Opus Building Spec Industrial Project in Northeast Minneapolis
The Opus Group is pushing ahead with the project on a speculative basis with no signed leases in place. The Opus Group

Opus Building Spec Industrial Project in Northeast Minneapolis

The developer is building the 130,440-square-foot industrial project on a site that's been vacant for several decades.

The Minnetonka-based Opus Group has broken ground on a rarely seen type of project: a new industrial building inside the city limits of Minneapolis.

Opus has started construction on the 130,440-square-foot project at University Avenue and 37th Avenue NE in Northeast Minneapolis. Opus has dubbed the project the Nordeast Business Center; “Nordeast” is long-standing local slang to refer to Northeast Minneapolis. The developer is pushing ahead on a speculative basis – “spec” in industry shorthand – with no signed leases in place.

Joe Mahoney, director of real estate development at Opus, said that once the company began working on the entitlement process with Minneapolis city planners, they noted the unusual nature of the project.

“They couldn’t recall an industrial project, a speculative one, that had been done in last couple of decades,” said Mahoney. “There aren’t many sites like this. It’s a very unique urban infill site.”

The site has been vacant for several decades. Mahoney said that Cargill once had a linseed oil facility on the site, but that was demolished in the early 1980s. Opus acquired the land from Hennepin County and Canadian Pacific; there were rail spurs on the site.

The pandemic has helped create a booming market for industrial properties. As online shopping continues to grow, companies increasingly need more warehouse and distribution spaces to fuel their e-commerce operations.

“It remains very strong,” said Mahoney of the current state of the industrial property market. “We’ve had a lot of good interest so far.”

Opus just completed a 130,000-square-foot industrial project in Eden Prairie. Last week the company closed on a site in Blaine where it plans to build the Sanctuary Business Center, a 137,000-square-foot industrial project.

Mahoney said that the Minneapolis site has some environmental contamination due to its history of having a linseed oil facility on the property. The Minnesota Department of Employment and Economic Development, the Metropolitan Council and Hennepin County kicked in approximately $683,000 in combined cleanup funds for the site.

Mahoney said that the Opus project will both generate new taxes and bring jobs to the site.

“It’s been a vacant site that hasn’t been on the tax rolls,” said Mahoney.