Fifth Street Towers Returned to Lender
- Jan 23, 2012
Fifth Street Towers, the gigantic downtown Minneapolis office complex, has been returned to its lender, Finance & Commerce reports.
The 1.1 million-square-foot complex overlooking Fifth Street and Marquette Avenue has been taken over from London-based Strategic Real Estate Advisors by MetLife. Bloomington-based Cushman & Wakefield/NorthMarq Real Estate Services will manage and lease the space.
With a vacancy rate of around 30 percent, Fifth Street Towers has more than 300,000 square feet of empty office space. Tenants include Bowman and Brooke, which occupies three floors in the building, Leonard Street and Deinard, URS and Messerli & Kramer.
The Minneapolis-St. Paul Business Journal reported that the deal took place in December as part of a deed-in-lieu of foreclosure. Dean Freeman, a veteran real estate broker and senior vice president with Frauenshuh Commercial, said that although foreclosure rates have decreased recently, there are still quite a lot of properties in distress. Fifth Street Towers is one of the highest-profile developments to have gone back in a long time.
CB Richard Ellis Investors paid $117 million for the building in 2004, then sold it to Strategic Real Estate Advisors in 2007, when prices were close to their peak, for $186 million. According to Hennepin County records, the current value of the property stands at $112.3 million.
Other high-profile metro-area office towers that have been in distress recently include the 394,000-square-foot One Financial Plaza and the 276,425-square-foot Minnesota Center in Bloomington. One Financial Plaza went back to its lender in December 2010, while foreclosure proceedings were started for Minnesota Center in 2011.
Photo Credit: AlexiusHoratius via Wikimedia Commons