Knollwood Mall is in the midst of renovation, which may have been just what the shopping center needed to attract a new suitor.
Heitman, a real estate investment management firm in Chicago, is purchasing the 60-year-old shopping center, according to St. Louis Park city officials. The chief executive of New York-based Rouse Properties revealed the sale's pricetag of $106.7 million during its third-quarter earnings report in November, but didn't reveal the buyer's name.
Knollwood was Rouse's only Minnesota real estate investment.
The mall, which sits near the northeast corner of Highways 7 and 169, is in the final stages of its $32-million makeover that is transforming it from an indoor to outdoor shopping center.
"We have executed a contract to sell Knollwood Mall upon completion of our redevelopment, demonstrating the value we are creating throughout our portfolio while recycling capital to reinvest in higher yielding growth opportunities," said Andrew Silberfein, Rouse's president and chief executive officer, in its third-quarter earnings statement.
Built in 1955, the shopping hub has survived multiple owners and disruptive trends in the Twin Cities retail market. The viability of the location is bolstered by its busy commercial neighborhood where the average household income is $93,000.
The property sale is expected to close this month, and possibly as early as this week, said St. Louis Park officials. Rouse and Heitman did not return phone calls.
Construction at the Knollwood shopping center has gutted the interior of the building. Knollwood Mall is undergoing a much-need facelift that involves converting the mall into a power-center, with stores accessible form the parking lot. Photographed on 6/20/14 by Bruce Bisping/Star Tribune.