Last Updated: June 19, 2012 11:22pm ET

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The office will be across from the HQ and next to Nicollet Residences.

MINNEAPOLIS-Xcel Energy has hired Opus Development Corp. to build a new office building to hold a consolidation of spread-out employees. The energy firm has agreed to a long-term lease on the proposed 212,000-square-foot building, to be built at the southeast corner of Fourth Street and the Nicollet Mall.

The company has about 1,500 employees at its headquarters at 414 Nicollet. The new office will be built across from the HQ over a private parking ramp. Ben Fowke, chairman, president and CEO of Xcel, said in a statement that the new building will improve operating efficiency. Leasing space in this new building is a prudent, cost-effective way to consolidate our operations, meet our future space requirements and create a great environment for our employees, he said.

Opus hasnt released the cost of the build-to-suit project. The company is about to start building the 33-story Nicollet Residences apartment building next door, over the site of the former Powers Department Store. A source tells GlobeSt.com that the entire one-block project is expected to cost Opus more than $160 million to build. The company has already said the apartment tower will cost about $108 million.

Dave Menke, SVP and general manager with Opus, tells GlobeSt.com that the company will begin the new office construction in 2014 and will finish in 2016, to align with current Xcel lease expirations at smaller locations. The new building will be owned by Opus Group. Nelson Tietz & Hoye represented Xcel in the lease deal.

Menke says the Minneapolis area isnt seeing much new office development besides build-to-suit for efficiency. Most of the Minneapolis markets still need substantial fundamental improvements before we start seeing speculative development, he said. The Minneapolis office market is at about 17.5% vacant.

Categories: Midwest, Office, Development, Leasing, Minneapolis

See the rest here:
Xcel Signs for New Nine-Story BTS Office

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