A perennial pastime in Uptown is fretting about the future of Uptown. The Ackerberg Group—a commercial real estate firm based in Uptown—acquired the iconic Calhoun Square in April for $69.5 million, marking the third sale in 10 years for the urban shopping mall.
Once again, the new owner is touting renovations. CEO Stuart Ackerberg plans to remove the “fancy tile” that the previous (non-local) owner installed, and looks to create a more “edgy” feel for the space. “We’re trying to urbanize it,” says Ackerberg, who wants to draw more local retailers.
In recent years, there has been grumbling—including comments by Ackerberg—that commercial space in Uptown was too pricey for local outfits. National players Apple, the North Face and Columbia Sportswear have opened stores directly across from Calhoun Square.
But Calhoun Square’s prices are not as lofty as the big regional malls. Market statistics from Bloomington-based Cushman & Wakefield/NorthMarq show top net rental rates per square foot at $150 at the Mall of America, $100 at Ridgedale Center and Rosedale Center, and $90 at Southdale Center.
The same study quotes net rates at Calhoun Square in the range of $15 to $60 per square foot. The top rates are for high-profile street-level spaces; retailers pay less for second-floor space. Ackerberg says that he thinks Calhoun Square’s rates are in line with the market.
“[Rental rates are] within normal market ranges,” says Skip Melin, senior director with Cushman & Wakefield/NorthMarq, of Calhoun Square’s rates. “It is really the epicenter of the trade area.”
Calhoun Square tenants include LA Fitness, H&M, CB2 and longtime locals Kitchen Window and Bay Street Shoes. The mall is already 88 percent leased but lacks verve. “We’re going to change the energy inside of the mall,” adds Ackerberg Group’s senior managing director Jackie Knight.
Retail brokers agree that there are tenants looking to open stores in Uptown, but prime space has been hard to find. The twice-abandoned corner restaurant space at Calhoun Square is the most high-profile square footage available.
Stefanie Meyer, senior vice president and principal with Mid-America Real Estate Minnesota, sees Uptown rents in line with other boutique markets: “The rates and the real estate aligns with 50th and France. It seems like the rates are pretty similar.”