The researchers at Marcus & Millichap Real Estate Investment Services predict that builders will deliver 1,865 rental units in 2012. That’s the highest this figure has stood in eight years. It also dwarves multi-family activity in 2011, when builders delivered 477 multi-family markets to the Minneapolis/St. Paul market.

The news is not all good, though. Marcus & Millichap is predicting that vacancies in the Twin Cities multi-family sector will rise 20 basis points in 2012 to 2.8 percent. The reason for this is fairly obvious: The number of new units delivered by builders will exceed a smaller increasein demand among Twin Cities consumers.

Don’t expect the rising vacancies, though, to hurt rents. According to Marcus & Millichap, operators should be able to raise asking rents 2.9 percent by the end of 2012 to $987 a month. Effective rents will see an even bigger increase, a predicted 4.5 percent to $956 a month.

This is all good news for the Twin Cities. Overall, Marcus & Millichap ranks Minneapolis/St. Paul as the 10th-best multi-family market in the country. That’s down a bit from 2011, when Marcus ranked the Twin Cites as the eighth-best such market, but it’s still a solid ranking. And it provides yet more evidence that the multi-family market here, and in most Midwest markets, remains the best commercial real estate bet out there.

In 2011, Towle closed 56 loans with a transactional volume of more than $250 million. That comares to 31 loans totaling $142 million in 2010.

“Our 2011 transactions included a mixture of apartments, retail, industrial, office and medical office, student and senior housing projects. Our pipeline of transactions going into 2012 appears to be building as we see a continued improvement in commercial real estate,” said Mark Vannelli, president and principal with Towle Financial.

Martha Nevanen

Martha Nevanen
Vice President, Marketing and Communications
Marquette Real Estate Group
Minneapolis

Reporters seeking last-minute interviews on commercial real estate trends know just how well Martha Nevanen does her job. So do the commercial real estate professionals at such companies as RJM Construction, United Properties and Cushman & Wakefield/NorthMarq.

As vice president for marketing and communications with Marquette Real Estate, Nevanen works daily with reporters, editors and many of the biggest names in the commercial real estate business, all to make sure that the companies that make up Marquette are able to effectively tell their stories. When you see an official from NorthMarq Capital quoted in the Minneapolis Star Tribune or one of the top producers from Cushman & Wakefield/NorthMarq profiled in a trade magazine, the odds are good that Nevanen made the interview happen.

It’s an important job that Nevanen holds. It’s more difficult today for companies to be heard. There is constant competition from blogs, Web sites, Tweets and Facebook posts. Nevanen, though, has used the latest social-media tools, along with long-held relationships with industry reporters, to help Marquette’s real estate companies cut through the noise.

Nevanen directs the marketing efforts for such companies as NorthMarq Capital, RJM Construction, United Properties and Cushman & Wakefield/NorthMarq. Marquette Real Estate serves as the holding company for each of these firms. Her job is to promote the milestones, acheivements, honors and successes of these companies. And no one does a better job of this than does Nevanen.

Nevanen best displayed her skills recently when she took the lead on promoting two major rebrandings of Marquette Real Estate companies. Just this year, Nevanen managed the rebranding of NorthMarq when this company merged with the Minnesota office of Cushman & Wakefield.

In 2008, Nevanen was responsible for rebranding United Properties, which had reorganized into three separate entities under the umbrella of Marquette Real Estate Group.

In both instances, Nevanen was able to distill what could have been complicated messages into ones that members of the real estate press were able to quickly grasp and report on.

Outside of her work, Nevanen finds time to give back to her community. She volunteers for such organizations as CornerHouse, NAIOP and IABC. She earned her bachelor’s degree in journalism from the University of Missouri, one of the top journalism programs in the country.

The seller was Cargill, an international producer and marketer of food, agricultural, financial and industrial products and services. Hines will assume property management responsibilities on behalf of Hines Global REIT.

Completed in 2010, 9320 Excelsior contains 254,915 square feet, and is one of the three buildings that comprise the Excelsior Crossings campus. The property is Leadership in Energy and Environmental Design Gold certified, and is fully leased and occupied by Cargill.

Hines vice president Steve Luthman said, “We are pleased to expand our Minneapolis portfolio with this quality asset and are delighted to form a new relationship with Cargill, one of the largest privately held companies in the world.”

Cassidy Turley’s Minneapolis team has been retained to manage the two-building 491,000-square-foot Class-A office complex. The 1550 (known as the MoneyGram Tower) and 1600 Towers were built in 1987 and 2000 respectively by Duke Realty Corporation, and are directly adjacent to its West End retail development.

“We are excited to have been selected by Equity Office Properties to manage this Class-A project in the Twin Cities,” said Dennis Panzer, managing principal of the Cassidy Turley Minneapolis office. “Our team of experts in property management is working to provide a seamless transition for the portfolio.  This assignment is a demonstration that our national business strategies are indeed proving valuable.  This assignment constitutes repeat business and was procured through relationships in our Columbus and Dallas markets.”

The team focused on this new assignment will be led by Dawn Grant, senior vice president of operations and a principal with the firm. Paul Skram will serve as senior property manager, having more than 25 years experience in property and facilities management. He most recently managed One Financial Plaza in downtown Minneapolis and the Woodbury Lifestyle Center in the east metro. Paul Doering, who has been with Cassidy Turley for more than 20 years, has been tapped as lead operating engineer.

Duke Realty’s nationwide industrial portfolio is now more than 108 million square feet. All the acquired industrial properties in the Minneapolis area are 100-percent leased.

“The acquisition of these three industrial properties is consistent with Duke Realty’s strategy to increase its investment in industrial assets in strong distribution markets,” said Pat Mascia, senior vice president, Minneapolis operations. “These properties meet all of our requirements for location and building features, making them excellent additions to our local portfolio.”

The two Roseville properties include I-35 Business Center and the FujiFilm building. I-35 Business Center is a 121,699-square-foot building leased to Milestone, an audiovisual equipment supplier, and Reliable Sprinkler, a fire sprinkler and sprinkler system control equipment company. The FujiFilm building totals 76,800 square feet.

The Minnesota Valley West building in Shakopee totals 157,644 square feet and is fully leased to COKeM, a video game and computer software distributor.

Before coming to UGL Services, Hanson served on the tenant representation teams for Jones Lang LaSalle, The Staubach Company and the Tegra Group.

During her career, Hanson has represented such Twin Cities-based firms as OLSON, Loomis Armored, Northstar Capital, Nonin Medical, Algos Pre-clinical Services and The Concept Group.

The Lyndale Plaza rendering

The Minneapolis suburb of Richfield will soon see its first new apartment building in the last two decades thanks to the efforts of Michael Development and St. Croix Real Estate.

The two companies teamed up to form Woodlake Richfield Apartments, the company that will develop and manage Lyndale Plaza, a new 94-unit apartment development at 6401 N. Lyndale Ave., the heart of Richfield.

The two companies held a ground-breaking ceremony Oct. 19 to celebrate the construction of the new apartment complex. Officials with St. Croix and Michael Development hope to begin moving renters into their new apartments by June of next year.

To Michael Swenson, owner of Michael Development, Lyndale Plaza represents an opportunity to inject some new life in what was previously an underperforming location. The same spot that will soon host the apartment complex recently served as the location for a struggling shopping center that Swenson described as “tired.”

“That area of Richfield was in need of something new,” Swenson said. “I owned that shopping center for 20 years. It was struggling. When the economy took a dip, that certainly took a toll on all retail centers. This one was especially struggling. It wasn’t making any money. One of the better fixes was to make the property into an apartment complex.”

The multi-family market, of course, is doing well today. And the developers of Lyndale Plaza decided to take advantage of this.

“Maybe some people can’t get mortgages to purchase a home. Maybe others are a little skittish about owning a home. They don’t know what’s going to happen with the housing market as we move forward,” Swenson said. “Apartments have certainly become an attractive alternative to the housing market.”

The four-story apartment building includes a transit plaza that connects commuters to downtown Minneapolis by express bus service. The architects on this project, Collage Architects, sought a pedestrian- and public-tranportation-friendly design. To that end, they included new pedestrian lighting, benches and a landscaped green space fronting Lyndale Avenue.

Most of the resident parking is located in an underground parking lot. This, Swenson said, alleviated the concerns of neighbors who were worried that apartment dwellers would clog side streets with their cars.

Lyndale Plaza will include 94 market-rate apartments, with 19 of these units reserved for households at 50 percent of the area’s median income. Interiors will feature 9-foot ceilings Energy Star appliances, in-unit washers and dryers, granite counter tops and high-quality floor finishes.

During the Oct. 19 groundbreaking, Terry McNellis, one of the principals, along with his wife, Mary, of St. Croix Real Estate, said that the city of Richfield deserved praise for the role it played in bringing this project to its borders.

The city approved the issuing of tax-exempt revenue bonds and tax increment financing to help make the project a reality, McNellis said.

“The city of Richfield was instrumental in this redevelopment project,” McNellis said during the ground-breaking ceremony.

The new project, the Bakken Oil Express Rail Hub, is connected to an existing regional oil pipeline and is currently accepting oil by trucks and pipelines. It began unit train loading and shipping operations Nov. 1.

The first phase of the terminal will include two rail loops, each about 8,000 feet long, and 210,000 barrels of tankage. It will also include a truck center with six independent bays. Initial loading capacity will be more than 100,000 barrels of oil a day. Additional development will provide the facility with an output of more than 250,000 barrels a day.

The partners of both firms have agreed to the combination. Pending final approvals, the merger will take effect Jan. 2, 2012. The new firm will be named CliftonLarsonAllen (CLA).

The new firm will have more than $550 million in combined revenue, employ more than 3,600 professionals, including 500-plus partners, and will operate from 25 states and Washington, D.C.

“This merger of peer firms changes the landscape of the accounting profession and pioneers a new trend by focusing primarily on private companies and their owners,” said Clifton Gunderson chief executive officer Kris McMasters. “We will be the firm of choice, the champions and leading resource center for privately held companies, proactively addressing their needs with our comprehensive suite of services. The firm will be positioned as the go-to source of information, knowledge and unique offerings for owners and leaders looking for assistance in achieving their personal and business dreams and objectives.”

Gordy Viere, chief executive officer of LarsonAllen, said industry specialization has been at the core of both firms’ practices.

“Coming together heightens our capacity to develop that vital focus and extend it beyond our accounting and advisory services to our wealth management and outsourcing capabilities,” he said. “This cohesive trio of industry-focused guidance is uncommon for private businesses and public sector organizations. It’s a powerful new resource for them.”

CLA will have a national wealth management practice positioned as one of the top three in the accounting profession, with nearly $3 billion in assets under management. The combined firm will boast a $50 million industry-specialized outsourcing practice to help clients meet their financial, tax regulatory compliance and reporting responsibilities. In addition, CLA will have the capacity to help clients with international dealings successfully do business in a global environment.