School district completes purchase of UNFI building

Eden Prairie Schools has completed its purchase of a Valley View Road office building formerly owned by United Natural Foods, Inc. (UNFI), clearing the way for the relocation of the TASSEL Education Center to that location.

The 45-year-old, 165,000-square-foot office building at 11840 Valley View Road was purchased for $9.2 million. On June 24, the Eden Prairie School Board ratified the sale and issuance of $13.365 million worth of bonds – technically “certificates of participation” – to pay for the building and the renovations needed to accommodate the TASSEL program.

The low bid on the bonds was 5.33 percent, lower than projected and thus saving taxpayers about $2.3 million in principal and interest payments – compared to earlier estimates – over the payback period of a little more than 15 years, according to Ehlers and Associates, the district’s bond consultant.

No referendum was required for the purchase, but the Minnesota Department of Education provided review and comment, and the land-use change – from office to school use – needed approval from the City of Eden Prairie and the Metropolitan Council.

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TASSEL stands for Teaching All Students Skills for Employment & Life. It’s a post-high school choice program for students ages 18-22 who have special learning needs. They receive special education programming, skill development, and job support, usually in one-on-one scenarios.

The TASSEL Transition program was until recently housed in rented space in the west end of the Eden Prairie City Center, the city hall building on Mitchell Road. However, the city plans to turn that space into new and expanded quarters for its Police Department and the department’s vehicle fleet.

Eden Prairie Schools Superintendent Josh Swanson said TASSEL would temporarily use the first floor of the newly acquired UNFI office building, starting next school year, until its second floor can be renovated for permanent use.

Plans are also being made to use the building for an alternative learning center (ALC), providing services currently outsourced to Intermediate District 287 and others. Swanson said he believes Eden Prairie Schools can offer high-quality ALC programming at a competitive cost, keeping those students in the district instead of requiring them to travel elsewhere for services.

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Additional uses for the building are possible and will be identified during future engagement with the community, said the superintendent.

For the short term, the district will probably lease the third floor to a private-use tenant or tenants, Swanson added.

The district is purchasing the building at a time when a lot of office space is on the market due to ongoing work-at-home trends boosted by the pandemic.

Swanson was asked how he felt about the purchase price versus the value the district gets in return.

“Amazing,” he responded. “I’m seeing (other districts) spend, I don’t know if it’s quite the 20s (in millions of dollars), but close, for half the space we’re getting. So there’s an incredible value we’re able to strike here.

“It’s a pretty amazing value proposition, and opens doors for the future,” he added. “This puts us in a great position as we think about academic design experiences … as we think about our Capstone work, our Pathways work.”

The school district has been looking at the purchase for nearly a year.

UNFI announced in April 2023 that, with many of its employees working remotely, it would put its 107-acre Eden Prairie business campus up for sale and relocate staff to a smaller regional office elsewhere in the Twin Cities.

The one-building Eden Prairie campus was established in the 1970s as the national headquarters for Supervalu, Inc., a Fortune 500 company that Providence, Rhode Island-based UNFI purchased in 2018. UNFI made the campus its regional headquarters.

Eden Prairie Schools is purchasing just a portion of the UNFI property. CSM Corp., a Minneapolis development company, has floated a proposal to buy the undeveloped, westernmost 46 acres, much of which borders Interstate Highway 494, and build a hotel on the property. CSM has not yet formally applied for city approval of the project.