Minneapolis — The Telos Group and 601W Cos. have received $250 million in financing for The Dayton’s Project, a historic redevelopment of 700 Nicollet Mall in downtown Minneapolis. The 12-story property was previously occupied by Dayton’s department store, which rebranded as Macy’s in 2004 before closing its doors in 2017.
The 1.2 million-square-foot project will include office space, 200,000 square feet of dining and retail, and a 45,000-square-foot food hall and market. Office amenities will include a rooftop terrace with views of the Minneapolis skyline, private lounge and library spaces, and a 10,000-square-foot, state-of-the-art health club.
Over the past few months, the development has been at the center of legal drama between developer 601W Cos. and Monarch Alternative Capital, which holds the mezzanine loan on the project, according to reports by Twin Cities Business (TCB).
601W sued Monarch in June of this year, with Monarch countering through the advertisement of a foreclosure sale of 601W’s equity interests in the property under technical default for not meeting leasing obligations, according to TCB. Hennepin County District Judge Susan Burke granted 601W a temporary injunction to secure new financing, thereby stopping the foreclosure sale that had been set for Aug. 23.
Jaime Fink, Jeffrey Bramson, Bruce Miller and Keith Largay of JLL represented the borrowers in securing a three-year, floating-rate loan for the project through a joint venture between Winthrop Strategic Real Estate Fund and funds managed by affiliates of Fortress Investment Group.
Details for the use of the funds were undisclosed, but the project is scheduled to open this fall, according to a statement from Brian Whiting, president of The Telos Group, to TCB.
The development and leasing team for The Dayton’s Project includes Gensler Minneapolis, Transwestern, Mid-America Real Estate, Hightower Initiative, Gardner Builders, PVN, MBJ and MEPC.
601W Cos. is a privately held real estate company with a focus on acquisitions, development and management. The firm’s portfolio spans 45 million square feet with a collective value of $12 billion.
The Telos Group is a Chicago-based real estate services firm specializing in the re-imagining, marketing and leasing of commercial office properties. The company represents a portfolio of over 23 million square feet.