United Properties is considering office and retail uses for the now-closed store in downtown Minneapolis’ Gaviidae Common.
Updated: April 3, 2013 - 11:51 PM
Long neglected, but now booming, the area near S. 5th Street and Nicollet Mall in downtown Minneapolis may very well be the hottest spot in town as far as commercial real estate goes.
Bloomington-based United Properties confirmed Wednesday that it is under contract to buy the now-shuttered Neiman Marcus store at 505 Nicollet Mall — although terms were not disclosed. It’s the latest deal in a flurry of ambitious transactions involving a corner of the central business district that, not so long ago, was a largely a surface parking lot.
Plans for two luxury apartment towers are in the works, as well as an expanded campus for Xcel Energy Inc. — all in the wake of an increasingly busy Hiawatha light-rail stop.
Mark Stenglein, CEO of the Minneapolis Downtown Council, says the northern stretch of Nicollet Mall has long been eyed for redevelopment.
“With the arrival of LRT at 5th and Nicollet, this is the beginning of much development that will be occurring on North Nicollet,” he said. “The Downtown Council’s 2025 plan not only calls for a revitalized Nicollet, but also a new gateway park at 3rd and Nicollet, making downtown Minneapolis a 24/7 city.”
The luxury retailer closed its doors in Gaviidae Common II in January, and property owner Brookfield Office Properties has been marketing the property ever since.
Enter United Properties. “We believe the space has strong redevelopment possibilities and are considering options to include office and retail space,” said Frank Dutke, the firm’s president and CEO. “In the upcoming weeks, we will continue to evaluate the strengths and significant challenges with the asset to determine our next steps.”
The four-story former Neiman’s store is across from Opus Development’s project to build a $100 million, 26-story luxury apartment tower called the Nic on Fifth. That project is expected to open in the summer of 2014.
Minnetonka-based Opus is also developing a nine-story office building on the southeast corner of Nicollet Mall and 4th Street, about a block away from its luxury tower. Office space in the new building would be leased to Xcel Energy for roughly half of its 1,500 employees downtown, with the remaining workforce located in the energy company’s headquarters across the street.
Last month, news surfaced that Mortenson Construction is proposing a 30-story luxury residential tower for S. 4th Street and Marquette Avenue. And this week, the 510 Marquette office building, which is next to the Neiman’s site, sold for $6.69 million to an affiliate of Swervo Development. Ned Abdul, president of Swervo, said earlier this week that the site may be developed as retail space on the first floor and skyway level, with offices on the upper floors.
Janet Moore • 612-673-7752
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