Ask St. Paul’s biggest downtown building owners about the lifeblood of the city’s core, and you’ll hear one word again and again.

Residential, residential, residential.

The evidence is bigger than a new grocery store — data abounds about St. Paul’s residential surge, which is now reaching a particularly sharp spike.

“Maybe St. Paul will be the living capital of the world — who knows?” said developer Dave Brooks. Brooks, along with the downtown core’s other three top building owners, sees the residential trend as the city’s salvation.

The quaint and quiet city where you can walk your dog and pull up a lawn chair is slated to attract residents at a higher rate over the next few years than the city across the river, according to Metropolitan Council statistics.

Still, some are anxious. With an ever-increasing amount of office space converted to livable lofts, will the balance ever tilt too far?

“It seems to me that a lot of offices continue to convert to residential, versus trying to get more jobs downtown,” said Mary Bujold, president of Maxfield Research and Consulting, a local company that analyzes the real estate market. “At some point, we are going to need to put some jobs in the downtown, too.”

City officials say there’s still plenty of room for everything — and they want the residential trend to continue. A hefty residential base will bring both retail and jobs, the theory goes.

“We were out of balance before. I’d argue that it was predominantly a 9-to-5 employee base … I still don’t think we’re ‘at balance,’ ” said Jonathan Sage-Martinson, director of the city’s planning and economic-development department.

Yes, the vacancy rate for competitive office space is the lowest it’s been for 15 years — in large part because of old offices being turned into upscale apartments and condos — but it still sits around 17 percent, based on multiple estimates. Bottom line: There’s still plenty of space to play with.

Regardless, it appears the genie’s out of the bottle: With six major residential projects in the works downtown or right at its edge, and vacancy rates staying low, the fastest-growing neighborhood in St. Paul is destined to get even bigger.

POPULATION GROWTH

Evidence of downtown’s boom has gone beyond anecdotal: An increasing array of metrics reveal a population explosion at the city’s core — and suggest an even bigger one on the horizon.

Rental rates jumped last year an average of 7.3 percent, as apartment vacancy rates dropped below those in downtown Minneapolis — 3.8 percent compared to the larger city’s 4.2 percent.

And the Metropolitan Council predicts a surge for St. Paul over the next several years, even compared to Minneapolis. While the council’s population estimate grew from the U.S. census’s figure of 6,604 in 2010 to 7,911 in 2014, that number is expected to skyrocket to 14,280 by 2020, an 80 percent jump.

In those same six years, the Met Council expects Minneapolis’ downtown core will grow from 26,300 to 34,350, a 30 percent jump. One caveat: The Met Council’s figures don’t include the bustling North Loop, where there has been immense residential development in recent years.

One reason for the Met Council’s optimism: The conversion of St. Paul’s former office space to market-rate — oftentimes upscale — apartments and condos has kicked into high gear over the last couple of years.

City officials point to the 254-unit Penfield project in 2013, along with the smaller Lofts at Farmer’s Market the year before, as the game-changers. It took about six months, but the Penfield reached 95 percent capacity.

“That showed the kind of market that hadn’t yet been proven downtown for market-rate rental,” said city economic-development director Sage-Martinson. “It gave some developers confidence … showing demand for higher-end rental.”

Following the Penfield’s opening in 2013, two new projects — the Pioneer-Endicott and Rayette Lofts — opened the following year. A slate of residential development is following: five projects, including the massive Custom House, totaling about 750 more units.

That’s 1,310 units added to the 5,644 housing units that existed in 2012, according to census and city data — a more than 20 percent boost in just five years, the vast majority of it market rate.

And there are more projects just across the downtown border: the two Seven Corners projects to the west and another phase of the West Side Flats.

“What we have seen in St. Paul that we haven’t seen for many years is new apartment construction. That’s real telling, because new apartment construction takes a higher rent level,” said developer Ted Bigos, who owns five residential buildings downtown.

Even now, St. Paul’s average monthly downtown rental cost is almost on par with Minneapolis: $1,420 for St. Paul compared to $1,505 for downtown Minneapolis, including the North Loop — just 6 percent less — according to data from Maxfield Research and Consulting.

Back in 2000, average rent was $787 in St. Paul compared to $942 in Minneapolis — a 16 percent difference.

NATIONAL TREND OF MOVING TO URBAN CORES

St. Paul had a lot of room to grow, compared to Minneapolis. Even city officials admit this.

“We have traditionally had fewer downtown residents compared to some of these other places,” Sage-Martinson said.

Many point to a national trend: In big cities across the nation — and in the Midwest in particular — there has been a huge wave of residents relocating to urban cores.

Millennials — many of whom value “walkability” and transit options like the Green Line, at least more than previous generations — have hit urban cores in greater numbers, said Andrea Cross, America’s head of office research for the CBRE Group, which is one of the world’s largest real estate investment managers.

A 2015 study by the CBRE Group found big residential jumps in the downtown cores of many major Midwestern cities over the past decade. Kansas City more than tripled. Cincinnati’s downtown doubled, and Cleveland and Columbus came close to doing the same.

But with so much office space being converted to house the new residents, some worry we’ll lose focus on other important matters.

“Someone needs to be thinking about where do we put the next office tower in downtown St. Paul, and I don’t think anybody is thinking about that,” said Bujold, president of Maxfield Research and Consulting.

Last week, there was murmuring in the real estate industry over reports that Cray — which has seen its workforce grow from 225 in 2009 to around 400 now and has maxed out its existing space — was looking for bigger digs, possibly outside St. Paul.

Still, St. Paul’s roughly 17 percent downtown office vacancy rate isn’t that much higher than Minneapolis’s 14 percent, according to CBRE data, which includes the tightly-packed North Loop.

WHAT’S MISSING?

When asked what downtown was missing, even George Sherman — a developer who owns five hefty residential properties in downtown St. Paul — replied simply: “Jobs.”

“It’s not a growth job market. That does have an impact on rental rates, but it’s livable. There’s the state government and hospitals, but major employers are more limited.”

Bigos says thing are fine for the moment, but he worries about the residential market being overbuilt in the future.

“It surprises me how long this good market has lasted … so at some point, you hit a button called oversaturation,” Bigos said.

But Cross thinks people shouldn’t worry about much of the office space that’s been converted so far. “The type of space being converted is not the type of space that’s been in demand by an employer, anyway.”

And others are convinced that the residential surge will be the main driver for more retail, more commercial development and more jobs.

“Downtown needs to do what it has been doing, which is to expand its residential population as aggressively as it can,” said Joe Spartz, president of the Greater St. Paul Building Owners and Managers Association. “What is clear is that once you expand your residential population, it’s going to then impact the demand for retail, which then affects the need for office space. Those things all work in tandem.”

Still, plenty are eager for that theory to start proving itself.

“You have to have some retail stuff down here. You go to Minneapolis, I can buy some beautiful stuff … St. Paul? There is nothing,” Brooks said.

City officials, for their part, are pushing for retail in upcoming projects — the old West Publishing site along the river, Macy’s and the Seven Corners Gateway site. But they still want more residential to round out the mix.

“Some people talk about the 24-hour city or the 18-hour city,” Sage-Martinson said. “I think that trend is happening generally — and it’s happened rapidly and in a big way in St. Paul.”