Felton Buys MN Rand Tower

A joint venture between Alex. Brown Realty, Inc. and Hempel has sold the historic Rand Tower in downtown Minneapolis to Felton Properties Inc., a Portland, Oregon based real estate investment firm. While terms of the deal and a sale price were not disclosed, archived reports show that the joint venture originally acquired the asset in 2008 for $10.2 million. According to a Minneapolis / St. Paul Business Journal report, Hempel spent more than $2.5 million to upgrade the building with new elevators, a fitness center and a conference room for tenants that include Ink, Shepherd Data Services Inc., Univision, Julie Snow Architects and ESP IT. Broker Ryan Watts, in the Bloomington-office of CBRE Group, marketed the building for sale.

"This will be the first of several deals in the Minneapolis metro market," said Felton Properties CEO Matt Felton. We've generally gravitated to the coastal markets, but there's so much institutional money ­chasing real estate in those markets."

The 194,316 square foot office property was originally developed in 1929 by Rufus Rand, with construction beginning at the height of the roaring twenties and the machine age. The art-deco style is distinctive and brings tremendous character to the space. The smaller floor plates also allow for abundant windows meaning more natural light and greater skyline views. Felton said he plans to make improvements that will help make the building more appealing for a range of businesses that need 300 to 5,500 square feet of space. "We won't do a rehab or a redo, but we want to significantly upgrade the vacant space there to differentiate it from much of the other generic office space that's out there," he said.

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