CBRE Capital Markets’ Debt & Structured Finance team has arranged $3.85 million in permanent financing for the building at 2505 University Avenue West in St. Paul, Minnesota. The property, also known as “The Mack Building” because of the eponymous signage from former occupant Mack Trucking, is now home to Handi Medical Supply through February 2025.
Ben Bastian and Jessica Burke of CBRE’s Minneapolis office represented the borrower, Midway 280 Business Commons, LLC; an entity related to The Commers Company, a longtime St. Paul-based private commercial real estate owner and operator.
The previously multi-tenant Mack Building has been home to Handi Medical Supply, Inc. since 1992. With a recent long-term lease signed earlier this year, the medical supplier had the opportunity to expand into the entire 57,078 square feet, up from 33,500 square feet.
The property was built in 1929 and originally occupied and owned by Mack Trucking for service and sales of its trucks. The building benefits from an excellent location between both the Minneapolis CBD and the St. Paul CBD with easy access to Interstate 94 and Highway 280. The current ownership of 25 years has maintained the property to the highest standards and was previously honored with a design award for its adaptive reuse and preservation of the building’s original, elegant façade.
“Ownership recently negotiated a long-term lease extension with Handi Medical to take over the entire building. This was the opportune time to put in place 10-year fixed rate financing with a new lending relationship,” said Bastian.
The building’s rents are currently below market and the lease reflects rent increases to bring it up to market over the next two years. The loan was structured with a holdback for additional funds to be released upon a revaluation at that time to maximize proceeds now and in the future for the Borrower.
