By Burl Gilyard
Dolan Media Newswires
Minneapolis — An industry newsletter reports that Chicago-based Zeller Realty Group is interested in buying what remains of Minnetonka-based Opus Northwest.
The Hoboken, N.J.-based Real Estate Alert, a weekly print publication covering the commercial real estate industry, reported on the prospective deal last week.
According to Real Estate Alert, the portfolio would trade for “significantly less than the properties’ $300 million of existing debt.” The portfolio included 14 commercial and multifamily properties and several undeveloped parcels, according to the report.
Representatives of Opus and Zeller have said little about the report of a potential deal.
“A preliminary bidder has been selected and identified, but until it is approved we’re not going to comment beyond that,” said Winston Hewett, spokeswoman for Minnetonka-based Opus Holding. Hewett said that the deal is subject to lender approval.
“There is due diligence that needs to take place. It could be anywhere from 30 to 90 days. We really don’t know,” Hewett said.
James Gearen, who heads the local office of Zeller Realty Group, declined to comment.
Real Estate Alert reported: “The deal is being driven by Opus’ lenders, including U.S. Bank.”
Steve Dale, a spokesman for Minneapolis-based U.S. Bancorp, said that the bank typically doesn’t comment about its clients.
John Solberg, who remains president and CEO of Opus Northwest, could not be reached for comment.
Zeller is firmly anchored in the Midwest, with offices in Minneapolis and Indianapolis. Zeller’s properties in Wisconsin include Aurora Medical Center buildings in Neenah, Hartford, and Two Rivers; the Deer Creek Corporate Center in Brookfield; and Riverwood Corporate Center office buildings in Pewaukee, according to Zeller’s website.
Last week, Opus Holding announced the creation of a new company, Opus Design Build. Opus Design Build has bought out a collection of Opus Northwest’s third-party construction projects that are in the pipeline.
Opus Holding has two divisions: its development arm, Opus North, and Opus Design Build, which will focus on third-party, build-to-suit construction projects.
Ultimately, the Opus Northwest name will vanish from the local development landscape.
Gone is the model of having regional operating companies. During 2009, Opus East, Opus South and Opus West filed for bankruptcy protection.
The remaining, reconstituted company has offices in eight cities: Minnetonka, Milwaukee, Chicago, Denver, Kansas City, St. Louis, Indianapolis and Columbus, Ohio.
Former Opus Northwest executive Tom Shaver was tapped as president and CEO of Opus North in February. Opus North is still based in Rosemont, Ill., a Chicago suburb.
“I spend two to three days a week in Chicago and have offices here in Minneapolis as well,” Shaver said.
Shaver said Opus North and Opus Design Build will essentially function as one company.
“They’re really seamless. We’ll work collaboratively with one another. A majority of the work that we’re doing on both sides is third-party build-to-suit,” Shaver said.
Opus North still holds about 200 acres of land for development; the bulk of those holdings are zoned industrial. But Shaver sees no new speculative development on the horizon.
In March, Opus North broke ground in Milwaukee on the $35 million Discovery Learning Complex for Marquette University.
“There’s some good things happening around the system,” Shaver said.