Office Space boom for St. Paul predicted

Downtown St. Paul office space is about to undergo a commercial boom, as transport links vastly improve, a report states.

The 18-page report, by Greater St. Paul Building Owners and Managers Association (BOMA), predicts flourishing investor interest, with the introduction of a light railway service in the new year.

The area is already home to 16.8 million square feet of high quality office space, and boasts an impressive occupancy rate - steady at an average of 90 per cent. Around a third of the current office space is occupied by Minnesota government agencies.

Occupancy rates in Class A space increased from 86.8 per cent to 87.3 per cent, with several high profile lease renewals. Several architectural and engineering firms renewed leases in the area, including planning firm TKDA, who renewed a lease for 50,000 square feet and acquired an additional 6,000 square feet.

“Renewals are a really good sign” that tenants are confident are with the future performance of the area, said Eric Rapp, vice president in Colliers International's Twin Cities office.

A $243 million renovation of the historic Union Depot began in December 2012, transforming it into a multimodal transportation hub. The $957 million Green Line light rail service will connect the St. Paul and Minneapolis downtown areas, and is scheduled to begin in mid-2014.

“Transportation is a key to attract talent,” said Aaron Barnard, senior director of brokerage services for Cushman & Wakefield/NorthMarq.

“For business owners, how to get talent to offices is a big concern, and if light rail makes it more convenient, that’s a positive."