Despite changes in office culture during the COVID-19 pandemic, some Duluth real estate brokers don’t expect major permanent changes to the downtown and Canal Park office spaces.

“I’d say 95% of the people we’ve talked to said, ‘We just can’t wait to get back to normal and be back in our office and see our friends, walk in the sky walk, go out to lunch and do that kind of thing,’” said Steve LaFlamme, president of Oneida Commerical Real Estate Services.

He estimates 80% of Duluth office workers are still primarily working from home, but many stop by their offices occasionally.

LaFlamme said Duluth has an advantage to bouncing back because most offices aren’t very saturated with workers to begin with, so being able to space people out isn’t such a difficult task.

In fact, LaFlamme sees potential for businesses based in the Twin Cities metro to either move to the Twin Ports or add a branch to their operations.

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Cushman and Wakefield reported that vacancy rates for offices in Minneapolis reached 19.9% in the fourth quarter of 2020, about a 2% increase from the first quarter of 2020.

Duluth also has quite a few vacant office spaces, but LaFlamme said he hopes the minimal traffic, proximity to nature and access to parking are desirable traits that will convince metro businesses to move their workspaces north.

Greg Follmer, owner of Follmer Commercial Real Estate in Duluth, said while the office market in Duluth isn’t particularly vibrant at the moment, COVID-19 isn’t necessarily to blame for that.

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“It is not the greatest market, but it was kind of slow prior to the pandemic anyway,” he said. ”It is generally the tougher of the markets here in town.”

Follmer said industrial spaces like shops and warehouses are in highest demand on the commercial market. He also said he’s seen a growing interest in vacancies between Lake Avenue and the Fitger's complex, especially on Superior Street. The area has lake views and many medical businesses are interested in the proximity to Essentia's Vision Northland expansion project.

LaFlamme said there hasn’t been much need for renovation within the office spaces he owns, other than adding some plastic barriers and ramping up cleaning. Both he and Follmer said office tenants continue to pay rent, even though most buildings stay vacant.

“We were very nervous when the pandemic came out to know what was going to happen,” Follmer said. “You really never know, but in the end we were really surprised by how strong and vibrant the market has been for us for what has gone on.”

What do you foresee for the future of downtown Duluth office spaces? Let me know.

Laura Butterbrodt covers health and business for the Duluth News Tribune. Contact her at 218-723-5320 or lbutterbrodt@duluthnews.com.