Sam Isaacson, Assistant Vice President | Bridgewater Bank
There’s an app for that
Instagram has made everyone a “professional” photographer these days. Filters and unique settings provide the right tools to master this trade. Like Instagram, advancements in the business banking sector have allowed individuals to be their own business banker. You can deposit a rent check while enjoying a nice cocktail on Stella’s Fish Cafe rooftop or send a Bill Payment to a contractor while on Lake Minnetonka.
One might ask, why do banks have brick and mortar branches anymore? Business entrepreneurs and real estate professionals are able to handle their day-to-day banking all on one mobile device, but there is still a growing demand for genuine relationships with an actual human, not a hologram.
Don’t work bank hours
In a mutually beneficial business relationship, a partner should never hinder each other’s growth. Business owners are expected to answer over 100 plus emails a day, manage their teams and somehow stay on top of their strategic plan. An educated business banker can be a valued partner.
Let’s take a typical commercial real estate investor. He or she is looking for the next multi-family or commercial shopping center deal. While the investor is negotiating, establishing financing, and making sure their kids get to soccer practice on time, the business banker is there to quarterback the transaction. From establishing the appropriate deposit accounts with the correct individuals, to making sure the investor has state-of-the-art ACH rent collection capabilities, the banker works all hours behind the scenes to ensure the investor isn’t limited by banker hours.
Death of the “Gold Sapphire Ultra Platinum Checking Account”
Simplicity and accuracy are making its way back into banking. Unfortunately, with hundreds of banks both big and small in the State of Minnesota, some institutions offer an extensive amount of business checking, savings, and money market accounts. These institutions are marketing their deposit products with catchy names, cash-back incentives, or “free” banking. However, the futuristic bank does not succumb to this transactional mentality. By focusing on custom products, employing technology effectively and tailoring services specific to the entrepreneur or real estate professional, there is no need for tricky marketing tactics. The value is in the overall experience and the technology is certainly there to ease any future banking headaches. There’s value in simplicity.
Dixon Diebold, owner of Reurban Real Estate, says that a solid relationship with his banker is a top priority. “Managing bank accounts is a very large part of any real estate business day to day operation. Having a banker that you enjoy working with makes those interactions more enjoyable, productive and hassle-free.”
Building a virtual network via LinkedIn is not enough. A well-networked business banker has a solid understanding of the local business environment and knows market leaders and industry experts. Using your business banker as a resource for referrals is not only recommended, it should be an expectation. An effective banker will help build your personal network with introductions to other industry contacts. The best partnerships result from establishing synergistic relationships.
Even with the inevitable changes afoot, technology and a strong banking relationship can coexist. While your business banker might not provide the best guidance on posting the most Instagramable photo, their partnership provides value beyond taking a picture of your check.
“Banking shouldn’t be a pain point for your business but more like an opportunity,” Diebold said.
“Once you find the right relationship that in and of itself is a game changer.”
The following companies announced personnel moves this week: Cushman & Wakefield, Avison Young, CBRE / New England, CBRE, Matthews REIS, Greystone, Cushman & Wakefield / NorthMarq, Weitzman Group, Stepp Commercial, Savills Studley, NAI Hunneman and NAI James E. Hanson.
It’s time to update those contact managers with CoStar’s People of Note, reporting news on significant new CRE hires and promotions. This week’s issue includes the following markets: Chicago, San Francisco, Boston, Northern New Jersey, Washington DC, Los Angeles, New York City, Atlanta, Minneapolis, Seattle, Salt Lake City, Las Vegas, Toronto, Austin, Dallas / Ft. Worth and South Florida.
By Kyle O’Connor
Cushman & Wakefield has recruited former Prologis executive Adam Tyler to the company’s industrial capital markets team in Chicago.
As managing director, Tyler will source and negotiate industrial investment sales in the Midwest for a team that has sold more than 77 million square feet of industrial real estate over the past five years. Tyler spent 11 years with Prologis working in various capacities including national dispositions, Midwestern acquisitions and development and asset management.
By Eric Kies
Avison Young has brought on top San Francisco Bay Area broker Kelly Glass to drive the firm’s agency leasing initiatives in Northern California as a principal.
Glass will specialize in office leasing and landlord and tenant representation, including spearheading leasing at 44 Montgomery St., Beacon Capital’s 42-story, 688,902-square-foot office tower in San Francisco’s financial district. The 16-year industry veteran most recently served as senior director at Cushman & Wakefield. In her career, she has brokered more than 4.6 million square feet of commercial leases.
CoStar’s People of Note is published each Friday covering the latest commercial real estate executive level promotions and new hires.
Click on the headline of each article to jump to full coverage.
Follow the news on Twitter @TheCoStarGroup and @JSumner2.
Send new executive hires and promotion announcements to firstname.lastname@example.org.
By Jessica Rothfus
Matt Curtin has joined CBRE/New England as senior vice president and partner with the company’s retail advisory and transaction services team.
Curtin will oversee and manage the retail leasing team while focusing on urban retail and tenant representation. For the last four years, he worked for Apple as a senior real estate manager, handling new site selection, lease negotiations, and expansion of existing stores. Before that he spent a decade with Dartmouth Co., where he focused on retail leasing.
NORTHERN NEW JERSEY
By Kevin Carder
CBRE elevated Jeremy Neuer to senior vice president and co-leader of its capital markets group, focusing on New Jersey office and industrial sales alongside vice chairman Jeff Dunne.
Neuer joined CBRE from Cushman & Wakefield in 2011 and continued to focus on office and industrial leasing throughout the state. His new role will see him shift to investment sales full time. Previous major assignments include representing KABR in the sale of 200 Rte. 9 N in Manalapan and the acquisition of 3 and 5 ADP Blvd. in Roseland.
By Sean Freeman
CBRE has hired long-time JBG executive Jill Goubeaux to serve as its senior vice president of investor services in Washington, D.C.
Goubeaux joins CBRE after 20 years with The JBG Cos. In her 27 years in the industry, she has also worked for Cassidy & Pinkard and Trizechahn Properties, and is an active member in CREW DC, NAIOP Northern Virginia and CREBA. Goubeaux sits on the board of the Arlington Real Estate Group and serves as president and founder of the Ballston Business Improvement District.
By Yolanda Aubuchon
Daniel Withers has joined Matthews Real Estate Investment Services as senior vice president of its multifamily division.
The 17-year industry veteran previously served as director of multifamily at Berkadia, where he specialized in multifamily investment sales and advisory in Los Angeles County. Before that he was a vice president at Marcus & Millichap. Throughout his career, Withers has closed more than $1 billion in multifamily investments and ground-up development sites.
NEW YORK CITY and ATLANTA
By Tyler Sexton and Michael Palfrey
Dan Wolins joined Greystone Funding Corporation as a managing director in the firm’s New York City office, expanding the company’s CMBS lending group.
In his new role, Wolins will focus on a diverse range of lending products offered by Greystone for both multifamily and commercial property owners. In addition, he will also attend to CMBS and Agency lending. Most recently, Wolins served as a managing director at Hunt Mortgage Group in New York City.
Michael Doran joined Greystone as a managing director in the firm’s Atlanta office, expanding the company’s agency lending team.
Doran will focus on originating mid- to large-sized transactions for permanent, bridge and construction multifamily debt. He most recently served as a principal and portfolio manager at PGIM Real Estate Finance and before that with CW Capital as a vice president of originations.
By Randyl Drummer
Weitzman Grp Promotes Lewis
By Victoria Cottman
Weitzman Group has promoted Jeff Lewis to vice president in the firm’s Austin, TX office. The former assistant vice president will oversee general retail brokerage services in the Greater Austin area.
Ventre Joins Stepp Commercial
By Chelsea Bell
Stepp Commercial has named industry expert Mark Ventre as its new vice president. Ventre will work to grow the company’s business in Hollywood as well as prime Westside neighborhoods such as Mar Vista and West LA.
Cushman & Wakefield Taps Pittman
By Bryce Meyers
Lisa Pittman has been promoted to director of Cushman & Wakefield’s industrial tenant representation practice in Atlanta. Pittman will help guide the firm’s strategic initiatives in one of its top five industrial markets.
DALLAS / FT. WORTH
Savills Studley Hires Knapstein
By Benjamin Caffey
Kris Knapstein joined the Dallas office of Savills Studley as a senior portfolio account manager focused on domestic and global accounts. He will support clients throughout the firm’s platform of service offerings.
NAI Expands Urban Advisory Grp
By Douglas Dunbar
NAI Hunneman bolstered its urban advisory group with the addition of Jason Roth as a corporate real estate advisor. Roth will specialize in landlord and tenant representation in the Boston and Cambridge submarkets.
NORTHERN NEW JERSEY
Sawyer Joins NAI
By Joia Dixon
John C. Sawyer has joined the Hackensack, NJ office of NAI James E. Hanson as a sales associate. Sawyer will focus on sales and leasing of industrial properties across the Northern New Jersey markets.
Talbot Joins Cushman & Wakefield
By Matthew Kahn
Adam Talbot joined Cushman & Wakefield as an associate broker in the firm’s West Palm Beach, FL office. Talbot will help manage relationships and business development for the company’s industrial clients.
Follow the news on Twitter @TheCoStarGroup and @JSumner2.
Check out last week’s edition of People of Note.
The select top industrial lease signed during the first half of 2017 in the Minneapolis market was at Blaine Preserve Business Park – Bldg. III in the North Central submarket. Arrowhead Electrical leased 250,000 square feet there in the second quarter. Cushman & Wakefield / NorthMarq represented the landlord.
VStar Entertainment Group leased 104,818 square feet at Northern Stacks IV in the North Central Industrial submarket. Colliers International represented the landlord.
Also in the second quarter, US Venture leased 96,470 square feet at Plymouth Point Business Center in the Northwest Industrial submarket. CBRE represented the landlord.
Staples leased 88,651 square feet at Northpoint Industrial Center I in the North Central Industrial submarket. CBRE represented the landlord in lease negotiations.
Pediatric Home Services renewed its 80,000-square-foot lease in the second quarter at Twin Lakes IV in the North Central Industrial submarket. Colliers International represented the landlord.
This trend is compared to the U.S. National Industrial select largest lease signings occurring in 2017, which include the 1 million-square-foot lease signed by Lindt at Lambert Farms Logistics Park – Building B1 in the Atlanta market, the 874,126-square-foot deal signed by Ace Hardware at Lebanon Valley Distribution Center in the Philadelphia market and the 857,379-square-foot lease signed by Amazon at Troutdale Logistics Center in the Portland market.
The information in this news report is based on CoStar’s Mid-Year 2017 Market Report, a 40+ page comprehensive research report available to CoStar subscribers. To learn more about quarterly research reports and other benefits available to CoStar subscribers, please call 888-226-7404.
While Tech Markets Tend to get More Attention, Minneapolis has One of the Lowest Unemployment Rates in U.S.
August 16, 2017
|Michael Roessle is a market economist with CoStar Market Analytics covering the Minneapolis/St. Paul market.|
The most recent figures from the Minnesota Dept. of Employment and Economic Development (DEED) for June 2017 show that total state employment has eclipsed the 3 million mark for the first time in state history, qualifying Minnesota’s diverse economy as one of the healthiest in the nation.
A total of 4,400 jobs were added in June 2017, with 77,000 jobs added over the previous 12-month period. Since the end of the recession, Minnesota has added over 314,000 jobs, with each of the state’s eleven industrial sectors posting employment gains over the last twelve months. The state’s economy is now strong enough to draw people back into the labor pool, which expanded by 6,100 people in June.
Another important economic figure, the labor force participation rate, also paints a positive picture. While the U.S. labor force participation rate has fallen from above 66% before 2009 to below 63% today, Minnesota’s labor-force participation rate stands at 69.9%, 7% above the national average.
The Minneapolis MSA’s 3.5% unemployment rate is lower than in so-called ‘tech markets’ that tend to get more attention, including San Francisco, San Jose, Seattle, Boston and Raleigh. High earnings, courtesy of the region’s large concentration of Fortune 500 employers, round out the economic climate in the Twin Cities.
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That isn’t to say the region is not without its challenges. Take for example Amazon, which completed its 820,000-square-foot regional distribution center last summer, creating 1,500 new jobs. Shortly after opening, the company announced it was looking to hire an additional 1,000 full-time employees. To help attract workers, Amazon promoted $1,000 sign-on bonuses and starting pay of up to $17 per hour.
However, the facility’s location in Shakopee makes it more difficult to draw on the employee base, as it is not conveniently located near public transportation routes. Also, with multifamily vacancy rates in that submarket in the low-3% range, only two deliveries in the last decade and no construction in the pipeline, employees face lengthy commutes as the options to rent near the facility are scarce.
The lower rents in the submarket, combined with higher costs of land and labor have made it difficult for new projects to pencil out, even though demand for more apartment units is clearly there.
Healthcare Services/Insurance See Job Growth
The Healthcare Services field continues to fuel growth in the market, with UnitedHealth Group being a major employer that continues to grow. In 2014-2015, the firm completed a 750,000-square-foot office campus in Eden Prairie for its Optum division to accommodate roughly 5,000 of its 15,000 metro-area employees. As the project was being completed, UnitedHealth announced it was looking to hire an additional 1,700 people in a variety of roles, including finance, sales and IT.
The Suburban St. Paul office market has also been the beneficiary of the growth in the Healthcare Services field. Woodbury is quickly becoming a healthcare hub within the market as its proximity to western Wisconsin attracts specialty providers that may not be available in that area. In addition, the affluent population is a draw, offering a larger market for elective procedures that wouldn’t necessarily be covered by medical insurance.
A selection of recent projects in the pipeline includes a clinic and surgery center by Tria Orthopaedics, a new facility for Twin Cities Orthopedics near the Bielenberg Sports Center, a 50,000-square-foot medical office building at CityPlace anchored by Minnesota Gastroenterology and a 41,000-square-foot medical office building for Minnesota Eye. Not to be outdone, a 148,000-square-foot medical center is under construction in Maplewood. After strong leasing, including anchor tenant HealthEast, the developer decided to expand the project from the initial 82,000 square feet to the site’s maximum capacity.
CoStar Market Insights is a new feature providing a snapshot of recent real estate trends. The CoStar Market Analytics team monitors commercial and multifamily real estate across 206 metro areas, with a granular understanding of the projects, players and economic trends that move these markets. Learn how CoStar Market Analytics can add to your market knowledge, helping to minimize risk and maximize returns.
Updated: Global CRE Company Rolling Up 10 NorthMarq Offices; Also Acquires Toronto-Based Advisory Firm
Cushman & Wakefield is buying out its joint-venture partner to take full ownership of its branded operations in Minneapolis, Seattle, Salt Lake City and Las Vegas from NorthMarq Cos., a private holding company owned by the Minneapolis-based Pohlad family.
In a separate transaction announced Tuesday, Chicago-based Cushman said that it has acquired Toronto-based 20 VIC Management Inc., one of Canada’s leading commercial real estate advisory and management firms.
In the U.S., Cushman will acquire 10 offices with 750 employees which in aggregate, manage almost 50 million square feet of property. The acquisition will bring Cushman & Wakefield NorthMarq (CWN) in Minnesota, one of the Twin Cities’ largest commercial brokerage and property management companies, fully under the corporate umbrella. Cushman will also buy out NorthMarq’s interest in Cushman & Wakefield Commerce (CWC) operations and offices in the Las Vegas, Salt Lake City and Seattle markets.
Cushman & Wakefield did not disclose terms of the U.S. acquisitions but said the sale, subject to customary closing conditions, is expected to close within the next three weeks. Leadership teams in the four markets will remain in place, the company said in a statement.
Cushman & Wakefield East Region President Shawn Mobley tells CoStar that the NorthMarq acquisitions will help Cushman shore up service lines and geographic coverage identified as part of a “gap analysis” following the company’s $2 billion acquisition by the group led by private-equity firm TPG from Italy’s Exor SpA and merger with DTZ in September 2015.
“We did our homework and found some white space and areas in which to grow, which eventually led us to transactions where we currently have alliance or JV relationships, but believe we should maintain owned offices,” Mobley said.
Mobley noted that both the NorthMarq and 20 VIC transactions include a significant property management component, a lucrative and coveted business that helps insulate brokerages against cyclical volatility in the transaction market, he added.
Eduardo Padilla, CEO of NorthMarq Cos. (formerly Marquette Real Estate Group), said NorthMarq believes there’s “a logical and compelling reason to sell our operations to Cushman & Wakefield at this time.”
“The industry is consolidating, with sophisticated clients needing a seamless platform, irrespective of geography or service,” Padilla said. NorthMarq Companies and NorthMarq Capital are not included in the transaction.
Cushman & Wakefield, among the largest global CRE services firms with revenues of $6 billion, is widely speculated in the industry to be exploring an initial public offering that could be launched as early as the current quarter. Mobley and others in the company have declined to comment on the speculation, citing internal and SEC regulations.
“The industry is defragmenting, becoming bigger, with fewer players that can do more. I’m laser focused on growing the company and filling the gaps,” Mobley said, adding that Cushman has a “handful or two” of additional acquisition opportunities that are similar in size and scale to the NorthMarq and 20 VIC transactions, some of which could close before year end.
Even before the TPG/DTZ combination, which occurred two years ago next month, industry mergers and acquisition activity was trending away from blockbuster deals between national and large regional firms to focus on acquiring single-market and smaller-scale regional players. Many recent acquisitions involve buyouts and roll ups of locally owned offices that had operated for many years under affiliation or franchise agreements.
Cushman, Newmark Knight Frank (NKF) and Colliers International have been particularly active in acquiring local and regional shops, which is also a ripple effect of the huge consolidations over the last 15-20 years as CRE firms seek size, scale, full-serve capabilities and global reach.
The TPG-led private-equity group that owns Cushman is believed to be exploring an IPO following the DTZ-Cushman combination, and in February, NKF parent BGC Partners, Inc. announced plans to spin off Newmark as a publicly traded company.
The company, marking its 100-year anniversary as a brand, has 45,000 employees in more than 70 countries with business operations that include leasing, asset services, capital markets, facility services, global occupier services, investment and asset management, project and development services, and valuation and advisory services.
Jeff Eaton, president of Cushman & Wakefield NorthMarq, which includes Cushman & Wakefield NorthMarq (CWN) and Cushman & Wakefield Commerce (CWC) operations, will expand his leadership role to include Cushman’s North Central Region, which includes oversight of Chicago, Minneapolis, and Detroit operations. Eaton will report to Mobley.
Eaton has led NorthMarq through several organizational changes since becoming president of NorthMarq Real Estate Services in 2008, including the 2009 acquisition of the property management division of Opus Corp.; the 2011 launch of NorthMarq’s joint venture with Cushman & Wakefield, and the acquisition of CWC in 2013.
Cushman also did not release terms of its closed acquisition of 20 VIC Management, a boutique firm that advises an exclusive group of pension funds, private equity firms and high-net-worth investors. The move significantly expands Cushman’s Canadian presence, including its entry into the Canadian property management business, with 20 VIC managing more than 21 million square feet on behalf of some of the country’s leading institutional and private investors.
George Buckles and Randy Scharf, who co-founded the company in 1995, will join Cushman as executive managing directors of asset services.
The 20 VIC acquisition is the first foray into Canadian property management services for Cushman. Like other large CRE service providers, Cushman aims to grow its global property and facilities management business to augment more volatile sales and leasing revenue with a steady and durable source of recurring income.
“Property management holds up well throughout the real estate cycle. It’s a strong performer during good times and bad,” Mobley noted.
Editor’s note: This update adds details on the transactions and other potential deals in Cushman’s acquisition pipeline.
US Funds has closed on a $20 million investment for the proposed ground-up redevelopment of RiZe at Opus Park in Minnetonka, MN.
RiZe will be converted into a 322-unit luxury multifamily building at 10101 Bren Rd. E in the East Minnetonka MF submarket. It is expected to break ground in early 2018 with an anticipated delivery date in the first quarter of 2019.
The project is being sponsored by LeCesse Development Corp and Morgan Management.
The site is currently part of the Opus Business Park, which is now undergoing demolition, with the first phase of leasing to begin in 15 to 18 months. There will be two other phases to encompass the entire project, with an expected timeline of 21 to 24 months until completion.
CBRE Multifamily represented ownership in the sale of Deerfield Townhomes, a 166-unit townhome style apartment community in Hermantown, Minnesota, to a joint venture between Capital Solutions, Inc. and VDB Asset Management, LLC, which is wholly owned by Wayne Vandenburg, the chairman of TVO Groupe, LLC. The sale closed August 16, 2017.
Located 15 minutes outside of downtown Duluth, Deerfield Townhomes is a 211,490-square-foot residential community featuring 166 townhomes. The property offers an amenity package that is unmatched by other properties in the submarket, including an outdoor resort-style swimming pool with a sundeck, an outdoor basketball court, a playground, a fitness center, a sauna, and a clubhouse. In addition, all units include at least one heated attached garage.
The new owner plans to undertake significant renovations to enhance the property’s curb appeal and common areas as well as to upgrade all unit interiors.
Keith Collins, Abe Appert, Ted Abramson, Robert Lockman and Laura Hanneman in CBRE’s Minneapolis office represented the seller, RRE Deerfield Holdings, LLC.
By David Arbit on Monday, August 21st, 2017
While many–though not all–cities around the metro have seen all-time high median sales prices, the first and second-ring suburbs near Minneapolis and major job centers stand out. Check out the median home price for these Minneapolis suburbs.
But when we account for the fact that bigger homes are selling (both from new construction and finishing the attics and basements of existing homes), we find that the price paid per foot of house has not reached new highs since the bubble. That means the price of a comparable or identical property may not really be at all-time highs. Record prices partially reflect the fact that bigger homes are selling.
Here is the same comparison for other Twin Cities suburbs a bit farther out.
The Investment Sales team at Colliers International | Minneapolis-St. Paul recently negotiated the sale of the Edina V building on behalf of Edina 76 Property Group LLC, an entity controlled by Sara investment Real Estate. Closing on August 3, 2017, the property was purchased by Francois Oil Company in Belleville, Wisconsin.
The med-tech industrial property is located at 5150-5198 W. 76th Street in Edina, Minnesota and was previously acquired by Sara Investment Real estate in 2014. Current tenants of the 136,494-square-foot building include Arkray USA and BARR.
Sara Investment Real Estate, a Madison, Wisconsin based real estate investment company has been active in many Midwestern markets in the past five years including Minneapolis-St. Paul. As owners they felt the property was well positioned at 100% occupancy and wanted to take advantage of favorable market conditions.
“Colliers has developed a great relationship with Sara Investment Real Estate,” said Bob Pounds, Senior Vice President at Colliers. “We have been a valued advisor in assisting to grow their Minneapolis-St. Paul holdings and we look forward to continuing that effort in the future.”
Sara Investment Real Estate’s most recent Minnesota acquisition was River Park Plaza, a 343,658-square-foot multi-tenant office property in St. Paul.
The Colliers International | Minneapolis-St. Paul Investment team of Senior Vice President Tim Prinsen, Senior Vice President Bob Pounds, Vice President Amy Senn and Senior Analyst Lori Pounds represented Sara Investment Real Estate in this transaction.
Sons of Norway has announced its agreement with Ryan Companies US, Inc. and Weidner Apartment Homes for the sale and redevelopment of their land parcel in South Minneapolis. The land parcel is located on Lake Street between Holmes and Humboldt avenues and is in the heart of the Uptown neighborhood.
Considered to be a marquee location, this property has been home to the International Headquarters of Sons of Norway since 1962. Once complete, the Sons of Norway plans to continue business operations on the site including their financial services and international cultural organization.
“After an extensive process to ensure the highest and best use of our primary asset, the clear choice was to sell the property that has served us so well,” said Eivind J. Heiberg, CEO Sons of Norway. “Considering market conditions in the Uptown neighborhood and the challenges of an aging facility, it was time to make the most forward-thinking decision for the long-term health of our organization, employees and the community. We’re extremely pleased to partner with Ryan Companies and Weidner Apartment Homes to redevelop what has been our home for more than 55 years and to continue our presence in the vibrant Uptown neighborhood,” said Heiberg.
Ryan Companies will develop, design and construct the project and has been involved in a number of iconic properties that have been successfully re-envisioned in the Twin Cities. These properties include Midtown Global Exchange, Grainbelt Brewery, and Downtown East among many others.
“We have been in dialogue with Sons of Norway for quite some time and we feel that the location provides an incredible opportunity. We are thrilled to be partnered with Sons of Norway and Weidner in re-visioning this great site,” said Tony Barranco, Vice President of Real Estate Development for Ryan Companies.