User-driven demand dictates land development in various sectors
- Land development continues to be user-driven, with developers pre-leasing buildings before construction begins.
- Retail land continues to be primarily driven by grocery activity, and features a number of stand-alone and small redevelopments.
- Growth in the child care sector is contributing to demand as day care providers across the metro are quick to pursue land for new locations.
- Demand in the single-family housing market is strong and driven by proximity to leading school districts. Some residential developers are buying 3-10 acre lots and building detached town homes in response to the lack of land available for large-scale developments. Multi-family residential in the seven-county area remains strong.
- Well-located industrial land availability is becoming scarce, as a large portion of the market is already developer-controlled.
- Minimal office development is occurring with the exception of medical office, which remains very user-driven. Examples of these offices include Prime Therapeutics in Eagan and TRIA in Woodbury.
- The overall outlook for land is positive through the remainder of 2016, and we predict that 2017 will also be strong.