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1454 posts categorized "Real estate news"

October 29, 2014

New downtown Rochester fitness studio warming up for opening

A new fitness studio is gearing up to open in downtown Rochester before the holiday feasting begins.

Sarah Pacchetti's Studio on Third is all set to open on Monday at 18 Third Ave. S.W. in the basement of the Merchant Exchange Building.  The 1,000-square-foot fitness center is tucked in next to The Doggery cocktail bar.

10282014studioonthirdThe studio offers hip hop, Barre, Piloxing, Zumba and yoga classes for Rochester folks as well as visitors staying in downtown hotels.

"I've been playing with this idea for years. I wanted to open a place that would be fun and empower others," she said in July, when she announced her plans for the studio.

Pacchetti is a certified instructor previously taught classes at Mayo Clinic's Dan Abraham Healthy Living Center. She has a team of nine instructors or as she calls them "inspire-ers." That team includes a couple of names that are familiar to the Rochester business community, Jess Irhke and Sara Pennington.

Sarah, with her husband John Pacchetti, bought half ownership of the basement level of the Merchants Exchange Building in June. The Pacchettis co-own the space with Scott Hoss, who also handles the leasing as an agent of Rochester's Paramark Real Estate Services.

The Pacchettis also own the Rochester-based Home Instead senior care operation that serves southeastern Minnesota.

October 28, 2014

Firewood biz turns up the heat on ash borers

A local firewood business plans to use a new Rochester retail site to heat things up for the insidious tree pest, the emerald ash borer.

Procut Firewood, which has been operating in the area for 25 years, launched its first Rochester sales spot last week at 2660 N. Broadway, next to Space Concepts. And soon, Procut owner Marv Sawyer plans to add his wood kiln to the site.

Procut uses the wood kiln, which Sawyer says has been certified by the Minnesota Department of Natural Resources and the U.S. Department of Agriculture, to sterilize firewood. That's significant now that the emerald ash borer has been found in local trees. To keep the tree-killing pest under control, the state has set up a restrictive quarantine to keep any possibly tainted firewood from leaving the county.

The only exception is wood that has been sterilized in a kiln, like Procut's. Basically, the kiln kills the borers, while also drying the wood for better burning in fireplaces, wood stoves or campsites, Sawyer said.

"The best thing about this is that we can utilize these trees that city and tree services are taking down. Within 24 hours, we can turn these trees into firewood that's good, safe and can be used anywhere," he said.

The city of Rochester or tree-cutting services bring the wood of any type, including ash, for Procut to process.

Procut now is selling firewood for pickup or for delivery by its two trucks on North Broadway. They are awaiting a natural gas hookup to soon be installed before bringing in the kiln.

Mike Haley, of Braasch Commercial Real Estate, handled the deal for Sawyer to acquire the lot space from Keith Witter, of Space Concepts.

October 23, 2014

Former Flamingo roost to be razed

While Flamingo Bingo is rolling along in its new home in Rochester's Elks Lodge, it soon will be game over for its former home.

The empty building at 2828 U.S. 52 North is slated for demolition by its owner, the Twin Cities-based Luther Automotive Group. Luther filed for a demolition permit this week, though the company has no immediate plans for the property.

10232914flamingobingo"I'm simply taking it down because I just don't want to carry the building through the winter. The roof is compromised," said Linda McGinty, Luther's director of real estate and development. "We just don't have a use for it. When we do develop this site, that was a building that we weren't planning on reusing."

The car dealer bought the 42-year-old building for $950,000 back on Jan. 17. Soon after, McGinty said, "We're working on possible plans. We're just happy to be in Rochester. We're excited to be part of the vibrancy."

Luther also owns Park Place Motors, Rochester's BMW dealership. Since Park Place is nearby, Luther theoretically could use the ex-bingo property to expand Park Place or possibly to introduce a new dealership into the market.

Flamingo Bingo, which raises money for the Rochester Senior Center, moved out of the 2828 building in April and into the Elks Lodge 1091 at 1652 U.S. 52 North in the Hillcrest Shopping Center.

It had operated in that building since 2007. Prior to the creation of Flamingo Bingo, it was the home of Circus World Bingo, which raised funds for Rochester's Catholic schools.

October 13, 2014

New biotech office launches in Rochester

This one seems to have a lot of local momentum behind it.

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The health care technology arm of a Sri Lanka-based company is officially launching its Rochester office on Tuesday morning.

Brandix i310132014brandixoffice is hosting a grand opening in the morning of its 2,000-square-foot office on the skyway level of Minnesota BioBusiness Center at 221 First Ave. S.W.

The software development firm has been working out of a spot in the Mayo Clinic Business Accelerator, since early summer. The business accelerator is located on the same floor of the Biobusiness Center as Brandix's new office.

Aaron Epps, Brandix's associate vice president of health care, said earlier this year that office would launch with six employees, though he expects it to grow to 12 by the end of the year

"We want to be part of the Destination Medical Center project," he said. "We're looking to expand quickly. We're a start-up, but we're a start-up with the backing of a large 10132014brandixskywaysigncompany."

Brandix's focus is to work with its local partner, Rochester-based Ambient Clinical Analytics. Ambient makes "real-time decision support tools" for doctors and nurses working in the ICU, operating room or emergency departments.

Mayo Clinic launched Ambient in 2013, and it named Al Berning as CEO. Berning is known in Rochester as a former IBMer, a co-founder of Pemstar and former CEO of Hardcore Computers/LiquidCool Solutions. Ambient's management team includes other local business leaders, like former long-time IBM executives Drew Flaada and Deb Sutherland.

Brandix has a three-year lease with the City of Rochester. It pays $20 per rentable foot
is In addition to the leasing the 2,000-square-feet, Brandix's lease promises "first right of refusal" for the other 2,000 square feet of adjacent vacant space to the west.

The city gave Brandix "a one-time fit-up allowance" of $10 per square foot, or $20,000, to build out its offices.

October 10, 2014

Kane and Johnson Architects merges with WSN

Kane and Johnson Architects, a small firm with a 63-year history in Rochester and Austin, is joining forces with a larger Minnesota company.

The five-person office merged Oct. 1 with Crookston-based Widseth Smith Nolting, an engineering and planning company. The Kane and Johnson team has joined WSN's Rochester office at 6301 Bandel Road N.W.

"I selected the firm I most respect and feel will best serve my clients," said David Kane about the "evolution" of the business that his father Warren Kane founded in 1951 in Austin. "They have a very similar culture, which makes this a comfortable change."FrmReadMail_Attachment-1

WSN has been in discussions with Kane and Johnson about merging, since March.

The two firms have competed for as well as worked together on many Minnesota and Iowa projects over the years. Recently, they've been working on what they describe as "their signature collaboration," the seven-story Bridge Plaza in Mankato. Work is expected to start on that mixed-use complex in 2015.

WSN has seven offices and 195 employees in Minnesota and North Dakota. It has always specialized in working in the smaller, non-metro communities since it was founded in 1975, said Joe Breiter, WSN's director of business developmenFrmReadMail_Attachment-3t. It has long working relationships with companies like Brainerd-based Mills Fleet Farm and Bremer Bank.

“WSN recognizes Rochester as a market that continues to experience significant growth. Bringing in KJA adds dimension to our experience and deepens our capacity to serve both firms’ existing and prospective clients,” stated WSN president Kevin Donnay in the announcement of the merger.

The Crookston firm has been interested in Rochester for some time. It merged with QED Engineering, a 20-year-old Rochester firm, in 2009. Since then, its Med City office has grown steadily to a staff of about 20 with the addition of Kane and Johnson.

FrmReadMail_Attachment-2"Rochester is the largest community where we have an office. We're seeing a lot growth here," said Brian Carlson, who joined WSN's local office earlier this year. He added that WSN has many "significant" projects in the pipeline for the area.

Kane, who will remain on with WSN, said this deal made excellent sense as the next step for his evolving business that has adapted many times over the years.

He has led the firm since he was 24. Kane started working there in 1974 and then was forced to lead the business a year later when his father suddenly died. He expanded the practice into Rochester in 1988 by acquiring Pieper Richmond Architects. In 1993, Kane sold the Austin practice in 1993 to his partner.

Over the years, Kane's small firm has lead the way in many areas. It was one of the first firms to begin offering asbestos removal in Minnesota and handled many large abatement projects throughout the Midwest. It was also an early innovator in the area of handicapped accessibility dating back to 1976, well before the Americans with Disabilities Act.

The firm has worked on such high profile projects, such as Olmsted National Banks' headquarters at 975 34th Ave. N.W., Timothy Chapel at Rochester's Autumn Ridge Church, the Steele County History Center and renovation of the Winona County Courthouse.

"Now with the additional resources of WSN, we'll be able to do even more," said Kane. "The financial reality is that it's tough to compete as a small, private practice."

October 07, 2014

OMC expanding its administration offices on Third Avenue

Olmsted Medical Center is expanding its footprint in a Third Avenue office building to house much of its administration staff.

Since 2013, OMC has been leasing 4,200 square feet of office space in the SEH-Yaggy building at 717 Third Ave. S.E., which is near its Southeast Clinic. About 20 senior administrators are based there, said Jeremy Salucka, OMC's communications coordinator.

SEH YaggyNow OMC has launched a construction project to expand its presence within that complex to about 15,000 square feet of office space.

"We're more than tripling the space we have there," said Salucka.

The plan is to eventually move administration staffers currently working in other leased offices into the Third Avenue building to consolidate many of OMC's non-clinical departments, he said. It will  also create much needed conference room space.

"This will help us reduce overhead and bring teams together under one roof," he said.

The exact number of workers that will join the 20 already in the building has not been determined yet. It could possibly double up to 40 people, according to rough ballpark estimate by Salucka.

The project is expected to be completed sometime in January.

CRW Architecture-Design Group moved its team of 10 people out of the building at the end of September. The firm had been based in there, since it spun off from what was previously known as Yaggy-Colby Associates in 2010.

CRW has a new office building plus four apartments under construction at 11th Avenue and Second St. N.W. It is hoped to be completed yet this fall.

September 23, 2014

Paint store, coffee/bagel shop may be coming to N.W. Rochester

If a few final details can be hammered out, a Sherwin-Williams paint store and combination Dunn Bros Coffee/Bruegger's Bagels shop could be coming for northwest Rochester.

TJL Development of St. Paul is planning to build a 4,000-square-foot building for Sherwin-Williams and a 2,500-square-foot building for the co-branded Dunn Bros/Bruegger's. They are slated for a parcel near Kwik Trip and Costco in the 108-acre commercial development at 19th Street and West Circle Drive. The development plans include other businesses, such as McDonald's, two hotels, an Aldi's grocery store and an Associated Bank branch.

This is not TJL's first foray into Rochester. It built a 4,000-square-foot paint store in 2013 for Sherwin-Williams in south Rochester, in front of the south ShopKo and Menards stores. That store replaced Sherwin-Williams' former south store, which was located in the defunct Rochester Market Square, which later became Rochester Public School's Alternative Learning Center.

If the northwest project moves ahead as planned, it is expected to replace Sherwin-Williams' current location at 19 Seventh St. N.E.

While TJL Principal Jim Lavalle says there are some aspects of the project that still need to be finalized, the company is moving ahead and has filed building plans with the City of Rochester.

"We're hopeful to start construction yet this fall," he said.

September 19, 2014

Rochester airport office complex sold for $1.6 million

The Affiliated Group has a new landlord following the $1.6 million sale of their leased office complex by the Rochester International Airport.

D5f521eaa63f4c98a62ea4f7564db20fWest Quad Capital LLC  bought the 12,000-square-foot building at 7381 Airport View Dr. S.W. from LNI Airport LLC on Aug. 29. Merl Groteboer of Re/Max Results handled the deal.

West Capital is owned by a Minneapolis family, who purchased the Rochester building as an investment. LNI Airport is one of the companies that long-time real estate investor Les Nelson of Clear Lake, Iowa uses to acquire properties.

The Affiliated Group, which moved its 100 employees into the office complex in July, has a long-term lease on the building. Affiliated is co-owned by Mark Neeb and Paul Skovbroten.

The 91-year-old debt collection company moved from the six-story building at 3055 41st St. N.W. that is part of what many call "The IBM White Buildings," though IBM no longer has any personnel in them.

The Rochester company moved to the 3055 building in 2006, when it sold its former downtown office at 316 First Ave. S.W. That downtown location was later demolished to make way for the 318 Commons student housing and University of Minnesota Rochester educational complex.

September 18, 2014

H3 Plaza's 1st tenant to move in during Dec.

The first tenant is expected to move into downtown Rochester's latest office building development in December, though the entire seven-story complex is not expected to be completed until the spring.

Titan Development and Investments, of Rochester, is building the $17 million building now called H3 Plaza at 300 S. Broadway. Construction began in March, when Titan demolished the former C.O. Brown building that previously stood on the site. H3 is a reference to Rochester's Historic Third Street, which is directly across Broadway from the building.

541ae78d4ef07.imageTitan will be the building's first tenant, with plans to fill the sixth floor with its offices in December. Titan, led by Andy and Gus Chafoulias, has about 25 employees working out of the Minnesota Biobusiness Center on First Avenue Southwest.

"We'll have it ready by then," said Joe Fort, project supervisor for Weis Builders, last week, as he stood inside the bare beams on the sixth floor and a crew of about 45 of his workers and local subcontractors worked around him. Fort expects to have the building enclosed and weather-tight before the full force of winter hits. That will allow them to work through the colder months to complete the first through fifth floors.

All but 6,000 square feet of the 43,000-square-foot building is already leased to local tenants, said Titan marketing and communications manager Shelia Thoma. That available space is divided between the second and third floors of the H3 Plaza.

The Nova Restaurant Group, which is led by Scott Foster and Pat Woodring, will fill the street level with an authentic Italian eatery as well as a rooftop patio bar and grill on the seventh floor. The rooftop patio will tower over Rochester's two nearby roof bars, Kathy's Pub and The Tap House.

Foster and Woodring have worked with Gus Chafoulias in the past, when they opened Chester's Kitchen & Bar in his Shops at University Square building in 2008 and Pescara in his DoubleTree by Hilton Hotel in 2009. They haven't named the H3 restaurants yet, though they do hope to open the Italian place in the spring.

Sept.2014H3rooftopSide-by side elevators will take people to the rooftop patio, even when the businesses in the building are closed. H3 Plaza will be connected to the adjacent City Centre complex and the Holiday Inn skyway.

Med City Dental and Dunlap & Seeger law firm, two businesses being displaced from the Associated Bank Building at 206 S. Broadway, have leased space in the H3 Plaza. The dental office, owned by Dr. Fred Carlson, will be located on the second floor, and the law firm, Rochester's largest, will occupy half of the third floor and all of the fourth and fifth floors.

Developer Bloom International Realty of Abu Dhabi plans to demolish the Associated Bank building in 2015 and possibly build a high-end hotel.

Andy Chafoulias originally envisioned developing the H3 Plaza site as a three-story restaurant and entertainment venue in 2013. That plan evolved as information about Mayo Clinic's Destination Medical Center initiative came out, along with the re-development plans for the Associated Bank building.

The Rochester City Council approved a special redevelopment tax-increment-financing district to raise $300,000 for Titan to cover the asbestos removal and demolition of the former C.O. Brown building. The council also prematurely labeled the H3 development as a DMC project.
 
Assistant City Administrator Gary Neumann said that since the DMC Corp. board of directors needs to approve any project before the start of construction, the H3 development doesn't qualify. However, the council's order states that any leftover money from the tax increment financing for the project could rollover to any nearby approved DMC projects, such as the anticipated update of Historic Third Street.

The pay-as-you-go TIF essentially reimburses the annual taxes the developers will pay, once the project is complete. The earliest Titan could see a payment was estimated at 2016.

Another, much larger, Titan development planned for the corner of South Broadway and East Center Street could possibly qualify as a DMC project. Spearheaded by Gus Chafoulias, the preliminary plan presented to the City Planning and Zoning Commission in March showed a 24-story, mixed-used complex featuring retail and restaurants, a 184-unit Embassy Suites Hotel on 11 floors, 84 apartments on six floors and underground parking. It was called Broadway at Center at that point.

Thoma said that project, which now is called The Legacy, is undergoing changes.

"A redesign with the hotel plans is the reason we are still in the design phase," she said.

September 11, 2014

Nu On U to close its doors to pursue new opportunities

After a four year run on North Broadway, a women's clothing resale store called Nu On U is preparing to close up shop as its owner takes on new projects.

48006_153372731356200_2669327_n"We're going to be sorry to say good-bye to Rochester. Business has gone well. It has been a terrific location," said Donna Gates, who has helped her daughter Kisa Bisek run the 1,600-square-foot storefront in the Dison Cleaners Center at 200 N. Broadway.

For Med City old timers, that's the spot that previously housed Wireless Toyz and Hobbit Travel back before that.

They have launched a "going out of business" sale. Gates says they plan on selling everything, including many of the store fixtures and mannequins.

Unlike when many stores close, this closure is not about slow sales. The resale shop was Bisek's brainchild and now she's ready for something new.

"My daughter is being offered other business opportunities, so it's time to shut this down," Gates said.

Nu On U was at the forefront of the surge in resale and consignment stores in Rochester, when it opened in August 2010. It purchases gently used girl's and women's clothing, shoes and accessories with the intent to resell them. By listening to its customers over the years, the store earned a loyal following.

When announcing the closing, Nu On U encouraged its regulars to patronize other similar Rochester shops like Kismet, Refashion, Danielle's Consignment Boutique and Size It Up.