Grandbridge Real Estate Capital closes $10 million loan for Minnesota apartment community

Grandbridge Real Estate Capital recently closed a $10.05 million first mortgage loan secured by a 133-unit apartment community in Moorhead, Minnesota.

Tony Carlson, president, and Jeff Witt, real estate analyst, with Grandbridge originated the loan.

Funding for the refinance loan was provided by a life-insurance correspondent and featured a 15-year term, 30-year amortization and low fixed interest rate.

Source: MN News

Elion Partners, Davis Group to develop 50,000-square-foot medical office building in Twin Cities market

Elion Partners and The Davis Group have entered a joint venture to develop a Class-A medical office building at CityPlace in Woodbury, Minnesota. The new medical office building is the second to be developed, and is part of the 100-acre master planned development off Radio Drive and Interstate-94.

The two-story, 50,000-plus-square-foot medical office building will be located between the retail and Residence Inn by Marriott, on about four acres.

The approved development plan for CityPlace identified the goal of 400,000 square feet of Places to Work land uses. Following the construction of the medical office, there will be 290,000 square feet of Places to Work uses.

The Davis Group, in conjunction with Elion Partners, has designed the multi-unit medical office building to meet the demands of today’s medical office user.

“Our focus at CityPlace has always been to bring the highest quality development to the site,” said Juan DeAngulo, managing principal with Elion Partners, in a written statement.

The new medical office building will be joining the 75,000-square-foot Tria Orthopaedic Center on site, which is currently under construction and expected to open this summer.

Source: MN News

DNA of CRE survey: Commercial real estate remains male-dominated, doesn’t make instant millionaires

The vast majority of commercial real estate professionals — 80 percent — are male, and most don’t rank among the super rich, with 24 percent of commercial real estate agents reporting that they earned less than $100,000 in gross commission income each year and 16 percent from $101,000 to $150,000 each year.

Those are two of the statistical nuggets unearthed in this year’s DNA of CRE survey compiled by online brokerage theBrokerList and Buildout, a company that produces marketing software for CRE brokerages. This is the second year that these two companies have partnered on the survey.

Some things haven’t changed much since the first survey last year. There’s the fact that commercial real estate remains a male-dominated industry. It’s also an industry led by older brokers. The survey found that 27 percent of CRE pros were from the ages of 50 to 59, while 20 percent were 60 to 69. Only 6 percent of CRE pros were from the ages of 21 to 29, while 20 percent were 30 to 39.

What roles do CRE pros assume today? The survey found that 34 percent of them spend the most time representing sellers in investment sales, while 22 percent spend the majority of their time representing landlords in leasing deals. An additional 21 percent said they spend the most time representing tenants in lease transactions, while 12 percent spent the greatest chunk of their time representing buyers in investment sales.

The south, as it did last year, remains the top source of business for commercial agents. A total of 32 percent of respondents said that most of their business came from the south, while 29 percent said that the west provided most of their business. Just 21 percent of respondents said that the Midwest provided most of their business.

When it comes to income, the greatest percentage of agents said that their gross commission income was under $100,000, with 24 percent of agents reporting this level of income. A total of 16 percent of agents said that their gross commission income came in at $150,001 to $200,000, while 15 percent said it was $200,001 to $300,000. A total of 10 percent said that their gross commission income was $500,000 to $1 million, while just 5 percent reported earning commission income of $1 million to $2 million.

And the big earners? The survey found that only 1 percent of respondents claimed to have earned gross commission income of $2 million or more.

Source: MN News

Manufacturing company to fill 140,000 square feet in Twin Cities-area industrial facility

CBRE recently assisted Spears Manufacturing in a new 142,000-square-foot lease at the Dayton Distribution Center in Dayton, Minnesota. The manufacturer is planning a new regional distribution center.

John Ryden in CBRE’s Minneapolis office with Jim Bolt, of CBRE’s Denver office, represented the tenant. Matt Oelschlager and Mike Bowen, also in CBRE’s Minneapolis office, represented the landlord, Liberty Property Trust.

The Dayton Distribution Center is a 247,000-square-foot new speculative construction distribution center in the northwest Twin Cities metro area.

Source: MN News


Attracting and retaining talent—in the suburbs

Alliant Credit Union’s employee lounge


Guest post by Steve Wright, AIA and Roger Heerema, AIA
Write Heerema Architects

Office life in the suburbs is rapidly evolving as building owners transform their buildings to cater to the new way of working preferred by today’s workforce. New lounges are offering spaces for employees to collaborate and socialize, while fitness centers and healthy food offerings are helping to meet employees’ health and wellness needs under one roof.

Many building owners have realized that Millennials and other professionals love their suburban lives (and shorter commutes)—they just want well-designed buildings with amenities on-par with their counterparts in the city. These building owners, whether investors or corporations, know that investing in the suburbs remains a strong long-term proposition.

Steve Wright

A 2016 report by PwC and the Urban Land Institute found absorption rates in Chicago’s suburban offices are improving, while vacancies have slowly but measurably declined. Moreover, the report pointed to ULI data finding that a larger number of millennials would prefer to live in the suburbs than currently do. This supports general logic that as members of the cohort move into their child-rearing years, they are likely to seek bigger homes and better schools in the suburbs.

How to attract and retain talent—in a suburban workplace 

As office deals in the suburbs pick up, building owners will find that new amenities and impactful design elements can help bring more energy and buzz to their buildings, which pays off in the long term. For owners and investors, repositioning projects increases returns on a building when the new features help attract and retain tenants. And for businesses, employee recruitment, engagement and retention increases when the design of the workplace effectively meets their needs.

Modern amenities add value to headquarters and multi-tenant buildings alike

Over the last decade, the tech industry upped the ante when it comes to office perks, with lavish amenities like gourmet cafeterias and massage rooms. Many downtown office buildings followed suit, adding high-tech conference facilities, fitness centers and lounges to help boost employee engagement. For example, the new tenant lounge at 222 South Riverside Plaza, located above Union Station, features a game room and golf simulator. And now we see this trend picking up in the suburbs.

One of the biggest suburban office deals of 2016 came in June, when Retail Properties of America, Inc. announced that Paylocity would take over 309,000 square feet of space at its Zurich Towers office building. To help lock in the 15-year agreement, RPA engaged Wright Heerema early in the process to design multiple building improvements, including a fully renovated atrium and lobby, state-of-the-art fitness center, new recreational amenities and modern conference and dining facilities.

Roger Heerema

When our teams design a suburban headquarters renovation, the plans almost always include new social spaces that bring people together organically. In-office lounges and bars build buzz and encourage employees to network outside of their everyday working relationships. These are features that originated in urban areas, and now are becoming more common in suburban office environments.

More subtle renovations can also make a big impact. Building owners and tenants alike are beginning to cater to the new style of working preferred by Millennials, who enjoy the opportunity to get out of the cocoon of their cubicle and work in a variety of spaces depending on the type of project they are focused on that day.

For instance, when Alliant Credit Union sought to redesign their offices in Rolling Meadows, they decided to knock down walls and transform their pantry area into a bright and airy lounge that brings employees together organically. A variety of seating areas provide spaces for employees to socialize and collaborate, and get a change of scenery from their desks.

Similarly, landlords are taking an active role in building out common spaces for tenants that go beyond lobbies and restrooms, helping to make their buildings more competitive and attract tenants. In multi-tenant buildings, Wi-Fi lounges offer a perk for building tenants and extend the available workspace, providing opportunities for employees to work in different venues and network with other people in the building. Many owners are also adding more robust conference centers and videoconference facilities, which tenants can use for a fraction of the cost that they would incur to add such amenities to their own individual space.

Fresh design wakes up sleepy office parks 

While new lounges and other amenities can go a long way in attracting tenants and increasing employee engagement, they may be overlooked if the building itself looks like it hasn’t changed since 1987. In the suburbs, the design of the building exterior and common spaces is more critical than in downtown buildings, where the general buzz of city life lends energy to offices.

In Oakbrook, Wright Heerema partnered with Golub & Company to reinvigorate a 289,000-square-foot complex now branded Oakbrook 22. On top of new amenities, the renovation helped to refresh the building with a re-imagined lobby, landscaping upgrades and a new entry arrival experience. The investment has paid off—new leases and renewals have helped to push up occupancy, and Michael Jordan’s restaurant has signed on to take over the new dining area.

Suburban locations also offer an advantage most downtown buildings cannot—the opportunity to extend the office outdoors. Oakbrook 22 took advantage of its land to add a new amenity space with seating in a green area. Bright canopies and thoughtful landscaping bring energy to the patio, giving office workers a place to take a break from the daily grind.

The project proved it is possible to be cool in the burbs. While some corporations will find a downtown building better suits the needs of their workforce, other companies will find they can still effectively recruit employees and keep them happy in the suburbs.

Modern design and amenities can add energy and cater to the working style of today’s employees. In the suburbs, where the onus is on the building to build energy and buzz, these improvements can be even more impactful.

Steve Wright and Roger Heerema are principals with Chicago architecture firm Wright Heerema Architects.

Source: MN News

Mortenson hires general manager for Minneapolis office

Todd Schilling

Mortenson Construction has hired Todd Schilling as a general manager in its Minneapolis office. In this new position, Schilling’s responsibilities will initially include research and development of emerging markets for Minnesota, Iowa and the Dakotas.

Prior to joining Mortenson, Schilling was vice president at J.E. Dunn Construction for four years where he opened the company’s North Dakota offices in Williston and Dickinson. In addition, Schilling spent 18 years at Knutson Construction where he served as vice president and general manager of the Minneapolis office, spearheading a variety of projects in the Twin Cities market. Prior to completing his construction management degree, Schilling spent 13 years at Sheehy Construction, starting as a laborer and working his way up to superintendent.

In addition, Schilling is actively involved in charitable and nonprofit organizations. He co-founded Changing Gaits, a Minnesota nonprofit organization that specializes in equine-assisted therapy services, where he continues to serve as an honorary board member. He also sits on the building advisory council for Crescent Cove, a residential hospice that offers care and support to children and young adults with a shortened life-expectancy.

Source: MN News

Dominium to build 163-unit seniors housing community in Minnesota

Dominium, a Minneapolis-based apartment development and management company, will soon build a 163-unit affordable senior housing development in Apple Valley, Minnesota.

Legends of Apple Valley will be built on the southwest corner of 140th Street and Cedar Avenue in Apple Valley. Dominium closed on the property in late December of 2016, and construction is scheduled for completion in Spring 2018.

“Dominium is committed to providing quality housing that meets the needs of seniors who want to stay in the community,” said Mike Hudson, development staff associate at Dominium, in a statement. “This is a great area and the proposed project will be mutually beneficial to the city, neighborhood and community.”

The building will consist of four stories and be constructed using attractive materials that are aesthetically pleasing and fit well into the neighborhood. Legends of Apple Valley will offer multiple floor plans and include amenities such as a community room, kitchen with separate dining room, craft and card rooms, beauty salon, fitness room, theater area and large outdoor elevated deck with grills and lounge area. It will include both underground and surface parking.

Source: MN News

Minneapolis’ New Perspective Senior Living hires new COO

Chris Hyatt

Chris Hyatt

Minneapolis-based New Perspective Senior Living has hired former Brookdale executive Chris Hyatt as partner, investor and chief operating officer. In this new position, Hyatt will be responsible for the day-to-day operations of the organization. Company founder Todd Novaczyk retains his position as chief executive officer, as does Ryan Novaczyk in his role of president and chief financial officer.

Hyatt has close to 20 years of experience with senior living companies. Most recently, Hyatt served as executive vice president of operations support for Brookdale. Prior to joining Brookdale, he was executive vice president and chief operations officer at Emeritus Senior Living, which merged with Brookdale in 2014.

Hyatt began his senior housing career with Emeritus in 1998.

Source: MN News

Destination suburbs: The new choice for aging Millennials

Steve Shepherd

Steve Shepherd

By Steve Shepherd, Vice President, Colliers International MSP

“I just want to cook a ham for the holidays and be surrounded by family and friends,” says one aging millennial, who as of late, is interested in finding balance and establishing roots.

As millennials age (or younger Gen-Xers for that matter), the live-work-play mantra will naturally morph into live-work-educate, as their focus changes to providing educational and enrichment opportunities for their children.

Good schools, a backyard with room for Fido and expanded living space will become more important lifestyle factors than proximity to the nearest micro-brewery.

Suburban “urban-hubs” 

Can the suburbs serve as an enticing option for a generation that wants it all and is used to having it all?  Not surprising to the people who study population migration patterns, the answer is “yes.”

Serving the needs of both millennials and boomers, the suburbs are embracing the integration of the types of amenities that draw people to urban centers.  Attractive mixed-use developments are surfacing in many suburban communities with the profile of centralized walkable hubs that offer ease of accessibility, community gathering space, entertainment, shopping and dining.

In the Twin Cities, suburban locations like West End, France Avenue, Ridgedale, Wayzata and Golden Valley are well positioned to offer this desirable mix of walkable amenities to both millennials and employers seeing to hire millennials.

It’s not only investors, developers and urban planners who are hip to this trend, office owners alike are figuring out how to reposition aging stock with creative, open, collaborative space to fulfill the “work” needs commanded by today’s transitioning workforce.  Savvy office owners know that to keep pace with modern demands and remain viable, they must differentiate themselves to attract businesses focused on recruiting and retaining talent.

Reinventing suburban assets 

Under the ownership of Hillcrest Development, Pentagon Park, located at Hwy. 100 and I-494 in Edina, Minnesota, is an example of a repositioned office property that undertook the task of reinventing itself to avoid abandoned offices, conference rooms and hallways.

“Reinvention of a 1960s-era office park requires attention to detail,” said Scott Tankenoff, managing partner at Hillcrest Development. “Our investments in the buildings were prioritized to promote energy efficiency, enhanced natural light and the development of adjacent tenant amenities.  Further renovations focused on creating open spaces, ceiling heights and exterior common spaces for employees and visitors to enjoy.”

Office options along popular Twin Cities’ commuter routes afford business owners and decision-makers who live in the suburbs, especially the affluent western suburbs, the convenience of a centralized location.  With transit options, accessible amenities, free parking for employees and the added “cool factor” of a repositioned property, the suburbs are starting to look, and think, like the city.

Looking outside the Loop 

Arguably our metro’s hottest office market – and not coincidentally a location very popular among millennials for live-work-play — the North Loop has filled up with creative and tech-driven businesses that don’t need to be in the downtown core with access to skyway connections.

The North Loop’s delivery of cool, non-traditional, often brick-and-timber office space at affordable prices of $12 – $14 PSF net became a popular alternative to a downtown address. With that submarket near full and lacking parking options, we are already seeing a shift to other submarket options, like neighboring Northeast Minneapolis.

With local developers chasing projects in Market West near International Market Square, it’s not a stretch to believe that a subset of office tenants looking for new space would consider the right creative project along Highway 55 or the Interstate-394 corridor if the value was right.

The jury is still out on whether companies are willing to stay in the North Loop as the top end of the market gets pushed closer to $20 PSF net.  Remember, these users have already acknowledged that they don’t need to be located at main-on-main in downtown. We have already seen creative/tech activity at Wirth Corporate Center on Highway 55 in Golden Valley, where creative space design has been implemented to attract those getting priced out of the Loop.

Can the suburban office package of creative finish, access to amenities and value win out over an urban setting if the value isn’t there?  I guess we’ll let the millennials decide.

Steve Shepherd, is vice president of Colliers International MSP in Minneapolis.

Source: MN News