2016 was generally a very good year for commercial real estate in the Twin Cities, producing dozens of sizable deals engineered by brokers who were kept busy across all property types.
Thus, there was a lot to choose from for members of the Minnesota Commercial Association of Real Estate/Realtors (MNCAR) as the trade group considered its annual awards for the year's best transactions.
The four winners, announced Tuesday during an MNCAR event held at the Walker Art Center, included three deals in downtown Minneapolis that pointed to the resurgence of the city's central business district as an employment hub.
Another winner illustrated the continuing strength of the suburban industrial market.
Office Transaction of the Year
Downtown boosters received very good news in November when it was announced that Select Comfort had struck a deal to move 900 employees from suburban Plymouth into the central core. And its destination was a rather unlikely one: a pioneering 1980s data center.
Transwestern's Reed Christianson and Erin Wendorf represented 1001 Third Avenue South's owner, California-based DCI Technology Holdings, which specializes in data center real estate.
The pair worked with Emily Nicoll and John Ferlita of CBRE, representing Select Comfort, to pull off an audacious deal in which the maker of Sleep Number beds will move downtown later this year to occupy some 211,000 square feet of the massive former IDS/Ameriprise data center.
Investment Transaction of the Year
It was undoubtedly tough for MNCAR's judges to choose a top investment transaction (or building sale) of the year, because 2016 represented a historic high-water mark for the Twin Cities. Previously unseen levels of investment capital flooded the metro from buyers from across the globe. The November sale of City Center, otherwise known as 33 South Sixth Street, topped them all.
That sale was single largest office asset deal in Twin Cities history, with HNA Holding Group of China snapping up the 51-story, Class A office tower and mixed-use complex for $315 million — some $62 million more than the previous record set when the IDS Center traded hands in 2013.
Tom Holtz, Ryan Watts, Judd Welliver and Sonja Dusil of CBRE's Minneapolis office represented the seller in the transaction, Shorenstein Properties, which had purchased the building for $202 million only four years earlier.
Retail Transaction of the Year
With mostly downbeat news such as the impending closures of Macy's and the Nicollet Mall Barnes & Noble bookstore, the signing of a lease deal in September to bring a hot concept like Nordstrom Rack to the IDS Crystal Court was a much-needed vote of retail confidence for the urban core.
Andrea Christenson and Blaine Beety of Cushman & Wakefield/Northmarq in September succeeded in landing a 40,000-square-foot IDS Center lease with Nordstrom for the second of its two upcoming Rack locations this year. The other opening will be in the east metro suburbs at Woodbury's CityPlace. Nordstrom was represented by Mike Sims of Mid-America Real Estate.
Broker of the Year
The 2016 MNCAR Broker of the Year award went to Todd Hanson of Cushman & Wakefield/Northmarq. Hanson joined its predecessor firm, United Properties, in 1997, and since then has established himself as one of the Twin Cities' top-performing specialists in the leasing and sales of industrial properties, operating primarily in the northeast metro.
Industrial Transaction of the Year
During a hot market for industrial real estate in 2016 that saw plenty of big leases signed and new buildings going up, the one that stood out for the MNCAR judges was at Ryan Cos.' Six Ten Zane Business Park in Brooklyn Park, where the developer signed Star Exhibits to a deal for a built-to-suit, 200,000-square foot facility.
The corporate display-maker, which was represented by Charles Caturia of CBRE, didn't need to move too far — its existing headquarters was just across Hampshire Avenue in the multitenant LDI Distribution Center. Mark Sims and Noam Newman and Cushman & Wakefield/Northmarq negotiated on behalf of Ryan in the first-quarter transaction.
Don Jacobson is a freelance writer based in St. Paul. He is the former editor of the Minneapolis-St. Paul Real Estate Journal.