The good news is that the commercial real estate industry grew at the strongest pace yet over the past year since the economic recovery began in 2011, according to a report recently released by NAIOP, the national commercial real estate development association.
The bad news is that Minnesota was not among the Top 10 states ranked by construction value for office, industrial, warehouse and retail.
The 96-page report, available here, was authored by Dr. Stephen Fuller, director of the Center for Regional Analysis at George Mason University in Virginia.
It concluded that the economic impact gleaned from development rose a little over 24 percent in the past year, the biggest gain since 2011. Direct expenditures for 2013 totaled $124 billion, up from $100 billion the prior year. In addition, commercial development's total contribution to the U.S. GDP was $376 billion, up from $303 billion in 2012. And jobs supported by the industry reached 2.8 million in 2013, up from 2.3 million the year before.
As NAIOP President and CEO Thomas Bisacquino said, "a healthy development industry is critical to a prosperous U.S. economy."
The biggest gainer in terms of sectors: Industrial development, which soared by 49 percent over the year, due mainly to new energy-processing facilities. Warehouse construction surged 38 percent, office construction was up 23 percent and retai construction was the laggard at 4.3 percent.
Here are the Top 10 states by construction value for office, industrial, warehouse and retail properties:
3. New York
9. West Virginia
Edina Realty broke ground this week on a new office building in Plymouth - the company's first new facility since 2007.
The 10,000 square-foot, one-level building will house about 100 agents and staff and is being built on a vacant lot at 9605 Schmidt Lake Rd. and will replace a facility that's at 4425 Highway 169 North. It'll serve agents that focus on markets ranging from Minneapolis to St. Michael.
Edina Realty, an affiliate of Berkshire Hathaway, has been remodeling, upgrading and moving its offices to better accommodate the changing ways agents do businesses - namely an increasing reliance on technology for an increasingly mobile sales force. The existing Plymouth building didn't lend itself to such a transformation and another suitable building wasn't available. used in the neighboring Maple Grove location, which relocated in Nov. 2013
Edina Realty CEO Greg Mason, president Barb Jandric, regional manager Terry McDonough and Plymouth office manager Jeff Shuman were on hand for the occassion.
“Our current facility is not ideal for the way agents do business today,” said Shuman. The offices will have several Apple TVs and fully outfitted private workspaces with computers, printers and phones. The building is being designed by Mohagen Hansen architects and is being constructed by Shingobee Builders; it'll be owned by United Properties. The Plymouth office is Edina Realty’s third largest and construction is expected to be completed by January 2015.
City officials will decide Tuesday whether to direct staff to investigate possible tax-increment-financing for a $6.2 million redevelopment proposal in north Minneapolis.
The project, located on the northwest corner of West Broadway and Aldrich avenues, could be the new home for the North Minneapolis Workforce Center.
City documents state that the 800 W. Broadway parcel is currently home to a two-story vacant tax-forfeit commercial building. Minneapolis-based developer, Sherman Associates, wants to rehab the site into a multi-use commercial and retail building.
The 2019 Aldrich Ave parcel is a bank-owned property with an existing vacant duplex that would be demolished for parking.
The project came about after the state issued a request-for-proposals to relocate the current Workforce Center from Plymouth Avenue to West Broadway. Sherman's proposal was selected -- the center will occupy about 12,000 square feet of the building's first floor.
The 800 West Broadway parcel is now under the control of Hennepin County. The city would purchase the property from the county and then sell it to the developer. Hennepin County has agreed to sell the property for $1 if the the developer pays $50,000 in holding and transactional costs.
Sherman Associates currently has a purchase agreement to buy the 2019 Aldrich Av. N. parcel from the owner, Sunrise Bank.
The developer is requesting about $500,000 in pay-as-you-go TIF assistance, city documents state. This could help pay for costs involving demolition, public improvements, geotechnical soil corrections and parking..
Sherman Associates hopes to complete the sale of the property and begin redeveloping it by the end of this year, with completion slated for September 2015.
The city's Community Development and Regulatory Services Committee will discuss the matter at a 1:30 p.m. meeting on Tuesday in City Hall.
Ground has officially been broken for a new $14 million senior living center in Woodbury.
Called Red Rock Senior Living, the 76-unit complex is located on Century Av., west of Interstate 494 and close to CornerStone Medical Specialty Centre and the Woodwinds Hospital campus. Red Rock is expected to open in June of 2015.
The two-story development will be owned by Twin Cities-based Oppidan Investment Co. and managed by Ebenezer Management Services. Red Rock will be constructed by La Crosse, Wis.-based TCI and designed by River Falls, Wis.-based Frisbie Architects.
The community will feature 39 independent and assisted living apartments, 32 memory care apartments and five care suites.
Amenities will state-of-the-art remote monitoring technology, outdoor patios, porches, gardens and walking paths. Chef-prepared meals, a chapel, underground parking garage, club room, community room, movie theater, salon and spa will be available, as well.
Home builders picked up the pace this month. Twin Cities builders were issued 443 permits to build 903 units, according to the Builders Association of the Twin Cities. Half of those units (a single permit can be issued to build multiple units) were rental apartments and other kinds of multi-family housing.
Both permits and the number of units were up considerably from last year, but the number of planned units was down slightly from the previous month. The report comes after a quieter June report, but such volatility is common from month to month.
Here's a link to the full report with all the numbers.
It's going to be an interesting night at the Minneapolis City Planning Commission's Committee of the Whole meeting Thursday. Developers will be releasing a bevy of interesting new details on three high-profile housing developments planned for in and around downtown.