Developer Ryan Cos. finalized its purchase of the 179-acre Thomson Reuters headquarters in Eagan, advancing plans to transform the former corporate campus into an industrial hub and housing.
Ryan Cos. to transform Eagan’s former Thomson Reuters compound to industrial campus, housing
The Minneapolis-based developer finalized its purchase of the 179-acre site Friday after initially agreeing to the deal earlier this year.
The Minnesota Star Tribune
December 10, 2024 at 12:31PM
The Minneapolis-based developer plans to tear down the site’s existing six-story office building and data centers to build a multistory industrial building with up to 3.6 million square feet of space. The property will be for warehouse and logistics use, with outdoor storage for trucks, trailers and vans, according to city documents, which refer to the development as “Project Nova.”
Peter Fitzgerald, vice president of real estate development for Ryan, said he could not disclose the name of the anchor tenant associated with Project Nova. He also declined to say how much the site cost.
“We’re finding more and more that the advanced technology and logistics companies are producing the most jobs,” Fitzgerald said. “We’re really excited about re-envisioning this former office campus to more industrial and advanced technology.”
Approximately 40 acres on the southern portion of the campus are slated to house smaller industrial buildings, though Fitzgerald said Ryan considers that area “a blank canvas” as it continues searching for businesses interested in the site.
The City Council last week approved plans for Miami-based Lennar to build 104 townhomes on 22 acres in the northeastern corner of the development. Ryan’s plans for the site also include a small number of single-family homes, 1.1 miles of new public walking trails and 10 acres of new parkland adjacent to Wescott Station Park.
“Ryan Companies’ redevelopment plan solidifies the historic balance this site has always had in our community,” Mayor Mike Maguire said in a statement. “The inclusion of light industrial components ensures it will remain a vital part of Eagan’s property tax base, while thoughtfully preserving the natural features and character that make the surrounding neighborhoods so desirable.”
Thomson Reuters held on to 83 acres of the campus that contains its print manufacturing facility. The Canadian business services and media conglomerate started searching for a new headquarters in late 2021, realizing it was using only a fraction of its more than 1 million square feet of office space.
The company officially downsized last year, subleasing new office space in the former Prime Therapeutics building, also in Eagan.
As businesses across the country reconsider their office needs in the wake of the COVID-19 pandemic and rise of remote and hybrid work, suburban office parks will likely continue to be targets for mixed-use redevelopments, said John McCarthy, a broker on the deal for Colliers. Colliers dubbed the sale one of the largest this year in the Twin Cities commercial real estate market.
“We are talking to other large corporate users that are going through the same assignment,” McCarthy said. “I think this is going to continue for a while. These corporate campuses and real estate are a very expensive piece of an organization’s operation, so they’re being looked at across the board.”
Rents continue to reflect the shift: Asking rates for industrial properties in the Twin Cities metro jumped 30% from last year as new construction has tapered off, according to Colliers’ third-quarter report.
The Thomson Reuters campus, along Dodd Road south of the I-494 and I-35E interchange, was especially prime because of its proximity to the airport, major roadways and both Twin Cities’ downtowns. McCarthy said the site drew a lot of interest, receiving more than 10 offers.
“It’s extremely rare to have a piece of property over 100 acres that’s available within minutes of interstates, freeways and an airport,” he said. “In Minnesota, we don’t have a lot of in-migration of million-square-foot tenants. So this is just a wonderful outcome for the local area because of what’s going to be eventually built.”
Fitzgerald said construction on the site will start right away, with the goal of moving tenants onto the campus in the next two to three years. Ryan does not plan to seek public assistance from the city for the project, he added.
The developer is in the midst of several other major suburban projects, including a 100-acre Minnesota Science and Technology Center in Maple Grove. Earlier this year, the company also came to terms with the Ramsey County Board to buy 40 acres at the massive Twin Cities Army Ammunition Plant site in Arden Hills.
“I truly believe the unique thing about this site is there’s a lot of green space and public amenity,” Fitzgerald said of the Eagan campus. “Developers usually want to maximize developable area. In this case, we tried to find that right balance of providing much-needed homes, preserving a lot of green space and then also looking for great businesses to come into Eagan.”
Eva Herscowitz contributed to this story.
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