MINNEAPOLIS—The Twin Cities industrial market witnessed a burst of leasing activity in the fourth quarter, and developers such as The Opus Group have also gotten off to a great start in 2017. The Minneapolis-based developer just completed the third phase of its Valley Park Business Center in southwest suburban Shakopee and signed a deal with a new tenant. Albert Lea, MN-based Fountain Industries will occupy about 48,000-square-feet of the 122,400-square-foot structure, which Opus began building last summer.
It was the final phase of Opus’ development at the 50-acre site, following the completion of a 200,000-square-foot speculative development and a 216,000-square-foot build-to-suit industrial warehouse and office space for Amerisource Bergen.
“The interest and demand for industrial space in the Twin Cities remains strong,” Matt Rauenhorst,vice president, real estate development, Opus Development Co., LLC, tells GlobeSt.com. “In particular, the southwest market of the Twin Cities has seen ongoing and solid interest from various companies, whether big and looking to expand, or small and seeking first-generation space, as we’ve experienced with the construction and leasing of Valley Park Business Center.”
Opus Development Co., LLC was the developer, Opus Design Build, LLC was the design-builder and Opus AE Group, LLC was the architect and structural engineer of record. Bill Ritter, Ryan Kryzmarzick and Eric Rossbach with Colliers International are marketing the property for lease and Kris Smeltzer at Cushman & Wakefield | Northmarq represented Fountain Industries in the leasing of their space.
The metro area’s overall vacancy rate sank to just 6.9% by the end of 2016, the lowest rate in 12 years, according to Colliers International. There was 377,640 square feet of absorption in the fourth quarter, bringing the 2016 total to 2,632,291 square feet. Tenants had absorbed a bit more space in 2015, but the 2016 net was well above the 10-year average of just over one million square feet.
Opus’ newest warehouse has approximately 74,000 remaining square feet available for lease. It features 28’ clear height, along with 193 parking stalls, 24 dock doors and six drive-in doors.
Previous phases of the Valley Park Business Center were completed in 2014 and 2015. Opus’ recent portfolio of work includes more than 6.9 million square feet of industrial developments currently under construction or completed in the past 24 months across the US.
Most observers say that 2017 will bring even more activity to the Twin Cities. “The local and national investment community continues to show interest in the strong economic fundamentals present in the Minneapolis-St. Paul area and 2017 will continue to see strong investor interest,” according to Colliers. “We predict robust absorption and continued decreasing vacancy during the first and second quarters of 2017.”
And Opus seems ready to take part in the market’s future expansion.
“We remain bullish on the industrial market and are looking at a number of opportunities across the Twin Cities,” says Rauenhorst. “We expect to announce another speculative industrial project in the coming months.”