From the world of commercial real estate, this shocking news:
Minnetonka-based Onward Investors purchased the 31-story Ameriprise Financial Center at a big discount, adding to its growing portfolio of downtown Minneapolis office buildings.
The firm paid $6.25 million in cash for the property at 707 S. Second Av., according to sources familiar with the deal. The building last sold in 2016 for $200 million.
So that represents a 97% decline in market value since 2016. The prior owners handed the keys back to their lender in 2023. This is a nice, new building in the heart of downtown Minneapolis, but it is now vacant:
In related news, Minneapolis Mayor Jacob Frey has announced that he will run for a third term. I am not sure why: Frey presided over the disastrous George Floyd riots, although, to be fair, he didn’t perform as badly as Governor Tim Walz. Now the commercial tax base in Minneapolis has dried up–that’s what happens when the value of commercial real estate declines by 97%–and it is hard to see how the city will finance itself going forward.
Rather than dealing with the city’s profound and possibly insoluble problems, Minneapolis’s City Council has just collaborated in an attempt to subject its police department to supervision by the Department of Justice, which, if approved–a big “if”–will subject law enforcement to more limitations that will further elevate the city’s crime rate. Like a number of other blue cities, Minneapolis needs a drastic change in leadership, but there is no sign that such reform is on the horizon.
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