Owners hope high-rise can park on their Mpls. lot

  • Article by: JIM BUCHTA , Star Tribune
  • Updated: October 18, 2011 - 11:31 PM

A Minneapolis parking lot could become the next high-rise apartment building downtown.

The owners of the land at 4th and Marquette are looking to cash in on the rental housing boom and hope to sell the one-third-acre parcel to someone who will turn it into apartments.

Gina Dingman, the broker for the lot, said it will go on the market next week. A listing price hasn't been set, but county records say the estimated tax valued is about $1.5 million. The owner, LST Properties, purchased the property in 1984 for $6.55 million, according to those records.

Dingman, president of Everest Real Estate Advisors, said she expects to get considerable interest from both local and national buyers because of the growing interest in rental housing.

The lot is in the heart of what's known as the city's central business district, an area dominated by high-rise office buildings. It's also appealing because it's on the same block as a light-rail transit station and whatever gets built there would have access to the downtown skyway system.

"This is a very unique property," she said, noting that there hasn't been a site brought to market that is skyway-connected and has light-rail access.

And it won't be the only residential building in the area if it eventually becomes a high-rise.

Several proposals to build luxury apartment buildings have emerged in recent months, including a nearby high-rise on a vacant site next door and the conversion of an existing office building into 250 apartments.

Jay Thompson, an Everest senior vice president who did research for the listing, said during the past decade, more than 4,000 new households moved into downtown. He expects the same to happen in the coming decade, with demand outstripping supply.

Thompson said there are plans to build more than 3,000 rental units in the downtown core and surrounding neighborhoods over the next several years. He acknowledges that not all of them will get built.

Mary Bujold, president of Maxfield Research Group, said the lack of new rental housing over the past decade is driving demand for upscale housing.

She said LST's parking lot would work well as a high-rise office building because of its proximity to public transportation and other offices. There also aren't a lot of other options for commercial developers once that part of the market returns.

"I think there's a shortage of top-quality commercial sites where you'd put a high-rise office tower downtown, but is there a shortage of sites for high-rise multifamily? Not really," she said. "Just as many people would prefer to be on the fringe as in the core."

Jim Buchta • 612-673-7376

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