The midcentury office tower on Wabasha Street in downtown St. Paul that once trained Ecolab staff is getting a very different second act. Rebranded as The Stella, the 16-story building is in the middle of an office-to-apartment conversion that developers say will welcome its first residents later this summer. The project is set to deliver a mix of studios, one- to three-bedroom apartments and penthouses, plus ground-floor retail and shared amenity space, adding a sizable batch of new housing in the city’s core.
The project at a glance
According to PACE Loan Group, the conversion at 386 Wabasha Street North will create about 174 multifamily homes and includes a $15.8 million C-PACE loan for energy-related upgrades. PACE notes that the C-PACE financing is one piece of a roughly $68 million capital stack that also includes about $18 million in federal and state historic tax credits to make the numbers work.
Developer and design
Kaeding Development Group has reworked the building’s office floors into residential layouts and stacked shared amenities to appeal to downtown renters. Plans call for coworking rooms, a fitness and yoga studio, a coffee lounge and an outdoor deck on the top level. The developer’s project page and commercial listings identify the building as Stella and show the 174-unit plan along with ground-floor retail. See Kaeding Development Group and the property record on LoopNet for floor-plan and amenity details.
Money and the hard work behind it
Getting the conversion financed meant stitching together several specialized tools and reworking ownership and debt structures more than once. “It really wasn’t anything anymore. It was just a shell of a building,” Kaeding told the Minneapolis / St. Paul Business Journal, which also reports that Sunrise Banks provided the senior construction loan while Bridgewater Bank supplied a bridge loan to monetize the historic tax credits. Developers and lenders involved say that a mix of C-PACE, tax credits, bridge financing and bank debt is increasingly what it takes to make office-to-residential conversions pencil out.
What it signals for downtown
Industry lenders have pointed to the Stella deal as an example of how energy-focused financing can plug gaps that conventional banks sometimes avoid on complicated conversions. PACE Loan Group has highlighted the transaction as a template for unlocking upgrades such as windows, HVAC, plumbing and lighting that are essential when you turn older office floors into homes.
Prospective renters and nearby residents can find leasing details on the developer’s project page and in current listings for 386 Wabasha Street North. The Stella is likely to be watched closely as an early, high-profile test of how much housing can be woven into a changing downtown skyline. For project background and financing specifics, see the developer and lender pages cited above.
