2017 BOMA Market Report

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Marjory Doyle
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1 217 OMA Market Report Greater Saint Paul OMA

The Total Universe of office space in the Saint Paul entral usiness District is 15,997,313 square feet. This total is divided among ompetitive, Owner -occupied and Government space.

In reviewing the current data, several trends are noteworthy. Owner-occupied space, as a percentage of the Total Universe, is unchanged.

2 The Total Universe of office space in the Saint Paul entral usiness District is 15,997,313 square feet. This total is divided among ompetitive, Owner -occupied and Government space. The Total Universe Historical omparison provides a valuable long term perspective on market trends within these three categories in downtown Saint Paul. In reviewing the current data, several trends are noteworthy. Owner-occupied space, as a percentage of the Total Universe, is unchanged. Government space, as a percentage of the Total Universe, is trending upward. ompetitive space, as a percentage of the Total Universe, is trending downward. The total square feet is trending downward. The most significant changes in the Total Universe were : The addition of the Ecolab Global Headquarters (+484,) The reduction in Travelers space (-413,) The removal of the Ecolab orporate enter (-238,) The reduction of occupied space at 18 E. 5th St. (-231,) The addition of the Osborne 37 building (+128,) The removal of the Degree of Honor (-67,) Total Universe Historic omparison ompetitive 5% 5% 5% 48% 48% 48% 49% 5% 49% 49% 48% Government 31% 31% 31% 33% 33% 33% 32% 3% 3% 31% 32% Owner Occupied 19% 19% 19% 19% 19% 19% 19% 2% 21% 2% 2% Total Square Feet (Million Sq. Ft.)

The Saint Paul D consists of 7,717,466 square feet of ompetitive office space. For the purposes of comparison, this office space is grouped into three classes, A, &.

A combination of factors including rent, building finishes, system standards and efficiency, building amenities, location/accessibility and market perception are used as relative measures.

3 The Saint Paul D consists of 7,717,466 square feet of ompetitive office space. For the purposes of comparison, this office space is grouped into three classes, A, &. These classes represent a subjective quality rating of buildings which indicates the competitive ability of each building to attract similar types of tenants. A combination of factors including rent, building finishes, system standards and efficiency, building amenities, location/accessibility and market perception are used as relative measures. lass A Most prestigious buildings competing for premier office users with rents above average for the area. uildings have high quality standard finishes, state of the art systems, exceptional accessibility and a definite market presence. lass uildings competing for a wide range of users with rents in the average range for the area. uilding finishes are fair to good for the area. uilding finishes are fair to good for the area and systems are adequate, but the building does not compete with lass A at the same price. lass uildings competing for tenants requiring functional space at rents below the average for the area. The overall vacancy rate for ompetitive office space in the Saint Paul D is 2.8% (1,65,173 square feet), an increase from 16.6% (1,293,377 square feet) in 216. Vacancy is lowest (14.5%) in lass A space and highest (24.%) in lass space.

4 The overall ompetitive vacancy rate moved higher from 216 to 217, due to some transition and consolidation in the market. The vacancy trend for Individual classes (A, & ) varies. A moved are lower, while & increased.

In general, the reasons for positive absorption include changes in occupancy, building reclassification, building remeasurement, and adjustments in square footage being offered for lease.

5 Absorption is a measurement of the increase or decrease in occupied office space that occurs during a given period of time. Absorption in downtown Saint Paul s ompetitive office space from 216 to 217 is -158,233 square feet. Overall absorption is -324,818. In general, the reasons for positive absorption include changes in occupancy, building reclassification, building remeasurement, and adjustments in square footage being offered for lease. Absorption figures are negatively impacted when buildings are removed from the total universe. The ompetitive absorption total was negatively impacted by the loss of leased space in 18 E. 5th St., ray Plaza and Park Square ourt. Overall absorption was negatively impacted by the Travelers and Ecolab transaction and the shifting of office space that ensured.

6 The quoted median gross rental rate for office space is the sum of the net rental rate and operating expenses, including property taxes. Net rental rates and operating expenses were provided by the building owners, managers, and leasing agents surveyed for this report. Each building s rental rate applies to rentable square feet and represents the average listing rate for that property. Several factors impact the actual rental rate in a lease transaction, including location inside the building, improvements made, parking availability, lease term, credit, services, and more. Average Gross Rental Rates for 217 $3. $25. $2. $15. $1. $5. $- $24.85 $19.3 $15.69 lass A lass lass $14. $12. $1. $8. $6. $4. $2. $- Average Net Rental Rates for 217 $12.17 $11.78 $7.7 lass A lass lass

7 Name and Total # of Floors in ldgs. Total S.F. Avail. S.F. Floor Plate SF Net Rate Op. & Taxes Parking in the uilding () lose or Nearby () or None available (N) ompany ontact Phone 4 uilding 4 North Robert ,24 11,645 17,895 $1-$12 office $11.46 ushman Wakefield/NorthMarq Tom Stella tom.stella@cushwakenm.com Town Square Tower. 445 Minnesota ,14 69,614 12, $8.-$9. $1.5 olliers International Eric Rapp eric.rapp@colliers.com Landmark Towers 345 St. Peter Lawson ommons 38 St. Peter ,959 25, ,378 75,394 12,186 34, $12.- $13. $14.48 $14.- $16. $13.21 Thompson National Properties, LL Jerry Hersman j.hersman@tnpre.com Frauenshuh, Inc. Sherry Hastings sherry.hastings@frauenshuh.c om US Plaza 444 edar ,653 49,561 12,373 $9.-$11. $11.42 Jones Lang LaSalle Jon Dahl jon.dahl@am.jll.com Wells Fargo Place 3 East 7th ,895 77,46 14,682 in the tower. 3-level atrium approx. 65, per floor $17.- Tower; $12.- $2.- Atrium $14.72 ushman Wakefield/NorthMarq Eric King eric.king@cushwakenm.com Total S.F. Total Avail. S.F Vacancy Rate 2,137,49 39, %

8 Name and 18 E. 5th 18 E. 5th 375 Jackson 375 Jackson 443 Lafayette Road 443 Lafayette Road 444 Lafayette Road 444 Lafayette Road 5 Lafayette Road 5 Lafayette Road 52 Lafayette Road 52 Lafayette Road 555 Park Office uilding 555 Park 81 On Seventh 81 East 7th Alliance ank enter* 55 East 5th Total # of Floors in ldgs Total S.F. Avail. S.F. 672,86 388, ,395 74, ,882 32, ,9 164,225 5,215 12,17 47,273 4,375 22,127 76,824 Floor Plate SF approx. 51, 15, (E. ldg.) 2, (W. ldg.) 13,46 12,5 11,6 Net Rate Op. & Taxes $8.- $1. $1.37 $5.82 $8.94 $9.1 $8.18 $12.38 $7.3 $13.8 $8.46 $11.9 $8.7 $7. $11.7 Negotiable $1.22 $11. - $14. $9.97 Parking in the uilding () lose or Nearby () or None available (N) (tenants only) (tenants only) (tenants only) (tenants only) - connected by ramp on 1st floor ompany ontact Phone Jackson I, LL Ken Seifert kseifert@talonmgmtservices.c om Madison Equites Todd Erager todd@madisonequities.biz Meritex Enterprises Fred Koehler fkoehler@meritex.com Meritex Enterprises Fred Koehler fkoehler@meritex.com Meritex Enterprises Fred Koehler fkoehler@meritex.com Meritex Enterprises Fred Koehler fkoehler@meritex.com Kraus Anderson Dan Mossey dmossey@karerealty.com ommercial Real Estate Services, Inc. Pat Wolf patwolf@cres-inc.com Security National Properties Alex Kelly alex@kellybrothersltd.com

9 Name rooks uilding** 366 Jackson apitol Office uilding 525 Park ray Plaza 38 Jackson Drake uilding 6 Plato lvd. East Ecolab University enter 386 North Wabasha Empire ldg., Endicott, Arcade ldg. 36 North Robert First National ank uilding 332 Minnesota Gallery Professional uilding 17 West Exchange Total # of Floors in ldgs West/ 16 East 8 Total S.F. Avail. S.F. 25, 75,39 4,257 22,134 14,77 83,759 2, , 57,165 52,365 66,64 158,254 17,514 49,22 Floor Plate SF 5, 15,426 Varies per floor, average - 31,142 21,6 1,941 7, 1,213 W 15, E 6, N 14,262 Net Rate Op. & Taxes - $1.- $12. $1.75 $9.- $12. Office: $9.29 Retail: $14.9 $1.- $12. $1.56 $12. $11. $ 5. $ 5.69 $18.5- $2. modified gross $9.74 $11. $12.71 Parking in the uilding () lose or Nearby () or None available (N) / ompany ontact Phone rooks Group Jaunae rooks jaunae@brooksgroup.net NorthMarq Tom Stella tom.stella@cushwakenm.com olliers International Eric Rapp eric.rapp@colliers.com Wellington Management Inc. Kori L. DeJong kdejong@wellingtonmgt.com olliers International Eric Rapp eric.rapp@colliers.com Madison Equites Todd Erager todd@madisonequities.biz Madison Equites Todd Erager todd@madisonequities.biz Healthcare Mgmt. of America, Inc. Andrew Nordhoff andrewnordhoff@htareit.com

10 Name and Gallery Towers 514 St. Peter Gilbert uilding 413 Wacouta Golden Rule uilding 85 East 7th Place Hamm uilding 48 St. Peter Osborn Wabasha St N St. Paul 5512 Park Square ourt uilding 4 East Sibley Public Housing Agency Saint Paul 555 N. Wabasha St. River Park Plaza 1 River Park Plaza Total # of Floors in ldg. 2 ommerci al, 2 total (tower) plus lower levels Total S.F. Avail. S.F. 25,47 1,327 41,554 1,86 289, ,866 31, , , 129,321 6,243 48, ,1 36,492 Floor Plate SF 12,5 5, 2 floors at 38, SF 4 floors at 28, SF , 14,53 27,- 42, SF Net Rate Op. & Taxes $12. $7.8 $1.- $12. $5.9 $8.- $1. $9.87 $8. $12.41 $ TD $ $16. gross $12. $8.3 Parking in the uilding () lose or Nearby () or None available (N) (connected by skyway) & ompany ontact Phone Ted Glasrud & Associates Paul uchmayer pbuchmayer@tedglasrud.co m Gilbert uilding, LL Ian Hedstrom ian@gilbertbuilding.com ommercial Real Estate Services, Inc. Pat Wolf patwolf@cres-inc.com The Markham ompany of Saint Paul Kristel Hansen kristel@markhamstpaul.co m Schafer Richardson Jen Renkly jrenkly@sr-re.com Madison Equites Todd Erager todd@madisonequities.biz Public Housing Agency of the ity of Saint Paul Ron Moen ron.moen@stpha.org olliers International Eric Rapp eric.rapp@colliers.com

Name and Saint Paul uilding 6 West 5th Town Square 445 Minnesota Union Depot 214 Fourth East US ank enter 11 East 5th Total S.F. Total Avail. S.F Vacancy Rate Total # of Floors in ldg. 9 26 Total S.F. Avail. S.F. 4,239 14,659 22,45 36,485 31, 2,48 37,187 35,537 5,243,592 1,26,911 24.

11 Name and Saint Paul uilding 6 West 5th Town Square 445 Minnesota Union Depot 214 Fourth East US ank enter 11 East 5th Total S.F. Total Avail. S.F Vacancy Rate Total # of Floors in ldg Total S.F. Avail. S.F. 4,239 14,659 22,45 36,485 31, 2,48 37,187 35,537 5,243,592 1,26, % Floor Plate SF 4, 13,432 Net Rate Op. & Taxes varies $8. $8.- $15. $1.5 $9.5 $1.65 Parking in the uilding () lose or Nearby () or None available (N) ompany ontact Phone ommonwealth Properties Debbie urgwald dburgwald@commonwealth properties.com ushman Wakefield/NorthMarq Eric King eric.king@cushwakenm.co m JLL Tannen Loge tannen.loge@am.jll.com Madison Equites Todd Erager todd@madisonequities.biz

12 Name and 213 E. 4th 213 E. 4th Allen uilding* 287 East 6th Exchange uilding 26 East Exchange Goff Public uilding 255 E. Kellogg lvd. Grace uilding 421 North Wabasha Landmark enter 75 West 5th Northwestern uilding 275 East 4th O'onnor uilding** 266 East 7th One West Water 1 West Water Total # of Floors in ldg above ground; 2 below ground Total S.F. Avail. S.F. 32,271 1,5 16,563 6, 42,5 9,212 26, 13, 4,5 15,21 48,12 7,939 81,57 8,31 2, 8, 27,326 1,52 Floor Plate SF 6, ,66 13, 15, varies - between 14,7 to 15,7 Approx. 1, each floor 4, varies Net Rate Op. & Taxes $7.5- $9.5 $7.56 $9.- $15. gro ss $8. $7.5 $16. $7.5 $5. $12-$18 $ $15. gross $8. $8. Parking in the uilding () lose or Nearby () or None available (N) ompany ontact Phone Summit Realty Rob lapp rob@summitrealtymn.c om Dacotah Properties Sandra Erickson lease@allenbuilding.com ommonwealth Properties Debbie urgwald dburgwald@commonwealth properties.com Goff Partners Paul Goff pgoff@sbs-intl.com Victory apital orporation Todd Geller todd@victorycapital.com Minnesota Landmarks Steve udas admin@landmarkcenter.org Halverson laiser, LTD Ardis Hafdahl ahafdahl@hbgltd.net rooks Group Jaunae rooks jaunae@brooksgroup.net James Miller Investment Realty o. Jim Miller jmiller@jmrealty.com

Name and Railroader Printer uilding** 235 East 6th Southbridge 155 Wabasha S The Lowry Hotel uilding 345 Wabasha Total S.F. Total Avail. S.F Vacancy Rate Total # of Floors in ldg. 4&5 1 11 Total S.F. Avail. S.F. 35,53 22, 56,38 536,825 79,673 14.

13 Name and Railroader Printer uilding** 235 East 6th Southbridge 155 Wabasha S The Lowry Hotel uilding 345 Wabasha Total S.F. Total Avail. S.F Vacancy Rate Total # of Floors in ldg. 4& Total S.F. Avail. S.F. 35,53 22, 56,38 536,825 79, % Floor Plate SF 5 private offices & 36 varies Net Rate Op. & Taxes $695 per private office $15. gross $13. modified gross Parking in the uilding () lose or Nearby () or None available (N) N ompany ontact Phone rooks Group Janaue rooks jaunae@brooksgroup.ne t Power Management Nicky Scarrella pminc@popp.net Madison Equites Todd Erager todd@madisonequities.b iz

14 uilding Name St. Joseph's Hospital* 45 W. 1th Total S.F. Listing ontact or Owner 68, HealthEast ontact Name, Phone Number, Kevin Johnson Fort Road Medical 36 Sherman Gallery Professional uilding 17 West Exchange Gillette hildren's Specialty Healthcare 2 University Avenue East Gillette hildren's Specialty Healthcare 25 University Avenue East Gillette hildren's Specialty Healthcare 183 University Avenue East hildren's Hospital - St. Paul 345 Smith Avenue Doctor's Professional uilding 28 Smith Avenue 5,265 17, , 53,63 17,2 155,893 Healthcare Trust of America, Inc. Healthcare Trust of America, Inc. Gillette hildren's Specialty Healthcare Gillette hildren's Specialty Healthcare Gillette hildren's Specialty Healthcare hildren's Hospitals and linics of Minnesota 11,664 NorthMarq Andrew Nordhoff andrewnordhoff@htareit.com Andrew Nordhoff andrewnordhoff@htareit.com eth losner eclosner@gillettechildrens.com eth losner eclosner@gillettechildrens.com eth losner eclosner@gillettechildrens.com ill Karkula William.Karkula@allina.com Dale Keena Exerare 266 North Smith Garden View 347 Smith Avenue John Nasseff Medical enter 255 Smith Avenue Ritchie Medical Plaza 31 Smith Avenue 1, ,778 43, ,728 Allina Health System/ United Hospital Allina, hildren's I.R.E.T. ushman Wakefield Allina, I.R.E.T. ill Karkula William.Karkula@allina.com ill Karkula William.Karkula@allina.com Angie Karies angie.kairies@cushwakenm.com ill Karkula William.Karkula@allina.com

15 uilding Name Total S.F Listing ontact or Owner ontact Name, Phone Number, Sky Tower (United Hospital/hildren's Hospital- St. Paul) 333 North Smith United Hospital 333 Smith Avenue apitol Professional Office uilding 59 Park Nasseff Specialty enter 225 Smith Avenue Gallery Towers 514 St. Peter HealthPartners Specialty enter Phalen Parkway HealthPartners Specialty enter Phalen Parkway HealthPartners St. Paul linic 8 West Plato oulevard Regions uilding #1 64 Jackson Regions uilding #2 64 Jackson Regions uilding #3 64 Jackson Regions uilding #5 64 Jackson 23, ,79 Allina Health System & hildren's Hospitals and linics of Minnesota Allina Health System 34,32 Kraus Anderson 119,199 Welltower Inc. 25,47 Ted Glasrud & Associates 124, HealthPartners 82,243 HealthPartners 65,268 HealthPartners 1,64,466 Regions Hospital 65,917 Regions Hospital 74,649 Regions Hospital 156,62 Regions Hospital ill Karkula William.Karkula@allina.com ill Karkula William.Karkula@allina.com Dan Mossey dmossey@karerealty.com Nathalie Peffer npeffer@welltower.com Paul uchmayer pbuchmayer@tedglasrud.com Rick Huston rick.a.huston@healthpartners.com Rick Huston rick.a.huston@healthpartners.com Rick Huston rick.a.huston@healthpartners.com Rick Huston rick.a.huston@healthpartners.com Rick Huston rick.a.huston@healthpartners.com Rick Huston rick.a.huston@healthpartners.com Rick Huston rick.a.huston@healthpartners.com

16 uilding Name and Total S.F Listing ontact or Owner ontact Name, Phone Number, Regions uilding #8 64 Jackson Regions uilding #9 64 Jackson American Red ross 134 Fillmore Avenue East American Red ross St. Paul Area lood Donation enter 176 Robert South RADIAS Health 166 E. 4th 63, 96, 63,888 41,14 6, Regions Hospital Regions Hospital American Red ross American Red ross South Metro Human Services dba RADIAS Health Rick Huston Rick Huston Steve Golias Steve Golias Tom Paul Total Square Footage 5,179,78

17 Name lass Total S.F. ontact, Phone, Hamm uilding 48 St. Peter 12,94 Rob Davis (952) Hamm uilding 48 St. Peter 2,576 Rob Davis On Seventh 81 East 7th 6,395 Pat Wolf Total Square Footage 21,875

18 Name and The Lowry 35 St. Peter Jemne uilding 35 St. Peter Travelers 385 Washington Twin ities Public Television uilding 172 East 4th US ank West Side Flats Operation enter 6 Livingston Avenue Rafferty Rafferty Tollefson Lindeke Architects** 278 7th St E League of Minnesota ities uilding 145 West University Avenue Market House 289 E. 5th Market Towers 7 West 4th Minnesota Public Radio uilding** 48 edar American Red ross St. Paul Area lood Donation enter 176 Robert South 317 On Rice Park 317 Washington Ecolab Global Headquarters 1 Ecolab Place Total S.F. ompany 75, R Enterpises, LL 25, District Energy 587, Travelers 15,84 Twin ities Public Television 35, US ank 12, 64, Rafferty Rafferty Tollefson Lindeke Architects, Owners Atelaier, LL League of Minnesota ities 34, 3 Deep Marketing 333, entury Link 142, 41,14 Minnesota Public Radio American Red ross 24, Minnesota Wild 484,53 Ecolab, Inc. ontact Phone Alissa Kellogg akellogg@pakproperties.net athy Hart athy.hart@ever-greenenergy.com Greg Sharpe gsharpe@travelers.com JoAnn Hawkins jhawkins@tpt.org Kelly Wilke kelly.wilke@usbank.com Lee Tollefson Nancy Tindall ntindall@lmc.org Dave Woodbeck Neal Anderson neal.anderson@centurylink.com Nick Kereakos nkereakos@americanpublicmedia.org Steve Golias steve.golias@redcross.org Tim Wolfgram twolfgram@wild.com Tim Yohnk tim.yohnk@ecolab.com

19 Name and Total S.F ompany ontact Name Phone Ecolab Global ommunications enter 36 North Wabasha 72,815 Ecolab, Inc. Tim Yohnk Science Museum of Minnesota 12 West Kellogg lvd. 38, Science Museum of Minnesota Tom arlson E. 4th 166 E. 4th 6, South Metro Human Services Tom Paul uilding 41 North Robert hicago Greatwestern Freight ondos East Kellogg lvd. 572,172 NorthMarq 32, Tom Stella Wayne Mahoney Total Square Footage 3,52,434

20 ity Hall Annex 25 W. 4th Griffin uilding 367 Grove Name and Public Safety Annex 1 East 1th 42 University Ave. 42 University Ave. 9 West Plato 9 West Plato ity Hall/ourthouse 15 W. Kellogg lvd. Don Junemann uilding 555 edar Juvenile Family Justice enter 25 West 7th Law Enforcement enter 425 Grove St. Metro Square uilding 121 East 7th Place Ramsey ounty Government enter - East 16 East Kellogg lvd. SF 85, ,94 76,162 39, 8, 24, 27, 59, 1, 39, ,518 ompany, ontact, Phone, ity of Saint Paul ruce Engelbrekt bruce.engelbrekt@ci.stpaul.mn.us ity of Saint Paul ruce Engelbrekt bruce.engelbrekt@ci.stpaul.mn.us ity of Saint Paul ruce Engelbrekt bruce.engelbrekt@ci.stpaul.mn.us Ramsey ounty Jean Krueger jean.krueger@co.ramsey.mn.us Ramsey ounty Jean Krueger jean.krueger@co.ramsey.mn.us Ramsey ounty Jean Krueger jean.krueger@co.ramsey.mn.us Ramsey ounty Jean Krueger jean.krueger@co.ramsey.mn.us Ramsey ounty Jean Krueger jean.krueger@co.ramsey.mn.us Ramsey ounty Jean Krueger jean.krueger@co.ramsey.mn.us Ramsey ounty Jean Krueger jean.krueger@co.ramsey.mn.us Ramsey ounty Jean Krueger jean.krueger@co.ramsey.mn.us

21 Name and Metropolitan ouncil uilding 39 North Robert MN Senate uilding 95 University Ave W 321 Grove 1 & Grove Administration uilding 5 Sherburne Avenue entennial uilding 658 edar Elmer L. Andersen uilding 54 edar Ford uilding 117 University Avenue Harold E. Stassen uilding 6 North Robert Judicial enter, Minnesota 25 Rev. Dr. Martin Luther King Jr. lvd. Minnesota State apitol uilding 75 Rev. Dr. Martin Luther King Jr. lvd. Orville L. Freeman uilding 625 N. Robert Square Feet 116, ,97 55,473 71, , ,2 51, , , , ,387 ompany, ontact, Phone, Metropolitan ouncil Steve Ylitalo Steven.Ylitalo@metc.state.mn.us

22 Name and State Lab uilding 61 North Robert State Office uilding 1 Rev. Dr. Martin Luther King Jr. lvd. Transportation uilding 395 John Ireland lvd. Veterans Service uilding 2 West 12th Warren E. urger Federal ourts uilding 316 North Robert Square Feet 166,34 259,26 318,271 78, ,137 Total 5,27,413 ompany, ontact, Phone, U.S. Government Tim Scully tim.scully@gsa.gov

2018 BOMA Market Report

2018 BOMA Market Report 218 OMA Market Report Greater Saint Paul OMA 1-18-18 The Total Universe of office space in the Saint Paul entral usiness District is 15,649,42 square feet. This total is divided among ompetitive, Owner