Congratulations to Santamaria Enterprises & Paramount’s West Team for the purchase and closing of The Cliff Town Offices!
THE BUILDING 2805 Cliff Road or The Cliff Town Offices is a ½ acre, 8,420 SF multi-tenant office building. It is class B space consisting of 3 floors and built in 2004.
Paramount Real Estate broker, Jeffrey Swanson helped his client, Santamaria Enterprises, purchase this fully leased investment property as part of a 1031 exchange for the price of $1,100,000.00. The property closed on July 20, 2020 and Jeff will stay on to help with any leasing needs the asset will have in the future. Currently we have two newly renovated, 1,200 square foot suites available for lease.
For more details about the spaces available: Cliff Town Offices For Lease
Santamaria Enterprises recently sold a building in Minneapolis that included a night club owned by the landlord. The profits from this sale were rolled into this 1031 exchange, and were used to purchase the 2805 Cliff Road building. Paramount also represented them in leasing space in Richfield, MN. They use this space to operate their Latino radio station, La Raza. Tune in and enjoy the show on 95.7 FM!
HISTORY OF THE PROPERTY
6450 Carlson Drive is a 42,760 multi-tenant office-warehouse building located off Highway 62 and Interstate 494. The Eden Prairie industrial building situated on 3.97 acres, was built in 1986. When a long term tenant vacated the majority of the building, Paramount was engaged to market the property. Initially they marketed it as a 36,885 square foot vacancy For Lease.
PARAMOUNT’S CLIENT & THE DEAL
Bloomington-based Paramount Real Estate Corporation brokers, Jeffrey Swanson, Associate and Fred Hedberg, President represented the seller in this transaction. FHM Partners, the sellers, consist of a local managing partner and two out of state passive owners.
“This Eden Prairie industrial building was on the market For Lease. We were in the midst of negotiating a 10-year lease for the building’s vacant space. This is when a user/buyer made an unsolicited offer to purchase the building. Paramount advised FHM Partners on the pros and cons of each opportunity. The partners decided that it was in their best interest to sell. The transaction moved forward quickly with only a slight delay due to a change in financing that pushed the closing out 10 extra days,” commented Jeff Swanson.
THE NEW OWNER
BLCKGLD, LLC, a Minnesota owned LLC, is the entity that recently purchased this office-warehouse building at 6450 Carlson Drive. With their upcoming expansion, a company with common ownership to BLCKGLD, LLC plans to remodel and occupy the entire building.
In conclusion, Paramount congratulates the West Team for closing on this deal!
OWNERSHIP CYCLE OF A COMMERCIAL PROPERTY
WEST BLOOMINGTON BUSINESS CENTER: 6300 W Old Shakopee Rd, Bloomington, MN
The ownership cycle of commercial properties can be quite unique. In 1997, Fred Hedberg, Principal of Paramount Real Estate Corporation was asked by a past client to determine the value and marketability of some excess land that was remaining after building a mini-storage facility on a site in Bloomington, Minnesota. Fred provided a valuation and marketing plan for the land. He also suggested that his client might want to consider developing an office-showroom or industrial building on the site. The market for that type of product was very strong at that time. Fred suggested to his client that if this was of interest, he would like to co-develop and own the building with his client.
Forming a Partnership
The prospect of continuing to own the land and not pay capital gains tax on a sale was appealing to Fred’s client. It was beneficial having the opportunity to partner with a seasoned real estate professional. Who also had a good understanding of the market and kind of buildings and spaces tenants were looking for at that time. They agreed to move forward on a new development together. They began to work with an architect and contractor. Whom laid out a building on the site that would meet current market demands for space. As well as a building that would meet the test of time.
Developing the Property
After reviewing financial projections prepared by Fred, a partnership formed to move forward with the project. Construction drawings, city approvals and financing were completed and secured. The general contractor selected for the new 80,714 SF project was Kraus Anderson. The project called West Bloomington Business Center.
Completing the Project
The partners hired Paramount Real Estate Corporation to lease and manage the building. In 1998, the shell building was completed and by the end of 1999 was fully leased and built out. The building attracted well-known local and national tenants that leased the majority of the building as office space. In 1999 the building was recognized by NAIOP as a recipient of their Awards of Excellence for the Light Industrial-High Finish category. The building has performed well though the various real estate cycles that followed. It has stood the test of time as different tenants with uses other than office have found it to be a desirable building and location for their businesses.
Selling the Building
After 20 years of ownership, Fred and his partner decided that it would be in their best interests to sell the building during the current business cycle for estate planning purposes and to maximize their return on the investment. Fred found a local investor that was in need of a 1031 exchange property. West Bloomington Business Center fulfilled his exchange requirement and his desire to own a well performing, high quality asset. The property sold in August 2018. The new owner hired Paramount Real Estate Corporation to continue to lease and manage the building.
Paramount Continues to Lease and Manage Property
Fred and his leasing and property management team are excited to have the opportunity to continue to work on this project in the future. See detailed information about the space currently available at West Bloomington Business Center.
Written by: Fred Hedberg
If you would like real estate investment advice,
please contact: www.paramountre.com
REAL ESTATE TIP: CHOOSING THE RIGHT COMMERCIAL REAL ESTATE BROKER
Would you buy a car from a boat deal? Let your barber clean your teeth? Perform your own surgery? Of course you wouldn’t. You want the people who you work with to be professionals and experts in what they do. So why would you go into the commercial real estate market without professional help?
Commercial real estate brokers are trained and licensed professionals. They all have geographic expertise, specific real estate product knowledge, and different negotiating styles. When you are ready to go out and find property to lease, buy, sell, or invest in, your best bet is to interview a number of brokers to find the best fit for you.
Here are some questions you should ask real estate professionals to clearly understand if they can add value to your situation:
What product type do you specialize in?
What is the geographic area you focus in?
How long have you worked on this type of transaction?
Can you tell me about another client with similar needs that you helped in the past?
Do you work alone or with a team?
What is your communication style?
Do your homework and make sure you have a broker who knows the type of space you are looking for inside and out.
“Isn’t it cheaper to lease or buy space on my own?”
People always ask me “Isn’t it cheaper to lease or buy space on my own?” No, is the answer most of the time. Any broker you interview should be open and transparent with how they will collect their fee. The industry has a standard commission for each product type, so make sure the brokers you are interviewing all tell you the same thing. Typically, the broker commission is paid by the landlord or seller when leasing or buying an owner/user building. In addition, your trained professional will help you avoid pitfalls. These could include; paying over market rents, getting locked into a larger term than you want, and even having to pay to build-out new space yourself.
Do yourself a favor and let a professional help you with your space needs. It will save you time, worry, and in the end, MONEY.