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Twin Cities Retail Market Holding up Despite Slowdown

MINNEAPOLIS-Retail experts say vacancy rates

By Jim McCartney | Updated on October 16, 2001

MINNEAPOLIS-Despite new development and a slowing economy, retailexperts are predicting vacancy rates at Twin Citiesshopping centers will go down over the next year.Russell McGinty, senior vices president of Grubb &Ellis, argues that all things considered, the TwinCities retail sector is in surprisingly good shape. Heargues that the economy is in a slowdown, not arecession, as retailers are not seeing negative salescomparisons and vacancy rates at shopping malls remainlow at 6.22 percent at mid-year. What’s more, he’sprojecting that vacancy rates will decline to 6.05percent by the middle of next year as 1.4 million sfof space will be absorbed over the next year.

John Johannson, vice president at Welsh Cos., is moreoptimistic about vacancy rates, but mostly because hesees a major slowdown in new development. He seesvacancy rates dropping to 5.67 percent, although inlarge part that’s because he thinks the pace of newdevelopment will slow considerably — he expects about651,000 sf will be added to the market, less than halfof what McGinty is expecting.

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