Target is switching to a flexible work model after the pandemic and will give up 1 million square feet of office space in downtown Minneapolis, all in the 52-story City Center tower.
Why it matters: The retailer is downtown's largest employer, with 8,500 workers. It means fewer high-paid employees eating, drinking and shopping downtown on a daily basis.
The big picture: 1 million square feet represents 4.5% of all downtown multi-tenant office space and 7.3% of all Class A downtown office space, according to CBRE Minneapolis numbers.
- Target will continue to occupy 2 million square feet elsewhere downtown and keep its Brooklyn Park campus.
What's next: Target has 10 years of term left on its lease at City Center and will have to find subleases.
- Axios talked to two real estate experts who said this decision could actually be good for downtown in the long-term because companies will be able to rent Class A office space at much lower prices, since Target will be happy to recoup costs.
The big picture: This trend is going to create a problem in suburban office parks as well.
- As we reported this week, Prime Therapeutics is also moving to a flexible plan and giving up 180,000 square feet in Bloomington's Normandale Lake Office Park.
This story first appeared in the Axios Twin Cities newsletter, designed to help readers get smarter, faster on the most consequential news unfolding in their own backyard.
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