MREJ Apr 2017

VOLUME 33, NUMBER 4

©2017 Real Estate Publishing Corporation

April 2017

Downtown St. Paul undergoes major transformation

Redevelopment/reuse is the name of the game as the city reinvents itself

By Liz Wolf

T

here’s no shortage of redevelopment projects proposed or underway in downtown St. Paul.

For example, major redevelopment plans are morphing for the former Ramsey County jail and West Publishing headquarters site that would mean a complete transformation of the riverfront property.

New upscale apartments and a new Hyatt Place hotel –– downtown’s first new hotel since the 1980s

-- opened in the Custom House, a redevelopment of the iconic 17-story Kellogg Boulevard post office tower.

The former Macy’s Department Store, which has been sitting vacant since 2013, will soon feature a rooftop ice rink and craft brewery.

The old Seven Corners Hardware store, on the St. Paul to page 12

New development in South St. Cloud presents opportunities 200 Acres of Commercial Land Near New School Building Site

By Cathy Mehelich, Director of the Economic Development Authority

G

ood things come to those who wait, right? Well for the City of St. Cloud, it has been more than

10 years since they completed a regional study that identified the number one opportunity for growth and expansion as their south side—the area where one of their high schools (Tech High School) will break ground on a brand new building later this spring.

Putting the proper roads in place and laying necessary utilities has finally made development possible.

And since the school voted last fall to relocate there from across town, the City is seeing immense interest in both commercial and residential development fol-

low closely behind.

“After many years of planning, we’re thrilled to see that the time has finally come to develop this area,” said Matt Glaesman, St. Cloud’s Community Development Director.

With the recent completion of the 33rd Street and Trunk Highway 15 Interchange, St. Cloud’s south side has quick access to I-94 and MN Hwy 15, making it easy to get to other parts of the City while avoiding St. Cloud to page 18

April 2017

Minnesota Real Estate Journal

Contents

1

APRIL 2017 • VOLUME 33, NUMBER 4

DOWNTOWN ST. PAUL UNDERGOES MAJOR TRANSFORMATION NEW DEVELOPMENT IN SOUTH ST. CLOUD PRESENTS OPPORTUNITIES

16

PLENTY OF CONSTRUCTION PROJECTS KEEPING DEVELOPERS BUSY IN MINNEAPOLIS/ST. PAUL MARKET

19

INDUSTRIAL INSIDER: TOP TRENDS FOR INDUSTRIAL REAL ESTATE IN 2017

Page 3

Departments PEOPLE

4

NEWS

6

Minnesota Real Estate Journal (ISSN 08932255) Copyright © 2017 by the Minnesota Real Estate Journal is published for $85 a year at 12 times per year by Jeff Johnson, 13700 83rd Way North, Suite 206, Maple Grove, MN 55369. Monthly Business and Editorial Offices: 13700 83rd Way North, Maple Grove, MN 55369 Accounting and Circulation Offices: Jeff Johnson, 13700 83rd Way North, Maple Grove, MN 55369 Call 952-885-0815 to subscribe. For more information call: 952-885-0815. Periodical postage paid at Maple Grove and additional mailing offices. POSTMASTER: Send address changes to Minnesota Real Estate Journal, 13700 83rd Way North, Suite 206, Maple Grove, MN 55369 ©2017 Real Estate Publishing Corporation. No part of this publication may be reproduced without the written permission of the publisher.

Page 4

Minnesota Real Estate Journal

April 2017

People

13700 83rd Way N, STE 206 Maple Grove, MN 55369 For information call 952-885-0815

President | Publisher Jeff Johnson jeff.johnson@resummits.com Associate Publisher Jay Kodytek jay.kodytek@resummits.com Consulting Editor Dr. Tom Musil tamusil@stthomas.edu Conference Manager | Art Director | Graphic Designer | CE Specialist Alan Davis alan@resummits.com

EditoRiAl AdvisoRy BoARd JOHN ALLEN Industrial Equities ROBERT ANGLESON Navigator Real Estate JEFF EATON Cushman & Wakefield/NorthMarq MARK EVENSON Evenson and Young PATRICIA GNETZ US Bank TOM GUMP TAG Consulting DAVID JELLISON Liberty Property Trust CHAD JOHNSON Hellmuth & Johnson BILL WARDWELL Colliers International JEFFREY LAFAVRE IAG Commercial WADE LAU Founders Properties MIKE LE JEUNE Fabcon JIM LOCKHART WIPFLI DUANE LUND Exchange Realty CLINT MILLER Cushman & Wakefield/NorthMarq DR. THOMAS MUSIL WILLIAM M. OSTLUND CBC Griffin Companies WHITNEY PEYTON MIKE SALMEN Transwestern

13700 83rd Way N, STE 206 Maple Grove, MN 55369 For information call 952-885-0815

Mitchell H. Cox joins Schafer Richardson and SR Realty Trust, Inc. Schafer Richardson announced that Mitchell H. Cox has joined Schafer Richardson, Inc. and SR Realty Trust, Inc. as their General Counsel. Mitch brings to us over 33 years of general corporate, business, real estate, merger and acquisition, and construction law experience. This enables Mitch to advise and assist in all aspects of entity formation, organization, financing and capital structuring. In the real estate area, Mitch handles a broad range of transactions, including the acquisition, financing, development, construction, leasing, management, operation, and disposition of projects.

Prior to joining Schafer Richardson, Mitch was a shareholder with Moss & Barnett, A Professional Association, a mid-sized law firm headquartered in Minneapolis, Minnesota. At Moss & Barnett, Mitch served as the Chair of its commercial department and the head of its business law practice group. While in private practice, Mitch was listed in Minnesota Super Lawyers, including the “Top 40 Business and Commercial Transactions” and the “Top 100” lists by its predecessor publication, Minnesota Law & Politics.

“We are excited to have Mitch Cox join our firm,” stated Brad Schafer, CEO of Schafer Richardson. “We worked with Mitch nearly exclusively for over 20 years when he was at Moss & Barnett, and value his expertise and integrity.”

Mike Rodriguez Joins Ryan Companies as Vice President of A+E Rodriguez has designed some of the region’s most impactful healthcare environments.

Ryan Companies US, Inc., announced today that Mike Rodriguez has joined the company as the Vice President of Architecture + Engineering. Rodriguez brings over twenty years of experience to the Ryan A+E team, having led the design and project development of millions of square feet of civic, corporate and medical space both nationally and internationally.

Rodriguez comes to Ryan from HDR where he spent the past seven years

leading the Minneapolis/St. Paul Design Studio. His diverse experience includes healthcare projects like the Mother Baby Center at Children’s Hospital, the expansion and renovation of the Mayo Clinic Emergency Department, and Mercy Hospital’s expansion and renovation, as well as convention centers, corporate spaces and a number of ballparks.

“Mike has designed some of the region’s most impactful healthcare environments, earning him a reputation among his clients for an uncommon commitment to their success. This combination of design expertise, impact and customer service makes him a great fit for us,” said Mike Ryan President, Ryan A+E. Rodriguez’s responsibilities will include executing on the architecture + engineering team’s plan for continued nationwide expansion, especially within the healthcare sector, as well as dayto-day leadership and oversight of current projects.

has been promoted to controller, effective March 1, 2017.

In his new role, Ulstad is responsible for United Properties' accounting functions, including preparing all financial reporting, the annual budget and strategic plan; coordinating the annual audit and tax returns; managing all debt compliance, capital commitment and line of credit tracking and forecasting; and overseeing internal controls and joint venture reporting and compliance.

BURNSVILLE CENTER ANNOUNCES NEW GENERAL MANAGER, JOE DUPERRE

United Properties’ Peter Ulstad promoted to controller

Burnsville Center recently announced Joe Duperre to their management team as General Manager. He will be instrumental in revitalizing the property’s tenant mix as well as developing key community partnerships to build strong strategies for future economic benefit. Duperre comes with a wealth of experience in property management, having spent the last three years in Bismarck, ND at CBL & Associates’ Kirkwood Mall as General Manager. He begins his tenure at Burnsville Center on May 1, 2017.

Duperre joins Burnsville Center in time for the center’s 40th anniversary year which kicks off in August.

“Burnsville Center is well positioned to serve the growing south metro communities,” shares Duperre. “I’m eager to work together with community leaders to provide convenient shopping from a mix of national, regional and local retailers, a great mix of entertainment, dining and event options as well as create opportunities that capitalize on the energy and attractions of the Minneapolis area.”

“Joe’s experience shows a strong ability to develop key community partnerships that bring new energy to a property. We look forward to the vision he brings to Burnsville Center,” shares Thom Guerra, Senior Director - Management at CBL & Associates.

Prior to his retail property management experience, Duperre spent several years in the hospitality industry, climbing the ranks to key leadership positions within the Marriott International brand.

United Properties announced today that Peter Ulstad, assistant controller,

People Section Continues to Page 22

Dominium Promotes Janice Dennie to Corporate Leasing Consultant Dominium, a leading apartment development and management company, today announced that it has promoted Janice Dennie to the newly created position of corporate leasing consultant at its Plymouth, Minn. headquarters.

Dennie will be responsible for fielding calls and written communications for Dominium’s senior developments, as well as creating insider prospect lists and providing updates on development, open houses and application processes.

Dennie will also be responsible for facilitating inbound communication for Dominium’s New Senior Communities, currently under construction in the Twin Cities. These properties include The Legends of Cottage Grove (February 2018), The Legends of Champlin (February 2018), The Legends of Columbia Heights (March 2018), and The Legends of Apple Valley (May 2018).

Page 6

News Dougherty Mortgage LLC closes $13.6 million HUD 223(f) loan for Prairie Meadows Townhomes Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $13.6 million HUD 223(f) loan to be used for the acquisition of Prairie Meadows Townhomes, a 168unit townhouse property located in Eden Prairie, Minnesota. The Sponsor of the project is Community Housing Development Corporation, a non-profit developer and owner of multifamily properties. The project was originally constructed in 1977, with renovations occurring in 1993, 2004, and 2010, with approximately $28,500 per unit renovations to be completed as part of this transaction. All 168 units are restricted to residents earning 60% or less of the Area Median Income, and all 168 units are also covered by a Section 8 HAP Contract. The HUD 223(f) loan has a 35-year term and amortization schedule and was arranged through Dougherty’s Minneapolis office for Prairie Meadows Limited Partnership, a Minnesota limited partnership.

COLLIERS INTERNATIONAL EXPANDS IN MINNESOTA Acquisition of Twin Cities real estate services icon Welsh Companies strengthens ongoing commitment to the Midwest market Leading global commercial real estate services firm Colliers International

Minnesota Real Estate Journal

Group Inc. (NASDAQ and TSX: CIGI) announced today the acquisition of WelshCo LLC (“Welsh”) and its brokerage, property management, facilities, and architecture divisions. Welsh has been an affiliate office of Colliers International since 2010. Terms of the transaction were not disclosed.

Founded in 1977, Welsh is a market leader in the greater Minneapolis-St. Paul area for its commitment to clients, offering a full range of services for commercial real estate owners and occupiers. With more than 225 professionals, Welsh provides investment sales, lease brokerage, property management, facilities management, architecture services, and project management to local, regional, national and global clients.

“This addition is the latest in a series of targeted strategic acquisitions across the U.S., specifically in the important Midwest region,” said Steve Everbach, Colliers International President | Central Region. “Adding our high-performing Minnesota affiliate as a fully integrated part of our global platform will further strengthen our company nationally and help leverage their managerial talents in other regions.”

“This partnership with Colliers is the next evolution of our business given our shared culture and focus on service excellence,” said Jean Kane, CEO of Welsh. “All of us in our Twin Cities offices are extremely excited about our extended relationship with Colliers International. By partnering with Colliers and leveraging the size, capital and established infrastructure of the Colliers global platform, we will stimulate the

April 2017

growth of our business and be positioned better than ever to serve the expanding needs of our clients and accelerate their success.”

“The Midwest is a thriving market and Colliers continues to enhance its market leading platform and pursue strategic growth in this important region,” said Marty Pupil, President | U.S. Brokerage. “This investment reaffirms our confidence in Jean, her entire team, and the Minnesota market, and it advances our goal of supporting best-inclass teams across our business.”

new downtown Minneapolis office space.

United Properties will be moving its’ Bloomington office into the newly renovated 7th & Nic building which formerly housed Saks 5th Avenue. Anderson CC will be completing the construction of approximately 17,000 sf of office space on the 4th floor. Currently, Anderson CC is working on the Phase II project at the 7th & Nic which includes the common area renovations.

United Properties plans to occupy it’s new space in mid-May.

Dougherty Mortgage LLC closes $1.9 million Fannie Mae loan for Blanco Oaks Apartment Homes

Dougherty Mortgage LLC closes $13 million HUD 223(f) loan for Manor Royal Apartments

Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $1.9 million Fannie Mae loan for the acquisition of Blanco Oaks Apartment Homes, a 30-unit market rate apartment property located in Blanco, Texas. The Fannie Mae 12-year term, 1-year interest only loan has a 30year amortization schedule and was arranged through a partnership with Old Capital Lending and Dougherty’s Minneapolis and Vienna, Virginia offices for borrower Rio Blanco Apartments LLC.

Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $13 million HUD 223(f) loan for the refinance of the Manor Royal Apartments, a 132-unit market rate apartment property located in Plymouth, Minnesota. The Sponsor of this refinance transaction is North American Realty, LLC, which is a real estate company based in Rochester, Minnesota. The project was originally constructed in 1970, and approximately $26,000 per unit in renovations will be completed as part of this transaction.

The project is professionally managed

by Real Estate Equities Management, LLC. The HUD 223(f) loan has a 35year term and amortization schedule and was arranged through Dougherty’s Minneapolis office for P & R Properties Company, LLC, a Minnesota limited

ANDERSON CC FINALZING CONSTRUCTION OF UNITED PROPERTIES NEW DOWNTOWN OFFICE SPACE Anderson CC, a Twin Cities based commercial general contractor, is finishing construction of United Properties

Page 8

liability company.

Midwest Steel Supply nMoving Operations to Rogers Midwest Steel Supply Inc. is moving its operations to Rogers in a $5.2 million expansion that will enable the company to double its space and hire 15 additional workers.

The company, currently based in New Hope, said plans call for building a 55,000-square-foot office and distribution facility in Rogers. Company officials said they are making the move because the business is growing and needs more room. The new jobs will be created over the next three years and pay wages averaging $16.95 an hour.

The Minnesota Department of Employment and Economic Development (DEED) is supporting the project with a $255,828 grant from the Job Creation Fund. The company will receive the funding once it has met investment and job creation commitments.

“Midwest Steel Supply’s decision to grow their business in Minnesota is a testament to the quality of Minnesota

Minnesota Real Estate Journal

workers and strength of our economy. I thank Midwest Steel for their continued commitment to our state,” said Lt. Governor Tina Smith. “I urge the Minnesota Legislature to restore funding for the state Job Creation Fund, so we may continue facilitating job creating projects across Minnesota in the future.”

Midwest Steel, which was established in 1960, is a metal service center and distributor specializing in aluminum, stainless steel, steel and brass, as well as precision cutting of metal. The company purchases metal products from suppliers around the world and distributes them in the U.S. market. The business serves the medical, aerospace, semiconductor, defense and automated packaging equipment industries.

“Midwest Steel is growing rapidly thanks to increased demand for their products and services,” said DEED Commissioner Shawntera Hardy. “This expansion will enable the company to respond quickly to customer needs and remain one of the top metal distributors in the country.”

The Job Creation Fund, which was first proposed by Gov. Mark Dayton in

2013, is a pay-for-performance program that provides funding to businesses after they meet certain criteria, including minimum requirements for job creation and private investments. Under the program, businesses must create at least 10 full-time jobs and invest at least $500,000 to be eligible for financial assistance.

Since the Job Creation Fund was launched in January 2014, DEED has awarded $34.2 million for 77 business expansion projects in Minnesota. Companies have committed to creating 4,671 full-time jobs and investing $1.07 billion to expand. Go to the DEED website for more details about the Job Creation Fund.

The Opus Group® Announces First Tenants at Completed 169 Business Center The Opus Group (Opus) announced today Staging Concepts and its sister company SC Railing Company as the first tenants at the completed 169 Busi-

April 2017

ness Center in Brooklyn Park. Together, Staging Concepts and SC Railing Company will occupy 65,000 square feet of the 145,800-square-foot development.

“We are delighted to welcome Staging Concepts and SC Railing Company as the first tenants at 169 Business Center and provide the companies with a highly functional space to meet their manufacturing needs,” said Joe Mahoney, senior manager, real estate development, Opus Development Company, L.L.C. “The leasing of this space underscores the desire for quality firstgeneration space that is well located, and we continue to see an increase in interest from the market in industrial buildings.”

Located at the intersection of 85th Avenue and Wyoming Avenue North, the building offers prime highway access and meets the demand for space resulting from the sector’s low vacancy rates. The development offers 24-foot clear height, access to Highway 169 and County Road 81 and desirable area amenities for employees.

“We are excited to further expand our operations in the Twin Cities metro area

Page 10

Minnesota Real Estate Journal

as we continue to grow our footprint in the performance staging and architectural railing markets,” said Chad Benning, director of operations, Staging Concepts. “The added space will allow us to amplify our production throughput and increase office space needed to accommodate our growing team.”

Staging Concepts leads the industry in portable staging equipment. The company has provided advanced, modular custom staging solutions for venues of all sizes in the industry since 1990. SC Railing Company is a leading national provider of decorative railing systems.

Staging Concepts will use the building as an additional facility to the company’s existing headquarters in Minneapolis. SC Railing will use a small portion of the facility to store finished goods and perform a portion of railing fabrication. Based on the unique needs of each business, Opus Design Build, L.L.C. worked with Staging Concepts and SC Railing Company to update the building for optimal functionality. Up

to 70 percent of the space will be used for manufacturing with the balance reserved for employee office space.

Opus’ recent portfolio of work includes more than 6.9 million square feet of industrial developments currently under construction or completed in the past 24 months across the United States.

169 Business Center is owned in a joint venture partnership between Opus Development Company, L.L.C. and Founders Properties, L.L.C. Opus Development Company, L.L.C. was the developer, Opus Design Build, L.L.C. was the design-builder and led the tenant improvement work, and Opus AE Group, L.L.C. was the architect and structural engineer of record and the interior designer for the project.

Jason Meyer, Brent Masica and Kris Smeltzer at Cushman & Wakefield | NorthMarq marketed the property for lease and Tim Carlson at Cresa represented Staging Concepts and SC Railing Company.

EXTEND THE LIFE OF YOUR ROOF Learn to identify roof deficiencies and apply that knowledge to your roof. Properly maintaining your roof will prolong its life!

April 2017

Dougherty Funding LLC Closes $12 million loan for Royal River Casino MINNEAPOLIS, Minn. – April 21, 2017 - Dougherty Funding LLC has closed a $12 million loan for stage two of a three-stage renovation and expansion of the Royal River Casino and Hotel located in Flandreau, South Dakota. This second stage includes the renovation of the existing bingo hall into a VIP lounge, high stakes gaming, and poker room, as well as the addition of an administrative building connecting directly to the casino. The Flandreau Santee Sioux Tribe has owned and operated the Royal River Casino since 1990. The financing was arranged for the Flandreau Santee Sioux Tribe of South Dakota with Dougherty Funding serving as lead lender and servicer for the loan.

VStar Entertainment Group Signs Lease at Northern Stacks Complex in Fridley

Hyde Development is pleased to welcome VStar Entertainment Group, LLC (“VStar”), one of the nation's leading multi-concept media and entertainment platforms and producer of family-friendly consumer shows and events, to the Northern Stacks complex in Fridley, MN. Future tenant VStar signed a multi-year lease to occupy 104,818 square feet of Northern Stacks IV – close to 60 percent of the building — which is currently under construction. Northern Stacks is a joint venture of Hyde Development and M. A. Mortenson Company.

Stacks IV, which broke ground on March 26, 2017, is the fourth building to be constructed at Northern Stacks, and is part of phase three development of the overall plan for the industrial park. The 177,600-square-foot building is slated for completion in November 2017. VStar will relocate both its production facility, currently in the Minneapolis Midway neighborhood, and its corporate offices, currently located in Shoreview, into the Northern

KNOW YOUR OPTIONS Understand the roof types and installations available to you and how they will perform on your building.

Contact us today for more information on all the options available to you 763-535-5831 Qtcommercial.com

April 2017

Stacks location.

“We are excited about the move, and expect this new state-of-the art facility will create added operational efficiencies, support our growing business portfolio and offer a fresh, spacious and creative new work home for our current and prospective talent,” said VStar CEO, Eric Grilly, Other Northern Stacks complex tenants include BAE Systems, Dero Bike Racks, Everlast Climbing Industries and MB2 Raceway.

“It’s fantastic to see the continued momentum at the Northern Stacks development,” says Paul Hyde, Principal at Minneapolis-based Hyde Development. “The interest is proof that the progress in urban warehousing is not a trend, but truly a reality in the Twin Cities.”

Jason Simek and Eric Batiza with Colliers International | Minneapolis-St. Paul represented Hyde Development in the completion of the transaction.

VStar was represented by Matt Oelschlager of CBRE. Mohagen

Minnesota Real Estate Journal

Hansen is the architect on the Northern Stacks development.

Dougherty Mortgage LLC closes $819,000 Fannie Mae Supplemental loan for Northridge Court Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed an $819,000 Fannie Mae supplemental loan for Northridge Court Apartments, an 86-unit market rate multifamily apartment property located in Cleburne, Texas.

The Fannie Mae 7.25-year term has a 30-year amortization schedule and was arranged through a partnership with Old Capital Lending and Dougherty’s Minneapolis and Vienna, Virginia offices for borrower 101 Westcourt, LLC.

Dougherty Mortgage LLC closes $5.1 million HUD 221(d)(4) loan for Hanover Townhouses

Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $5.1 million HUD 221(d)(4) loan to be used for the rehabilitation of Hanover Townhouses, a 96-unit townhouse property located in St. Paul, Minnesota. The Sponsor of the project is Community Housing Development Corporation, a non-profit developer and owner of multifamily properties. The project was originally constructed in 1968, with renovations occurring in 2001 and 2009, with approximately $30,000 per unit renovations to be completed as part of this transaction. All 96 units are restricted to residents earning 60% or less of the Area Median Income, and all are also covered by a Section 8 HAP Contract.

The HUD 221(d)(4) 40-year term loan has a 40-year amortization schedule and was arranged through Dougherty’s Minneapolis office for borrower Hanover Limited Partnership, a Minnesota limited partnership.

Page 11

The Hive Salon Moves into Fisk Building on East Hennepin Avenue Minneapolis, MN, April 10, 2017– Schafer Richardson, Inc. is excited to announce the new lease of 4,000 SF to The Hive Salon at 1621 E. Hennepin Avenue in Minneapolis. The Hive Salon outgrew its space at Lowry Avenue and 4th Street in the Northeast Neighborhood, and has now opened its doors in Suite B20 at the newly renovated Fisk Building in Minneapolis.

Hive Salon’s space was constructed by Synergy Builders and features an open concept with designated areas for cutting/styling, coloring, and teacher-student instruction. Co-owner Jen Cortez said, “Synergy Builders started the build-out work in January and stayed as close to our deadline as possible.

We love our new space – especially the size and openness, and all the natural light helps our stylists see what is happening with their clients’ hair in a comNews to page 20

Page 12

Minnesota Real Estate Journal

St. Paul

square feet of office space, 300 marketrate housing units, 30,000 square feet of retail, 1,200 parking stalls and a public plaza.

The Ramsey County Board of Commissioners authorized staff to enter negotiations with Cardon on a development agreement for the riverfront properties.

“We have been working for years to transform this riverfront property into an asset for our community,” said Ramsey County Commissioner Rafael Ortega, who represents the area, in a prepared statement. “We are excited to work with Cardon to turn this vacant property into a first-class development.”

If plans are approved, construction would begin in 2018 and take approximately three years.

From page 1

edge of downtown, has been transformed into apartments and a hotel. All of these projects and more are redefining the CBD. “Redevelopment is the trend and that’s been the case probably for four or five years now and it continues, needless to say,” says Joe Spartz, president of Greater St. Paul BOMA. More people calling downtown home A significant amount of the redevelopment has been office-to-residential conversions as obsolete office space is being transformed into modern urban living spaces. Demand for downtown St. Paul apartments is strong and continues to exceed supply.

“People want to live downtown, and because of that, the population has increased by almost 75 percent since 2010, which is one of the fastest you’re going to see for a downtown urban core in the U.S.,” Spartz says. “So it’s pretty impressive.”

He says a slowdown in conversions is likely, however.

“My sense is the conversion piece is going to be slowing down a bit now,

April 2017

because some of the real prime-choice properties that made sense for conversion have already gone through the process,” Spartz says.

In addition to these new apartments, the CBD is seeing new hotels, some new and repositioned office space as well as entertainment. Here’s a rundown of some of downtown’s major projects:

West Publishing/County Jail Site Phoenix-based Cardon Development Group is looking to make a big splash with a $225 million, mixed-use development on the site of the former county jail and West Publishing site on Kellogg Boulevard. The redevelopment would essentially rebuild the city’s riverfront.

Cardon’s plans for the five-acre river bluffs site were released on April 18 and include a four-star hotel, 60,000

Custom House/Hyatt Place The Exeter Group LLC took on the challenge of renovating the iconic 17story, former post office tower on Kellogg Boulevard overlooking the Mississippi River. The $125 million rehab includes 202 units of upscale apartments.

“The first move-ins were last April,” says Rob Stolpestad, principal and chief financial manager at the Exeter Group. “We’ve been around 97 percent

April 2017

leased since December so the lease-up has gone very well.”

The apartments include plenty of amenities.

“It’s pretty spectacular,” Stolpestad says. “The sixth floor is what we call the annex and it’s about a 32,000square-foot amenity area, about a third of which is outdoor space. We took the roof off the sixth floor, so there’s a

Minnesota Real Estate Journal

Page 13

pool, outdoor lounge, grill area, etc., and that’s wrapped by a fitness center, yoga room, club room and some other amenities. That’s the advantage of having such a huge building as we had plenty of space. We just had to figure out what we could put where.”

The renovation also includes a 149room Hyatt Place developed and owned by Nelson Development & Construction.

Renovation of the massive, 740,000square-foot building was a major undertaking.

“It was definitely a collective effort not only within our shop but Nelson Development, the contractors and architects, the city was hugely supportive and obviously our lenders and tax credit partners were with us the whole process,” Stolpestad says. “It took a village to do that project and we’re very pleased with the outcome.”

He says it’s exciting to see so much redevelopment/reuse occurring downtown.

“We think it’s great,” he says. “Our offices are downtown. It’s great to see people living downtown. You’re seeing more restaurants. We’re not really seeing too many retail amenities yet, but I think there will be some more of that in the near term. It would be great to get more office tenants downtown.”

St Paul to page 14

Page 14

Minnesota Real Estate Journal

Initially, a Radisson RED was announced as the hotel.

“We’re continuing the development process in partnership with the city and all of the stakeholders and look forward to having some exciting announcements moving forward in the coming months,” Rauenhorst says. “Radisson RED is no longer part of the project. We look forward to announcing a new hotel partner.”

St. Paul from page 13

Ecolab A development partnership led by PAK Properties is purchasing the former 20-story Ecolab headquarters tower, at 370 Wabasha St., with plans to renovate it into high-end, multi-tenant office space. While other uses were considered for the building, it will remain office.

Ecolab is vacating the building and consolidating into the former Travelers building.

Former Woolworth’s Plans are in the works to convert the long-vacant Woolworth’s building, at Seventh Place and Minnesota Street, into creative office space. Pat Wolf, president and owner of Commercial Real Estate Services Inc. -- the property’s listing broker -- has described the 42,000-square-foot building constructed in the 1950s as a “Mad Men” era building. Plans could include adding more natural light, a fourth level and a rooftop patio. The building has sat vacant for more than two decades.

Oxbo/Hampton Inn Opus Development Co. developed Oxbo, a six-story, 191-unit luxury apartment complex that completely transformed the site of the former Seven Corners Hardware store. High-end ameni-

April 2017

ties include an outdoor courtyard featuring a pool, hot tub and bocce ball, and a terrace-level patio and club room. The project also includes 11,500 square feet of ground-floor retail.

“Oxbo opened for our first residents the 1st of March and we’re thrilled to be welcoming them,” says Matt Rauenhorst, vice president of real estate development at Opus. “We’re really pleased with the leasing activity we’ve seen in the market and look forward to continuing the leasing process through the spring and summer.”

He says the mixed-use project adds to the community because it’s a work-playlive environment. The redevelopment also includes a new 160-unit Hampton Inn & Suites, which opened late last year.

The Gateway Opus is partnering with the city of St. Paul to redevelop the Seven Corners Gateway site, across from the Xcel Energy Center. Plans call for a mixeduse development with market-rate apartments, retail, a hotel and public plaza.

Former Macy’s building The St. Paul Port Authority and Hempel Cos. formed a joint venture to redevelop the 540,000-square-foot, former Macy’s building at 400 Wabasha St. The building was renamed Treasure Island Center after the Prairie Island Indian Community purchased naming rights.

The major overhaul will include an 1,100-seat rooftop practice rink for the Minnesota Wild. The rink will also be available for youth hockey teams, college hockey teams, amateur leagues, skating clubs and the general public.

The rink is called Tria Rink after Tria Orthopaedic Center acquired the naming rights.

In addition, other announced tenants include Stacked Deck Brewing Co., which will open a tap room and production facility; Walgreens; and Tria, which will open a small clinic on the first floor.

April 2017

“It’s going to be just fabulous with the Wild practice facility on the roof, which if you look at right now, you can see some of the beams going in place for

that enclosed facility,” Spartz says.

“There will be different kinds of retail and some office… So there will be a number of different tenants throughout those floors by the time they get done leasing that out over the next few years.”

City officials say the redevelopment will be transformative.

“It really solves the hole in the middle of downtown,” says St. Paul Port Authority President Lee Krueger. “Lowertown is really cool. A lot of activity is happening down there with the bars and restaurants and the St. Paul Saints. And there’s so much going on along West Seventh with the Xcel and the restaurants and the new Opus project Oxbo.

But there’s not a lot happening along Wabasha. This connects Lowertown to West Seventh by creating a pretty exciting, pretty transformative project right in the heart of the city.”

Sibley Square/333 on the Park Timberland Partners renovated the historic Sibley Square at Mears Park office building at 333 N. Sibley St. into “333 on the Park.” Sibley Square was largely empty, with only one-quarter of the office space occupied. The 280,000square-foot building now boasts 134 loft-style apartments, 10 of which are two-story penthouses. The apartments feature exposed 12-foot ceilings, exposed ductwork and hardwood floors and offer amenities such as rooftop decks, a theater and yoga studio. Federal and state historic tax credits were used to help fund the project's development costs.

“The project opened March 15,” says Ryan Sailer, vice president of development at Timberland Partners. “Demand has been strong. We’re leasing up in accordance with our projections, so we’re happy with the performance thus far.”

Minnesota Real Estate Journal

Pioneer Press building After redevelopment plans for the eight-story Pioneer Press building, at 345 Cedar St., stalled, a new buyer has emerged. Real Estate Equities plans to acquire the building and convert it into 143 workforce housing units aimed at lower- and middle-income workers, reported the Twin Cities Pioneer Press.

The Stencil Group purchased the building two years ago from the Pioneer Press with its own plans to convert it into housing; those plans have not panned out.

Palace Theater The city spent $15.5 million to renovate and reopen the 100-year-old Palace Theatre on West Seventh Place as a music venue. The city hopes the redeveloped theater will attract more than 100,000 people downtown each year.

Empire Building Jim Crockarell of Madison Equities is partnering with the Stencil Group with plans to convert the historic Empire Building at 360 N. Robert St. into a 100room boutique hotel.

Page 15

Degree of Honor Building Madison Equities is also teaming up with the Stencil Group to convert the 10-story Degree of Honor Building, at 325 Cedar St., into apartments.

Page 16

Minnesota Real Estate Journal

April 2017

Plenty of construction projects keeping developers busy in Minneapolis/St. Paul market

by Dan Rafter

C

onstruction activity is rising across the country. The Midwest is no exception, with cranes soaring into the skies of cities from St. Louis and Kansas City to Omaha and Chicago.

And one of the busiest of all Midwest markets? The Minneapolis and St. Paul region, which is seeing a seemingly nonstop stream of new-construction projects in both its urban and suburban communities.

What’s most interesting about the construction scene in the Twin Cities, though, is the wide variety of projects that developers are tackling.

One of the most interesting projects in the middle of construction here today is the transformation of a former Macy’s department store.

RJM Construction is moving along on schedule on its work converting the former Macy’s store in downtown St. Paul into a new development that will be called Treasure Island Center. The resulting 540,000-square-foot building will include a mix of new office and retail tenants.

It will also include a rather interest-

The Opus Group recently completed the third phase of the Valley Park Business Center in Shakopee. ing feature: an 1,100-seat hockey practice facility at its very top.

The new building, located at 363 Wabasha St., will boast an NHL-sized ice rink, the TRIA Rink. Earlier this year, crews from RJM reached a milestone when they placed a 100,000pound crane atop the new building’s roof. The crane will hoist structural

steel, mechanical equipment and other supplies.

“This isn’t your typical construction project, but we’re up for the challenge,” said Joe Maddy, chief operating officer, when describing the task of building a new ice rink.

There will be space inside the project for the Minnesota Wild hockey team

and Minnesota Housing Finance Agency. RJM will also build a 6,000square-foot orthopedic clinic for TRIA Orthopaedic Center on the building’s street level.

RJM Construction is also involved in a suburban office project, building a 25,000-square-foot addition to Bremer Bank’s service center in Lake Elmo,

April 2017

Minnesota.

The bank building is located at 8555 Eagle Point Blvd. in Lake Elmo. Construction is scheduled to begin in April, with the addition set for completion at the end of 2017.

As in most Midwest cities, the industrial market is a strong one, too, in the Minneapolis and St. Paul markets. A good example is the work that the Opus Group is turning in on an industrial park in the region.

The Opus Group has completed the third phase of development at Valley Park Business Center in Shakopee, Minnesota. Minnesota-based Fountain Industries will be the first tenant at the park, leasing about 48,000 square feet of the 122,400-square-foot development.

The project represents the final phase of Opus’ development at the 50-acre site, following the completion of a 200,000-square-foot speculative development and a 216,000-square-foot build-to-suit industrial warehouse and office space for Amerisource Bergen.

“We are very pleased to bring Fountain Industries, Amerisource Bergen and other businesses to Valley Park Business Center,” said Joe Mahoney, senior manager of real estate development with Opus Development Company.. “The leasing of this development underscores the ongoing interest for industrial space in the southwest market of the Twin

Minnesota Real Estate Journal

Cities.”

Located southwest of Minneapolis near major state highways, the warehouse has approximately 74,000 remaining square feet available for lease. The development suits tenants who desire to be in the Shakopee submarket and are seeking functional, first generation space. The property features 28-foot clear height, along with 193 parking stalls, 24 dock doors and six drive-in doors.

Building construction of the final phase of the speculative industrial development began in July 2016. Previous phases of the Valley Park Business Center were completed in 2014 and 2015. Opus’ recent portfolio of work includes more than 6.9 million square feet of industrial developments currently under construction or completed in the past 24 months across the United States.

Kraus-Anderson Construction Company has been busy throughout the region, too. The construction firm recently completed a major warehouse addition for Dahlheimer Beverage at 3360 Chelsea Road West in Monticello, Minnesota.

The 97,250-square-foot expansion nearly doubles the size of Dahlheimer’s warehouse.

The expansion of the beer distributor’s existing warehouse and office space was designed by HDA Architects.

Chesterfield, Missouri-based Gabriel Project Management is the owner’s representative.

The new addition was performed while the distributor was in full operation. Construction was completed in a tight schedule of only 22 weeks and included the installation of approximately 32,000 square feet of in-floor heating systems in the truck wash bays and truck drive-thru bay.

Of course, the Minneapolis and St. Paul regions are seeing plenty of multifamily development, too, as are all Midwest markets. A good example is a new development new the Mayo Clinic, about 80 miles from the center of Minneapolis.

Multifamily development the Lofts at Mayo Park in Rochester, Minnesota, held a ribbon-cutting ceremony on Feb. 21. The ribbon-cutting marks the opening of the new market-rate apartment complex.

The site is located within the Destination Medical Center Development District located between 107 and 121 Sixth Ave. SE. The four-story project is being developed by Helen and Chris Roland, trustees of the George F. Pougiales Trust. Welsh Construction worked with the Rolands to execute their vision for the short-term and extended-stay residential development near Mayo Clinic.

The ribbon-cutting, hosted by the

Page 17

Rochester Area Chamber of Commerce, included remarks from Laurie Ackerman, Director of Sales and Marketing for Opportunity Services and Chamber Ambassador; Helen and Chris Roland, trustees of the George F. Pougiales Trust; and Judy Braatz, Membership Development Director at the Rochester Area Chamber of Commerce.

“We’re always happy to have additional housing choices in Rochester. The Destination Medical Center Initiative will generate tens of thousands of new jobs. The workforce needed to fill those jobs will require a myriad of housing options,” said Rob Miller, president of the Rochester Area Chamber of Commerce.

The development features 29 units, and was designed by Minneapolis-based Snow Kreilich Architects. Amenities of the Lofts at Mayo Park include modern exterior finishes, underground parking, roof deck patios, a glass-front lobby and conference room and private patios and balconies. Additionally, 14 of the 29 units are fully-furnished for future tenants.

The development is located on Mayo Memorial Park, one of Rochester’s oldest and most well-connected parks. The building’s common spaces provide expansive views of the park, the Zumbro River and downtown Rochester.

Page 18

Minnesota Real Estate Journal

St. Cloud From page 1

congestion. Drive time to 494 and 694 is less than an hour.

Tech High School is part of Independent School District 742, which consists of 13 St. Cloud schools (8 elementary, 3 middle, and 2 high) serving a total enrollment of more than 10,000 students. This new facility will sit on 116 acres, and will relocate the current building’s high schoolers with room for 1,800 students when it opens in 2019.

“All aspects of planning the new high school ultimately focus on the students,” said Willie Jett, Superintendent of ISD 742. “During the referendum campaign, we repeatedly reminded people that we weren’t just building a school; we were building futures.”

The reality of this area’s future is looking very bright. And the fact that it’s all starting with a school indicates that it could really become its own thriving community. With the close proximity to I-94 and MN Hwy 15, along with a direct thoroughfare to the established Crossroads Shopping Center in Waite Park, the area is quickly catching the eyes of commercial property developers, CEOs looking to expand their businesses into lucrative markets, Twin

Cities and St. Cloud commuters, and current residents.

“Aside from serving as a great symbol of pride for our school district, we know the new high school will attract and retain residents to our area,” said Jett. “It is already stimulating economic growth, and it will prepare graduates to enter our future workforce.”

As for commercial and retail development, which won’t be far behind the

anticipated residential boom, the City is currently extending utilities within County Road 74 to accommodate development north and south of the 33rd Street and Trunk Highway 15 Interchange. With this move, more than 200 acres become available for commercial development.

Possibilities for this location are truly endless, with retail stores, medical facilities, office buildings, daycare centers, banks, fast food restaurants, and microbreweries and tap houses being just some of what has been speculated.

“Once we see that first big anchor come through, the rest will quickly follow,” said Kevin Brink, Primary Broker at INH Commercial Brokerage, Inc., in St. Cloud.

The City will continue to expand area roads to keep up with the extreme average daily traffic (ADT) increase—currently projected to rise from 2,000 to more than 12,000.

“We have been receiving a number of calls from inquiring businesses,” said Glaesman. “The interest is really spanning the gamut of commercial development.”

As for residents, the draw is equally as huge. With roads now put in place, those wanting flexible lot sizes have begun seeking out land for new home construction. For those currently working in the Cities, the cost of living in St.

We provide quality pavements enhancing property values.

Parking Lots • New construction • Reconstruction • Expansion • Overlay Pavement Maintenance • Drainage Corrections • Concrete Repairs • Cracksealing • Sealcoating • Patching

April 2017

Cloud is less expensive overall than the Metra Area, and families can enjoy a quieter and simpler way of life in comparison to a more populated city. And travel time from this location to 494 and 694—whether for entertainment or work—clocks in at less than an hour.

Families of school-aged kids are already planning accordingly, as the area’s first residential plats since 2008 are currently proceeding through the Planning Commission and City Council.

“We expect residential development to generate more than 2,000 housing units within 1 mile of the school site,” said Glaesman. Beyond that 1-mile radius, more than 1,000 acres are guided for residential development.

With everything now put in place for the development of St. Cloud’s south side, developers will enjoy a streamlined process along with an ideal location.

Anyone interested in development opportunities on the south side of St. Cloud should contact Cathy Mehelich, Director of the Economic Development Authority, by calling 320-255-7218 or emailing cathy.mehelich@ci.stcloud.mn.us.

Cathy Mehelich has 20 years of municipal economic development experience in St. Cloud, Elk River, and Olivia, Minnesota. Since she was selected in 2011 to lead the City of St. Cloud’s creation of its first Economic Development Authority, she has facilitated a variety of business expansions and attraction projects resulting in the creation of 500 jobs, 450,000-sf of expansion, $86-million in private investment and $5-million in public investment. She is a key asset to anyone interested in new development or redevelopment within the City of St. Cloud.

Bituminous Roadways, Inc.

651.686.7001 www.bitroads.com

Contact us for a free quote

April 2017

Minnesota Real Estate Journal

Page 19

Industrial insider: Top trends for industrial real estate in 2017

By Elise Couston. Senior managing director, Newmark Grubb Knight Frank

A

s the e-commerce sector continues to experience growth in market share, and as new trends in manufacturing transform and grow, developers are paying close attention to what users will require going forward so that industrial real estate can accommodate their changing requirements and provide the required flexibility as business models evolve.

We have identified several current “Top Trends” which are described below, and currently on top-of-mind for most real estate decision-makers.

Location first Location has always been one of the foundations of real estate decisionmaking, and continues to be one of the most important factors that drive decisions.

Adequate labor supply has become a key issue for growing companies in the e-commerce and manufacturing sectors. Being well-located in a growing demographic, with access to public transportation, is becoming more critical than ever. In many cases, companies are competing for employees within certain labor markets, so proximity to an ample and expanding labor supply has become a central factor in determining a company’s location.

Quick access to highways and arterial roadway networks is also important and has become more beneficial to employees and employers that serve customers with distribution requirements.

Access to intermodal facilities and ports, on the coasts and inland, with rail connectivity to other major cities, are also important locational traits that are being valued by companies going forward. Research indicates that there has been a recent increase in intermodal shipping, particularly with freight train deliveries.

Growth of e-commerce Perhaps the hottest trend continues to be the exponential growth of e-commerce and the impact it is having on so many aspects of our everyday lives.

A growing expectation by consumers for the delivery of online orders within a short amount of time has also created the need for multiple “last mile” facilities in major market areas.

For industrial buildings, the demand for large regional distribution facilities with sophisticated warehouse management systems has been increasing over the last few years, and that trend is expected to continue.

E-commerce has also continued to significantly impact the growth of intermodal facilities across the country.

Several research reports indicate that there has been an increase in rail usage,

and imports into the ports has also been increasing.

Another recent and popular industry trend includes a new type of multi-tenant industrial building, the “shallowbay building”. These buildings are utilized as fulfillment centers for the “lastmile” delivery of e-commerce products to the consumer. These facilities are much closer in proximity to the end user, and require additional parking for a higher employee count. Products move through these facilities in one or two days, so the narrow-bay configuration facilitates the functionality of “turning” the product around more quickly.

Ceiling heights matter There are more companies than ever who are using modern and sophisticated warehouse management systems (WMS) that are designed to maximize the efficiencies of 30’ to 36’ clear ceiling heights. Some users are doing build-to-suits at 40’ clear, but this warehouse ceiling height requires upgraded sprinklers, thicker floors, and different racking and fork-lift vehicles to function at this height.

The higher ceiling height in warehouse facilities is also being driven by a scarcity of land in the most desirable locations. This is driving land prices higher, which in turn impacts higher project costs and rents.

Second generation facilities with warehouse clear heights that are below 20’ are being redeveloped into a new, higher-clearance building in highdemand locations. This trend is expected to continue as land continues

to be scarce in these areas.

Increased security Maintaining the safety and security of inventory and employees has now become a top priority for almost every company, from manufacturers and suppliers to logistics companies and their customers.

Information Technology (IT) has become an integral and valuable part of the supply chain and is protected through various measures. Companies have become very serious about information security, and now implement multi-level initiatives to maintain their information at the highest levels. Backup servers in offsite locations provide storage in external areas, keeping information safe and readily accessible at any time. Messages are now encrypted to ensure delivery is secure both into storage or while being accessed by authorized users.

Quality procedures, security measures and certifications are continuing to improve in an effort to ensure that products reach the correct destination as often as possible.

The ability to follow and track products all the way through the supply chain is an extremely effective way to enhance logistics security. Products can be tracked by the entire truckload, specific pallet or even by the single item. Tracking products from beginning to end provides transparency for suppliers, manufacturers, 3PLs and customers.

The securitization of industrial properties that move products through the supply chain has also become more commonplace. Multiple methods of

securitizing a property including fencing, guard house, and key card entries, are now a requirement by most companies to ensure protection for their employees and the products they handle.

Property prices and lease rates on the rise With vacancy rates at very low levels, an increase in spec building development has attempted to keep up with increased user demand in many of the most desirable locations.

Construction cost increases, coupled with escalated land prices, have driven overall project costs up in the last few years. The result is higher rental rates for new buildings as well as second generation facilities.

National rental rates are anticipated to appreciate at an annual average rate of approximately 2-2.5% over the next few years. In some of the major manufacturing hubs, such as Chicago, there have been recent year-over-year rental increases of 6%.

Interest rates and cap rates are still at very low levels, with investors facing fierce competition for purchasing class A and value-add properties in core markets. The growth in lease rates, together with low vacancy rates, is continuing to fuel new spec buildings in the most active markets. This trend is expected to continue at least through 2018.

The good news is that commercial real estate is likely continue to flourish throughout 2017-18, and the current trends will favorably address the ongoing demand for maximizing operational efficiencies.

Page 20

Minnesota Real Estate Journal News from page 10

pletely different way.” The Hive Salon will be showcasing local artists’ work and is planning a grand opening on Saturday, May 20 from 6 pm – 9 pm (visit http://www.thehivesalon.com/ for more details). Any inquiries into additional leasing opportunities at the Fisk Building are invited to contact Mike Olson at molson@sr-re.com.

Dougherty Mortgage LLC closes $7.4 million Fannie Mae loan for Villa France Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $7.4 million Fannie Mae loan for the acquisition financing of Villa France Apartments, a 134-unit market rate multifamily apartment property located in Irving, Texas.

The Fannie Mae 12-year term, 2-year interest only loan has a 30-year amortization schedule and was arranged through a partnership with Old Capital Lending and Dougherty’s Minneapolis

and Vienna, Virginia offices for borrower Legacy REI Group VF LLC.

Doran & CSM Partner to Develop General Mills Riverside Technical Center Property Twin City real estate developers Kelly Doran and Gary Holmes have joined forces to purchase the General Mills Riverside Technical Center property located at 330 University Avenue, a prime location within the rapidlygrowing Northeast retail sector of Minneapolis, and just one block off of Main Street, the Stone Arch Bridge and the St. Anthony Falls Historic District.

The 8.71 acre site between Second Street and University Avenue is bisected by Third Avenue with surface parking to the west and the General Mills Riverside Technical Center building to the east.

Both Doran and Holmes’ companies have developments in the area. Doran Companies previously developed six

student housing properties in the Marcy-Holmes Dinkytown area and the 338-unit luxury apartment property, Mill & Main, a block away on Main Street. Holmes’ company, CSM Corporation, owns the recently updated and expanded Renaissance Minneapolis Hotel - The Depot and Residence Inn by Marriott located just across the river in the Historic Mill District.

The $15.8 million sale was completed today. “We are excited to work with someone as iconic as Gary Holmes and his CSM team,” said Doran. “We’ll begin developing concepts for a multifamily housing project in the surface parking area to start the approval process this year and hope to break ground sometime next year.” Doran said the partnership negotiated a lease with General Mills allowing them to continue using the space in the Riverside Technical Center building.

The entrepreneurial Holmes has a long history of acquiring, developing and renovating commercial, hotel and residential properties across the United States. “We have been active all across

April 2017

the country but it always feels good to do business in Minneapolis,” Holmes said. “We are very pleased to partner with a company like Doran which has a great tradition of developing and building high-quality projects in this market,” he added. Today, CSM owns and manages a portfolio including more than 10 million square feet of commercial space, 6,600 hotel rooms and 2,600 multi-family units.

Doran, whose construction and architecture companies will design and build this project, is currently developing 800 multi-family units in Brooklyn Park, Hopkins and Maple Grove.

Dougherty Mortgage LLC closes $1.3 million Fannie Mae Supplemental loan for Darby Square Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $1.3 million Fannie Mae supplemental loan for Darby Square Apartments, a 75-unit market rate multifamily apartment

April 2017

property located in San Antonio, Texas.

The Fannie Mae 7.58-year term has a 30-year amortization schedule and was arranged through a partnership with Old Capital Lending and Dougherty’s Minneapolis and Vienna, Virginia offices for borrower 811 Darby LLC.

Dougherty Mortgage LLC closes $700,000 Fannie Mae loan for Hill City Terrace Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $700,000 Fannie Mae loan for the refinance of Hill City Terrace Apartments, an 18-unit multifamily affordable housing apartment property located in Chattanooga, Tennessee. The Fannie Mae 10-year term, 3-year interest only loan has a 30year amortization schedule and was arranged through Dougherty’s Brentwood, Tennessee office for borrower Hill City, LLC.

Dougherty Mortgage LLC closes $5.2 million Fannie

Minnesota Real Estate Journal

Mae Supplemental loan for Green Oaks Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $5.2 million Fannie Mae Supplemental loan for Green Oak Apartments, a 384-unit market rate multifamily housing property located in Palos Hills, Illinois. The Fannie Mae 7.92-year term loan has a 30-year amortization schedule and was arranged through Dougherty’s Brentwood, Tennessee office for borrower Green Oaks at Palos Hills LP.

Dougherty Mortgage LLC closes $11 million Fannie Mae loan for Willow Park Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed an $11 million Fannie Mae loan for the acquisition financing of Willow Park Apartments, a 300-unit market rate multifamily apartment property located in Des Moines, Iowa. The Fannie Mae 10year term, 1-year interest only loan has

a 30-year amortization schedule and was arranged through Dougherty’s Minneapolis office for borrower Willow Park Partners, LLC.

Dougherty Mortgage LLC closes $9.4 million Fannie Mae loan for Sierra Vista Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $9.4 million Fannie Mae loan for the acquisition financing of Sierra Vista Apartments, a 224-unit affordable multifamily apartment property located in Dallas, Texas.

The Fannie Mae 12-year term, 1-year interest only loan has a 30-year amortization schedule and was arranged through a partnership with Old Capital Lending and Dougherty’s Minneapolis and Vienna, Virginia offices for borrower SevenSeas Holdings IV, LLC.

Dougherty Mortgage LLC closes $1.3 million Fannie Mae Supplemental loan for

Page 21

The Monterrey Apartments and Townhomes Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $1.3 million Fannie Mae Supplemental loan for the acquisition financing of The Monterrey Apartments and Townhomes, a 105unit market rate multifamily apartment property located in Fort Worth, Texas.

The Fannie Mae Supplemental 7.58year term loan has a 30-year amortization schedule and was arranged through a partnership with Old Capital Lending and Dougherty’s Minneapolis and Vienna, Virginia offices for borrower Napali One, LLC.

School District of Superior to Break Ground on New Cooper Elementary The School District of Superior, WI is set to break ground Wednesday, April 12, 2017 to mark the start of demolition of the existing Cooper Elementary and the construction of the new Cooper Elementary School News to page 22

Page 22

Minnesota Real Estate Journal News from page 21

designed by LHB. The ceremony will begin at 10:00 a.m. at 1807 Missouri Avenue, Superior, WI 54880.

The new Early Childhood to grade five facility is designed to accommodate 600 students, plus faculty and staff. The project will replace the existing facility on the same site. Main project goals include improved site safety and circulation, building security, clear entry for parents and visitors, increased occupant capacity, and an improved educational environment. The new facility includes Early Childhood functions within the building and a separate age-appropriate playground, as well as designs specifically focus on the district’s autism program, in addition to the standard K-5 grades and support spaces.

LHB is providing architecture and engineering services for the project, with construction services from KrausAnderson Construction and local contractors.

The School District of Superior’s mission is to provide all children with the relevant tools to develop a foundation for living, learning, and working successfully. The District’s nine school buildings accommodate 4,707 students ranging from early childhood through grade 12.

The general management position at Burnsville Center excitedly brings Duperre and his wife back to the Minneapolis metro area having previously been on the management team at the Marriott City Center in downtown Minneapolis.

Knutson Announces Four Promotions in their Minneapolis Market Knutson Construction, a leading builder in the Twin Cities, is pleased to announce Dana Skjod, Dillon Theusch, Hamza Janjua, and Linnea Haler, have been promoted to assistant project managers in the Minneapolis office.

Dana Skjod came to Knutson in 2015 with a Bachelor of Applied Science degree in applied engineering from Bemidji State University and an Associate of Applied Science degree in construction project management from Dunwoody College of Technology. In her two years at Knutson, Dana has not only been an exceptional project engineer, but she’s also willingly taken on

Dougherty Mortgage LLC closes $11.1 million Fannie Mae loan for Blair’s Cove Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed an $11.1 million Fannie Mae loan for the acquisition financing of Blair’s Cove Apartments, a 256-unit market rate multifamily apartment property located in Waco, Texas. The Fannie Mae 10-year term, 1-year interest only loan has a 30-year amortization schedule and was arranged through a partnership with Old Capital Lending and Dougherty’s Minneapolis and Vienna, Virginia offices for borrower Upper Level Acquisitions II, LLC.

Dougherty Mortgage LLC closes $4.6 million HUD loan for Summerfield Apartments

mixed income multifamily property located in Northfield, Minnesota. Per a Land Use Restriction Agreement, 20% of the units at the property are restricted to residents earning 50% or less of the Area Median Income. The HUD 35-year term loan was arranged through Dougherty’s Minneapolis office for borrower Summerfield Investments, LLC.

Dougherty Mortgage LLC closes $16.5 million Fannie Mae loan for Parc 410 Apartment Homes Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $16.5 million Fannie Mae loan for the acquisition financing of Parc 410 Apartment Homes, a 344-unit market rate multifamily apartment property located in San Antonio, Texas. The Fannie Mae 12-year term loan has a 30-year amortization schedule and was arranged through a partnership with Old Capital Lending and Dougherty’s Minneapolis and Vienna, Virginia offices for borrower 5827 Loop 410 LLC.

Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $4.6 million HUD 223(a)(7) loan for the refinance of Summerfield Apartments, a 112-unit

Dougherty Mortgage LLC closes $1.4 million Fannie Mae loan for St. Elmo Court

the assistant project manager role during various projects. Most recently, Dana has played a key role on the Mercy Hospital expansion project. Her passion and drive for success has been the catalyst for her move into the assistant project manager role.

With a construction management degree from Minnesota State University Moorhead and three years of previous project engineer experience on fastpaced remodel projects across the nation, Dillon Theusch joined Knutson in early 2016. Dillon has been an enthusiastic and driven addition to Team Blue, continuously demonstrating his capabilities on the Minnesota Correctional Facility Saint Cloud Health Services project and contributing to Knutson’s hard bid pursuit teams. Dillon’s excellent communication skills and team-oriented mindset make him an excellent candidate to transition into the assistant project manager role.

Hamza Janjua joined Knutson in 2015 as a project engineer. With a Bachelor of Science degree in civil engineering from

Iowa State University, Hamza has been a valuable asset on the Ames Water Treatment Plant project in Ames, IA. He has proven his capabilities not only as a project engineer, but also standing in as an assistant project manager when needed. Hamza exudes positivity and accepts challenges without hesitation.

Since joining Knutson in 2015, Linnea Haler has exemplified a strong work ethic and creative problem solving on every project she’s been a part of. Most recently, Linnea has showcased her abilities at Treasure Island Resort and Casino, Park Nicolet Clinic and Methodist Hospital. Her teamwork, drive and leadership skills have allowed her to be successful in her role as a Project Engineer and will be a huge asset to her as she transitions into the assistant project manager role. Linnea received a Bachelor of Arts degree in engineering science from Wartburg College and a construction management certificate from Ashworth College.

“Knutson is thrilled to have these hardworking individuals on our team,”

April 2017

Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $1.4 million Fannie Mae loan for the refinance of St. Elmo Court Apartments, a 47-unit multifamily affordable housing apartment property located in Chattanooga, Tennessee. The Fannie Mae 10-year term, 3-year interest only loan has a 30year amortization schedule and was arranged through Dougherty’s Brentwood, Tennessee office for borrower St. Elmo, LLC.

Dougherty Mortgage LLC closes $1.3 million Fannie Mae loan for Dodson Avenue Apartments Dougherty Mortgage LLC, a full service national mortgage banking firm, recently closed a $1.3 million Fannie Mae loan for the refinance of Dodson Avenue Apartments, a 40-unit multifamily affordable housing apartment property located in Chattanooga, Tennessee. The Fannie Mae 10-year term, 3-year interest only loan has a 30year amortization schedule and was arranged through Dougherty’s Brentwood, Tennessee office for borrower Dodson Ave., LLC.

said Lance Hornaday, vice president and general manager. “Each possess the knowledge and confidence needed to continue to be valuable assets to our current and future clients. We are excited about the growth Knutson Construction is experiencing and are looking forward to the future.”

RYAN COMPANIES, US, INC. NAMES CASEY HANKINSON SENIOR VICE PRESIDENTOF NATIONAL BUILD-TO-SUIT Minneapolis, MN – (April 10, 2017) Following the success of a multitude of build-to-suit projects across the United States, Ryan Companies has named Casey Hankinson Senior Vice President – National Build-to-Suit. Hankinson will leverage the over 40 million square feet of projects Ryan Companies has developed in the past 10 years to further position the company as a national leader among corporate customers.