Capella Tower in Minneapolis sold for $255 million

Capella Tower and the adjoining Star Tribune Building in downtown Minneapolis were sold for $255 million, according to an announcement Friday.

The sale is one of the highest prices for a Twin Cities office building in recent years.

San Francisco-based Shorenstein Properties purchased the skyscraper from ASB Real Estate Investments, with headquarters in Washington, D.C.

The 58-story Capella Tower, the second-tallest building in the city after the IDS Center, and the 20-story Star Tribune Building have about 1.4 million square feet of space, meaning the sale price was about $182 per square foot.

The complex on 2nd Avenue between 6th and 7th streets is the home of Capella Education Co., the Winthrop & Weinstine law firm, Baker Tilly accounting firm and the Star Tribune, among other businesses. WeWork recently opened its first Minneapolis co-working space in the taller tower.

"After successfully owning the asset for 11 years, Capella had become a less strategic investment from a portfolio diversification standpoint, and the current market dynamics presented a good opportunity to sell and redeploy capital," Larry Braithwaite, senior vice president and portfolio manager of ASB's Allegiance Fund, said in a statement.

ASB bought Capella Tower in 2006 for $245 million.

The deal comes more than a month after Fifty South Sixth, a 29-story building in downtown Minneapolis that chiefly houses law firms, sold for $258.5 million. Shorenstein isn't new to the Twin Cities area. In 2016, the firm sold the City Center office and retail complex, which is also in downtown Minneapolis, for $315 million to HNA Holding Group Co., Ltd., a subsidiary of Chinese conglomerate HNA Group. Shorenstein also owns the Washington Square office campus.

Nicole Norfleet • 612-673-4495