Sherman Associates in partnership with Polaris Properties Group, Taconic Capital Advisors, and Wilson Street Hotel Group are completing a $250 million master-planned redevelopment of Northstar Center in Minneapolis’ central business district.
The parties will complete a historic conversion of the former office space, hotel, and parking garage and deliver a coordinated ecosystem of uses to downtown Minneapolis including apartment homes, a repositioned office tower and parking garage, renovated hotel, public-facing meetings and events facility, and a variety of new restaurants and retail concepts.
Northstar Center opened in 1963 as a mixed-use development, an innovative concept at the time, with its developers promoting it as a “city-within-a-city.” Northstar Center was also the birthplace of the Minneapolis skyway system which has grown to comprise 9.5 miles of pathways, connecting 80 city blocks.
Sherman will redevelop the Northstar Center East building, a 13-story office tower, to deliver 216 apartment homes called Groove Lofts. The building’s unique design allows for over 10,000 square feet of amenity space including a media lounge, arcade and virtual reality rooms as well as a maker space, coworking lounge, expansive fitness center, and rooftop club room. Each unit will be equipped with smart home technology as well as high-end appliances and solid surface countertops. The average unit sizes will exceed 900 SF.
Once all phases are complete, the Northstar Center complex will exemplify a large scale reimaging of a distressed office building that has been repositioned to its highest and best use. With housing, office, hotel, and restaurants/retail, it will serve downtown Minneapolis as a destination to live, work, play, and stay.
A CATALYST FOR FURTHER TRANSFORMATION
Northstar Center, situated in the vibrant heart of downtown Minneapolis, was developed in the 1960s as the first mixed-use development in Minneapolis that provided office, retail, entertainment and hotel space. Over the years, however, the building faced challenges in maintaining occupancy due to its outdated infrastructure and design. Recognizing the evolving demands of the downtown area, the opportunity arose to redevelop Northstar Center East into multifamily housing, addressing the growing need for modern living in the heart of the city.
The vision for the redevelopment project was not just to revitalize the building, but to catalyze a broader transformation within downtown Minneapolis. The goal was to reimagine Northstar Center East as Groove Lofts at Northstar Center, a multifamily development that would not only enhance the urban fabric but also contribute to downtown’s economic, social, cultural, and environmental resurgence. The project aims to create a thriving community where residents can live, work, play, and stay, fostering a sense of connectedness and inclusivity.
By transforming former office space into multifamily housing in a historic conversion, the project plays a pivotal role in revitalizing the downtown core. It aims to shift the focus from a traditional financial district turned central business district, to a mixed-use, dynamic urban environment.
It pioneers the concept that downtowns across the country can be more integrated with uses to serve all ages and all incomes in a reimagined downtown community.
As the first post-pandemic office to housing conversion in the downtown core, Groove Lofts at Northstar Center serves as a catalyst for further investment and development in downtown Minneapolis. It has influenced adjacent office buildings, driving momentum for higher leasing rates and encouraging a return to office in the core.
The redevelopment will significantly increase the assessed value of the property, leading to a stabilization and growth of the tax base in the long term and will contribute to increased revenue for the city.
The redevelopment of Northstar Center East into Groove Lofts at Northstar Center represents more than just a commercial real estate development; it symbolizes a transformative vision for downtown Minneapolis.
By embracing principles of integration, inclusivity, and equity, the project has set a precedent for future developments in the Twin Cities and nationwide. It serves the missing middle with affordable housing that allows for the full spectrum of income levels to live downtown.
Through strategic partnerships, innovative financing mechanisms, and a commitment to community engagement, Groove Lofts at Northstar Center has emerged as a beacon of urban renewal, driving positive change and shaping the future of downtowns.
