Sherman Buys Downtown East Site for Apartments
By: Matt M. Johnson February 22, 2018 4:18 pm
One year after entering a development agreement with the city of Minneapolis, Sherman Associates is set to start building its latest Downtown East apartment project.
Minneapolis-based Sherman paid $3.25 million in cash for a 0.83-acre surface parking lot at 205 Park Ave. S., according to a certificate of real estate value made public Wednesday.
Sherman plans to build a 122-unit, mixed-income apartment building on the site along with four for-sale townhomes and 8,000 square feet of commercial space.
The property is in the northeast quadrant of Park Avenue South and Washington Avenue South, a short distance from the U.S. Bank Stadium.
Sherman completes the purchase in the one-year time frame allowed in the development agreement with the city. The deadline was the closing date of the transaction, Feb. 20.
“It was very important to us to hit the date that was in the agreement,” said Shane LaFave, the project manager for the 205 Park project, in an interview.
It took a year to finish the deal because Sherman was getting project approvals from the city and lining up bank financing, LaFave said. It also took a year to secure cleanup funds for the site, which was once part of a railroad yard. The Metropolitan Council awarded $558,500, which will be used to target petroleum contamination, LaFave said.
Sherman plans to start construction of the $44 million project in March, he said. The building will open in July 2019. The general contractor is Hopkins-based Frana Cos. and the project architect is ESG of Minneapolis.
Twenty percent of the apartments at 205 Park will be rented to tenants earning 60 percent or less of the area median income of $90,400. The remainder will be market-rate units, LaFave said.
The majority of the commercial space has already been leased to Kim Bartmann, who plans a sit-down eatery and a coffee shop and bakery. Bartmann operates several Minneapolis restaurants, including Barbette, Red Stag Supperclub, and Pat’s Tap.
Sherman is one of the busiest developers in Downtown East. In addition to 205 Park, it is remodeling the Thresher Square building at 724 Washington Ave. S. into a 183-room hotel, and constructing the 180-unit East End apartments at 721 Washington Ave. S.
Sherman’s completed Downtown East projects include the Encore apartments at 935 Second St. S., the Aloft hotel at 900 Washington Ave. S., and the Zenith condominiums at 901 Second St. S.