Target Field – Real Estate Matters
Browsing Tag

Target Field

Best of Real Estate Matters

Best of Real Estate Matters #1: The Little Idea That Could: The untold story about the development of Target Field

Target Field BlogWhile the local news is filled with stories about where the Vikings, law makers, mayors and developers want to see the proposed new stadium, the story of the development of Target Field is an interesting one to review. The most popular (most viewed) post of 2011 was:

Best of Real Estate Matters – #1: The Little Idea That Could: The untold story about the development of Target Field

Bruce Lambrecht and Dave Albersman are back at it in building another “little idea that could” – this time for the Vikings. Check out more of the story in this 2011 blog post: Looking for a Victory? The Vikings May Want to Try Left Field…  Although the plans have changed and evolved since this post was written in early 2011, it will be interesting to see where Lambrecht and Albersman play into the Vikings Stadium decisions.

Commercial Real Estate, Development, Industry News, Real Estate Trends, Residential Real Estate, Uncategorized

Proposed Housing a Home Run for Twinsville

NorthLoopStreetIn Minneapolis, rentals are hot – so hot that an estimated 850 units are planned to come online within the next year or so, and that’s just in the North Loop.  Residents of the North Loop are enthused that the vision for the Twinsville neighborhood is finally taking shape, and it’s only the beginning.  Some North Loopers hope that the surge in housing and retail growth will help spark interest in building a new Vikings stadium in the lower North Loop on the current farmer’s market site.

“People who live in the North Loop are self-selected Pioneers,” states David Frank, President of the North Loop Neighborhood Association.  “If you’re someone who has selected to live in an urban environment with loading docks and industrial buildings, you want things to happen and are comfortable with change.  It’s a lot less clear what will happen with development in the neighborhood than if you live in a single family home in South Minneapolis.  My family and I are proud that we have chosen to live in the North Loop and to invest in making our neighborhood better.”

Frank explains that overall, the North Loop neighborhood has been supportive of new housing developments, especially proposed plans that contribute to establishing the North Loop as a pedestrian-friendly urban environment.  However, more affordable housing options continue to be an important objective and developers so far have not been stepping up to the plate.  Frank fears that if not enough affordable housing is built initially, the North Loop will become “a gated community” privy only to middle to high income earners.

Currently proposed developments include Ryan Companies’ 7-story, mixed use, 280-unit apartment building at the former Jaguar dealership site at 222 Hennepin Avenue.  Rumor has it that Whole Foods will anchor the project.  On Washington Avenue adjacent to Union Plaza, Hines Interests is pitching a three-phase development on the six acre site that will eventually incorporate several types of housing, retail, and offices.  The project will be launched with a 185-unit high-end apartment building called Dock Street Apartments.

Continue Reading

Development, Industry News, Real Estate Trends

Looking for a Victory? The Vikings May Want to Try Left Field…

Yes. Although we are academics and we spent more time reading through investment prospectuses and development plans than watching Sports Center, we are well aware there is no left field in football. However, after the lackluster performance of the Purple and Gold last year, Mr. Wilf and Co. may want to look to their peers on the other side of downtown (the ones who do have a left field). Despite the sluggish start for the Twins (there is still time!), one thing is certainly not subpar about Minnesota sports currently, and that is Target Field. By any standards, the eight acres that only five years ago was a parking lot, is now one of those landmark buildings that represents the identity of the entire state.  All good buildings, businesses, ideas, etc. start somewhere, with someone, and even though everyone probably has had thousands of big ideas, few people get to see them realized. That is the hard part about great ideas, plainly put, it’s really hard to turn them into anything. The men who came up with the idea for Target Field, Bruce Lambrecht & Dave Albersman spent years working on moving the Twins to, what is now Target Field. (for that story click here). lucky enough for the Vikings, the same two men are fired up and at it again. Lets just hope the Vikings, and the politicians who are responsible for this decision, decide to pay attention.

Proposed Stadium at the Farmers Market Site, courtesy of Bruce Lambrecht

Proposed Stadium at the Farmers Market Site, courtesy of Bruce Lambrecht

The similarities between the Viking’s current situation and the Twin’s search for a new home are eerily similar. The Vikings have, for several years, voiced concerns about playing in the Metrodome, and were fairly clear that they were not interested in renewing their lease at the Metrodome. The “fairly” was clearly removed on December 12th, of last year when this happened… During the offseason several plans have emerged, and sites proposed for development of a new stadium. Recently, the talk has been narrowed down to three sites, (1) Rebuilding on the current Metrodome property, (2) A stadium in Arden Hills, a suburb 10 miles north of St. Paul, and (3) Developing a site near Target Field, on what is now a series of small buildings, storage facilities, and the Minneapolis farmers market. Mr. Lambrecht and Mr. Albersman are the driving force behind the third option, and have begun the same arduous process that the probably swore they would never start again. Each of the three site has positives and challenges, and will undoubtably require a great deal of planning and foresight if anyone is going to become nearly as successful as Target Field.

The first major battle, and the one that causes the strongest emotions is who, how, and what will pay for this project. Two recent studies looked at the total cost of developing, building, and creating the infrastructure necessary for the project, Finance & Commerce reports,

An analysis from the Metropolitan Sports Facilities Commission says the “hard and soft” construction costs for the Metrodome and Arden Hills sites are about the same – $825 million for the dome site, $859 million for Arden Hills. However, the Arden Hills location would require up to $339.5 million in highway, parking, pedestrian access and utility improvements, which brings the total price tag to $1.2 billion, the analysis said. By contrast, the Metrodome location needs a far more modest $29.9 million in such improvements, for a total cost of $895 million. Also on Tuesday, Gov. Mark Dayton released the findings of a separate analysis that says it would cost up to $240 million for the transportation improvements needed to accommodate the Arden Hills location. Dayton said any state contribution to the project would be capped at $300 million – including the cost of road improvements.

“I support the project in either location up to that amount,” Dayton said. “If one project is more expensive than the other, the Vikings are going to have to make up that difference unless the local partner does.” To read the entire story click here

Although the Farmers Market site was not included in this study, Mr. Lambrecht has provided estimates that would place the total cost of the site in the same range as the Metrodome. It is also important to note that at this point in the search for a new Twins Ballpark, Mr. Lambrecht’s parking lot was barely even in consideration. The key behind Mr. Lambrecht’s plan is the same as it was for Target Field, in that an accessible urban sports venue is valuable to everyone in the state, even those who could care less about football. Mr. Lambrecht was right the first time, and has since quieted almost everyone of the many critics, who thought a new Twins stadium was too expensive, the site was too small, and any other reason imaginable. For everyone’s sake, let’s hope he is able to repeat history, and make lightning strike twice in the heart of downtown Minneapolis.

This is the first in a series of stories about this topic, which is sure to dominate headlines in the sports, real estate, local/metro, and front page of the states newspapers (if anyone still reads them…) Check back for more.


Commercial Real Estate, Development, Executive Insight Series, Industry News, Property Management, Real Estate Trends, Residential Real Estate, Retail Real Estate

Executive Insight Series: Boyd Stofer

Boyd Stofer - CEO Marquette Group

Boyd Stofer - CEO Marquette Group

“No one was doing anything, I mean no one was even talking about starting a new project. Sure I was scared, we paid too much for the building during the worst real estate market in my lifetime. However, we needed to play offense, someone had to make the first move, and it was us. That got a lot of attention, and we were able to get the building 90% leased before we started renovation, that’s just unheard of, and it worked to our benefit.”

The quotation above does a superb job in summing up the career, strategy, and philosophy of Boyd Stofer, president and CEO of the Marquette Real Estate Group. Over the past 32 years, Mr. Stofer has helped United Properties (Now part of the Marquette Group) grow into one of the most successful and profitable real estate development companies in the country. Attending a lecture from Mr. Stofer is somewhat like listening to a Harvard (one of his Ivy degrees) Economics professor give a semesters worth of lectures fast forwarded to a speed that condenses the information into one hour. During his talk it appeared as if he continued to talk as he inhaled, and didn’t miss a beat or misstate a figure as he outlined the micro and macro forces that are effecting the national commercial real estate market. His charisma stems directly from his incredible intelligence and ability to conceptualize and connect the vast set of variables that made up the contents of his talk, ending with the weaving of details to present the Marquette Group’s current standing and plans for the future. It’s no wonder that the Pohlad Family entrusts Mr. Stofer with a significant share of their fortune, as very few individuals can impart their razor sharp intellect and cunning in such a succinct and complete manor. It is highly unlikely that anyone in the room (full of real estate professionals, academics, and students) walked out questioning Mr. Stofer’s understanding of the real estate market, actually, it highly unlikely that anyone who meets him ever has doubtful thoughts.

Biography |

Mr. Stofer’s educational credentials mimics his career as nothing short of top tier. In 1971 he graduated from the Cornell School of Engineering, and followed it up with an MBA with Honors from Harvard. Immediately following his MBA program, Mr. Stofer was hired by Hines Interests, a national real estate development group based in Houston. After three years in Houston Mr. Stofer left and came to Minneapolis to join United Properties, then owned by the Hamm family. Since his hire, Mr. Stofer has led the companies development initiatives, and has amassed an amazing portfolio of work. In 1996 he was named president and CEO, since that time Mr. Stofer has grown and merged United Properties into what is now the Marquette Group. Today, the combined entities of the Marquette group employ over 1,000 people, has assets around $750M and services more than $40B worth of real estate loans. The current operational structure of the Marquette Group is the culmination of Mr. Stofer’s vision for a vertically integrated property firm that is unique in the services that it can provide. The vast array of real estate products that Marquette Group is far from novel, in fact it is probably the firms best financial hedge, in that the organization is prepared and capable of earning revenues in any market and any economic climate.

Continue Reading

Commercial Real Estate, Development, Executive Insight Series, Industry News, Real Estate Trends, Residential Real Estate, Retail Real Estate, Uncategorized

Executive Insight Series: Bob Lux and the 14 Million Dollar Question About Block E

Bob Lux- Principal at Alatus Development

Bob Lux- Principal at Alatus Development

“So, what is the plan for Block E?”

A simple question that was definitely on every attendee’s mind at the most recent Real Estate Executive Insight Series. However, the answer isn’t so simple, and if it were not for Bob Lux’s (principal at Alatus LLC) charisma, intelligence, and experience in leading major, press-worthy development projects the answer might not have been as well received. As any gifted public figure would, Mr. Lux skirted the question, but in his sidestep, alluded to several important things concerning the future of Block E, as well as the kind of person Mr. Lux is. Before his answer can be assessed properly, it is important to understand Mr. Lux’s history, professional accomplishments, and his philosophy on development (and life).

Mr. Lux grew up in a Long Prairie, a small community in central Minnesota, a town that most likely does not have a building higher than the many crop silos that dot the agrarian landscape. Like many young men from small towns, Mr. Lux left home in search of success and the experience that can only be found in the “big city”. After earning his degree in Business Administration from the University of Minnesota, Mr. Lux returned to Long Prairie with the intention of starting a home building business in the area. He purchased a lumber yard with his father and began building farmers homesteads in the immediate area. Although this was quite different than the projects he would eventually oversee, Mr. Lux quickly learned the importance of adding value to differentiate his product, otherwise it would simply be a commodity.

After a short time at home the urge to return to city life became to great to resist, and once again, Mr. Lux left Long Prairie for the Twin Cities. His first employer, The Dominium Group, was developing high-density suburban real estate, which faced major issues surrounding obtaining approval from the community and local government for the rezoning of  land for this use. Suburban homeowners are very protective of their communities, and the amount of space that each homesite has was a reflection of the owners desire for privacy and quiet living. Mr. Lux’s first assignment was in Eagan, MN, where he faced opposition form the mayor as well as landowners surrounding the proposed site. To change the attitudes of the landowners surrounding the site, who were a critical stakeholder in the success of the project, Mr. Lux used a mixture of logic, emotional appeal, and financial acumen to reach out to each of the parties and work with them to develop a compromised plan that met the needs of everyone. In the end this project was approved, and through it, Mr. Lux learned one of the key lessons that has helped him throughout his career. During the lecture, he repeatedly cited the ability to listen to, and connect with people as the most important skill he has, and the main reason why projects fail or succeed.

Continue Reading

Commercial Real Estate, Development, Executive Insight Series, Industry News, Minnesota Real Estate Journal, Real Estate Trends, Retail Real Estate, Uncategorized, Upcoming Industry Events, Upcoming UST Events

Block E: A Deal Alatus Could Not Refuse

blocke7The short history of the building currently occupying the 600 block of Hennepin, know commonly as Block E,  in downtown Minneapolis is a staggeringly accurate metaphor paralleling the last decade of the greater real estate market. According to Minneapolis St. Paul Business Journal, the original cost of developing the site in 2001 (less the $36.25 million spent on the Graves Hotel which did not change ownership) was $105.75 million. When Alatus Development purchased the development in July, 2010 they paid a paltry $14 million, or roughly 13.23% of the original price. At the risk free rate of return (based on the 10 year T-bill which average 4.42% over the period) the investment in Block E would be worth $162.973 million, resulting in a savings of $148.973 million for Alatus in todays value. This investment appears to be a no brainer, but it is not without risk. Since opening, Block E has lost most of the anchor businesses that originally signed leases in the space including: Borders Books, Game Works, The Hard Rock Cafe, Applebees, and Hooters. The space which Game Works and Borders occupied is still vacant, presenting Alatus and Bob Lux, the lead developer on the project, with significant challenges in their attempt to turn the site into a successful retail operation. That said, the final price tag for the site was too attractive to pass on.

One significant factor that helped persuade Mr. Lux to move forward with the deal is the 550 heated underground parking spaces beneath Block E, at $25,455 per spot is inline with other parking structures around the city. Looking at the deal from this perspective, Alatus paid market rate for the parking, and got a deal sweetener that is quite impressive, approximately 213,000 sq/ft of retail space. Pricing it the other way, at $66 sq/ft, the retail space was purchased at a price that is almost inconceivable given Block E’s location at the heart of the downtown district and within walking distance of Target Field, The Target Center, and many of Minneapolis’s theaters and restaurants. Despite the obvious advantages in location, the previous owners at Block E have had serious difficulty maintaining profitable levels of business. Trying to figure out what to do with this space will certainly keep Mr. Lux up at night, until a solution that provides long term tenants can be derived. Continue Reading

Development, Industry News, Upcoming UST Events

The Little Idea That Could: The untold story about the development of Target Field

Target Field Blog

Target Field – Home of the Minnesota Twins

Tuesday evening, attendees to the bi-monthly Real Estate Executive Insight Series were lucky enough to hear an insider account detailing one of the largest development projects in the recent history of the Twin Cities. However, the story of Bruce Lambrecht & Dave Albersman and their little idea to save Minnesota baseball was more than a recount of a development project-it is a uniquely American tale-one filled with tragedy, triumph, the encouragement that anyone who works hard enough can succeed, and of course baseball. Although this story ends in condemnation, after an 18 month battle over eminent domain, neither Lambrecht or Albersman make any apologies or seem to have any regrets, and, rightfully so, after hearing their recount of events.

Talk of returning to outdoor baseball was not a new idea in Minnesota.  In fact, almost as soon as the Twins began playing in the Metrodome in 1982, investors, developers, and municipalities began exploring the idea of a return to outdoor baseball. The first major effort to relocate the Twins was a study conducted by the city of Minneapolis in 1996 in which seven new sites were identified (the Rapid Park site was not one of them) as possible locations for a new ballpark-when presented to the legislature the proposal failed. A second attempt was shot down the next year, and for the time being hope for a new stadium seemed to be lost…

Enter Bruce Lambrecht & Dave Albersman

When looking at the past experience of Lambrecht and Albersman, one would not guess that these two men were behind one of the biggest development projects in the last decade, in Minnesota, not to mention one of the best places in the country to watch baseball. Like many innovators they do not credit their own genius, rather the power of the idea and the success that comes from unwavering commitment, sweat, and toil. Continue Reading