Several New Office Buildings To Join Mpls. Skyline
Amid high vacancy and a bumpy economy, the Twin Cities has seen few new office buildings built in recent years. That’s about to change.
At the moment, there are four significant new office projects planned in Minneapolis alone: three in downtown and one in the Uptown area. (Images of each project appear at the end of this story.)
On Wednesday, Minneapolis-based nonprofit the National Marrow Donor Program/Be The Match announced plans to move to a new 240,000-square-foot office building, which will be built in the North Loop area of Minneapolis. Bloomington-based United Properties will develop the project, which calls for razing the Shapco Printing building on the site at 524 Fifth Street North. The site is one block away from Target Field.
Jeffrey Chell, CEO of the nonprofit, told Twin Cities Business that the group looked far and wide at options for new space. The National Marrow Donor Program/Be the Match currently leases 196,000 square feet at the Broadway Ridge and Broadway Place East buildings in northeast Minneapolis.
“We looked at 65 different potential locations over the years,” Chell said. The nonprofit conducted a zip code analysis of where employees live and weighed the inefficiencies of its current space versus the cost to lease new space, he added. Chell also noted that the North Loop location offers many transit connections for employees.
“We thought that this location would give us a little more visibility,” Chell said. “We want to create the best possible environment for our staff.”
Chell said that his organization has about 850 employees in Minnesota. Construction of the project is set to start in the summer of 2014, with completion slated for late 2015. Earlier this year, city of Minneapolis documents outlined the projected cost of the United Properties project on the Shapco site at $56.9 million.
Meanwhile, two other office projects are up for discussion late Thursday before the Minneapolis City Planning Commission’s Committee of the Whole: Ryan Companies’ expansive Downtown East redevelopment plan and MoZaic East, a new office building in the Uptown area of Minneapolis, which would be developed by the Ackerberg Group. No votes are taken at Committee of the Whole meetings, which are meant as a way for developers to gather feedback from planning commissioners.
The $400 million mixed-use Ryan plan includes more than 1 million square feet of office space in two towers, which would ultimately be owned by San Francisco-based Wells Fargo & Company, which would occupy the space.
“We continue to make progress on many fronts,” Rick Collins, vice president of development with Minneapolis-based Ryan Companies US Inc., told Twin Cities Business. “We’ll be in front of the Planning Commission and the City Council several times in the next few months.”
Collins said that Ryan Companies still expects to acquire five blocks of land from the Star Tribune at the end of the year and break ground on the project in April next spring.
Wells Fargo has not yet made a final commitment to the project. On Wednesday, Wells Fargo spokeswoman Peggy Gunn said that the company continues to evaluate the Ryan project.
The MoZaic East project in Uptown would add 170,000 square feet of office space to the neighborhood, which has not traditionally been a draw for office tenants. The Minneapolis-based Ackerberg Group is working to land an anchor tenant before it would start construction.
“We are trying to get an anchor deal. We’re in active negotiations with some tenants,” said JoAnna Hicks, senior vice president with the Ackerberg Group. “I think if everything aligns we would like to begin construction early next year.”
MoZaic East would be built just to the east of the Ackerberg’s original MoZaic development, which has been successful in drawing tenants. The office and retail space in original MoZaic, completed in 2012, is now 91 percent leased, Hicks said. The new project would also include some retail space.
“I think that we have been able to prove out that the Uptown market is very appealing to both businesses and employees,” Hicks said. “It has incredible amenities.”
Most of the office projects that are moving ahead are build-to-suit deals, which are tailored to the needs of a specific company or organization.
Minnetonka-based Opus Development Company plans to build a new nine-story, 222,000-square-foot office building at 401 Nicollet Mall in downtown Minneapolis. The building will be fully leased by Minneapolis-based Xcel Energy, Inc. The new building is across the street from Xcel’s headquarters and is next to the site of The Nic on Fifth, a luxury apartment tower that Opus is developing and is currently under construction. Construction of the office project is set to begin in 2014; the project will be complete in 2016.
Below are photos of each of the planned office projects:
The planned headquarters for the National Marrow Donor Program/Be The Match (Courtesy of the National Marrow Donor Program/Be The Match)
Ryan's planned Downtown East project
Xcel Energy's new office building