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1490 posts categorized "Real estate news"

March 26, 2015

Furniture store owners buy building for $5 million

A year after quadrupling the size of their businesses by leasing the former Menards North store, two Rochester retailers have purchased the building for $5 million.

Jim Sather and Mark Byer moved Furniture Superstore and America's Mattress into the complex at 5150 U.S. 52 North last spring, shortly after Mernards moved to a new store. They were leasing the huge store and the surrounding 10 acres of property with an option to buy it after a year.

They closed on the deal to buy it for $5.09 million from John Mernard Jr. on March 17.

"Our intent all along was to buy the building," Sather said Wednesday. "Business has been stellar here. That and outstanding support from Bremer Bank helped make this happen. It's a big deal for us."

Sather and Byer also bought the adjacent Jo-Ann Fabric and Craft store for $2.4 million on the same day, but they immediately sold it to Rochester-based Brackenridge 52 LLC for $3.4 million. While it's unclear who the new owners are, it appears the very successful Jo-Ann Fabric store will remain where it is for now.

Now that they own the building, Sather and Byer plan to upgrade their store. The first step is to remodel inside the store and then reface the building within the next 12 months or so, Sather said.

A team of 18 employees staff the furniture/mattress store. However, it isn't just retail sales that's driving the business. They are renting out portions of the former Menards outdoor lumber yard for boat and RV storage. Other businesses, including a trucking firm, are  using the yard for storage.

They also are considering other business possibilities on the land in front of and behind the facility.

"We'll see what happens," Sather said.

Cardio3 reports losing $18 million in 2014

Cardio3 released a financial report today with a lot of interesting tidbits like it's building in the Minnesota BioBusiness Center due to an agreement with Mayo Clinic.

Also it's developing a U.S. headquarters… in Boston.

Here's most of my article on this:

The Belgium-based biotech firm building a manufacturing facility in downtown Rochester reported today that it lost $18.1 million in 2014, up from the $15.9 milCardiobioscience_jpeglion it lost in 2013.

Cardio3 BioSciences, which works closely with Mayo Clinic and is taking over the fifth floor of the Minnesota BioBusiness Center, reported its financials for 2014, plus some highlights of its activities in 2015.

Cardio3 is publicly listed on the European stock markets of NYSE Euronext Brussels and NYSE Euronext Paris, although it is not traded publicly in the United States.

Mayo Clinic owned 2.69 percent of Cardio3, as of March 3. Mayo Clinic first acquired equity in Cardio3 in 2007, when it licensed stem cell research by Mayo Clinic's Dr. Andre Terzic and Dr. Atta Behfar. Its cardiopoiesis technology repairs patients' hearts by re-programming their own stem cell to regenerate cardiac tissue.

6a00d83451cc8269e201a511d8e824970c-250wiThe Hong Kong-based Medisun, which is opening an office in Rochester, owned 7.2 percent of Cardio3 on March 3.

In the years since 2007, Mayo Clinic has developed a close working relationship with the Belgian company. Mayo Clinic is participating the U.S. clinical trial of Cardio3.

"We made significant strategic, operational and financial advancements in 2014 as we seek to build C3BS into a global specialty therapeutics company," stated Cardio3 CEO Dr. Christian Homsy in the announcement.

The annual report highlighted "a non-exclusive preferred access agreement" signed with Mayo Clinic in October that cleared the way for Cardio3 to build a facility in the City of Rochester's BioBusiness Center building.

"With this agreement, Cardio3 BioSciences agreed to give preferred consideration for Rochester, Minnesota to the U.S. to build a manufacturing facility for the production of C-Cure, at a facility located adjacent to the campus of the Mayo Clinic, and the Mayo Clinic agreed to periodically review with Cardio3 BioSciences its portfolio of regenerative medicine technologies, including in the areas of cardiology and oncology, with a view towards future potential licensing," according to the Cardio3 report.

Cardio3's prototype manufacturing facility will occupy the 14,963-square-feet of space on the fifth floor of the downtown building. Mayo, which leases the fourth through eighth floors, moved its employees out of the fifth floor earlier this year. Cardio3's five-year lease calls for it to pay a rent of $18 per square foot, or $22,444.50, per month. The city agreed to pay for $600,000 in equipment and improvements to the space.

The Minnesota Department of Employment and Economic Development also agreed to give Cardio3 a Minnesota Job Creation Fund award of $357,000, if the company invests $1.5 million in Rochester within a year and hires 33 employees within two years.

The ultimate goal of this project is for the city and RAEDI to eventually convince Cardio3 to build a 100,000-square-foot manufacturing facility with 350 employees in Rochester, according to officials at RAEDI.

However, Rochester is not the only city wooing the Belgium company. While the Rochester facility is Cardio3's first official U.S. location, the company's report show that it also has plans to build a U.S. headquarters in Boston, Mass.
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The company also reported that it's re-stating its 2013 financial reports "to reflect errors" found by PriceWaterhouseCoopers.

"After due consideration with its auditors, we decided that the shareholders convertible loans should have been accounted for as a financial debt instead of equity (previously called 'quasi equity') as originally posted in our 2013 financial statements, because the loans were convertible into a variable number of shares," according to today's statement from the company.

March 25, 2015

Upscale craft beer pub to open in northwest Rochester

A Crooked Pint Ale House is on tap to open soon in Rochester's former Green Mill Restaurant building.

Green Mill Restaurants CEO and Crooked Pint franchisor Paul Dzubnar announced this week that the "nouveau urban pub with a local neighborhood feel" is scheduled to open on April 21 at 2723 Commerce Drive NW.

Dzubner built the 6,800-square-foot restaurant in 2006 and still owns the building. The Green Mill operated there until it abruptly closed Jan. 1.

Place_18269"Even though the Green Mill closed, we still think Rochester is a great restaurant market. We want to get right back out in front of the market," Dzubnar said on Tuesday. "I think the people of Rochester have a very good palate."

He cited the poor timing of Green Mill's opening just as the recession started and the resulting development hiatus as contributing to the restaurant's failure. The resurgence of development along West Circle Drive and Mayo Clinic's Destination Medical Center initiative makes it much more favorable to launch a new concept now, he said.

Construction crews have been revamping the restaurant for weeks. It is expected to employ between 65 and 70 people, about the same that Green Mill did.

This will be the third Crooked Pint in Minnesota and the first outside of the Twin Cities metro area. Jeremy Brown owns the Rochester Crooked Pint as well as one in Apple Valley.

“Everything at Crooked Pint is the real deal, from the menu to the furnishings to all of the local craft beers,” Brown said in an announcement.

Dzubner described the Crooked Pint concept as catering to the growing craft beer trend, while serving "upscale pub fare," like stuffed burgers, homemade tater tots and stuffed pickles.

"We think this concept is really good. While the food is upscale, it's very affordable. We offer a daily $6 burger basket lunch special," he said.

From the bar, the Crooked Pint offers 30 local and regional craft beers on tap as well as 20 wines available by the glass. It also will serve a variety of high-end bourbons and scotches.

Plans call for up to 10 more Crooked Pint locations to open in the next three years.

“Rochester is growing with a mix of business and residential, providing a great backdrop for this fabulous concept. We are excited for Crooked Pint to join the community,” Brown said.

March 17, 2015

O'Neill's Pizza goes dark before the wearing of the green

Instead of St. Paddy's green, things are blue at Rochester's O'Neill's Pizza Pub.

The popular Irish-flavored spot at 1201 S. Broadway in the Crossroads Shopping Center closed its doors for good on Saturday, after an early St. Patrick's Day party.

O'neill's"We've been happy there for 10 and half years. We've been happy with our customer base there," said Shannon O'Neill, one of the owners of the family business. "Our lease is done, so we decided to close."

She owns O'Neill's with Erin O'Neill, Brian O'Neill and Phyllis O'Neill.

O'Neill's Pizza Pub moved to that spot, the former home of the Face The Music store, in late 2004. The family originally launched the eatery in 1999 at 7 Second St. S.W. That's the former bank building, where Goonie's Comedy Club is located.

AfteroneillsOne of its pizza slingers, Cam Kvittem, made news in 2012 when he was named the second best dough slinger in Minnesota.

"If he had been able to use to the dough for our cracker crust, I'm sure Cam would have gone all the way to first," said Shannon O'Neill at that time.

Shannon O'Neill said this week that this latest closing might not be the final end of the business and it could possibly be re-kindled in Rochester. She said the family is considering starting looking for a new location, though it's too early to even consider that at this point.

March 10, 2015

Tinn's to double its Rochester footprint with 2 new shops

Rochester fans of Tinn's Grilled Philly Steak Subs soon will have twice as many places to get their favorite sandwiches.

Tinn's, originally founded by Tien Danh, is opening a shop next to Tonic across from Mayo Clinic's Saint Marys Hospital on Second Street and another one on North Broadway at the corner of First Street Northwest.

03092015tinnsalibabasTinn's General Manager Bounlot Singkeo says he hopes to have the Saint Marys location, which is next to Tonic, open possibly as soon as late May. This shop will be take-out only with no customer seating, he said.

"We saw an opportunity there. We have a lot of customers at Saint Marys," he said. "So we thought we'd give it a try."

Singkeo estimated the store could have about eight employees to staff it, when it opens.

The other Tinns shop is opening in the former Ali Baba Restaurant spot at 101 N. Broadway Ave. It's currently undergoing an extensive makeover.

If everything goes as expected, Singkeo estimated the Broadway restaurant could be ready to launch within three to four weeks. It will be a sit-down restaurant with seating for about 20, as well as take-out. It probably will have about eight to 10 employees to staff it, he said.

These two new Tinn's will complement the other two older locations at  3462 55th St. in the Northwest Plaza and in the First Avenue Food Court on the skyway level at 100 First Ave. SW. 

February 26, 2015

Rochester senior apartments sell for $1 million

In the wake of the sale of Rochester's Maple Manor Health Care, the senior apartments next door now have been sold for $1.01 million.

The 18-unit Maples Senior Apartments at 1893 19th St. NW was purchased by Kurt Luschen, of Maynard, Minn., on Feb. 17. The Blum family, which owned Maple Manor until it was sold in January, sold the complex.

Maples senior apartmentsPat Blum, the former administrator of Maple Manor, said it made sense to sell it after the sale of the senior-care center.

Having the apartments next door, Blum previously easily could manage the apartments and handle his duties at Maple Manor. Now that he has left Maple Manor, it wasn't practical for him to continue managing the apartments.

"It's a good fit," he said. "I'm happy we found a buyer for it so quickly."

Darci Fenske, of Rochester's Paramark Real Estate, represented the Blums in the deal, while Cory Magnuson, of Edina Realty, represented the buyer.

Luschen, the new owner, also is pleased with the deal.

"It's an investment property for me. I plan to keep it fairly the same," he said. "I think it's good to invest in Rochester. It's a fairly stable community down there."

Luschen is in talks with Pritok Capital, of Skokie, Ill., which bought Maple Manor, about working out an agreement to provide some services to the apartments' tenants. Pritok bought the center at 1875 19th St. NW for $3.5 million in mid-January.

February 25, 2015

City to lease former Mayo Clinic space to Cardio3

This has been in the works for quite a while. It looks like it's now a done deal, at least on the city, RAEDI and DEED side.

We'll see what happens next. After following this for more than a decade, it will be interesting to see how it plays out. I'm particularly fascinated with how the China piece of this, including Medisun and Danny Wong, turns out.

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After amending its original lease, Belgium-based Cardio3 BioSciences is now finally cleared to take over the entire fifth floor C3BS_may_spotlightof Rochester's Minnesota BioBusiness Center.

In December, the Rochester City Council originally approved a five-year agreement with Cardio3 for the 14,963-square-feet of space to use as a prototype manufacturing facility. However, the company then asked for "an early termination provision" in the lease.

The deal is being driven by the city, Rochester Area Economic Development Inc., Mayo Clinic and the Minnesota Department of Employment and Economic Development to make Rochester more attractive to Cardio3, so that the company will build a major manufacturing plant here.

This is the second phase of deal funded by $1.2 million from the city of Rochester's economic development sales tax fund. The first phase was developing little more than 5,000 square feet of unused space on the third floor of the BioBusiness Center to build a special manufacturing lab for Cardio3.

Mayo Clinic and Cardio3 have collaborated for years on the cardiopoiesis technology the company uses to repair patients' hearts by re-programming their own stem cells to regenerate cardiac tissue. Mayo Clinic owned 2.96 percent of the company as of Jan. 21. It's also managing a clinical trial for Cardio3.
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On Wednesday, city council members voted to add an early termination provision to the deal that allows Cardio3 to end the five-year lease after just two years in the space. That provision kicks in only if Cardio3 decides to "construct or lease a larger production facility in Rochester" or the clinical trial on its regenerative heart treatment is not successful.

To leave early, Cardio3 will need to notify the city six months ahead of time. Under the modified lease, the earliest that the regenerative medicine firm could pull out is April 30, 2017. Cardio3 would need to pay the city $269,334 if it did leave earlier than five years. That amount equals about one year of base rent.

If Cardio3 does leave before its lease is up, all of the city-funded fixed equipment and improvements will become the city of Rochester's property. The city agreed in the lease to pay for $600,000 in equipment and improvements to the space.

The final version of the lease calls for Cardio3 to pay a rent of $18 per square foot or $22,444.50 a month.

Mayo Clinic, which leases the fourth through eighth floors of the BioBusiness Center, moved its employees out of the fifth floor earlier this year. At one point, Mayo Clinic Global Products' corporate accounts had offices on the fifth floor.

In earlier discussions about this project, RAEDI estimated that Cardio3 will need 30 to 50 employees to staff the proposed prototype manufacturing facility on the fifth floor.

The ultimate goal of this project is to convince Cardio3 to build a 100,000-square-foot manufacturing facility with 350 employees in Rochester. That's what Cardio3 anticipates it will need if the Federal Drug Administration gives it a green light to take its stem cell treatment to market.

RAEDI President Gary Smith calls it "the big enchilada."

February 19, 2015

Forager Brewing Co. on tap for Kutzky neighborhood

Here's some from my article today about a proposed brewery/coffee house/wood fired pizza shop and local market.

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A new project promises to bring a small batch brewery, wood fired pizzas, a coffee shop and more to Rochester's Kutzky neighborhood by this summer.

Foragersketch1The plan is to transform 5,000-square-feet of the former Good Food Store building at 1005 Sixth Street NW into The Kutzky Market. Spearheaded by majority owner Annie Henderson, the concept is to bring together a coffee shop, brewery/restaurant, a leasable commercial kitchen, and a local retail market.

"With everything going on with DMC (Destination Medical Center initiative) and the hype around downtown, we decided to look in the core neighborhoods," said Henderson. "We wanted it to be something community based and neighborhood based, but still walkable from a lot of people's houses."

The building has been empty since the Good Food Store closed in 2013 and merged with the People's Food Cooperative in downtown Rochester.

Kutzky Market has a lot of permits and construction yet to get through before it becomes a reality. She estimates it should be ready to open sometime this summer. Some interior demolition has already started and the hope is for construction to start in earnest in March.

The main piece of this new project is Forager Brewing Co. as well as its daytime counterpart, Kutzky Coffee. Head brewer and part owner Austin Jevne will run Forager, where he will produce small batches of beer using local ingredients. The name of the brewer comes from the fact that many of the ingredients that Jevne uses are foraged from the southeastern Minnesota countryside.

Jevne the brewer and Henderson the visionary were connected by the owners of the Thirsty Belgium bar, where Jevne worked.

"It's kind of a perfect match," she said. "Austin already had that name (Forager) in mind. We thought it was a really cool name and now it's become a big part of our identity.

The conversation started about mid-January and now about month later, Kutzky Market is moving ahead.

Forager will also be a full restaurant with a focus on local, seasonal ingredients. A large wood-fired oven will be used for many of Chef Jordan Bell's dishes, including pizzas. Bell comes to Forager from the popular Nosh Bar & Restaurant in Lake City.

Another owner, Rochester architect Adam Ferrari describes Forager as "the Farmer's Market approach to beer making and pizza."

During the day, the restaurant space will serve as the Kutzky Coffee shop.

Henderson's vision also includes The Kitchen, a commercial kitchen available for lease.

"Say you want to make things to sell at the Farmer's Market. You could lease the Kitchen for that and you could also sell your things in our retail market," she said.

The Kutzky Market will focus on locally created goods, including foods created by Chef Bell.

And then there's the artistic piece. Henderson is very active with various downtown Rochester groups, including the C4 art salon, so she intends to have periodic artists-in-residence as well as three walls for the display of local art.

Forager will also feature a piece of Rochester history. The group purchased the bar from Pappageorge Taverna at the recent auction of the furnishing, art and equipment from Michaels restaurant.

"This is a marriage of all of these different fun, entrepreneurial uses under one roof," said Ferrari of the whole project.

February 12, 2015

Prosthetics lab complex sold for $4.51 million

The Rochester commercial complex that houses a prosthetics firm and a veterinarian clinic recently sold for $4.51 million.

02122014prostheticslabcomplexRochester developer Gus Chafoulias sold the 13-year-old building at 121 23rd Ave. SW  to Mace Holdings LLP of Billings, Mont. Chafoulias developed and owned the 28,000-square-foot facility through his company, ACG Second Street LLC.

Prosthetic Laboratories of Rochester, Inc. and Affiliated Emergency Veterinary Service are tenants in the center, which stands in front of the Shorewood Senior Campus along Second Street Southwest. Chafoulias was invested in Prosthetic Labs until it sold to Hanger Inc. last year.

Michael R. Mace, managing partner of Mace Holdings, says the purchase is simply an investment for he and his wife.

"We think Rochester, Minn. is a dynamic community with wonderful people. We just think it's a great place to be doing business," said Mace.

February 10, 2015

Ex-Stifel, Nicolaus building sells for $535,000

A commercial building in northeast Rochester recently sold for $535,000.

Stifel nicolausOn Jan. 30, Pensco Trust Co. of Denver bought the 4,680-square-foot former Stifel, Nicolaus & Co. building at 305 Alliance Place. The empty building is north of 37th Street Northeast and East River Road N.E.

The former tenant, Stifel, Nicolaus, now operates an office in downtown Rochester.

Pensco, a financial investment firm, purchased the 13-year-old building from Helen Properties Co. of Rochester. Helen Properties bought it for $715,000 in 2003.

It's unclear what Pensco plans to do with the Rochester building. Calls to the corporate office for comment were not returned.

Chatter in the Med City business community is that a media firm is seriously looking at the site. However, there's no firm answer either way to confirm or dispel that rumor, so stayed tuned to find out what happens next.