New Brighton Commons

100 Fifth Ave, New Brighton, MN 55112
Strategy: Current Yield
Status: Current
Purchase Price: $5,250,000
Acquisition Date: 3/26/2010
SqFt: 57,782
Off-Market - Direct From Owner, Repeat Seller

New Brighton Commons is a multi-tenant office/warehouse building in New Brighton, Minnesota. The property is just south of the state’s second-busiest interchange, I-35W/I-694.

Our firm transacted with this owner on a previous deal and contacted them as they were signing the final lease. We put the property under contract at just over a 9.0% cap rate on a property with two very long leases with high-quality tenants (USPS & Pepperl+Fuchs Comtrol).

During our due diligence review, both leases required amendments to fix errors we discovered. Our firm negotiated and obtained 4-year payment of rent guaranty from the seller, turning a tough, off-market deal into a clean transaction.

We declined two unsolicited offers—one of them in excess of $7.5M, which would have represented 43% appreciation since the acquisition. For 10+ years New Brighton Commons has maintained 100% occupancy and distributed cash quarterly to ownership, and we believe it will continue to be a strong performer for us, so we opted to hold the asset.