MINNEAPOLIS — Alliant Credit Union has provided a $23 million loan for the refinancing of The Hewing Hotel in the North Loop market of Minneapolis. The 124-room boutique hotel features a restaurant called Tullibee as well as a rooftop, social club and ballroom. Ben Greazel of NKF Capital arranged the four-year loan. The borrower was not disclosed.
The most active commercial real estate category in the Twin Cities metro area over the last several years, in terms of leasing activity and new construction sales, has been industrial product. New construction has been trending toward office warehouse and bulk buildings with higher clear heights, as tenants are implementing new racking systems and growing upward to optimize their space. On the surface, this trend may sound like it will leave behind the lower-clear height flex and office showroom buildings. However, owners of flex and office showroom buildings in Minneapolis-St. Paul are finding new interest by providing creative amenities and repositioning assets that are attracting entirely new tenant prospect types and reinventing what an office showroom building can become. The ability to target a wider potential prospect pool including office users, retailers and non-traditional industrial users is reliant on proper vacancy preparation to be able to show the space as a true blank slate. Through white-boxing the space, owners show that the space has high ceilings with an industrial feel, an aesthetic that many office users are interested in, but at a significantly lower price point versus many office buildings. Another benefit of the office showroom product is that there …
WILLMAR, MINN. — Montecito Medical has purchased a Class A medical office building totaling 31,775 square feet in Willmar, a city in southwestern Minnesota. The purchase price was not disclosed. The building was constructed in 2005 as a build-to-suit for Fischer Laser Eye Center and Janning ENT. The facility includes an 8,000-square-foot ambulatory surgery center where patients can receive LASIK, cataract, cornea and refractive procedures. Newmark Knight Frank brokered the sale. The seller was not disclosed.
COTTAGE GROVE, MINN. — Kraus-Anderson has completed the construction of Oltman Middle School in Cottage Grove. The $50 million school opened to students this month and replaces the former school in St. Paul Park. The facility can currently accommodate as many as 1,100 students in grades 6-8 with future expansion capabilities for as many as 1,450 students. Each grade level is housed in its own two-story section of the building. Designed by architects Rego + Youngquist, the 188,000-square-foot building includes new classrooms, a media center, state-of-the-art auditorium and performing arts center, pool, music suite, gym, fitness center, locker rooms, cafeteria, kitchen and administrative space.
Like several other markets across the country, the Twin Cities is experiencing the peak of the post-recession construction cycle. However, the traditionally tight multifamily market is in one of the best positions to absorb new units. In fact, Minneapolis-St. Paul has consistently reported one of the lowest vacancy rates in the nation due to a strong economic base and pent up demand for new units. Metro Minneapolis is the second-largest economic center in the Midwest and the local economy has grown at an average of 3 percent over the past five years, a healthy rate in the Midwest. The 18 Fortune 500 companies headquartered in the area are a significant driver of job growth and rental demand, along with the hundreds of support firms. As a result, the unemployment rate is below 3 percent and among the lowest in the nation. Despite a lack of available talent, employers managed to create 30,600 jobs in the year-long period ending in the second quarter. Overall, payrolls expanded by 1.5 percent during that time. Employment growth is encouraging development across several sectors in the market. In South Minneapolis, construction along the Blue Line is taking shape as $300 million in projects are coming …
EDINA, MINN. — Noble Investment Group and Simon Property Group have opened a Homewood Suites by Hilton hotel in Edina. The 146-room hotel is located within the Southdale Center mixed-use project. The property features a business center, fitness center, pool, lobby bar and outdoor courtyard. Southdale Center is also home to a luxury apartment development. Shake Shack is slated to open this fall followed by home furnishing retailer RH next year.
NEW YORK CITY — The American investment team of Bahrain-based Investcorp has acquired 56 industrial properties totaling approximately 4.5 million square feet across seven major American markets. The purchase price was roughly $300 million. The portfolio includes nine warehouses in Minneapolis; 16 warehouse/flex buildings in Dallas; 14 warehouse/manufacturing buildings in Chicago; nine warehouse and flex buildings in Philadelphia and Delaware; five warehouse/manufacturing buildings in Phoenix; two industrial properties in Houston; and one industrial asset in San Antonio. All of the infill properties offer last-mile proximity to major population centers. The seller was not disclosed. “This acquisition gives us the opportunity to expand our presence in this important and growing industrial/warehouse sector in the U.S.,” says Mohammed Alardhi, executive chairman of Investcorp. “This investment further reflects our commitment to growing Investcorp’s footprint in the U.S., which is a key driver of the firm’s overall growth strategy.” At the time of sale, the properties were collectively 90 percent occupied by tenants in the e-commerce, manufacturing, design, wholesaling and food services industries. The sale marks Investcorp’s ninth industrial portfolio acquisition in the last 36 months. Since 1996, Investcorp has purchased more than 550 properties with a total value in excess of $14 billion. …
MINNEAPOLIS — Ackerberg has purchased the Williams Pub building in the Uptown neighborhood of Minneapolis for an undisclosed price. The 26,854-square-foot mixed-use building is located at 2909-2911 Hennepin Ave. Ackerberg plans to rename the building The Carling, as the property once housed The Carling Hotel. The new owner plans to renovate the lobby and façade in order to differentiate the office portion from the space occupied by Williams Pub. Mary Burnton and Teresa Lingg of Newmark Knight Frank will handle lease-up of the property’s office component.
BLOOMINGTON, MINN. AND MILFORD, OHIO — Four Springs Capital Trust (FSCT) has acquired two automotive service centers for an undisclosed price. One of the properties is a collision repair center leased to ABRA Auto Body & Glass in Bloomington, Minn. The other is a tire and service center occupied by AAA in Milford, Ohio. Sellers of the properties were not disclosed. New Jersey-based FSCT is an internally managed, private real estate investment trust focused on acquiring a portfolio of net leased retail, industrial and healthcare properties.
ST. PAUL, MINN. — Kraus-Anderson Construction Co. has completed RiverEast, a $21.9 million special education school in St. Paul. Located at 1055 Mackubin St., the 71,100-square-foot school will open in September and serve students in grades K-8. A maximum of 80 students will be enrolled in the school. Health and education design firm BWBR designed the school. Saint Paul Public Schools was the developer.
