Franklin Street Properties, the investment firm trying to revive the TCF Bank building and tower, has bought another large downtown Minneapolis property, Plaza Seven, for $82 million.
Franklin Street, a Massachusetts-based real estate investment firm, said it will spend about $2 million on upgrades over the next four years at the 36-story Plaza Seven tower, which includes offices, a hotel, retailers and parking structure at 45 S. 7th St.
The sellers, San Francisco-based City Center Realty Partners LLC and private investment adviser Angelo, Gordon & Co., spent about $5 million on improvements since purchasing the building in 2013. Those upgrades helped raise the building’s occupancy level from 58 percent to 97 percent.
Chief among its new tenants is PricewaterhouseCoopers, which announced in October that all of its Minneapolis employees will move from the Capella Tower, located at 225 S. 6th St. in downtown Minneapolis, to Plaza Seven this summer. Once the professional service firm moves in, the building will be renamed PwC Plaza.
Franklin Street owns buildings throughout the U.S., but many of its premier properties are in Minneapolis. The company said it funded the acquisition with money freed up through the sale of its “noncore” suburban buildings and through loan repayments.
The investment firm recently backed away from a plan to build a 50-story tower on the site of the TCF Bank building at 801 Marquette Av., next to the historic Foshay Tower.
Franklin instead will spend $15 million to $18 million to renovate the four-story bank building, which TCF vacated last year.
Plaza Seven’s seller, City Center Realty Partners, is still active in the Twin Cities real estate scene. It recently co-purchased — along with New York-based DRA Advisors LLC — the 450,000-square-foot Wells Fargo Plaza building in Bloomington for more than $46 million.