Square Mile Boosts Twin Cities Project
- Sep 07, 2016
By Jeffrey Steele
Minneapolis—Square Mile Capital Management LLC has originated preferred equity for Rise at Prospect Park, a luxury apartment development in Minneapolis. Harlem Irving Cos. and CA Ventures will develop the property.
The financing was arranged by JLL’s Capital Markets.
Rise at Prospect Park is located two blocks from the University of Minnesota and is also near Target Field, Target Center, the Minneapolis Convention Center and the recently unveiled home of the Minnesota Vikings, U.S. Bank Stadium. The 336-unit development will feature more than 40,000 square feet of ground-level retail space, which will be anchored by a Fresh Thyme Farmers Market.
One of the primary challenges that arose on the financing side was ensuring would-be investors understood the nature of the development.
“Because of this project’s fantastic location next to the light rail stop at University Avenue, some investors were initially unclear about whether the product was pure student housing or traditional multifamily,” JLL Executive Vice President Charles Johanns told MHN. “Some investors simply weren’t used to seeing such a high-quality, luxury multifamily asset in an urban university area and the price point it commanded.”
Surmounting the challenge involved collaboration, he added. “We had great sponsors on this deal, and we went through a diligent process of using CA Ventures and Harlem Irving’s past experience with building luxury multifamily in urban university areas to get capital comfortable with the cost basis,” said Johanns. “As we have seen with similar projects in cities like Chicago, luxury high-rise multifamily assets will actually benefit from the full spectrum of demand drivers such as university staff and administration, students, the medical center and associated research and business functions.”
Units will feature stainless steel appliances, floor-to-ceiling windows and private balconies. Among the development’s planned amenities will be a roof deck with fire pit, outdoor lounge with grilling station and television, 16-person screening theater, hot tub and sauna, yoga studio, fitness center, golf simulator and two party rooms.
The supply of luxury multifamily product in downtown Minneapolis is constrained, Johanns said. “The combination of Rise at Prospect Park’s top-tier amenities, prime location and grocery-anchored retail made this a sound investment in a burgeoning multifamily market,” he added.
Noted Square Mile Principal Matthew Drummond, “Our first multifamily investment in Minneapolis is backed by what will be an asset of the highest quality, with very strong sponsorship. We couldn’t have asked for a more attractive entrée into the market. We will continue to look for opportunities in the region.”
Johanns led the JLL team on the financing, working alongside Managing Directors David Hendrickson and Keith Largay and Vice President Fiorentina Malko.
Image courtesy of Harlem Irving Companies