John McDermott, Hines VP, says the company believes in the city and its suburbs. "We think this market is tight, and is going to stay very tight, Minneapolis is doing well and is going to get better," he tells GlobeSt.com. "The way it is in the Midwest goes market by market, Chicago's doing well, too, but those that are heavily linked to the automotive industry are obviously struggling."

The properties include the:

• Three-building, 258,118-sf Golden Hills Business Park in Golden Valley, completed in 1999
• 114,800-sf, single-story Westside Business Park in Hopkins, completed in 1987
• Two-building, 112,332-sf Edenvale Executive Center in Eden Prairie, completed in 1987
• Single-story, 53,079-sf Valley Gate building in Eden Prairie, completed in 1986
• 144,441-sf, one-story Hampshire Technology Center in Bloomington, completed in 1998
• Single-story, 83,470-sf medical office building University Crossing in St. Paul, completed in 1990.

McDermott says Hines, the sponsor of Hines REIT, would rather buy older properties than build new in the market. "It's challenging to build new product here because of the cost increase and rents to support," he says. "You do a new building, like Duke is building in the Normandale Lake Office Park in Bloomington, and you have to get rents at $19 per sf. We only need to get low teens to do well. Also, these are great infill markets in places where it's not easy to find land or get zoning. Most people who are building this product are doing it in further-out locations."

The properties are 86% leased, he says. PreferredOne, a health benefits administrator and insurance provider, leases 87,456 sf, about 11% of the portfolio, in a lease that expires in April 2015 with options to renew for two additional five-year periods. The remaining space is leased to 41 tenants, including Cyber Optics, General Dynamics, Prime Therapeutics, Eschelon Telecom and the State of Minnesota. CB Richard Ellis represented the venture, while Hines represented itself.