MINNEAPOLIS — Merchants Capital has secured $16 million in construction and permanent financing for The Redwell, a 109-unit affordable housing property in the North Loop District of Minneapolis. The financing includes a Merchants Bank of Indiana construction loan and a Fannie Mae mortgage-backed security as tax-exempt bond (M.TEB) forward loan. This type of Fannie Mae loan can be used to finance the new construction and rehabilitation of multifamily affordable housing properties. Financing also included $7.9 million in low-income housing tax credit equity. Schafer Richardson and WNC were the borrowers. The Redwell will rise six stories and include first-floor commercial space. The Minneapolis Public Housing Authority (MPHA) will provide 22 Section 8 vouchers whereby households will pay 30 percent of their income toward rent, with the balance paid by federal subsidies administered by MPHA. The remaining units will be priced at the fair-market rate for 60 percent of the area median income.
Our Twin Cities office market remains strong as the population of millennials and empty nesters continues to migrate to first- and second-ring areas, bringing revitalization and new investment into the city’s commerce and infrastructure. With vacancies remaining exceptionally low and fewer developments on the horizon, rents have shown consistent growth. We are seeing fewer new buildings under construction for single-tenant users. Most are geared toward multi-tenant, mixed-use concepts. Newly renovated buildings with many amenities are performing well in attracting and keeping tenants. With the metro’s unemployment right around 3 percent and employers with jobs to fill, tenants have the leverage. Offering modern and high-tech communal spaces with multiple amenities is key. Tenants and buyers are leveraging this trend, therefore spaces with the allure of contemporary and updated finishes are highly desired. It is imperative that landlords and owners renovate and update their buildings in order to stay relevant in today’s market. Many tenants are simply moving from one space to another nearby because it has been updated and improved upon. That is one of the bigger challenges — improvements that keep the space relevant. Space configurations Employers often offset higher rent costs by embracing space efficiency and flexible workspace strategies …
EDEN PRAIRIE, MINN. — Timberland Partners has opened Elevate at Southwest Station Apartments in Eden Prairie. Elevate features 222 apartment units as well as 13,000 square feet of retail space. Brick & Bourbon craft bar and eatery is expected to open at the property by the end of the year. Amenities at Elevate include a rooftop courtyard, pool, community room, coworking space, dog run, pet spa, yoga studio and fitness center. Kaas Wilson Architects and general contractor Frana Cos. made up the project team for the $63.7 million development. Monthly rents start at $1,279 for studios.
ST. PAUL, MINN. — Kraus-Anderson Development has begun the conversion of the former Capitol Professional Office Building located at 590 Park St. in St. Paul into a 92-unit apartment building. Located near Regions Hospital and the state capitol building, the project is situated within the Capitol Heights neighborhood. Completion is slated for July 2020. Designed by UrbanWorks Architecture, the 590 Park project will offer micro and one-bedroom units. Amenities will include a lobby lounge, game room, outdoor patio, dog run, fitness center and clubroom. Kraus-Anderson will also renovate the adjacent parking structure as part of the project.
WOODBURY, MINN. — Hanley Investment Group Real Estate Advisors has negotiated the $11.8 million sale of Commons Plaza, a 13,405-square-foot, three-building retail property in Woodbury. The property is located at 720-740 Commons Drive, 23 miles east of downtown Minneapolis. The property features a new 2,926-square-foot building that is fully leased to Raising Cane’s. The second building spans 3,551 square feet and is fully leased to Minneapolis-based Sleep Number. Lastly, the third building totals 7,199 square feet and is occupied by WellHaven Pet Health and Restore Cryotherapy. Jeff Lefko and Bill Asher of Hanley Investment Group represented the seller, Florida-based Onecorp, in the transaction. Steve Tucker of California-based Tucker Investments represented the buyer, a private investor from Orange County, California.
ROCHESTER, MINN. — The Opus Group and Titan Development & Investments have completed development of The Maven on Broadway, a 154-unit apartment project in Rochester near the Mayo Clinic. The building offers a mix of floor plans ranging from studios to penthouses, including 20 furnished units. Tenants have access to various amenities, including a pool, clubroom, fitness center, lounge, rooftop deck and dog wash. The property also includes 9,000 square feet of ground-level retail space. The project is part of the city of Rochester’s Destination Medical Center initiative, a public-private partnership to position Rochester as a destination for health and wellness. Opus and Titan were co-developers, while Titan provided construction management. Opus served as design-builder, interior designer, architect and structural engineer of record.
As a team, we work heavily in mixed-use leasing and development sourcing. Our team handles the commercial leasing on many mixed-use projects within the Twin Cities market, where we also source and find locations for mixed-use apartment developers. This article will give a current snapshot of the mixed-use retail and apartment market within the Twin Cities. What types of projects? There are many three- to six-story, podium-style apartment buildings popping up all over the urban areas of Minneapolis-St. Paul. This product type can also be found in the suburbs. The first floor, or the podium, is constructed out of concrete and allows for up to five additional floors. This is very prevalent in our market and we don’t see this changing soon. However, advanced timber construction is just starting to show itself in the Twin Cities. The mid-rise and high-rise multifamily buildings are mostly contained to the urban core areas. These projects are all concrete construction. It took up until the last five years or so to see major grocers occupy the first floor. We have observed many examples of this and have worked with some of the large nationals as well as larger, local grocers. Mixed-use does not appear …
LAKEVILLE, MINN. — Upland Real Estate Group Inc. has arranged the $3.5 million sale of a U.S. Bank ground lease in Lakeville, approximately 20 miles south of Minneapolis. The 3,636-square-foot property is located at 20191 Iberia Ave. There are 11 years remaining on the ground lease. Upland represented the undisclosed seller. A 1031 exchange investor purchased the asset. U.S. Bank operates 3,106 branches throughout the country.
EDINA, MINN. — NorthMarq has arranged a $17.4 million Freddie Mac loan for the refinancing of York Place Apartments in Edina. Built in 2009, the 114-unit apartment property is located at 3121 W. 69th St. Dan Trebil of NorthMarq arranged the 10-year loan with five years of interest-only payments and a 30-year amortization schedule. The borrower was undisclosed.
EAGAN, MINN. — The Opus Group has broken ground on Dodd Road Business Center, a 152,000-square-foot industrial development in Eagan. Construction of the building is slated for the first quarter of 2020. The speculative project will sit on 10 acres and include 180 parking stalls, a clear height of 32 feet, 35 dock doors, two drive-in doors and an outdoor patio. Opus is the developer, design-builder, architect and engineer of record. Eric Rossbach and Bill Ritter of Colliers International will market the property for lease.