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Home My WebLink About2025-08-14 Work Session Agenda Packet1.Call to Order/Roll Call 2.Scheduled Items a.Economic Development Discussion 3.Adjournment Corcoran City Council - Work Session Agenda August 14, 2025 5:30 PM *Includes Materials - Materials relating to these agenda items can be found in the Council Chambers Agenda Packet book located by the entrance. The complete Council Agenda Packet is available electronically on the City website at www.corcoranmn.gov. 1 STAFF REPORT Agenda Item: 2.a Council Meeting: August 14, 2025 Prepared By: Jay Tobin, City Administrator Topic: Economic Development Discussion Action Required: Discussion Summary Corcoran leadership is committed to addressing difficult issues now in order to avoid larger more difficult issues in the future (Corcoran Values Statement: "Responsible Decision Making"). Consequently, staff strives to seize opportunities identified as having potential strategic value, and this is one of those opportunities. The discussion topic(s) for this work session stem from conversations following the April 24, 2025 Council Meeting at which Council provided direction regarding the Concept Plan brought forward by Continental Properties. Specifically, Council's expressed desire for concurrent commercial development to compliment Continental's residential development concept on this property guided "Mixed-Use" in Corcoran's 2040 Comprehensive Plan (Map 2-1 2040 Future Land Use). As part of Continental's efforts to better understand the commercial development market in the metro, they reached out to Mary Bujold of Maxfield Research. When staff met with Continental and Maxfield Research representatives to discuss information and share understanding, it became clear that the topic(s) at hand and the timing of their project/research could have strategic value for the city. Their project/research could have implications on current work for the "Commercial/Industrial Update" informing present zoning discussions/decisions, and on upcoming work for the 2050 Comprehensive Plan regarding discussions/decisions about future land use. Continental Properties and Maxfield Research will be moving forward with their project/research for the specific property related to their proposed development. And, the City has an opportunity to partner with them, opening the aperture of their project/research to a broader scope that can impact current and future strategic city priorities. Staff recommends discussing the topic of "economic development" as facilitated by Mary Bujold of Maxfield Research, and providing direction regarding potential city collaboration to expand the scope of the Continental and Maxfield Research project. Financial/Budget Expenses would be allocated to long-range planning fund. Options Discuss and provide direction. Recommendation Staff recommends discussing the topic of "economic development" as facilitated by Mary Bujold of Maxfield Research, and providing direction regarding potential city collaboration to expand the scope of the Continental and Maxfield Research project. Council Action Staff recommend discussion of points raised in briefing from Maxfield Research (Mary Bujold) to offer staff direction. Attachments 1. Economic Development DIscussion by Maxfield Research.pdf 2 Preliminary Review Real Estate Market Conditions Presented to:Corcoran City Council Presented by:Mary Bujold, President Maxfield Research & Consulting Date Presented: August 14, 2025 3 Corcoran’s Location 4 Building Permit Trends (2019-2025) Corcoran Permit Classification No. of Permits % of Total Commercial 21 1.2%Includes Excavating permits Multifamily 7 0.4%Primarily Multifamily For-Sale Accessory Building 39 2.2%Primarily Agricultural Properties Additions 20 1.1%Primarily Residential Additions Single-Family 1,466 81.7% Townhome/Attached 242 13.5% Total 1,795 100.0% Source: City of Corcoran CORCORAN BUILDING PERMITS NEW CONSTRUCTION/ADDITIONS/EXPANSIONS 2019 through 2025 (YTD) Comments 5 Corcoran Land Use Land Use Gross Acres Net Acres Agricultural/Rural 17848.03 13528.95 Commercial 62.86 61.77 Golf Course 445.69 361.91 Industrial 182.52 161.97 Manufactured Home Park 28.57 27.99 Parks and Open Space 111.29 96.4 Public/Semi-Public 162.36 120.69 Single Family Residential 3067.26 2490.69 Other 6.54 6.54 Total 21915.12 16856.91 Existing Land Use - 2019 Land Use Gross Acres Percent Total Net Acres Gross Acres Percent Total Gross Acres Ag Preserve 1,588.72 9.42% 2,078.36 9.48% Rural/Ag Residential 9,276.27 55.03% 11,954.94 54.55% Existing Residential 1,153.70 6.84% 1,586.74 7.24% Low Density Residential 2,656.56 15.76% 3,694.72 16.86% Medium Density Residential 66.04 0.39% 84.75 0.39% Mixed Residential 449.88 2.67% 522.43 2.38% High Density Residential 80.38 0.48% 128.75 0.59% Mixed Use 459.08 2.72% 532.42 2.43% Rural Service/Commercial 185.69 1.10% 198.15 0.90% Commercial 148.38 0.88% 173.81 0.79% Business Park 76.89 0.46% 76.89 0.35% Light Industrial 481.22 2.85% 563.34 2.57% Parks/Open Space 76.85 0.46% 84.38 0.39% Public/Semi-Public 157.30 0.93% 235.42 1.07% Total 16,856.96 100% 21,915.10 100% Future Land Use - 2040 6 Office Market Activity – Twin Cities Metro Office Sector Existing Inventory Deliveries (YTD) Under Development Direct Availability Sublet Availability Total Availability Total Availability Change (YoY) Net Absorption (QTD) Absorption % of Inventory (QTD) Minneapolis CBD 33,247,345 ----23.7%4.6%28.3%0.8%(15,240)0.0% Southwest 22,298,941 --136,000 22.8%3.5%26.3%0.6%45,426 0.2% Northeast 17,339,218 ----10.7%0.5%11.2%-0.7%(60,124)-0.3% Airport/Southeast 14,851,493 ----15.5%0.8%16.3%-0.7%19,400 0.1% St. Paul CBD 6,818,608 ----21.5%1.8%23.3%0.3%(36,355)-0.5% West 6,740,748 ----16.3%3.8%20.1%-4.9%32,120 0.5% Northwest 5,179,945 ----20.0%5.0%20.5%1.8%(1,455)0.0% North Loop 3,832,115 ----17.7%10.9%28.6%5.9%2,473 0.1% West End 2,764,966 ----12.3%4.0%16.2%1.0%21,062 0.8% Market Total 113,073,379 --136,000 19.2%3.1%22.3%20.0%7,307 0.0% Source: Avison Young TWIN CITIES OFFICE MARKET ACTIVITY - 2ND QUARTER 2025 7 Retail Market Activity – Twin Cities Metro 1.4% 6.8% 4.0% 5.1% 4.0% 3.3% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% General Mall Neighborhood Other Power Strip Va c a n c y R a t e Twin Cities Metro Retail Vacancy by Product Type 1st Quarter 2025 Vacancy Increased Quarter over Quarter by 10 basis points; lease rates inched up slightly Total net absorption was -63,805 sf for the qtr, a reversal from the previous qtr New development is limited, with most new construction occurring in suburban Submarkets. Large format spaces 40,000 sf+ remain very difficult to reposition, due to prohibitive costs for reconstruction Retailers with growth plans continue to target high traffic suburban growth corridors; demand strongest in small format spaces 8 For -Sale Residential Market Activity – Twin Cities Metro MN Statewide % Chg Twin Cities Metro % Chg Minneapolis % Chg St. Paul % Chg New Listings 9,722 +3.7%6,500 +0.8%545 -9.3%383 +8.2% Pending Sales 6,850 +3.7%4,650 +3.5%435 +5.1%274 +5.0% Closed Sales 7,469 +9.2%4,975 +7.5%460 +10.6%291 -0.3% Median Sales Price $370,000 +4.2%$401,000 +2.8%$350,000 +2.2%$320,000 +1.6% Days on Market 35 +2.9%39 +11.5%45 +9.8%31 -3.1% % of List Price Rec'd 99.3%-0.1%100.0%-0.1%101.1%+0.8%101.0%-0.8% Inventory 16,900 +8.9%9,715 +2.0%887 -7.8%484 +4.1% Months of Supply 3.0 +7.1%2.6 +4.0%2.6 -3.7%2.2 +10.0% Source: Minnesota Board of Realtors RESIDENTIAL HOUSING MARKET ACTIVITY June 2025 (compared to a year ago) 9 Multifamily Market Activity – Twin Cities Metro Deliveries slow as the pipeline narrows The market absorbed 2,125 units in Q2 2025, marketing the second consecutive quarter of positive absorption and signaling continued, healthy renter demand. Stabilized vacancy rate is 5.5%, indicating a balanced rental market Rent growth continues as concessions fade; avg rent psf $1.81 10 Key Takeaways… Residential development continues to overshadow all other real estate sectors, with multifamily urban and suburban development still in demand although deliveries will be significantly reduced due to financing challenges. Single-family detached and attached prices continue to rise, inventories have increased slightly and mortgage interest rates have moderated, but remain high, continuing to challenge entry- level and lower end middle market buyers. Industrial demand lagged in 1Q 2025, with absorption down from 2024; limited speculative development means that most space has already been targeted for specific users. Retail demand remains strong and vacancy decreased slightly again, but some persistent challenges remain with big box users and reuse of larger vacant spaces in retail centers (pre-significant tariffs) Office is showing slight improvement and there is some stability in suburban markets, but vacancies remain high and absorption still negative in many submarkets (smaller medical office still has some strength) 11 Reference Reading Office https://www.axios.com/local/twin-cities/2025/07/28/downtown-minneapolis-office-vacancy-leasing https://forterep.com/q1-2025-minneapolis-st-paul-office-market -summary/ Retail https://www.colliers.com/en/research/minneapolis-st -paul/minneapolis-st-paul-retail-report-q2-2025 https://rejournals.com/low-vacancies-and-steady-demand-twin-cities-retail-sector-still-ringing-up-the-business/ Multifamily https://www.yardimatrix.com/blog/twin-cities-multifamily-market -report/ https://mmgrea.com/2025-twin-cities-forecast/ For-Sale Real Estate https://www.mnrealtor.com/blogs/mnr-news1/2025/07/14/june-2025-housing-report 12 Mary Bujold Maxfield Research & Consulting mbujold@maxfieldresearch.com MaxfieldResearch.com Thank You! http://www.linkedin.com/co mpany/maxfield-research-inc 13