On a hot day in June, construction crews are busy making the Wyman Building on First Avenue North, built in 1901, fit for habitation by 21st-century businesses. There’s plenty to do. The building’s attributes are, shall we say, distinctive. The men’s restroom on one of the lower floors is lined with the type of wood paneling you’d find in a basement rec room circa 1967. The toilet seats have a curious design—two semicircular pieces of plastic held over the bowl by steel rods—not seen since the early postwar years. A few floors up, there’s a central stairway with a rusty railing so low you wonder why the installers bothered.
Ken Sherman, owner of the Sherman Group, which owns the Wyman, casts an intent eye on the work of the sheetrock and HVAC crews. “These old buildings are tough,” says Sherman, an opinionated New York native who’s been in the commercial real estate business since 1987. “That’s why I think with some of these guys who try to do these condos, they are clueless. They have no idea what it’s going to cost.”
Sherman knows. The Sherman Group either owns, co-owns, or manages several buildings throughout the Warehouse District, including the Colwell Building, a National Register of Historic Places structure on Third Avenue North, and the Lumber Exchange on Hennepin Avenue, where Sherman now has his own headquarters. All are office buildings; he shies away from condos, claiming he doesn’t get their appeal: “I bought a home in Minnetonka—really nice home, big home, with land. Not a ton of land, but you know, land. I look out there, and there are trees. So why would you spend $350,000 for a concrete shell?”
The district's old-guard sellers "weren't real estate investors—just property owners," says one observer. New buyers are investors who've already "skinned their shins" on other projects, and know how to redevelop the properties.
In many cases, Sherman has partnered with Ned Abdul of Swervo Development. Together, their organizations have become some of the largest property owners in the district. (You won’t meet Abdul here. He prefers life below the media radar.) Sherman and Abdul purchased the Wyman Building—the well-known structure on First Avenue—a few years ago; Abdul and others bought its less familiar companion, the adjacent Wyman-Partridge that faces Fifth Street North.
“We know what we’re buying,” Sherman says. “We look at the building. We know that there’s no air conditioning. We know the elevators are ridiculous. We know the electric is held together by chewing gum. We know all the restrooms smell bad—we’re going to have to redo them.”
