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Commercial Real Estate, Executive Insight Series, Industry News, Twin Cities Real Estate

Executive Insight Series: Mike Ohmes

Discussion Topics

The CRE Cycle – Are we headed over the top?

Working in the new consolidated CRE environment

Mike Ohmes, Cushman & Wakefield

Executive Vice President, Brokerage

Earning an undergraduate Bachelor of Arts degree in economics and speech communications from Macalester College in St. Paul and an MBA from the Carlson School of Business at the University of Minnesota, Mike Ohmes has a wealth of commercial real estate experience from a broker to a manager.

Today as Executive Vice President Mike Ohmes is responsible for leading Cushman & Wakefield’s Transaction and Advisory Services business. This group includes the company’s Brokerage, Capital Markets and Real Estate Advisory.

Since joining the Cushman & Wakefield in 1991 as a broker in the office division, Ohmes consistently was among the top producers. He has received the company’s Offshore Club designation for his performance a total of 7 times (each year from 1993-1999). In 2000, Ohmes earned the company’s President’s Award for his outstanding contributions to the company, and in 2003, he was recognized by The Minneapolis/St. Paul Business Journal as one of their “40 Under Forty.”

The Shenehon Center for Real Estate is proud to present this opportunity to gain insights into the commercial real estate industry. Founded in 2000, the Shenehon Center for Real Estate looks to provide both resources and a public forum for real estate industry professionals and the public.

Executive Insight Series - Shenehon Center for Real Estate


Tuesday, November 28th, 5:30PM


University of St Thomas, Minneapolis Campus

Shulze Hall, Room 127





Minneapolis / St. Paul Housing, Residential Real Estate, Residential Real Estate Index, Twin Cities Real Estate

UST Housing Index: “It’s Not Your Father’s Housing Market Anymore”

The September Residential Index report from the Shenehon Center for Real Estate came out last week. Mr. Tousley, director of the Shenehon Center, was not surprised by the continuation of the supply glut, but in this latest report, he pointed out that the housing market is now being driven by the Millennial generation and Generation Z. Some key takeaways,

  • Over half of home sales this year have been to people 36 years old or younger
  • Home price appreciation continues to outpace income growth
  • Inventory remains significantly below demand
  • Price and inventory are affecting the “typical” renter

As seen in Minneapolis, many major cities are being pressed by a combination of decreased household sizes, sociocultural trends for “more” space, and an influx of people coming to live in the cities not seen since the 1940’s. The report states, Millenials and Generation Z’ers while interested in buying Continue Reading

Affordable Housing, Development, Housing, Housing Trends, Minneapolis / St. Paul Housing

Affordable Housing (Part 2)

According to Minnesota Compass, 48.4 percent of Minneapolis households are overburdened by housing costs. To explain, these households pay more than 30% of their gross income towards housing. Just for reference, a house in Minneapolis is averaging around $200,000 which for a first time home buyer with 10 percent down payment amounts to a monthly mortgage around $1,400 including an estimates for coverages and taxes.

There are many factors affecting this overburdened number. According to a Minneapolis City Council housing report, the city’s current population [approx. 412,000] has not been this high since the 1970’s which is still lower than the peak seen in 1950 [reported 521,718]. Further exacerbating the issue is the fact that there are about the same amount of units today as in 1950 in conjunction with a decrease in average household size. In 1950, it was roughly 3.3 persons per household compared to today’s 2.3 persons per household.

The most recent residential housing report from the University of St. Thomas and the 2017 Housing Market Comprehensive Analysis by HUD, give evidence that the cost burden is a result of the simple economic principle of supply and demand. The influx of demand for housing within Minneapolis has increased the risk of displacement. Housing prices are up year over year and there remains record low vacancy levels of 4 percent. Talks with a political liaison, Mark Stenglein, and local developer and founder Bob Lux of Atalus, LLC, reinforced the challenges to affordable housing Continue Reading

Minnesota Real Estate Hall of Fame

Minnesota Hall of Fame Inductees Announced!!!

The time has come, the 2017 Hall of Fame inductees have been announced. Congratulations to Ralph Burnet, Jack Rice, and Howard Shenehon!

Join in the recognition of the accomplishments Burnet, Rice and Shenehon have done for Minnesota real estate. Members of the Minnesota Real Estate Hall of Fame are chosen for their outstanding business performance, high standards of ethics and community activities. The three new members are:


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Ralph Burnet

Ralph began his real estate career at Bermel Smaby Realtors. After leaving Bermel Smaby Realtors, he started his own realty company, Burnet Gagner Realty and built it to the largest in the Twin Cities. In 1983, Burnet merged his company with Merrill Lynch and for the next 7 years Burnet served as its Eastern Regional President. But when Merrill Lynch Real Estate was sold to Prudential in 1990, Burnet and his partner Dar Reedy bought back the Minnesota-based company. In 1996, Burnet expanded into the Chicago market, merging with Prudential Preferred Properties of Chicago. By 1998, Burnet Realty had grown to the 4th largest residential brokerage in the United States, and expanded though merging with the Coldwell Banker name. Today, Coldwell Banker Burnet is one of Continue Reading

Economics, Housing, Housing Trends, Minneapolis / St. Paul Housing, Real Estate Trends, Residential Real Estate, Residential Real Estate Index, Twin Cities Real Estate, Uncategorized

Sight-Unseen Home Buying: Trend or Consequence

Twenty years ago, virtual tours and 3D graphics were mainly science fiction in movies like The Fifth Element, and a “sight-unseen” purchase literally meant a buyer had no experience of the property other than static photographs. Buyers were in essence blindfolded. Today, 3D and virtual technologies have become a reality. They are able to bring a property experience to the “sight-unseen” purchase. Local Minneapolis real estate broker Aleksa Montpetit of Downtown Resource Group noted this ingress of technology into the real estate industry, and how it has given realtors a new tool to present properties. Montpetit, who has personally sold 3 properties sight-unseen in the last year, said the Minneapolis market has recently seen buyers more willing to at least offer sight-unseen.

An article posted in the Wall Street Journal by Katy McLaughlin cites increases in sight-unseen purchases are nationally becoming more common. The annual Redfin survey showed 33 percent of those surveyed said they had made at least an offer on a house “sight-unseen” in the last year. However, this survey did not include the Minneapolis market.

Both Scott Parkin of Verve realty and Scott Stabeck of Sotheby International agreed with Montpetit that potential buyers are more willing to make offers “sight-unseen,” and they added Continue Reading

Home Prices, Housing

4th of July Real Estate Matters

Last evening, I watched the Delano fireworks. The show was excellent and the lightning made it even more interesting. It got me thinking about the past, and how 10 years ago, my family would get there 5 or 6 hours early to get prime sitting/parking real estate to see fireworks up close. Whereas, now, as long as we can see the fireworks it is a good spot. To be honest, the effort to get a good spot doesn’t have the same value as before.

Although, my preferences have changed, finding a spot to park a car or a lawn chair seems like it is even harder to find than 10 years ago. Granted, Delano hosts one of the oldest annual 4th of July festivals in the state, the town has grown substantially, and they don’t seem to ever hold back on the fireworks. A couple years back at the 100th anniversary, the Delano fireworks show had a finale “end-of-show” firework which my friends and I felt from 10 miles away. I digress. Despite my own preferences, people want prime viewing real estate to watch the fireworks up close, but there isn’t enough. As the effort [price] to acquire the sitting space rises, people, like my family, have decided to locate farther away.

To the point, the fireworks show reminded me of the current housing market. Low housing inventories with high demand. From a simple economic standpoint, people should be entering the market as the price rises, but like the fireworks show there is an intangible element to housing. Individually, we all value these intangible attributes of living differently. For example, some people in a median priced house may value geography and education opportunities higher than the house alone, and they may not be able to find a home with similar geography and education. Therefore, they do not enter the market keeping inventory low.

FRED reports the average American family can afford a mortgage. So, why are we not seeing more sales? Can people not afford or not willing to pay current prices? Could it be trends changing social norms (Home ownership)? Whatever the reason, it will be interesting to see at what point housing inventories truly begin to climb.

Home Prices, Housing Trends, Minneapolis / St. Paul Housing, Residential Real Estate Index

Low Home Inventory Beginning to Affect Sales Volume: First Time Home Buyers Fueling Growth

MINNEAPOLIS, (June 21, 2017)— According to the First-Time Homebuyer Market Report recently released by Genworth Mortgage Insurance this segment of the market is having a big influence on the national housing market. The report found that this demographic accounted for 424,000 single-family home sales, or 38 percent of the total homes sold in Q1 of 2017. This amount is an 11 percent increase from Q1 2016, and the most since 2005. Their source data dates back to 1994 and analyzes over 20 million records. The survey tracks home sales for first-time homebuyers on a monthly basis, publishes quarterly, and compares the data against national housing market indicators.

“The first time home buyer segment is poised for additional growth in the Twin Cities. In fact, historically low interest rates and a strong local economy are all feeding demand in this market segment.” said Herb Tousley, director of real estate programs at the University of St. Thomas.

There are some head winds that are creating a drag on the willingness and ability of first time buyers to jump into home ownership. Student loan debt is a major factor making it very difficult to save for a down payment, qualify for a mortgage, and afford a mortgage payment. Additionally, the extreme shortage of moderately priced homes is making it difficult for first time buyers to find affordable homes in good locations.

The limited availability of homes to buy is creating upward pressure on sale prices. Home prices have been rising faster than wages for the last several years. This situation is starting to create affordability issues for first time buyers who typically do not have large down payments. The idea of home ownership is still very much alive among younger potential home buyers. However, due to the aforementioned factors many are needing to delay their first home purchase by several years.

 Setting New Records

The Twin Cities housing market continues to set new records in May. Record high median sales prices and historically low supply continue to dominate the market. The overall median sale price jumped from $245,500 in April to $250,000 in May.

Continue Reading

Architecture & Design, Development, Twin Cities Real Estate, Urban Planning

Former Washburn-McReavy Funeral Home Development Remains Postponed

If you take a leisurely drive east over the 3rd Street bridge, you will see a familiar building. Familiar in the sense, the building is 90 years old. Your grandparents likely could have seen it as children. However, today unlike 90 years ago, fences surround the building with visible graffiti and construction equipment. It is the sight of one of many development projects in historic Northeast Minneapolis. 

The plan for the 90 year old building, previously occupied by Washburn-McReavy funeral home, was demolition to make way for a 40 story high rise. The project thus far is similar to the redevelopment efforts of Nye’s Polonaise which occupied the historic Harness shop and 112 Hennepin building. The Nye’s Polonaise project originally planned a high rise building, but in the end scrapped 24 of the original 30 floors to accommodate the neighborhood and Heritage Preservation Commission.

While it is not the same building as Nye’s, the project has been postponed now for almost a year. It will be interesting to see what happens, but recent history and potential project pressures may indicate serious alterations to the original plans.


Commercial Real Estate, Development, Economics, Executive Insight Series, Housing, Industry News, Investment Real Estate, Real Estate Programs, Real Estate Trends, Think Outside The Box, Twin Cities Real Estate, Upcoming UST Events

Real Estate Executive Insight Speaker Series Bob Lux – Inside the Mind of A Developer


Real Estate Executive Insight Series

Bob Lux – Inside the Mind of A Developer 

Event Details Tuesday, March 28th 2017 5:30 p.m. University of St. Thomas, Minneapolis Campus Schulze Hall, Room 127

A candid conversation with industry leader Bob Lux, Founder Alatus LLC

Quality real estate development requires innovative thinking. Bob Lux, founder of Alatus LLC, has been in the real estate development and investment business for over 30 years. His company’s mission is to provide innovative solutions and high quality projects by wisely using his team’s talents and strengths to achieve the client’s vision and form a better community.   Lux will discuss the challenges, opportunities and trends in developing residential and commercial real estate in the Twin Cities. Lux will also share his views on the condo market and as the largest private owner of parking facilities in Minnesota Bob will outline his expectations for future parking and infrastructure needs in the downtown area.

Agenda 5:30-6 p.m. Networking 6-7 p.m. Presentation by Bob Lux

Register Today
Affordable Housing, Economics, Home Prices, Housing, Housing Trends, Minneapolis / St. Paul Housing, Multifamily, Twin Cities Real Estate

St. Thomas real estate analysis for July: Tight market is the result of several long-term trends that won’t change soon

Current trends, including the low number of moderately priced homes, are expected to continue through the end of 2017.mortgages

Current real estate trends in the 13-county Twin Cities region, including the historically low number of moderately priced homes available to purchase, are the result of several long-term trends that are expected to change slowly over time. That’s the conclusion reached by the Shenehon Center for Real Estate at the University of St. Thomas’ Opus College of Business. The center examined the Twin Cities’ long-term trends, expected to continue through the end of 2017, in its monthly analysis of metro area real estate data. “The historically low-supply-of-homes-for-sale situation has been with us for the last several years although it has been most acute since mid-2015,” said Herb Tousley, director of real estate programs at the university.

He cited five statistics that illustrate the housing supply-and-demand situation in the Twin Cities:

  • Days on Market:       It was 53 days in July. That’s 15 percent less than a year ago and the fastest turnover since 2007.
  • Month’s Supply: It was 2.9 months in July. That’s 24 percent less than a year ago and the lowest 12-month average since 2005.
  • New Listings: It was 7,522 in July. Down 14 percent from June and 6 percent from a year ago.
  • Closed Sales: It was 6,030 in July. The annualized number of homes sold has increased 59 percent since early 2011.
  • Homes for Sale: It was 14,457 in July. The annualized number of homes for sale has decreased 48 percent since early 2011.

The shortage of homes is most pronounced for homes selling for less than $200,000 and for those selling between $200,000 and $399,000.

For example, in July there was only a two-month supply of homes selling for less than $200,000 and a 2.6-month supply for homes selling between $200,000 and $399,000. However, there was 5.2-month supply of homes selling between $400,000 and $599,000 and a 10.5-month supply of homes selling for more than $600,000.

Also in July, 56.3 percent of homes available for purchase were under $400,000 while 81.7 percent of homes sold were under $400,000.

The median price for homes sold in the Twin Cities in July was $239,000. That’s down $6,000 from the all-time high median sale price of $245,900 that was set in June. However, it still is in record territory; the previous high was $238,000 set in June 2006.

Supply Side Trends

The Shenehon report cited these long-term underlying trends on the supply side of the Twin Cities market.

  • Americans are keep their homes longer. CoreLogic reported recently that the number of years homeowners owned their homes increased by three years between 2007 and 2013 and it has increased an additional year since then.
  • The homeownership in the Twin Cities, as reported by the U.S. Census Bureau, was 68.6 percent in the second quarter of 2016. That’s the highest rate of any major metro area in the nation. Nationally, the rate is 62.9 percent.

“Since we have a very high ownership rate and homeowners are keeping their homes longer, the result is fewer existing homes being listed and a shortage of homes available for sale,” Tousley said.

Demand Side Trends

According to this month’s Shenehon report, “On the demand side the simple answer is that people want to live here.”

  • The Twin Cities population has been increasing and is expected to increase for at least the next 10 to 15 years. This is mainly due to migration from rural areas and other parts of the country, and immigration.
  • Housing is affordable. According to a recent Bloomberg News report, the Twin Cities area ranks fourth in the top-10 list of most affordable places for people between the ages of 24 and 44 to purchase a home.

“These people are going to need a place to live here,” Tousley said. “Our diverse economy, strong job growth and high median income attracts people to the area.

“Favorable economic conditions coupled with historically low interest rates and an increasing number of potential home buyers will continue to create strong demand for single-family homes.”

How long will the shortage last?

According to the Metropolitan Council, the Twin Cities region had 1,176,600 owned or rented households in 2015, up almost 59,000 since 2010. During that time, however, only 43,000 housing units were added. The remaining 16,000 new households moved into existing housing, and that in turn reduced the vacancy rate. “This growth pattern is expected to continue for at least the next five years,” Tousley said. “It is unlikely that we will be able to build our way out of this situation in the near term. “Single family home builders have not yet returned to pre-recession production levels. Over the last several years there has been a great deal of multi-family construction but much of this new product has been high-end luxury units, beyond the financial reach of many households. “For the housing market to become more balanced between buyers and sellers we are going to have to add a significant number of affordably priced rental and for-sale housing units. “These units need to be affordable to households who earn the area median income in order to keep up with the expected population growth in the Twin Cities market area. As this happens the market should begin to slowly come back into balance. “However, this is a process that is going to take a number of years and until then we should expect similar market conditions to what we have experienced over the last couple of years. “In the meantime, expect to see solid annual price appreciation for existing homeowners. As you can see from the table below in the past year the supply of homes for sale has become even tighter, especially for homes are priced at less than $400,000

The St. Thomas indexes.

Here are the Shenehon Center’s monthly composite index scores for July 2016. The index, which tracks nine data elements for the three types of sales (traditional, short sales and foreclosures), started in January 2005. For that month, the center gave each of the three indexes a value of 1,000.

  • The July 2016 index score for traditional sales was 1,192, up .3 percent from June 2016 and up 5.7 percent from July 2015.


  • The July 2016 index score for short sales was 1,031, up 2.1 percent from June 2016 and up 5.9 percent from July 2015.


  • The July 2016 index score for foreclosures was 875, which is unchanged from June 2016 and up 7.1% from July 2015.

For the third consecutive month, the score for traditional sales set new record highs. “Although the increase was small in July, it is the result of a continuing tight supply of homes for sale couple with very low interest rates,” Tousley said in Shenehon Center’s July report.

 More information online

The Shenehon Center’s complete online report for July can be found at:

The report is available free via email from Tousley at