MINNEAPOLIS—The RBC Plaza has been one of this city's top office properties since it opened, but when KBS Real Estate Investment Trust III acquired it last year for $118.1 million, company officials still felt that significant renovations were needed. Perhaps most important was the transformation of an adjacent four-story retail mall, formerly known as the Gaviidae Common II, into an integral part of the 40-story, 678,045-square-foot building. The third and fourth floors were recreated as modern office space, the rest into building amenities. KBS has now filled the fourth floor with one tenant, as well as signing another group of new tenants for the tower.
“The tower has always been well-positioned,” Sonja Dusil, Cushman & Wakefield | NorthMarq's senior director-brokerage services, who represents the building, tells GlobeSt.com. However, the four-story mall, and the types of retail it had, “did not work in downtown Minneapolis anymore. It had a very heavy, 80's feel.”
But modern office workers now expect far more amenities at class A office buildings, and buying the mall alongside the tower presented KBS with an opportunity. The façade was modernized, the interior transformed into a new lobby for the RBC Plaza, and the lower levels will now provide plaza tenants with a fitness center and locker rooms, a conference center, and other amenities. “These are the norm now and having them strengthens and solidifies the building's position in the class A market,” she adds. The structure will still have retail for building tenants such as a Caribou Coffee, a convenience store and other outlets. “We just did not want to create another food court.”
Overall, CWN has signed leases for 125,000-square-feet of space in RBC Plaza. The global law firm Fish & Richardson extended its 50,000-square-foot lease in the tower and has agreed to occupy the former mall's entire fourth floor – an additional 30,000-square-feet – beginning June 2015. “Our new space will not look like a traditional law office,” says Richard Anderson, a principal and chief operating officer of Fish. “The space will be open and modern, an appropriate home for Fish's new, cutting-edge administrative hub.”
Dusil represented KBS in the transaction. Mark Minich, Charles Caturia, Jason Mundstock and John Lenio of CBRE represented Fish & Richardson. The third floor is still available.
And beginning in August of 2015, law firm Best & Flanagan, LLP will relocate its 100 employees from its current location in the Capella Tower at 225 S. Sixth St. to 28,000-square-feet on the 26th and 27th floors. CWN brokers Brent Erickson and Dan Wicker represented Best & Flanagan in the transaction.
In addition, law firms Hessian McKasy, P.A., and Norton Rose Fulbright have decided to move into RBC Plaza, along with the following businesses: eggen, PLLC, a financial and legal advisory firm; Hillcrest Capital, private equity firm; Isles Ranch Partners, an alternative investment management firm; Joern, Samaha & Associates, a financial planning practice; and Windstream, a network communications company. Krieg DeVault, LLP, a law firm; and North Central Equity, a private equity firm; have also just renewed their leases in the building.
RJM Construction led the construction project with Mitch Weaver as project principal and Greg Van Ochten as project executive. Shea Design, under the direction of Tanya Spaulding, serves as the project architects. CWN's Theresa Elveru, general manager, managed the renovation project on behalf of KBS with assistance from Michael Shields, project manager and Tom Smith, construction representation.
Another benefit of this renovation job is that by integrating the tower and former mall, office tenants now have a direct connection to Nicollet Mall, the core of Minneapolis' CBD. “These are strong and timeless benefits for the property,” says Dusil.
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
