Shoreview Corporate Center was developed on 34.6 acres just north of the intersection Lexington Avenue N. and Interstate 694, the main corridor feeding the Shoreview submarket. The seller--a joint venture partnership of Lutz Real Estate Investments of Farmington Hills and Becker Ventures of Troy--acquired the park in May 2003 for $49 million and then invested an additional $3 million repositioning the property, extending leases and bringing in new tenants.

"This is a blue-chip portfolio of extremely well maintained office properties where four of the buildings are each fully occupied by a major corporation leasing a minimum of 100,000 sf," says James Drever, Argus Realty's vice president of acquisitions. "We are impressed with the strength of the Shoreview submarket with its strong track record of attracting and retaining large Fortune 500 tenants because of its location close to a substantial pool of skilled workers on the north side of the Twin Cities."

Shoreview was originally developed as the world headquarters for Deluxe Financial Services, which largely relocated to a new campus but still leases 226,439 sf at Shoreview. Other large tenants include Medtronic, a global medical technology company, which leases 209,000 sf; Land O' Lakes, the food and agricultural cooperative, which leases 126,609 sf and is headquartered nearby; and, Hil-Rom, a medical products and services company, which leases 100,130 sf.

Argus Realty Investors chief executive Dick Gee says the 21-million-sf Shoreview submarket has an average vacancy of 3.5%. A company source tells GlobeSt.com the average remaining lease term at Shoreview Corporate Center is somewhere between five and seven years. The leasing agent was, and will remain, in the hands of CB Richard Ellis broker Mike Marinovich.

Tom Holtz of CBRE's institutional group in Minneapolis and colleague Steven Buss had the disposition assignment. Around 12 institutional and private investors nationwide bid on Shoreview, says Holtz, adding that Argus was not the high bidder but was selected as the most likely to follow through.

LaSalle Real Estate Capital Markets in Chicago provided the financing, a $54.7-million, eight-year loan at a fixed rate of 5.75% that is interest only for the first four years, according to John Hofmann, a La Salle associate. "Shoreview is a very strong asset with an excellent location and Argus structured the deal appropriately--not too aggressive--that made it an attractive credit," Hofmann says.

Argus Realty specializes in acquiring institutional-grade stabilized and value-added office and industrial properties for individual and institutional investors. In the final 90 days of 2005, Argus closed on $233 million of suburban office buildings throughout the US totaling more than 1.4 million sf.

Instant Insights /

GlobeSt.com EXCLUSIVE: Argus Realty Buys 553,000-SF Corporate Center for $73M-Plus

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