When the Right Space Doesn't Exist — You Build It
The US Department of Agriculture (USDA) needed a building in Faribault, MN to house three government agencies with specific requirements. The search was extensive. The right lease option simply didn't exist in the market.
Rather than walk away, we stepped in. CEG bought the property — a vacant former charter school — and repositioned it from the ground up to create exactly what the client needed. The result: 10,000 SF of brand new, purpose-built government office space, a stabilized multi-tenant asset, and a fourfold increase in property value.
"When the right building was not available to lease, we bought one to reposition."
The Transformation
The Execution — Step by Step
The USDA's requirements were specific — three government agencies, particular spatial needs, and a Faribault location. Lease options were slim. Rather than let the parameters kill the deal, we kept our focus on what the client needed and asked a different question: could we buy something and reposition it? With years of experience reading buildings, we knew the answer was yes.
Once we found and purchased the former charter school, we assembled a team of architects and got to work. Walls moved. Doors relocated. HVAC redesigned. The empty building was converted into an efficient, purpose-built government office — 10,000 SF built to the USDA's exact specifications. Additional areas of the building were designated for other tenants from day one, setting the stage for immediate revenue diversification.
The original contract negotiations had taken so long that the USDA's prior lease expired mid-process — they were operating without an office. Speed was not optional. We called on our network, brought in a Service-Disabled Veteran-Owned Small Business (SDVOSB) for construction, and executed on schedule and on budget. The right team, the right relationships, and no wasted time.
The outside told the wrong story. Dated beige vinyl siding, mismatched colors, deteriorating fascia — it looked neglected. We stripped the old siding, installed hardy board throughout, added new lighting, replaced the roof and gutters, and painted the lower block. What had been forgotten and almost abandoned became a clean, professional, appealing presence on the street.
The site conditions were rough — a small tree growing out of an air conditioner, a crumbling lumber storage wall, piles of debris, overgrown landscaping. We hauled away dumpster after dumpster, installed all-new HVAC, regraded and restriped the parking, poured new curbs and sidewalks connecting front and back lots, and enclosed the property with an electric-gated fence. The transformation was total.
A Vacant Building Becomes a Thriving Asset
The USDA moved into 10,000 SF of brand new, purpose-built office space. Three government agencies, housed exactly as specified. The city was happy. Neighboring property owners were happy. And Black Seven added another strong asset to the portfolio — this one with a fourfold increase in value from acquisition to stabilized delivery.
This deal is a case study in what value-add really means: not just cosmetic improvements, but vision, execution, and the willingness to buy a problem and solve it completely.
"We took a vacant charter school and turned it into a thriving building that not only improved look and function but made the city and neighboring property owners happy."