“The decades-old University Crossing medical office and industrial building in St. Paul’s Midway area has sold for $14.8 million, about 18% more than the property traded for in 2019.
At $175.88 per square foot, the recent sale of the 84,150-square-foot asset at 2200 University Ave. W. in St. Paul sets a “new high-water mark” for industrial tech assets, said Bentley Smith, a CBRE senior associate representing the seller.
“In the last couple of years, $150 a foot is probably more typical,” Smith said in an interview. Essjay Investments of Fargo, North Dakota, sold the fully leased property to Capital Partners LLP. Tenants include Fairview Health Services and the state of Minnesota.
The deal, which closed in mid-December, was announced by CBRE this week. Smith, Judd Welliver, Sonja Dusil, Ryan Watts and Tom Holtz represented the seller as part of CBRE’s Minneapolis Institutional Properties team. Smith said the sale “checks all the boxes” for investors. With parking for 231 cars and 16 trucks, the building has 9-foot office ceilings, 15-foot warehouse clear height, 10 drive-in doors and 12 dock doors.
“Given the fact that it’s medical, which is a resilient industry, but also has industrial characteristics — dock doors, warehouse space — all those factors contributed to make it a desirable asset,” Smith said.
The location is also desirable, Smith said.
Built-in 1990, University Crossing is in the northeast quadrant of Interstate 94 and Highway 280 in St. Paul’s Midway area. It’s about three blocks southeast of the Raymond Avenue Station on the Green Line light rail route. Smith said the industrial vacancy rate in the Midway area is around 2% “at most.”
“That area currently is and always has been a strong submarket,” Smith said. “It’s centrally located, right between both metros. You can get pretty much anywhere in the metro within 20, 25 minutes.”
Josh Benson, president of Essjay Investments, said in a statement that the transaction was “a fun project, and our business plan was completed sooner than we expected due to the great location and quality tenant makeup. We really enjoyed working with the tenants at University Crossing, and Capital Partners will do a great job moving
forward.”
The building is less than three years removed from its most recent sale. In May 2019, Finance & Commerce reported that Essjay Investment Co. paid $12.5 million for the University Crossing. Connecticut-based Greenfield Partners was the seller.”
By: Brian Johnson January 21, 2022
