Just Listed brings you the latest news and information from the Twin Cities-area commercial and residential real estate market and beyond from veteran reporters Jim Buchta and Kristen Leigh Painter.

Twin Cities CEOs will swing hammers for Habitat for Humanity

Posted by: Jim Buchta under Architecture Updated: October 9, 2014 - 5:15 PM
Here’s a shot of what one of the two houses looked like a couple weeks back when volunteers from General Mills were working on the job.

Hereâ s a shot of what one of the two houses looked like a couple weeks back when volunteers from General Mills were working on the job.

A Who’s Who of Minnesota execs, including Jay Lund, CEO of Andersen Corp., and Trudy Rautio, CEO of Carlson, will be swinging hammers in north Minneapolis on Monday to celebrate Twin Cities Habitat for Humanity’s 13th Annual CEO Build Day.

Lund and Rautio are CEO Build Day co-chairs, and they will be helping volunteers from more than two dozen companies build a pair of houses that will be sold to moderate-income families. Because of a disparity between construction costs and market values in the area, buyers of both houses will pay far less than what it actually costs to build the houses.

The 1,676 square-foot house at 3026 Logan Av. N., for example, appraised for $165,000, but the buyer will pay only $132,000. Habitat will hold the remainder of the value, about $33,000, as a forgivable second mortgage and gets the right of first refusal if they sell before paying off the mortgage. Buyers must have a family income 30 to 60 percent of the Twin Cities area median income to qualify. Both houses are spoken for, by the way.

Majestic Oaks Golf Club sells for $9.8 million

Posted by: Kristen Leigh Painter under Buying Updated: October 9, 2014 - 3:54 PM

Majestic Oaks Golf Club in Ham Lake has sold for $9.8 million, according to property records.

The sale -- which was posted on the Minnesota Department of Revenue's real estate portal Tuesday -- includes buildings and more than 394 acres of land.

Florida-based CNL Lifestyles Properties sold Majestic Oaks in a bundle with 47 other golf properties located throughout the U.S. CF Majestic Oaks Arcis, an LLC with a Manhattan address, is listed as the buyer. 

The new owners will continue using the property as a golf course and club, according to the certificate of real estate value. 

Majestic Oaks is only about three miles from another golf course, Bunker Hills Golf Club, in Coon Rapids. The expansive property contains two 18-hole golf course and one 9-hole golf course. During peak season, the golf club employs more than 100 people. 


 


 

House prices in the Twin Cities increased slightly behind the national average during August

Posted by: Jim Buchta under Buying Updated: October 7, 2014 - 12:39 PM

House prices in the Twin Cites metro during August increased slightly behind the national average, according to CoreLogic's Home Price Index, which showed that from August 2013 to August 2014 home prices increased 5.1 percent compared with a 6.4 percent increase nationwide. Prices in the Twin Cities were up 0.9 percent from July to August.

Those figures include distressed sales, which have now fallen to pre-crash levels, according to a recent report from the University of St. Thomas. With heavily discounted foreclosures declining, house prices in the Twin Cities and beyond have continued rising despite a a decline in sales. Early next week we'll have a complete look at the local real estate market when the Minneapolis Area Association of Realtors releases its September housing report. Early reports suggest that sales will be down significantly and prices will post another increase.

CoreLogic's August increase was the 30 consecutive month of higher prices year-over-year, and every state showed an annual increase. In fact, the HPI reached a new high in nine states, including Alaska, Colorado, Iowa, Louisiana, Nebraska, North Dakota, Oklahoma, Texas and Wyoming. CoreLogic predicts that home prices, including distressed sales, will increase 0.2 percent from August 2014 to September 2014 and 5.2 percent from August 2014 to August 2015.

Here's a link to the full report.

Maplewood's Birch Run shopping center sold, to be managed by Cushman & Wakefield/NorthMarq

Posted by: Kristen Leigh Painter under Buying Updated: October 7, 2014 - 12:05 PM

Maplewood's Birch Run Station Shopping Center, which sold last week to a California company for more than $27 million, will be managed by Cushman & Wakefield/NorthMarq. 

The 278,000 square feet shopping district is home to Marshalls, JoAnn, Burlington Coat Factory, Herberger's Clearance Center, HealthEast and other retailers. 

The complex was purchased by Birch Run Station Shopping Center 14A LLC, which a certificate of real estate value lists as being based in suburban Los Angeles.

St. Paul's BOMA unveils new DataSource website, expanding its perspective

Posted by: Kristen Leigh Painter Updated: October 6, 2014 - 3:25 PM

 

St. Paul’s membership organization for commercial real estate is going paperless.

The Greater Saint Paul Building Owners and Managers Association, commonly called BOMA, launched a new website called DataSource Monday that replaces the printed version of its 20-year-old annual market report.

The 300-member organization unveiled the new website during a luncheon with civic and real estate leaders at the St. Paul Hotel.  Perhaps more importantly, the shift from paper to digital signals a change in perspective for leaders in St. Paul’s downtown.

“This really is to help support the new initiative found in the Downtown Saint Paul Alliance (SPda), a public-private partnership. Their goal is to drive growth downtown and we want to be able to measure that success. So, yes, growing the office market is one way we can mark that, but we want to start tracking and reporting many more metrics,” said BOMA president Joe Spartz.

The downtown alliance is an offshoot of BOMA that officially formed in Dec. 2013. The group’s vision is also an expansion of BOMA’s traditionally more commercial-centric perspective.

“What we feel we have here are really more data points that show a more complex and in-depth picture of what is happening in the downtown St. Paul market, and that is what DataSource is really going to be about,” Spartz said.


Source: St. Paul BOMA/DataSource

Much like downtown Minneapolis, people are moving back into downtown St. Paul -- a nationwide trend, generally called reurbanization. St. Paul’s central core experienced a 62 percent jump in its residential population form 2010 to 2014.

And so BOMA, in conjunction with SPda, are now formally recognizing the interconnection between the residential, retail and commercial with its new website.

“Everything is following residential. That’s really the driver for retail, which leads to more demand for commercial office space,” Spartz said.  

This is the organization’s latest iteration in its evolution. It has long grappled with how to more fully represent the commercial market of its central business district.

“Many of the real estate companies that have excellent reporting were really only reporting on the competitive (office) space,” said Patricia Wolf, a member of BOMA.” And so we looked at it and, given that we are the capital city, we realized that we were really underestimating what was happening in our market.”

Being the capital seat, St. Paul’s indicators were often skewed when a government entity would vacate a commercial building downtown because it was building its own facilities.

“Sometimes we would be reporting a negative net absorption where we might have actually had significant growth,” Wolf said.  “So, 20 years ago, we decided that no one else was doing this and we needed to give people  a comprehensive snapshot of our market.”

Which is why BOMA’s market report breaks down its vacancies by competitive, government and owner-occupied.

As for this year’s hard numbers, St. Paul’s central business district remained relatively flat with 90 percent occupancy overall. Its traditional Class A, B and C office spaces are 86, 76 and 86 percent occupied, respectively.   

Minneapolis office vacancy decreases in third quarter as construction costs rise

Posted by: Kristen Leigh Painter Updated: October 3, 2014 - 4:54 PM

Twin Cities office vacancy decreased slightly during the third quarter of 2014 to 16.6 percent while existing tenants requested more improvements and longer leases, according to new data from Jones Lang LaSalle.

This is due, in part, to the rising costs of new construction, the real estate firm concludes – which is being spurred by a glut of commercial development projects in the Twin Cities metro area.

These projects, including the “new Vikings stadium, numerous build-to-suit office projects, multiple repurposing projects, and substantial industrial, multifamily and hotel” activity, have led to an extremely tight labor market for construction.

Jones Lang LaSalle produces statistics and insight on the office and industrial markets quarterly.  It’s Q2 survey reported an office vacancy rate of 17.2 percent in the Twin Cities.

The metro area is basically on par with national rates. Reis Inc. released its preliminary national data on Wednesday, finding national office vacancy at 16.8 percent.

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