Water Street Partners spends $41 million in Twin Cities real estate on last two weeks
Water Street Partners acquired two suburban buildings for a total of nearly $41 million in the past two weeks.
The Excelsior-based real estate investment firm paid $35.5 million for an office building in Eagan this week. On Nov. 17, Water Street announced that it paid $5.25 million for an industrial-office building in Savage, according to news releases.
Water Street is a sister company to Excelsior-based Oppidan Investment Co., for which it oversees capital market activity. Oppidan is a national real estate developer and ranks seventh of the Business Journal’s list of largest development companies in the Twin Cities.
Water Street’s purchase of the Eagan building includes 290,000 square feet of flex-tech space as well as 870 parking stalls located on the building’s roof. It’s located at 1000 Blue Gentian Road and was formerly known as the Spectrum Commerce Center.
The multitenant property is roughly 46% occupied. To fill the remaining approximately 160,000 square feet of space, Water Street is planning to rebrand the property and complete deferred maintenance. It’s also launching an aggressive leasing and marketing campaign that includes “ample” tenant improvement and leasing commission packages to attract potential tenants, the release said.
Water Street will work with CBRE on leasing and Ryan Cos. US Inc. will handle property management.
“We see a lot of untapped potential here and are eager to get started,” Water Street Managing Partner Jim Hegedus, said in the release. “The building is extremely flexible and suitable for a wide variety of tenants, and the enclosed parking is a unique offering for a property like this. Easy access to major thoroughfares and a ton of nearby amenities set this property up for a bright future. …”
The Eagan building was constructed in 2001, using hundreds of concrete panels from a decommissioned parking deck at the Minneapolis-St. Paul International Airport. Because of this, the building was one of the largest recycling projects in the state at the time, the Business Journal reported.
An entity named SCC Real Estate LLC is the former owner of the property, according to Dakota County property records.
Water Street also paid $5.25 million for a 45,000-square-foot industrial-office building in Savage, at 8925 Highway 101 Frontage Road.
The former owner and occupier of the building, an entity related to Trend Lab LLC, will vacate. Water Street is working with a new tenant to fill the entire space. Water Street didn’t disclose the tenant’s name, according to the news release.
“This is a perfect value-add opportunity for our fund and our investors in that we were able to secure a tenant prior to closing, which significantly reduces the risks of acquiring a vacant building,” Water Street Managing Partner Joe Boone said in the release.
Both properties were acquired as part of the Water Street Fund II, LLC, a fund focused on commercial and multifamily properties in the Twin Cities and Raleigh-Durham, North Carolina markets. Over the next six to 12 months, Water Street plans to buy five to seven properties for the fund.
This article about Water Street Partners is from the Minneapolis/St. Paul Business Journal