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2918 posts categorized "Follow-up"

July 29, 2015

More on Mayo Clinic + US Postal facility

 So the Post-Bulletin is not the only Minnesota media to take note of Mayo Clinic's recent $2.11 million purchase of the unused U.S. Postal Service center at 3939 Valleyhigh Drive.

PostalcenterOn July 17, Mayo closed the $29.13 a square foot deal on the northwest Rochester property, which the US Post Office closed in January. I wrote an article about it on July 21.

The Twin Cities business newspaper, Finance & Commerce, spotlighted the deal in it's "Minnesota Snapshot" real estate feature in its July 23 issue.

While Mayo Clinic still hasn't worked out what it will do the building that it purchased, the Finance & Commerce piece by Anne Bretts does provide some new insight into how the deal played out.

Chris Gliedman, of the Minneapolis-St. Paul office of CBRE Group, which has a national contract to represent the USPS.

Gleidman and colleague Mike Marinovich most recently marketed several properties that became available after the Postal Service consolidated many of its operations in Eagan, where the USPS expanded an existing facility to create a 950,000-square-foot regional processing center.

The move affected facilities throughout Minnesota and into Wisconsin.

------------

The Rochester property went on the market in January 2014.

“We had pretty good interest,” Gleidman said.

In fact, he was in discussions within months and had it under contract by fall. The buyer withdrew, however, leaving Gleidman and Marinovich to start over. Before they could put the building back on the market, Mayo made an offer. It was lower than the original offer, but the deal carried no risk, Gleidman said.

“We felt very comfortable that Mayo Clinic was going to deliver,” Gleidman said.

July 28, 2015

New pizza place cooking for NW Rochester

Pizza is returning to Rochester's Northgate Plaza neighborhood.


A new carryout franchise called $5 Pizza is gearing up to open in the former Pizza Hut space at 1105 Seventh St. NW, says co-owner Doug Howe. Construction is underway, and he hopes to have the new eatery open by late August.

They expect to have a team of five to 10 employees on staff.

Darci Fenske of Paramark Real Estate brokered the deal to bring $5 Pizza into that spot.

UnnamedHowe and his partner, Rod Bailey, believe the pizza chain, which has 13 Minnesota locations, is a good fit for Rochester and that neighborhood in particular.

"We tried it up in the Cities. We loved the product and we loved the concept. We bake it and you carry it out," he said. "With this economy, it's always not always easy to feed a family."

The $5 Pizza approach is to keep costs down by not offering restaurant seating or delivery. Customers pick up pizzas. All one-topping pizzas cost just $5.

It offers a full menu, which includes specialty pizzas such as Cheeseburger and Inferno Chicken. It also serves breadsticks and a variety of chicken wings.

That spot puts $5 Pizza in the heart of a busy northwest Rochester neighborhood.

"We liked the fact it's a block away from John Marshall High School. And there's a lot of housing right behind us," said Howe. "Geographically, it's a great location for us."

July 23, 2015

Quiet period to end for Celyad (former Cardio3) on July 29

Here's an interesting update from a site called Marketbeat.com about the former Cardio3, now trading in U.S. as Celyad. This Belgium firm has deep ties to Mayo Clinic and will soon occupy an entire floor of the Minnesota Biobusiness Center in downtown Rochester.

 Celyad SA’s  quiet period is set to expire on Wednesday, July 29th. Celyad SA had issued 1,460,000 shares in its initial public offering on June 19th, Market Beat reports.

CelyadThe total size of the offering was $100,097,600 based on an initial share price of $68.56. During Celyad SA’s quiet period, insiders and underwriters involved in the IPO are restricted from issuing any research reports or earnings estimates for the company because of SEC regulations. Following the expiration of the company’s quiet period, it’s expected that the brokerages that served as underwriters on the stock will initiate research coverage on the company.

 

CYAD has been the subject of a number of recent recent research reports. Analysts at Piper Jaffray initiated coverage on shares of Celyad SA in a research note on Tuesday, July 14th. They set an “overweight” rating and a $95.00 price target on the stock. Separately, analysts at Maxim Group reiterated a “buy” rating on shares of Celyad SA in a research note on Sunday, June 21st.

Celyad SA remained flat at $60.44 during during mid-day trading trading on Wednesday. 126 shares of the company’s stock traded hands. Celyad SA has a one year low of $47.52 and a one year high of $67.94. The stock’s 50-day moving average is $54.65 and its 200-day moving average is $54.65.

 

July 22, 2015

Holiday Inn: Roch.'s downtown hotel to close at end of August

Don't expect to book a room in Rochester's downtown Holiday Inn after Aug 31, according to the hotel chain's national reservation line.

Holiday-inn-rochester-3336465069-4x3An InterContinental Hotels representative on the reservation line said this week that Rochester employees said the 170-room hotel at 220 Broadway Ave. S will close at the end of August. They told the ICH representative the closing is because of the sale of the hotel.

For several months, word has been leaking out about a deal to sell the downtown hotel to an unnamed buyer who is planning to convert the 46-year-old hotel into a senior living facility.

If the buzz is correct, these talks have been going on for quite a while without reaching closure. Now the employees are saying a closure is on the way.

At least for the hotel, if not the real estate deal. 

July 17, 2015

Downtown tower's construction waiting on financing

Construction on a 23-story downtown Rochester tower has yet to begin because the developer has not finalized financing for the project, according to a city official.

In May, the City of Rochester pledged $6.5 million in assistance to developer Gus Chafoulias to build his long-planned $140 million Broadway at Center tower. Chafoulias, with limited assistance from his son Andrew Chafoulias and Titan Development and Investments, has been working on different versions of this project since 2007.

TowerBroadway at Center will house a 264-room Hilton Hotel, 33 apartment units and space for office, retail and restaurant use. More than $14 million — including the city's $6.5 million assistance to the developer and the remainder of infrastructure costs — is planned to be reported as Destination Medical Center local contributions and credited toward the city's $128 million commitment.

The tower is to be built on South Broadway and East Center Street, just north of Broadway Residence and Suites by BridgeStreet. Since early last year, buildings that previously housed CJ's Midtown Lounge, Ginny's Fine Fabrics and Jakobson Management Co. have sat empty on the site. When the tenants were asked to vacate, Titan officials estimated that the buildings would be demolished during the summer of 2014.

When approving the project, the city agreed to work in conjunction with the developers to build an attached public parking ramp. But city officials said they have to wait on final paperwork from Titan Development before construction can start.

"Chafoulias indicated a while back that they are still reviewing some of their financing options for the project, so they have not provided us with that signed development agreement as of yet. I'm anticipating it should be fairly soon," City Redevelopment Director Terry Spaeth said. "I know they are looking at a couple different financing options."

The development agreement includes a number of provisions about vacating an alley, conveying properties and approving easements.

Spaeth said it's estimated it will take 22 months, from start to finish, to build Broadway at Center. The city's portion of the project is expected to take nine to 12 months to complete. The plan is for the city work to be completed to coincide with the opening of the overall project.

"Once they get going, I suspect things will get moving pretty rapidly," he said. "The first step is to get the development assistance agreement signed."

When asked about the status of the Broadway at Center project, Titan Marketing and Communications Manager Sheila Thoma said there wasn't much to report.

"I do not have a new/significant update. The project is still on course. With a major project like this, there are a lot of moving parts and it takes time to solidify all details," she wrote in response to inquiries about when the CJ's and Ginny's Fine Fabrics buildings would be demolished.

On May 4, the city approved a development assistance agreement with Titan about Broadway at Center. The Rochester Economic Development Authority, a board comprised of the seven Rochester City Council members, approved $6.5 million in tax increment financing and land write-downs. The EDA had put its development assistance agreement on hold until the Destination Medical Center Corp. board of directors named Broadway at Center as a DMC project. That happened on April 30.

Broadway at Center is reminiscent of a previous project called Time Square that Gus Chafoulias proposed for that block 15 years ago. When Mayo Clinic opted not to lease office space in the $200 million project, Chafoulias withdrew it in 2000.

"This is the single biggest disappointment of my career," Chafoulias said after making the announcement. "It never feels good when you fail. It didn't work out, but it's not the end of the world."

After Chafoulias withdrew, Dubai-based investors stepped in and built a 26-story tower, the tallest building in Rochester, on that corner. That tower, now known as Broadway Residence and Suites, stands next door to the proposed Broadway at Center project.

 

July 14, 2015

Piper Jaffrey gives Celyad (former Cardio3) stock positive rating

Here's an interesting item that floated into my email box this a.m. about the former Cardio3, now trading in U.S. as Celyad. This Belgium firm has deep ties to Mayo Clinic and will soon occupy an entire floor of the Minnesota Biobusiness Center in downtown Rochester.

By the way, a rating of "overweight" is a good thing. It means the stock is a better value that other stocks in the same sector.

Here's the item as posted by Piper Jaffray:

Piper Jaffray initiates coverage on Celyad SA with a Overweight rating and a price target of $95.00.

Analyst Edward Tenthoff commented, "Celyad is a leading cell therapy company. CelyadCelyad is conducting the Phase III CHART-1 trial of autologous cell therapy C-CURE in heart failure patients with data likely next summer. The company will initiate the CHART-2 trial this year with data in 2017. Celyad recently in-licensed novel CAR-T technology for cancer currently in a Phase I AML and multiple myeloma study. Celyad is listed on the EuroNext exchange in Brussels and Paris, and just completed a U.S. IPO issuing 1.46 million shares at US$68.56 raising gross proceed of US$101 million. CYAD shares have sold off since the IPO providing an attractive entry point at US$54.71, in our view. We are initiating coverage with an Overweight rating and US$95 price target."

Shares of Celyad SA closed at $54.71 yesterday.

 

 

July 10, 2015

Jersey Jo's is open and selling Philly cheesesteaks

In case you missed it yesterday, Jersey Jo's is now officially open for business in Rochester.

This is Joe Phillips' new East Coast flavored restaurant, just a couple of blocks from Mayo Clinic’s Saint Marys Hospital. It's located at 187 16th Ave. SW in the Shoppes on Second commercial center spot that was last occupied by Cousin’s Subs. Cousin's closed and sold its equipment to Phillips.09072015jerseyjos

Jersey Jo’s menu is built around “authentic Philly Cheesesteaks and more.”

Phillips, a software programmer who will continue that profession remotely from the restaurant, said this new project started very simply.

“I couldn’t get a cheesesteak anywhere around here that I liked,” he said. So after years of looking, he finally decided to open a place of his own.

In addition to Philly cheesesteaks, Jersey Jo’s also will serve cold hoagie sandwiches, chicken wings and a trio of specialty burgers. The meat will be sliced on-site, deli-style for each of the made-to-order sandwiches.

July 08, 2015

More apartments proposed by Rochester's Shoppes on Maine

Preparing to build an apartment complex, developers have purchased more than eight acres of land in south Rochester for  $1.8 million.

Harbor Bay Real Estate Advisors bought open, grass-covered land next to the Shoppes on Maine commercial area in preparation to build a proposed 211-apartment complex, according to Harbor Bay co-founder Tom Lund. HarborbayaptsHarbor Bay is based in Minneapolis and Chicago.

The land was purchased by Bascom Capital LLC, a firm set up by Harbor Bay. The acquisition was done in two transactions of $590,000 on June 26 and $1.22 million on July 1. The apartment complex is slated to be located by Maine Avenue Southeast near the two hotels.

While some design details still are being worked out, Lund described the unnamed complex as featuring Class A, high-end apartments.

"It (the complex) will be a higher end product," he said. "We'll have a clubhouse and lots of amenities."

A Site Development Plan for the project was filed the Rochester Building Safety Department on Monday. He hopes to have the plan before the Rochester City Council for approval this month.

Lund said the goal is to start construction in September and hopefully have it completed by late next summer.

Harbor Bay has projects in Minneapolis and Duluth, but this will be its first here.

"Rochester is an amazing community that's growing. The demographics for apartments are very strong and the supply right now is relatively limited," he said.

The location near Shoppes on Maine was attractive because of the easy access to shopping as well as one of Rochester's Park and Ride mass transit lots.

In fact, another developer agrees that area is prime for more housing. Big Rock, Ill.-based Executive Affiliates has its own $35 million housing project called The Boulders already under construction near Harbor Bay's site. The Boulders will include a three-story building with 144 apartments and eight buildings with 10 townhouses in each.

"I think we'll complement each other," said Lund of The Boulders.

July 06, 2015

Clients defend Rochester ADA lawsuits

The clients behind recent costly disability lawsuits against Rochester businesses say the money they collect will create programs to help disabled people.

"We all suffer with access issues," said Melanie Davis, a student from Jackson, Minn. "The ADA (Americans with Disabilities Act) has been effect for many years. We've gotten tired of not having the same level of access everybody else has,"

Davis, who has cerebral palsy and uses a wheelchair, is one of four board members of the Minnesota-based Disability Support Alliance. She, a Parking_lot_sign_largelong with other alliance members, filed at least eight lawsuits in the last two months against Rochester businesses over ADA violations. The non-profit Disability Support Alliance was formed on July 3, 2014.

Davis and her companions recently stayed in Rochester for about week. When asked why they were here, she replied, "We travel. There were various reasons for being in Rochester, like medical things. We like touring and stuff like that."

Surprised by lawsuits

Many of the local businesses, such as Bilotti's Pizzeria and Hillcrest Shopping Center, were surprised by the lawsuits. Neither Davis nor any of her companions made complaints directly to the businesses during their visit to Rochester.

The DSA's Minneapolis attorney, Paul Hansmeier, approaches businesses about settling the lawsuits for amounts, like $5,000. That has led some of the businesses to wonder if the suits are more about making money than resolving accessibility issues.

"These people (from the DSA) had no intention of supporting my business when they drove in here. They came in here with every intention of getting rich quick," said Bilotti's owner Karla Sperry, who is addressing the problem with signage for her handicapped parking spots.

Davis disputes that claim. She said none of the board members receive salaries or part of the settlements. However, they did receive travel expenses to attend their board meetings, which occur every three months. She said DSA board members are mostly supported by payments from Social Security.

"We're getting paid for damages, and we donate the money back into the DSA. That's basically how it works," she explained.

The money from the settlements goes into a fund to be used by the DSA to develop programs to help disabled people in Minnesota, Davis said. 

"All of those (programs) are in the works. Nothing is working yet at the moment," she said when asked about the support programs.

Hansmeier, who works for law firm Class Justice, handles all of DSA's lawsuits and does collect a portion of the settlements, she said.

"It's not a salary, but he gets a portion from each case," Davis said. "Paul receives his own salary from his law firm, which is a contract which we developed between our organizations."

When asked what percentage of each settlement that Hansmeier collects, she declined to answer.

Litigious past

Hansmeier has filed a large number of this type of lawsuit throughout the state, including in Marshall and Mankato. Before pursuing ADA cases, he was well known for suits against Internet users, charging they had illegally downloaded copyrighted pornography. A federal judge ordered Hansmeier and others to pay sanctions related to that practice. Prenda Law, the firm Hansmeier worked with on the porn cases, has been dissolved.

He has been quoted in the media saying, "We consider ourselves to be an advocacy association more than we consider ourselves a law firm. With the porn reputation, I wanted to shift my focus and focus on something more positive."

In 2013, Hansmeier began filing a number of ADA-related cases for a disabled Minneapolis client named Eric A Wong. In a deposition for one of the cases, Wong testified that Hansmeier's brother, Peter Hansmeier, and others working with Hansmeier would take him to businesses to see if he could access them.

Hennepin County District Court Chief Judge Peter Cahill flagged six of the cases at the end of 2013 and ordered them all assigned to one judge to make sure they were all managed the same way.


The judge wrote that the manner in which the lawsuits were filed "… raises the specter of litigation abuse, and Mr. Hansmeier’s history reinforces this concern."

Davis said Wong is chairman of the DSA board. He recruited her to the board after she appeared in a documentary called "Independence to Inclusion" by Twin Cities Public Television in April 2014.

"He (Eric) had a vision for a better life," she said.

As far as Hansmeier's controversial past as an attorney, Davis said that doesn't concern her or any of the other board members.

"For us right now, it comes down to this, everybody has a past. What he did then is very different than what he's doing now," she said. "We're thankful for someone who's willing to help us exercise our civil rights."

In an email to the Post-Bulletin, Hansmeier reiterated the reason for the lawsuits is to make businesses more accessible, not to make money.

"Regardless of whether everyone agrees with my clients' efforts there can be no question that more attention to these issues will encourage more business owners to obey the law without the need for a lawsuit," he wrote.

Hansmeier also clarified in his email that a lawsuit he filed for DSA against Rochester's Kahler Grand Hotel in March plus a counter-suit filed in response by Kahler were settled in April.

July 02, 2015

KTTC's Overlie signs up for 5 more years in Rochester

KTTC-TV's popular news anchor Tom Overlie will continue covering Rochester for at least another five years, after signing a new contract with the station.

Overlie, who has won six Emmy Awards for best newscast, has co-anchored KTTC's 6 p.m. and 10 p.m. weekday newscasts. He announced his new five-year contract on Facebook this week. When asked why he has chosen to remain in Rochester, he responded that he thinks it is "one of the finest communities" that he's seen.

"I've traveled the world, and each time I come home to Rochester, I know this is the place I want to be," Overlie wrote in a message. "I'm fortunate to work with great people who are not only colleagues, but family."

8006876_GPrior to joining KTTC, Overlie worked for KMOT-TV in North Dakota for five years and three years at KEYC-TV in Mankato.

KTTC, which is owned by Quincy Newspapers in Quincy, Ill., is "thrilled" about Overlie remaining with the station, said Jerry Watson, KTTC general manager and Quincy regional vice president.

"Tom's special. Clearly to us, he's more than an anchor. He's really superb journalist who really understands his audience," he said. "To us, he's more than an anchor. He's one of the best ambassadors KTTC has had in years."

Overlie is not the only KTTC on-air talent that is committed to Rochester. Co-anchor Robin Wolfram recently signed a three-year contract extension with the TV station through 2017. Watson pointed out that KTTC's Sports Director Pat Lund is celebrating his 25th anniversary with the station this week.

"It's really fun to talk to Pat about local sports, because he knows the generations of athletes," said Watson.