Another Asian investor makes office buy in Minneapolis

Singapore-based Mapletree has acquired 50 South Sixth, a 29-story office tower in downtown Minneapolis, from Hines Global REIT for $258.5 million, one of the highest prices for a Twin Cities office building in recent years, according to media outlets.

The transaction closed on Dec. 20. An official statement has not been released.

The property was completed in 2001 and is the 18th-tallest building in the city. A skyway connects this building to the 15 Building, Renaissance Square, City Center, and Gaviidae Common.

Hines purchased the 698,606-square-foot office tower in 2010 for $180 million.

The deal is one of the largest-ever acquisitions of a downtown property in the city. Another Asian investor active in the market is China-based HNA Group, which acquired the neighboring office at 33 South Sixth Street (City Center) for $315 million in 2016.

The third quarter in the Minneapolis multi-tenant office market ended with a positive absorption figure of 2,800 square feet, according to Colliers International. This minor variance from second quarter held the metrowide vacancy rate at 15.2 percent. Among the subsets, class A office was the strongest performing, with a positive 130,000 square feet of absorption. The Minneapolis CBD accounted for three-quarters of that absorption.

There is more than 1.75 million square feet of office space currently under construction, with delivery dates all expected by fall of 2018. This is one of the largest totals of office construction delivery over the past several years.

And the Minneapolis-St. Paul economy continues to boast one of the lowest unemployment rates in the country, currently hovering around 3.4 percent, which is considered full employment, according to Colliers.