Ways Infrastructure Projects Positively Impact Commercial Real Estate

People say Minnesota has two seasons––winter and construction. When I see orange and white striped barriers and road closed signs, I think of how the project is impacting the surrounding commercial properties. Road construction may be a short-term headache, but it brings long-term benefits. (I know I’m happy about driving and biking on the recently resurfaced roads in my neighborhood. 😉)

Here are five ways well-planned, infrastructure projects impact commercial property values and CRE investing. (and It's more than a smooth ride 😉)

1.      Road updates can increase accessibility and usability, which then boosts demand and sparks revitalization of areas. That leads to increased property values. In addition, as we learned from the collapse of the 35W bridge (18 years ago this month) not taking care of our infrastructure is far more costly. When the bridge collapsed, the economic costs alone totaled around $60 million, and the costs of life and human suffering were priceless.

2.     Quality infrastructure attracts more businesses which then creates jobs and economic growth. In Faribault near one of our investment properties, we’ve seen a sanitary sewer replacement project completed that supports future city growth. A roundabout project at Highway 3 and 30^th Street NW added to the updates. The renovations we made to the property aligned with city projects to improve the area.

3.     Roads, bridges, and mass transit that are modernized and strategically planned can reduce commute time for employees and make it easier for customers to find and access a business. This convenience makes the property more desirable. The area at large becomes more attractive to live, work, and invest. They can also reduce production and distribution costs for businesses. Better roads mean lower costs for transporting goods and materials. The north I-94 corridor towards St. Cloud has seen industry growth in manufacturing, health care, retail, and business and financial services because of its strategic and accessible location. The improvements to the road network have paid off resulting in smoother travel and increased safety and access.

4.    Properties close to mass transit, like the Snelling Lodge in Minneapolis, can see a “transit premium”, meaning the value increases because of convenience and shorter commute times. Between 2009 and 2023, high frequency transit corridor developments represented 38% of all in the region, totaling $19.2 billion. Snelling Lodge (5346 Minnehaha Avenue) offers a rare redevelopment opportunity to deliver a high-density project in one of Minneapolis’s most connected urban neighborhoods (Nokomis East). Along with being steps away from the Blue Line LRT, it provides seamless access to the VA Medical Center, Minneapolis-St. Paul International Airport, Mall of America, and downtown Minneapolis.

5.     The repaving and lane additions on Highway 10 will make the commute to a number of our Coon Rapids listings (Foley Ridge, Kelmark, and Northdale) smoother and more manageable. With Coon Rapids being the largest Minneapolis suburb to the north, traffic levels and congestion have rapidly increased over the years. A third lane in each direction will make it easier, safer, and with less congestion to access these properties.

Conclusion

Infrastructure projects, while often seen as short-term inconveniences, bring long-term benefits to commercial real estate by improving accessibility, boosting property values, and attracting businesses. Upgraded roads and transit systems reduce commute times, lower operational costs, and revitalize neighborhoods—making them more desirable for owners, customers, and investors. Strategic improvements, like those in Faribault, metro highways, and in Coon Rapids, demonstrate how aligning city development with property investments can drive economic growth. Properties near mass transit also gain a “transit premium,” increasing their value and appeal. Infrastructure projects that are well-planned can positively impact commercial real estate, so keep calm and carry on.

Jeff Salzbrun is the owner/broker of Commercial Equities Group (CEG). As a veteran-owned real estate brokerage, CEG has been involved in thousands of sale and lease transactions, ranging from single offices to 250,000+ square foot buildings. At CEG, we get your deal done. We know space, and we know the CRE business.

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