE 1st Ave NE Hennepin Ave E 2nd Ave SE 10th Ave N 3rd Ave SE 9th Ave N 4th St SE

6th Ave N Hennepin Ave E University Ave SE Central Ave TowneSuites Place 4th Ave N 7th Ave N Washington Ave N 2nd St SE Main St SE Island Ave W Bank St SE 4th St SE

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4th St N Hennepin Ave E Lourdes Pl Ortman St SE

8th Ave N 8th Ave N 2nd Ave SE Lyndale Ave 6th Ave N 5th Ave N 7th St S E CBD MAPS 1st St N Eastman Ave 8th Ave N University Ave SE Central Ave 4th St SE

L 7th Ave N Power St Lyndale Ave y 7th St N A n Washington Ave N ld d r a 2nd St N i l c e h 1st St N P d A 3rd Ave SE lv ve l B N l a 3rd St N Merriam St University Ave SE ri o Aldrich Ave N 5th Ave N Emerson Ave N Emerson Ave em Pl M n 6th Ave N te ow 8th Ave N 6th St SE hi Br 3rd Ave N Main St SE 2nd St SE 2nd Ave SE W Colfax Ave N e l Azine Ln n B d P Va r u n y tr a r w n e ro 5th St N Central Ave t G B Lyndale Ave Washington Ave N 2nd Ave N Lyndale Ave A e v ud 1st St N e tr er N G 2nd St N

3rd Ave SE 4th St N 2nd St SE 5th Ave N

I-94 entrance viaduct 3rd Ave N Main St SE 5th St SE 6th Ave N I-94 exit viaduct 2nd Ave N Olson Memorial Hwy 1st Ave N 9th Ave SE Olson Memorial Hwy Washington Ave N 1st St N Traffic St Olson Memorial Hwy 2nd St N Olson Memorial Hwy Olson Memorial Hwy 6th Ave N 6th Ave N MINNEAPOLIS CBD 5th St N Main St SE 3rd Ave SE

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W 7th St N n 10th St N Hennepin Ave S a 3rd Ave N 3rd Ave Bridge V 2nd Ave N 1st Ave N 1st St S

Bryant Ave N I-394 2nd St SE 8th Ave SE 4th St N Cesar Chavez Ave 5th St N 4th Ave N Royalston Ave 3rd St N Washington Ave S

2nd Ave S Marquette Ave 7th St N

1st Ave N Hennepin Ave S 1st St S 6th Ave SE W 2nd Ave N es 2nd St S t 10th St N R

3rd Ave S i Lakeside Ave Lakeside v e Washington Ave S r Nicollet Mall Bryant Ave N 3rd St S 2nd Ave S P k Border Ave N 4th St N w DuPont Ave N DuPont Ave 3rd Ave N I-94 3rd Ave N y

7th St N 5th St N 1st Ave N Minneapolis 2nd St S ay Freemont Ave N Freemont Ave s W Central in 2nd Ave N Hennepin Ave S Tw 3rd St S Bryant Ave N I-394 Library Marquette Ave Washington Ave S 5th Ave S Glenwood Ave Royalston Ave 4th St S 6th St N 3rd Ave S

Border Ave N 2nd St S Glenwood Ave Holden St 3rd St S Market St 5th St N Nicollet Mall 2nd Ave N 1st Ave N Glenwood Ave 2nd Ave S Washington Ave S Hennepin Ave S 4th St S Glenwood Ave Twins Way Target Center Marquette Ave 6th St N 2nd St S Portland Ave S 3rd Ave S Glen I-394 wood 3rd St S Ave 5th St S ve 7th St N d A woo 4th St S 2nd Ave N Glen Wes Glenwood Ave 5th Ave S Glenwood Ave Hennepin Ave S ert PkRiv 1st Ave N Nicollet Mall 2nd Ave S 4th Ave S 2nd St S w Mayo Square 3rd St S y

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Marquette Ave Portland Ave S I-94 Washington Ave S 6th St S 3rd Ave S

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12th St N St 12th 7th St N 5th Street Towers 4th St S 2nd St S

1st Ave N West River Pkwy Lyndale Ave Lyndale 5th St S Chicago Ave Mall 2nd Ave S 3rd St S 5th Ave S East Lyndale Ave N Ave East Lyndale Currie Ave I-394 Currie Ave 8th St N Washington Ave S Colfax Ave N City Center RBC 4th St S 7th St S 4th Ave S Park Ave S 2nd St S 6th St S

3rd St S Portland Ave S Chicago Ave S

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Marquette Ave 3rd Ave S Hennepin Ave Minneapolis Plaza 7 Nicollet Mall 4th St S Washington Ave S 2nd Ave S 5th St S 5th Ave S 10th St N City Hall 2nd St S Chestnut Ave Park Ave S 9th St N Wells Gaviidae 6th St S 3rd St S 8th St S Fargo 4th Ave S Hawthorne Ave Northstar 9th Ave S 10th St N 7th St S US Bank 4th St S Portland Ave S 2nd St S 12th St N Hennepin Ave LaSalle Plaza Macy’s Chicago Ave S Marquette Ave 6th St S Wells Washington Ave S 3rd St S 10th Ave S 15th St N 8th St S 3rd Ave S Hawthorne Ave 9th St S Fargo ve IDS e A 5th Ave S Linden Ave rn Linden Ave tho LaSalle Ave Center 5th St S w 11th St N Nicollet Mall Hennepin Linden Ave Ha 4th St S 7th St S 4th Ave S Hennepin Ave 2nd Ave S Capella Co. Gov’t Park Ave S 3rd St S I-35W 8th St S Center 9th Ave S Baker 5th St S Chicago Ave S Washington Ave S 11th Ave S 9th St S US Bancorp Portland Ave S Marquette Ave 12th Ave S Center 7th St S 4th St S 12th St N Hennepin Ave 2nd St S 3rd Ave S I-394 10th Ave S 6th St S 13th Ave S Nicollet Mall 5th St S 5th Ave S Armory LaSalle Ave Park Ave S 4th St S Hawthorne Ave Hawthorne Ave 10th St S 8th St S McGrew Pl Hennepin Ave 11th St S 2nd Ave S 7th St S Thrivent 9th St S 4th Ave S 13th St N 6th St S 12th St S TCF 4th St S Marquette Ave Portland Ave S

16th St N Harmon Pl Tower 8th St S 3rd Ave S

15th St N 10th St S Van White Blvd (proposed) 5th St S Hennepin Ave Washington Ave S Nicollet Mall Linden Ave 9th St S 7th St S 5th Ave S 2nd Ave S 4th Ave S 6th St S Park Ave S Laurel Ave Laurel Ave Kirby Puckett Pl 3rd St S Harmon Pl 11th St S LaSalle Ave I-94 Hennepin Ave 13th St S 8th St S Target Plaza 10th St S 7th St S US Bank Stadium Washington Ave S 12th St S

Harmon Pl Portland Ave S Marquette Ave 6th St S 11th St S Spruce Pl 9th St S

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17th St N St 17th 8th St S 10th St S 3rd Ave S Aldrich Ave S Nicollet Mall 13th St S 5th Ave S Ontario Ave Harmon Pl 7th St S 2nd Ave S 9th St S Park Ave S Washington Ave S Hennepin Ave I-35W 12th St S 4th Ave S 6th St S 11th Ave S LaSalle Ave 11th St S Hilton 8th St S

Yale Pl Marquette Ave 10th St S Portland Ave S 5th St S

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Aldrich Ave S 12th St S Maple St Spruce Pl 9th St S 6th St S Cedar Ave S Nicollet Mall Minnesota 5th Ave S 11th St S 8th St S 15th Ave S Dunwoody Blvd Yale Pl Orchestra Park Ave S 2nd Ave S Carew Dr S 4th Ave S 7th St S 12th St S e 10th St S v A 9th St S I-94 n 11th St S i Portland Ave S p e Marquette Ave

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Cedar Ave S ll 13th St S 12th St S Portland Ave S a Marquette Ave 7th St S 4th St S 16th Ave t M e 11th St S ll 9th St S o c i Chicago Ave S N 3rd Ave S

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4th Ave S 9th Ave S Willow St 9th St S Kenwood Pkwy 13th Ave S I-35W W Grant St W Grant St W Grant St E Grant St 12th St S E Grant St Minneapolis Portland Ave S

C I-94 h i Hennepin Ave Convention Center c Centennial Pl a 11th Ave S

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G Oak Grove St r o 10th Ave S St Paul v el Kittson St an d T err Hennepin Ave University Ave Police Clifton Pl

16th St E ST. PAUL CBD St Pine Colfax Ave S M Groveland Ave 16th St E 10 t C Grove St u rv Cedar Ave S e Lyndale Ave Portland Ave S A ve Regions Hospital Clifton Pl Clifton Ave 35E

& Gillette Children’s Elliot Ave S 11th Ave S 11th Ave Douglas Ave Douglas Ave Leif Chicago Ave S Minnesota State Capitol Specialty Healthcare e Erikson v 17th St E A Groveland Ave

n (MN Historical Society) i

Colfax Ave S Bryant Ave S Park Spruce St p e n n e

H Ave Lyndale I-94

Stevens Ave S Broadway Pine St I-94 I-94 Nicollet Ave Lafayette Rd

Summit Ave 3rd Ave S Summit Ave Summit Ave Summit Ave E 14th St Summit Ave Dell Pl Aurora Ave

2nd Ave S I-94 M 18th St E S Ave 1st 18th St E Colfax Ave S Ave Colfax 18th St E Bryant Ave S 18th St E

18th St E 18th St E Cedar Ave S

Emerson Ave S Ave Emerson

Dupont Ave S Ave Dupont Fremont Ave S Ave Fremont a

Lyndale Ave Lyndale 18th St E 18th St E 18th St E 18th St E 18th St E I-94 r 18th St E

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Lincoln Ave L 18th St E Lincoln Ave Lincoln Ave Lincoln Ave Stevens Ave S

u Groveland Ave 5 Holiday 4th Ave S Ave 4th Elliot Ave S Elliot Ave

Nicollet Ave Minnehaha Ave S t S 10th Ave S 11th Ave h 3rd Ave S e E 10th St Groveland Ave S Ave 1st

Groveland Ave Cedar Ave S 4th Ave S Ave 4th r Portland Ave S K Centennial Bldg Park Ave S

13th Ave S i S Ave 14th Ridgewoodn Ave 19th St E 19th St E 19th St E g 19th St E 19th St E 19th St E Hiawatha Ave Rice St J 19th St E 19th St E 19th St E 9th St S Colfax Ave S Ave Colfax r 19th St E 19th St E 19th St E Hennepin Ave Dupont Ave S Ave Dupont MN 55 Emerson Ave S Ave Emerson B Ridgewood Ave lvd Cedar St E 8th St S 19th St E Fremont Ave S Ave Fremont ve e e A v Chicago Ave S A v t S Ave Aldrich od

A Pillsbury Ave S Ave Pillsbury n Ave Lyndale o w a t

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1st Ave S Ave 1st 4th Ave S Ave 4th I-35W S Ave 5th N Robert St 94 Portland Ave S Franklin Ave W Jackson St Franklin Ave W Franklin Ave W Franklin Ave W Franklin Ave W S Ave Cedar Franklin Ave W S Ave 14th Franklin Ave W Franklin Ave W 13th Ave S Franklin Ave W Nicollet Ave Park Ave S Franklin Ave W 10 Franklin Ave W Franklin Ave E Franklin Ave E Franklin Ave E Franklin Frontage Rd Franklin Ave E Franklin AveFranklin E Ave E Franklin Ave E Franklin Ave E Franklin Ave E Columbus Ave Franklin Ave E Franklin Ave E Franklin Ave E FranklinE Ave7th E St Franklin Ave E Franklin Ave E Franklin Ave E E 12th St E 10th St Franklin Ave E Hennepin Ave S

Franklin Ave E 10th Ave S 10th Ave Elliot Ave S Elliot Ave 14th Ave S 14th Ave

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Pleasant Ave S Cedar Ave S Aldrich Ave S Ave Aldrich

11th Ave S 11th Ave Bryant Ave S Ave Bryant

Lyndale Ave SLyndale

Harriet Ave S

Garfield Ave S Wacouta

Dupont Ave S Ave Dupont Emerson Ave S Ave Emerson

Fremont Ave S Ave Fremont Commons Girard Ave S Ave Girard Minnesota St Wacouta St 17th Ave S

Grand Ave S 21st St E 21st St E 21st St E 21st St E 21st St E

Humboldt Ave S Ave Humboldt

Colfax Ave S Ave Colfax Blaisdell Ave Blaisdell Hennepin Ave S

Stevens Ave S 5 Hiawatha Ave 4th Ave S Ave 4th

5th Ave S Ave 5th MN 55

Portland Ave S S

13th Ave S 13th Ave Elliot Ave S Elliot Ave 12th Ave S 12th Ave

1st Ave S Ave 1st e 11th Ave S 11th Ave 10th Ave S 10th Ave

14th Ave S 14th Ave v Park Ave S A

Nicollet Ave r a 22nd St W Oakland Ave S d 22nd St W 22nd St W 22nd St W e 22nd St W 22nd St W C 22nd St St.W Anthony22nd St W Ave 22nd St W 22nd St W 22nd St W 22nd St W 22nd St E 22nd St E 22nd St E E 12th St 22nd St E 22nd St E 22nd St E 22nd St E E 9th St 22nd St E 22nd St E 22nd St E 22nd St E 22nd St E 22nd St E 52

t S 12th Ave 2th S Wabasha St W 1 E 8th St E 7th St 13th Ave S 13th Ave

Fremont Ave S Hennepin Ave S 14th Ave S 14th Ave Cedar Ave S

Pillsbury Ave S Elliot Ave S Elliot Ave 94 Ave Stevens t 10th Ave S 10th Ave S S 11th Ave

Garfield Ave S

Colfax Ave S Ave Colfax

Emerson Ave S Ave Emerson

Aldrich Ave S Ave Aldrich Bryant Ave S Ave Bryant

Girard Ave S Ave Girard Harriet Ave S

Portland Ave S

Lyndale Ave SLyndale h S Ave 4th 5th Ave S Ave 5th

Park Ave S

Humboldt Ave S Ave Humboldt t 1 Oakland Ave S th St Blaisdell Ave Blaisdell 1 7 1st Ave S Ave 1st E 23rd St E

Nicollet Ave E Dupont Ave S Wall St M S Ave 3rd ar E 10th St 24th St W i CHS Stadium 24th St W 24th St W 24th St W 24th St W 24th St W o 24thn St W 24th St W 24th St W 24th St E 24th St E E 6th St 24th St W 24th St W 24th St E 24th St E S Clinton Ave S 24th St E 24th St E 24th St E 24th St E t John Ireland Blvd E 10th St 5 Fremont Ave Wacouta St Hennepin Ave S St Paul Minnesota Farmers Broadway

Garfield Ave S

Colfax Ave S Ave Colfax Bryant Ave S Ave Bryant

Lyndale Ave SLyndale Metro Mears Aldrich Ave S Ave Aldrich Harriet Ave S History Center Market (MN Historical Society) Square Park Kellogg Stevens Ave S Ave Stevens McNally-Smith Jackson St

Pillsbury Ave S Dupont Ave S Place Prince St Blaisdell Ave Blaisdell E 9th St E 5th St Prof Bldg

College of Music Minnesota N Robert St

1st Ave S Ave 1st Humboldt Ave S Ave Humboldt

Girard Ave S Ave Girard Public Radio

Irving Ave S Ave Irving Mears

Nicollet Ave 25th St W S Ave Emerson Park Hennepin Ave S S Ave 3rd Golden E 7th Place Elliot Ave S Elliot Ave 10th Ave S 10th Ave 11th Ave S 11th Ave Chicago Ave S Chicago Ave Clinton Ave S Clinton Ave Grand Ave S Rule Bldg Securian E Exchange St 25th St W 25th St W 25th St W 25th St W W Kellogg Blvd Minnesota St Center Sibley St 25th St W 25th St W 25th St W 25th St W 25th St W 25th St W 25th St W 25th St W Bremer Tower Park Ave S 25th St W 25th St W 25th St E 400 N Robert 25th St E 25th St E 25th St E 25th St E

Dupont Ave S 25th St E 25th St E 25th St E 25th St E 25th St E Girard Ave S Ave Girard Colfax Ave S Ave Colfax Mears Hennepin Ave S Park Ctr HealthEast Cray

Euclid Pl S Ave Irving

Humboldt Ave S Ave Humboldt 25 1/2 St W Summit St. Joseph’s Plaza Bryant Ave S Ave Bryant

Aldrich Ave S Ave Aldrich Park Hospital E 7th St

1st Ave S Ave 1st 26th St W Ave Blaisdell

Lyndale Ave SLyndale

Garfield Ave S

Harriet Ave S Pillsbury Ave S

Grand Ave S

Nicollet Ave Marshall Ave UBS S 10th Ave 11th Ave S 11th Ave

MetropolitanColumbus Ave S Council S Chicago Ave

3rd Ave S Ave 3rd Wells Plaza

Oakland Ave S Fargo Portland Ave S 26th St W Hennepin Ave S 35E Elliot Ave S Elliot Ave Stevens Ave S Ave Stevens Town Square

Park Ave S

Clinton Ave S Clinton Ave Place Main St

Summit Ave 5th SAve

26th St W 26th St W S Ave 1st 26th St W 26th St W 26th St W 26th St W 26th St W Nicollet Ave Wabasha St E Kellogg Blvd 26th St W 26th St W 26th St W 26th St W Cedar St 26th St W 26th St W 26th St E 26th St E 26th St E 26th St E 26th St E 26th St E Old Kellogg Blvd W 9th St St Joseph’s Minnesota 26th St E 26th St E 26th St E 26th St E 26th St E Children’s US Bank 26th St E 26th St E 26th ESt E4th St 26th St E Irving Ave S Center Empire Mulberry St Museum Bldg 5

Humboldt Ave S S Chicago Ave

Blaisdell Ave Blaisdell Bryant Ave S Ave Bryant

Hennepin Ave S S Ave Aldrich

3rd Ave S Ave 3rd I-35W

Colfax Ave S Ave Colfax

Emerson Ave S Ave Emerson

2nd Ave S Ave 2nd

Fremont Ave S Ave Fremont Stevens Ave S Ave Stevens Clinton Ave S Clinton Ave

Garfield Ave S

Lyndale Ave SLyndale

Pillsbury Ave S Harriet Ave S Endicott Bldg College Ave St Peter St Oakland Ave S

Columbus Ave S

First S 10th Ave

Portland Ave S

Girard Ave Girard 1st Ave S Ave 1st Nicollet Ave National Bank E 6th 5th SAve St 27th St W Building Selby Ave 5th Street Center Park Ave S W Kellogg Blvd Old 6th St 27th St W 27th St W 27th St W 27th St W 27th St W 27th St W 27th St W

Irving Ave S 27th St W 27th St W 27th St W 3rd Ave S Ave 3rd 27th St W S Ave 2nd 27th St W 27th St E Clinton Ave S Lake of the Isles Pkwy E 27th St E 27th St E W 6th St 27th St E Wells Fargo Way 27th St E 27th St E 27th St E 27th St E 27th St E

Humboldt Ave S S Ave Emerson

Garfield Ave S

Lyndale Ave SLyndale Aldrich Ave S Ave Aldrich

Bryant Ave S I-35W

Hennepin Ave S S Ave Fremont W 7th St

Colfax Ave S Ave Colfax Girard Ave S Ave Girard

Columbus Ave S S 10th Ave

y S Chicago Ave

Pillsbury Ave S

Blaisdell Ave Blaisdell a Stevens Ave S Ave Stevens Harriet Ave S Grand Ave S Landmark W 28th St W E 5th St o g Warner Rd r Kellogg a

Smith Ave F

Oakland Ave S

1st Ave S Ave 1st

s

Plaza l Square l

28th St W Nicollet Ave e

W 2nd Ave S Ave 2nd

Summit Ave Park Ave S S 5th SAve e v 3rd Ave S A W 5th St g 28th St W in Portland Ave S v r I Market St 28th St W 28th St W 28th St W 28th St W Humboldt Ave S 28th St W 28th St W 28th St W 28th St W 28th St W 28th St E 28th St E 28th St E 28th St E 28th St E 28th St E 28th St E 28th St E 28th St E 28th St E 28th St E Ordway E 4th St 28th St E 28th St E 28th St E 28th St E Xcel Energy Center Center for The Lowry 28th St E

Hennepin Ave S Ave Hennepin Robert St Bridge Performing Oakland Ave S Girard Ave S Ave Girard Arts Rice Fremont Ave S Ave Fremont Park

Lyndale Ave SLyndale

Bryant Ave S Colfax Ave S Ave Colfax

Aldrich Ave S Ave Aldrich Landmark

Garfield Ave S

4th SAve

5th SAve 10th Ave S 10th Ave Chicago Ave S Chicago Ave

Harriet Ave S 11th Ave S 11th Ave S 12th Ave Towers E Kellogg BlvdColumbus Ave S

James S Ave

Irving S Ave Washington St Humboldt Ave S Ave Humboldt W 4th St City Hall 2nd Ave S Park Ave S Midtown Greenway 35E

Portland Ave S The Mall Shepard Rd The Mall Midtown Greenway Midtown Greenway Midtown Greenway The Mall The Mall The Mall W 29th St Wabasha St Bridge The Mall W 29th St W 29th St 11 W 29th St | Minneapolis/St.Paul Market Overview cushwakenm.com The Mall The Mall 29th St E 29th St E 29th St E 29th St E 29th St E

Hennepin Ave S W Kellogg Blvd 29th St E 29th St E

James S Ave Pleasant St W Kellogg Blvd Humboldt Ave S Ave Humboldt

Irving S Ave Fremont Ave S E a g Lagoon Ave Lagoon Ave l Lagoon Ave Oakland Ave S a Lagoon Ave Harriet Ave S Chestnut St Lagoon Ave Lagoon Ave Garfield Ave S e z Lagoon Ave a

4th SAve Colfax Ave S Ave Colfax Chicago Ave S Chicago Ave

Bryant Ave S 5th SAve l

Portland Ave S

3rd SAve

Columbus Ave S 10th Ave S 10th Ave

Thompson St P S Ave 2nd P Aldrich Ave S Ave Aldrich United S 12th Ave

Clinton SAve k S 11th Ave

Girard Ave S Ave Girard rk

Lyndale Ave SLyndale

Humboldt Ave S Hennepin Ave S Ave Hennepin

Irving S Ave Fremont Ave S a James S Ave Hospital w P r y Park Ave S e Smith Ave v i W Lake St W Lake St W Lake St W Lake St W Lake St W Lake St Shepard Rd R W Lake St W Lake St W Lake St W Lake St W Lake St W Lake St Science E Lake St E Lake St Sherman St Museum of Raspberry E Lake St E Lake St E Lake St E Lake St Walnut St Minnesota Island Park Di Knox S Ave sc Livingston Ave

Hennepin SAve James S Ave ove n

Humboldt Ave S Ave Humboldt L Irving S Ave Holmes Ave S ry

Garfield Ave S Colfax Ave S Ave Colfax S Exchange St

Bryant Ave S E Fillmore Ave

Harriet Ave S Aldrich Ave S Ave Aldrich

Lyndale Ave SLyndale

Oakland Ave S Park Ave S 10th Ave S 10th Ave

Elliot Ave S Elliot Ave Columbus Ave S Ave Columbus Chicago Ave S Chicago Ave 11th Ave S 11th Ave 5 Science S 12th Ave Park

W 31st St W 31st St W 31st St W 31st St W 31st St W 31st St Grand Ave E 31st St E 31st St

James S Ave

Irving S Ave Humboldt S Ave

Hennepin Ave S Holmes Ave S E 31st St E 31st St E 31st St E 31st St CURRENT MARKET OVERVIEW

Navigating the Minneapolis/St. Paul Commercial Real Estate Market

COMPASS is the Twin Cities’ most comprehensive commercial real estate market report. Published bi-annually, COMPASS provides a market recap of the last six months as well as an outlook for the next six months.

HIGHLIGHTS FROM JULY 2016 ISSUE OVERALL MARKET TRENDS Vacancy Rate Nears Record Low as CRE Market Continues to Stabilize

VACANCY RATE ABSORPTION NEW CONSTRUCTION 9.9% 1.76 million square feet 463,000 square feet Lowest multi-tenant rate across Slight drop from 2015 but Multi-tenant pace slowing, all property types since 2000 market is stabilizing single-tenant construction grows

SECTOR HIGHLIGHTS

INDUSTRIAL: East metro heats up as vacancy MEDICAL OFFICE: Users continue to tightens gravitate away from the campus model

INVESTMENT & CAPITAL MARKETS: Multi-family and office markets looking for MULTI-FAMILY: Focus shifts to suburbs as record volumes in 2016 new units are gobbled up

OFFICE: New projects inch closer as rents LAND: Demand rises even more as rise developers seek next big thing

RETAIL: Vacancy nears all-time market record HOTELS: Market continues to expand lows with new development on the way

PROJECTIONS FOR REMAINDER OF 2016 MORE NEW CAPITAL ABSORPTION NEW CONSTRUCTION Office and multi-family 600-800,000 sf expected 1.67 msf multi-tenant space headed toward record sales in second half of 2016 to be delivered volume

VISIT northmarqcompass.com to access the entire Executive Summary and/or sign up for full access to the COMPASS website with Property Type Reports, Submarket Reports and more

12 | Minneapolis/St.Paul Market Overview cushwakenm.com 85 500 TRANSACTION 130 EMPLOYEES PROFESSIONALS ENGINEERS

NEARLY FACILITIES / 65 PROPERTY 45 M MANAGERS SF FACILITIES / PROPERTIES UNDER MANAGEMENT

$1.7 Billion AVERAGE ANNUAL TRANSACTION VOLUME

BROKERAGE & PROPERTY # MANAGEMENT 1IN THE TWIN CITIES

43,000 $5 EMPLOYEES Billion IN REVENUE

FACILITIES / NEARLY 65 PROPERTY OFFICES IN MORE THAN EMPLOYEES500 MANAGERS $191 43 M COUNTRIES Billion SF FACILITIES / PROPERTIES 60 IN TRANSACTION VALUE UNDER MANAGEMENT Confidently 85 $2.3 Billion 4.3 Global, TRANSACTION AVERAGE ANNUAL Expertly PROFESSIONALS Billion TRANSACTION VOLUME SF MANAGED Local.

BROKERAGE & 130 PROPERTY ENGINEERS # MANAGEMENT 1IN THE TWIN CITIES

3500 American Blvd W Suite 200 Minneapolis, MN 55431 952 831 1000 / [email protected] cushwakenm.com

EXPERTLY LOCAL . CONFIDENTLY GLOBAL. Cushman & Wakefield/NorthMarq is the industry leader in providing Cushman & Wakefield is a leading global real customized commercial real estate services in the Upper Midwest. estate services firm that helps clients transform The firm operates the Minnesota business of Cushman & Wakefield. the way people work, shop, and live.

FACILITIES / NEARLY 500 65 PROPERTY $5 EMPLOYEES MANAGERS 43,000 EMPLOYEES Billion 46 M IN REVENUE SF FACILITIES / PROPERTIES UNDER MANAGEMENT OFFICES IN MORE THAN $191 COUNTRIES Billion 90 $2.3 Billion 60 IN TRANSACTION VALUE TRANSACTION AVERAGE ANNUAL PROFESSIONALS TRANSACTION VOLUME Confidently

BROKERAGE & 4.3 Global, 130 PROPERTY Expertly ENGINEERS # MANAGEMENT Billion FIRM 1IN THE TWIN CITIES SF MANAGED Local. 13 | Minneapolis/St.Paul Market Overview cushwakenm.com