Minnesota’s largest and most expensive office complex was resold in what was claimed to be the largest real estate transaction in the history of Minneapolis-St. Paul. MetLife led a partnership, including Allstate Corporation that paid $368,950,000 for the Normandale Lake Office in Bloomington from an entity led by Chicago-developer Sam Zell.
This transaction exceeds the developer’s previous record-setting $270 million purchase of the complex in 2012 by the seller of the complex. A spokesperson for MetLife said that this transaction was worth pursuing because of the complex’s quality and amenities as well as reputation of its tenants and its proximity to the Northland Plaza, a 300,000 square foot office tower.
The partnership was among several bidders for the complex. The ownership is intended to be long-term and there are no plans to make major changes to the property.
The complex, a sprawling sky-way connected network comprised of five glass buildings, was developed in stages over several years in the 1980s. It exceeds the size of downtown Minneapolis’ tallest building, the 57-story IDS Center. The complex has two fine dining restaurants and on-site services such as day care and hair salons. It is also located near a 2,500-acre regional park.
Tata Consulting Services and Oracle Corp. are among its 90 well-known tenants. The complex has outperformed the market and has a 93-percent occupancy rate compared to the normal 83 percent for similar buildings in the metro area.
Other recently high-profile real estate transactions in the Twin Cities have included the Graves Hotel, 50 South Tenth and Washington Square in downtown Minneapolis.This record-setting purchase, like other routine commercial real estate transactions in the Twin Cities, requires negotiation, planning and knowledge of numerous laws and regulations such as zoning laws and requirements governing commercial mortgages. Prompt legal advice can help assure that these deals are successful.
Source: Star Tribune, “Minnesota’s biggest office complex changes hands again, Jim Buchta and Kristen Leigh Painter, Nov. 6, 2014