T
he Bloomington "strip" along I-494 is the second-largest office sector in the metro, but it's also one of the emptiest. However, there are signs that this might be changing. According to a recent report from commercial brokerage firm Colliers, the vacancy rate along the I-494 strip has stabilized for the first time since the pandemic began.

    The area is attractive to companies due to its amenities, including parks, restaurants, hotels, and major transportation routes. Minneapolis-St. Paul International Airport is also nearby, making it a convenient location for businesses with clients who fly in for meetings. Abundant free parking is another perk that's drawing tenants to the area.

    Brokers are struggling to fill offices as leases expire and companies downsize, but they're seeing a shift towards higher-quality space with better amenities. Companies want to create an environment where employees feel comfortable and motivated to come into the office. This includes adding features like provided lunches, golf simulators, and cozy lounges, as well as allowing pets in the workplace.

    The vacancy rate for Class A buildings in the I-494 submarket is 19%, which is lower than Class B buildings. Several big leases have been signed recently, including one by Burns & McDonnell, a Kansas City-based construction firm that's moving into a larger space at Norman Pointe II building.

    Companies are looking for spaces with good highway frontage and branding opportunities. While many companies are letting employees work remotely, Burns & McDonnell has brought its employees back to the office full-time, citing the benefits of in-person collaboration and customer interaction.

    Despite the surplus of space in the metro, building owners aren't slashing rents yet, especially for deluxe spaces. The southern suburbs are less expensive than downtown Minneapolis, making them an attractive option for companies looking for high-quality space at a lower cost. With corporations shedding nearly 3 million square feet of space in the southwest metro alone, office shoppers have plenty of options to choose from.