Built over a century ago as the headquarters of the two railway companies of James J. Hill and the First National Bank, a gigantic apartment building in Lower Town comes to life as an office for government agencies and their officials. clients.
The 14-story Great Northern Building at 180 E. Fifth St. opened in 1916, the year Hill died. It remains the largest office building in St. Paul and was the largest of the Twin Cities until the construction of the IDS Center in Minneapolis in the late 1960s.
“It’s an important piece of downtown architecture, and we want to make it shine again,” said Matt Jacobs, managing director of New York-based Gamma Real Estate, who took an interest in the projects. real estate in the South and Midwest.
The Great Northern, which is listed on the National Register of Historic Places as a contributor to the Lower Town Historic District, is Gamma’s first business in the capital of Minnesota.
When Gamma, a Park Avenue real estate company founded and operated by generations of the Kalikow family, discovered the Great Northern Building, a significant portion of its more than 600,000 square feet of office space was empty. Gamma bought the building into receivership for $ 52 million in 2019 and invested $ 2.5 million in renovating the floor space and common areas, including the old Great Hall, a hall shaped like a ballroom so large that it once hosted weddings and other events.
After a million dollar renovation, the Great Hall is now a 500-person lounge, two-story tall and unique among downtown office facilities. Upgrades are planned for the adjacent 267-seat Jerome Hill Theater, which could play a central role in a future conference center below the existing conference room suite on the second floor.
Jacobs called the remodeling the benefit of having “well capitalized owners” with “a very strong reputation in the market we work in for delivering on the promises we make, that level of institutional practice where you know what you are doing. get “.
The Great Northern – not to be confused with the Great Northern Lofts condo building on Kellogg Boulevard, which was the former headquarters of the Great Northern Railroad – once housed the offices of Gander Outdoors before the retailer declared bankruptcy in 2017 and consolidates its offices in Bloomington.
The stately structure near Lower Town’s Mears Park was almost home to Ditech Financial, formerly Green Tree Servicing, Inc., a mortgage and loan company that bankrupted its home loan unit in 2012 and eventually left the ‘State. An 11th floor space that was built for Ditech was never occupied.
Cray, the supercomputer company, also had overflow space in the building. They too left St. Paul, leaving Talon Holdings, then owner, with a few large tenants.
Gamma Real Estate, which completed major renovations a year ago, saw a rough diamond.
“We were excited about downtown St. Paul and St. Paul in general, seeing it as a value game compared to Minneapolis which has seen explosive growth in recent years,” said Jacobs. “I’m from New York, and I take Brooklyn over Manhattan as an example.”
The Great Hall no longer does weddings. It is now a single “amenity center” for office tenants. pic.twitter.com/GuEKvjnzbh
– Frederick Melo, journalist (@FrederickMelo) April 30, 2021
GREEN AND THE GRAIN, ACT AS TENANT
Jacobs said Minneapolis’ airway system fostered its own indoor urban environment with seats and rows of vendors, while “St. Paul seemed to be missing the same, even though he had the bones for it.”
Gamma wooed Green and the Grain, a quick and casual salad restaurant with multiple locations in the Minneapolis skyways. The Great Northern building will be both a retail location and their Twin Cities food court. “They’re at ground level, so they’ll have both indoor and outdoor visibility,” Jacobs said.
Chris Gliedman, a senior partner with CBRE, the project’s rental team, said Green and the Grain was almost ready to open in March 2020 when government closures sent office workers rushing home to the light. of the pandemic. He hopes the office workers will come back, as will the salads.
Prospective tenants are offered net rental rates of $ 11 to $ 12 per square foot, in addition to $ 8 per square foot in operating costs.
Jacobs declined to give specific occupancy levels, although national referral agencies describe the building as being around 70 percent occupied. Most tenants are “next to the government,” Jacobs said, which means contractors and consultants who do business with government agencies.
In an unusual turn in real estate negotiations in the era of the pandemic, two government agencies with a significant downtown presence will change office buildings.
The Minnesota Department of Employment and Economic Development, currently based in the First National Bank building on Minnesota Street, will occupy floors 11 through 13 in the Great Northern by August, with more than 700 employees from the State. The lease involved securing some 500 nearby parking spaces.
In a statement written last February, DEED director Steve Grove said the move to the Great Northern “will save taxpayers thousands of dollars each year with a reduced footprint, while dramatically improving the workspace of the company. our employees ”.
The US Army Corps of Engineers also has a significant presence in the Great Northern, but has plans to build $ 10 million of office space in the First National Bank building. They could move in a year. Indeed, DEED and the Army Corps exchange their addresses.
“There are a few big contracts going on,” Jacobs said. “There is still room to rent.