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.

Latitude 45 retail space is fully leased during construction; Ryan Burnet signs restaurant lease

Posted by: Kristen Leigh Painter under Architecture Updated: November 13, 2014 - 1:45 PM

The retail space is now fully leased at Latitude 45, the high-end apartment building still under construction on Washington Av. downtown Minneapolis.

The 10,000 square feet of ground-level retail will be split into two businesses: a destination restaurant and massage spa.

Restauranteur Ryan Burnet will fill more than 6,000 square feet at the corner of 3rd and Washinton avenues with what he hopes is an "approachable destination" restaurant.

The developer, Alatus, announced in March that Burnet -- who has seen success in the Minneapolis restaurant scene with Bar La Grassa, Burch Steakhouse & Pizza and Barrio Tequila Bar -- had signed a letter of intent to open a new concept at Latitude 45.

Burnet, who officially signed the lease two weeks ago, said the concept is still being fleshed out, but there are certain segments of the dining scene he hopes to capture with this new restaurant.

"I want people who live in the building to feel comfortable coming down in their sweatpants for a beer on Saturday night with people in business suits at a table nearby," Burnet said. 

There is no shortage of quality restaurants in Minneapolis, but Burnet wants this to be a staple for the extended neighborhood.

"The goal is for people who would want to come back multple times a week, not just once a month," Burnet said. 

To do this, he said, "the bar will have a lack of pretense and that will be reflected in the cost structure as well."

Massage Envy will occupy more than 4,000 square feet at the other corner, 4th and Washington avenues, fitting the lifestyle of the building's likely clientele. The Star Tribune reported in March that Alatus was targeting empty-nesters and "aspirational" young professionals. 

Andrea Christenson of Cassidy Turley brokered the deals. This is the only downtown residential building to pre-lease all of its retail space while still under construction, she said. 

"People will want to live in this building just knowing there’s a Ryan Burnet restaurant downstairs," Christenson said. "We really think that being near the river, in that neighborhood and being skyway connected is the perfect storm."

The 319 apartment units will be ready for move-in by the summer. Burnet anticipates being open for business in September 2015. 

Cash-out refinancings have more than doubled in just two years.

Posted by: Jim Buchta under Buying Updated: November 13, 2014 - 10:22 AM

Recent - and unexpected - declines in mortgage rates over the past several months have sparked some very low levels of refinance activity. A boomlet? Compared with previous levels of refinancing, no. But during the middle of October, for example, mortgage rates dipped slightly to the lowest they've been since the summer 2013. During the third quarter refi activity nationwide rose to about $8 billion, which is less than one-tenth of the refi activity when the market peaked in mid-2006. Still, an analysis by Freddie Mac shows that reduced mortgage payments will save American homeowners more than $1.5 billion in interest payments over the next 12 months with an average interest rate reduction of about 1.3 percentage points , or a savings of about 24 percent. And with house prices on the rise, the share of those cash-out refinancings is on the rise, increasing from 3 percent during the third quarter 2012 to almost 8 percent by the end of September.

Twin Cities home sales fell 1.5 percent during October, while prices increased 7.2 percent

Posted by: Jim Buchta under Buying, Foreclosures Updated: November 12, 2014 - 10:39 AM

An surprise dip in mortgage rates last month did little to warm home buyers. During October there were 4,523 home sales in the 13-county metro, a 1.5 percent decline compared with last year, according to a monthly sales report released this morning by the Minneapolis Area Association of Realtors. Because fewer of those sales were foreclosures, the median price of those deals increased 7.2 percent boost to $209,000 - the 32nd consecutive month of year-over-year price gains. Here's a peak at other hightlights from the report (we'll have a full story later today):

  • Pending sales declined 1.3 percent from last year, while new listings decreased 2.3 percent.
  • Total inventory rose 4.3 percent to 17,132 homes
  • The average price per square foot rose 5.6 percent to $123.
  • The average market fell 4.0 percent to 72 days.
  • The months' supply of inventory rose 10.8 percent to 4.1 months
  • Traditional new listings (not bank-owned) rose 6.7 percent.
  • Foreclosure and short sale new listings were down 42.4 and 31.3 percent, respectively.
  • Traditional closed sales were up 9.7 percent while foreclosure and short sale closings fell 41.1 and 48.3 percent.

United Properties announces new 10-story office building next to Target Field Station

Posted by: Kristen Leigh Painter under Architecture Updated: November 12, 2014 - 3:16 PM

United Properties plans to build a 240,000 square foot office building on the final parcel adjacent to the Target Field light-rail station in Minneapolis' North Loop neighborhood. 

The developer announced Wednesday that it is moving forward on the 10-story building without any tenants, a sign of the company's confidence in the rebounding market and its location.

 This is another stake in the booming North Loop ground for United, which shares the same owner as the Minnesota Twins team that play next door. Both the Twins and United are Pohlad Family companies.

At the corner of 6th Av. N. and 5th St. N, the project site is next to the light-rail stop that serves the Twins ballpark and is across the street from another high-profile construction project, Be The Match headquarters, that United is currently developing.

United and the Twins began working with Hennepin County in 2012 to develop the land near Target Field Station. The development arm of the Pohlad Family Company built out the Caribou Coffee earlier this year that sits below the light-rail platform and the Ford Center across the street. 

This project, while still in the early stages, would bring more premium office space to the neighborhood -- something that, until recently, sorely lacked.

The news comes on the heels of another announcement for a speculative office building in the North Loop. Hines unveiled its plans last week for a seven-story building that will sit just a few blocks from United's new site.

United's project concept is for a transit-oriented building with all the amenitites office seekers are now desiring -- a roof terrace and lounge, bike storage and fitness center. Additionally, this project will have a restaurant and the ground level and offer underground executive parking. 

But first, United must purchase the 0.75-acre parcel from Hennepin County. The company intends to go through the city's entitlement process in early 2015. United hopes to break ground next fall with a target completion date of late 2016.

“The development of this new project at Target Field Station builds on United Properties' previous success and ongoing commitment in the North Loop,” said Bill Katter, executive vice president, United Properties, in a statement. “This area continues to be one of the most exciting places for next-generation office space in the Twin Cities.”

Jim Montez of Cushman & Wakefield|NorthMarq, another Pohlad company, will head leasing of the office space.


Junction Flats apartments in Minneapolis sells for $49 million

Posted by: Jim Buchta under Architecture, Buying Updated: November 12, 2014 - 10:25 AM

Another national investor is making a big investment in Twin Cities real estate. South Carolina-based Greystar paid $49 million - a whopping $270,000 per unit - for the Junction Flats apartments in the North Loop neighborhood in downtown Minneapolis, according to public records.

The 182-unit property was developed by Dallas-based Trammell Crow in one of the most rapidly developing developing corners of the city. The building is at 643 Fifth St. N. near Target Field and the new Target Field Station transit hub, and is within walking distance of downtown Central Business District. Residents started moving in on August 1 and the building is nearly half occupied.

Greystar is a big national player that's relatively new to Minneapolis. The company developed Elan, a massive multi-phase luxury apartment building with nearly 600 units along the Midtown Greenway in the Uptown neighborhood, and is planning to build a high-rise apartment building along Lake Calhoun.

Trammell Crow has been active in the Twin Cities, as well. The company developed Arcata, a 165 unit rental bulding at Xenia and Golden Hills Drive in Golden Valley, and that's scheduled to open December 1. The company is also building the 175-unit Island Residences at Carlson Center in Minnetonka.

Several major commercial and apartment properties in the Twin Cities have been snapped up national investors who have paid premium prices. Just last week, for example, a Chicago-based partnership paid a record price for the Normandale Lake Office Park.

Normandale Lake Office Park sale price revealed; largest transaction in Twin Cities history

Posted by: Kristen Leigh Painter under Buying Updated: November 11, 2014 - 4:12 PM


Sam Zell sold the largest office complex in Minnesota last week for a record-breaking $368,950,000, according to its certificate of real estate value.

A partnership led by MetLIfe bought the 1.7-million-square-foot Normandale Lake Office Park in Bloomington from the Chicago developer on Oct. 10.

It is the largest real estate transaction in Twin Cities history, shattering the previous record set by Zell when he purchased the same property in 2012 for $265 million. 

The Star Tribune reported the sale last week: 

The sprawling, skyway-connected network of five shimmering glass office buildings exceeds the size of the tallest building in downtown Minneapolis, the 57-story IDS Center.

The complex, which was developed in stages over several years during the 1980s, has more than 90 high-profile tenants, including Tata Consultancy Services and Oracle Corp.

Its occupancy rate of 93 percent has outperformed the market, according to Tom Tracy, executive director of brokerage services for Cushman & Wakefield/NorthMarq, which brokered the deal and will continue to manage and lease the property. Metrowide, the occupancy rate for such buildings is about 83 percent.

With two fine dining restaurants, a 2,500-acre regional park on its doorstep and the kind of on-site services, including day care and hair salons, that you’d typically find in a more urban area, the property has managed to attract high-profile tenants who are willing to pay top dollar for their space.

The deal is among several high-profile property sales that have happened this year in the Twin Cities, including the Graves Hotel, 50 South Tenth and Washington Square, all in downtown Minneapolis.


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