Services Provided:

Architecture, Brokerage, Construction, Facility Services, Property Management

Industries:

Office

Location

Eden Prairie, MN

Size

239,120 SF

Brokers:

Mike Gelfman, Kevin O'Neill

Project Summary

TOBY-AWARD-WINNING BUILDING

Challenge

Colliers and Welsh took over office property management of One Southwest Crossing, a distressed Class A multi-tenant office building comprised of 239,119-square-feet on eight acres in Eden Prairie, Minnesota. Although the building was fully leased, the current owner, a TIC entity with 36 owners, was not servicing their debt.

CIGNA Behavioral Health, Inc., the largest tenant in the building occupying 75% of the space, had a lease expiring at the end of 2012. The building’s loan was coming due and the Welsh and Colliers team needed to move quickly with a strategy and solution. The team was further challenged with incomplete files and minimal paperwork from the prior office property management management company.

Strategy

Transform the property with successful asset and office property management in the form of debt restructuring, expense reduction and lease negotiations. Stabilize the asset and add long-term value for both the owners and tenants.

Office Property Management and Other Services

The team studied the asset operationally, pieced together the history and challenges, and jumped in to implement cost-saving solutions. Recognizing that tenant, CIGNA, was the key to stabilizing the value of the building, the team worked diligently to improve the asset’s appeal and to secure a renewal. The loan-to-value ratio on the property was upside down, however, Welsh Capital successfully negotiated a loan extension for the property. Welsh Construction and Genesis Architecture were tapped to design and build a $3 million parking facility to improve the building’s functionality and to meet the needs of the increasing density of CIGNA employees.

Results

CIGNA signed a long-term lease to renew their existing 177,058-square-foot space and to expand into a total of 211,105 square feet.
The Building Owners and Managers Association (BOMA) of Greater Minneapolis awarded Colliers and Welsh with the Outstanding Building of the Year (TOBY) Award for the management of One Southwest Crossing.

Every division of Welsh and Colliers was involved in this project. Our vertically integrated platform and ability to collaborate with all team members under one roof contributed to the success in restoring the value of this prominent asset.

Awards

One Southwest Crossing has won The Outstanding Building of the Year (TOBY) Award from the Building Owners and Managers Association (BOMA) for multiple years. This is due in part to the entire Welsh and Colliers team, working together to provide first-class service to the building.