Office-to-residential conversion project opens in downtown Minneapolis

Delivering 216 apartment homes in former Northstar Center East

{MINNEAPOLIS, MINN, December 19, 2024}—A one-hundred-year-old building that was vacant, outdated office space just three years ago, has been converted into 216 apartment homes now called Groove Lofts at Northstar Center. A grand opening event announced this milestone with the State of Minnesota, Hennepin County, City of Minneapolis, Sherman Associates and development partners.

“While the decline of commercial property values is a problem for the city, it is one that we can solve with creative and practical solutions that bring these buildings back to life,” said Senator Ann Rest, District 43. “Groove Lofts is a prime example of an investment that will get people living, working, and playing in downtown Minneapolis. Our downtown center serves as the economic lifeblood of not just Minneapolis, but our entire state.”

Groove Lofts, developed by Sherman, provides mixed-income living downtown within the master-planned redevelopment of Northstar Center. The phased redevelopment of the block involves multiple developers and uses including hospitality-focused office space, meetings and events facility, and restaurants and retail. Hotel Indigo and Star Bar & Bistro were the first phase of the redevelopment, completed in 2023.

Groove Lofts provides housing for middle-income residents of the downtown community. Its core location is ideal for downtown employees who are integral to the community, yet who often cannot afford to live in the communities they serve.

The apartment homes have unique floor plans since the building was constructed as office space, which lends itself to longer layouts. Groove Lofts has over 40 different floor plans for renters to choose from.



The building’s unique design also allows for over 10,000 square feet of amenity space in the center of the building which includes a media lounge, arcade with karaoke and virtual reality rooms, maker’s space, coworking lounge, fitness center, a rooftop club room with a rooftop deck and ample storage space.

“Groove Lofts at Northstar Center exemplifies what’s possible when federal, state, and local policies align to prioritize investment and preservation, that will serve generations to come,” said Chris Sherman, President at Sherman Associates. “These efforts drive local economies, advance sustainable development, and unlock new potential for urban centers. While office-to-residential conversions are complex, the tools and support for projects like this are critical for transforming downtown Minneapolis—and, on a larger scale, downtowns across the country.”

Northstar Center was the birthplace of the Minneapolis skyway system and residents at Groove Lofts have the convenience of a four-way skyway connection with direct access to Capella Tower, Rand Tower, Wells Fargo Center, and Baker Center.

Kraus-Anderson was the general contractor for Groove Lofts and RSP Architects was the architect for the entire Northstar Center redevelopment.

“Most of the project cost went toward labor, with over 180 trades people on site during peak activity, heavily supporting the local economy,” said Peter Diessner, CEO at Kraus-Anderson. “Over 75% of the materials from interior demolition were recycled. Groove Lofts is a model for adaptive reuse and economic redevelopment, and our teams have delivered a very innovative, high-caliber and affordable living environment in the heart of downtown. It’s a win-win-win all around.”

Groove Lofts joins Sherman’s massive development portfolio of over 1,100 units in downtown Minneapolis. Sherman is nearing completion of another office-to-residential conversion at Landmark Tower in St. Paul.

Visit the website to learn more about Groove Lofts.
Backgrounder:

Sherman Associates

Sherman Associates is a growing commercial real estate development and management firm based in Minneapolis with properties throughout the Midwest, Colorado, and Florida. Sherman develops, owns, and operates its assets with a long-term vision to build neighborhoods, enrich communities, and empower people.

Sherman Associates has developed over 13,000 multifamily units and currently owns and manages over 7,000 multifamily rental units (affordable and market-rate). Sherman also owns and manages over 720,000 square feet of commercial space, five hotels, four Starbucks, three restaurants, and two solar gardens. Stay connected with Sherman on LinkedIn, Instagram, X, and Facebook.