Is Your Space Working for You?
By Chris Rohrer, Broker & Pete Kostroski, Broker | Rokos Advisors
How Twin Cities Companies Are Rethinking Their Real Estate in 2025
Across the Twin Cities, more business owners are asking a question that used to be an afterthought:
“Is our space still working for us?”
With the cost of leasing on the rise and workplace models changing dramatically, the answer is often more complicated than it seems. The office or industrial space you leased three, five, or ten years ago may no longer align with how your business operates today.
This article outlines the key trends, metrics, and decision-making tools Twin Cities businesses are using to assess their space and make smarter moves in 2025.
Why This Question Matters Now
There are two big forces driving this shift:
You’re paying more for space. Increases in taxes, insurance, utilities, and common area maintenance (CAM) are inflating occupancy costs, even in buildings where base rent has stayed relatively flat.
You’re likely using it less efficiently. Office tenants are seeing much lower in-office attendance due to hybrid work. Industrial users are experiencing inefficiencies as operations, automation, and distribution models evolve.
The result is often wasted money and unrealized potential.
Office Trends in 2025: Purpose Over Presence
In places like the North Loop, Edina, and the West End, we’re seeing clear trends:
Companies with hybrid models often have large sections of space sitting empty.
Traditional layouts aren’t built for collaborative or flexible work.
Some companies are downsizing, while others are investing in more purposeful layouts. A key shift is from measuring space in square feet to measuring impact: How well the space supports productivity, retention, and brand image.
Industrial Trends in 2025: Rethinking Layout and Location
In industrial areas like Brooklyn Park, Lakeville, and Rogers, operational efficiency is the driver. Businesses are rethinking:
Are we using our clear height and dock doors efficiently?
Do we have the right power or layout for automation?
Are we located optimally for labor and logistics?
One manufacturer recently reduced their square footage by 15% and cut distribution costs by relocating from an outdated St. Paul facility to a more modern, suburban industrial park. Therese moves are less about growth and more about smart optimization.
Metrics That Matter
To make informed real estate decisions, businesses need to go beyond gut instinct. Here are core metrics we use to evaluate performance.
Office Metrics
Square feet per employee
In-office utilization (badge data or surveys)
Cost per occupied seat
Employee satisfaction (workplace surveys or eNPS)
Industrial Metrics
Revenue per square foot
Orders or shipments per dock door
Labor outputs by shift
Cost per shipment (including location/logistics impact)
Stay, Renovate, or Move? A Decision Framework
As lease expirations approach (typically within 12-36 months), it’s important to evaluate the full range of options.
| Option | When It Makes Sense | What To Do |
|---|---|---|
| Stay | The space still works well, but your lease terms are outdated. | Use market comps to negotiate better terms or add flexibility. |
| Renovate | The location is strong, but the layout or image is no longer working. | Explore landlord-funded updates or light capital improvements. |
| Move | Your space no longer aligns with operations or culture. | Begin a strategic site search 12–24 months before your lease ends. |
Final Thoughts
Whether you’re running a creative office team, a distribution center, or a manufacturing line, your real estate should serve your business – not limit it.
If you haven’t re-evaluated your space in the last few years, now is the time. The costs inefficiency are real, and the opportunity to optimize your footprint – or renegotiate your lease – is stronger than it’s been in years.
If you’d like a confidential review of your space, lease, or market options, let’s talk.
Wondering if your current space is still the right fit?
Contact Rokos Advisors for a strategic review of your lease, layout, and location.
Rokos Advisors is an award-winning Minneapolis - St. Paul based commercial real estate/tenant representation firm specializing in helping businesses find the perfect office or industrial space for their company.