Wells Fargo Center in downtown Minneapolis, the city's third-tallest building, has been sold to a trio of investor groups, one of which is locally based.

Minnetonka-based Onward Investors, an investment firm that focuses on real estate opportunities, said Thursday that it had partnered with Cross Ocean Partners and Neuberger Berman to acquire the 57-story tower at 90 S. 7th St.

The price of the building was not disclosed, but downtown enthusiasts hope a local player will mean active ownership and the sale perhaps is a sign of more acquisition activity to come.

Known for its Art Deco style, Wells Fargo Center has been a hallmark of the Minneapolis skyline since it opened in 1987. The property was designed by renowned architect César Pelli for Norwest Corp. after a fire destroyed the former headquarters of the banking institution, which went on to merge with Wells Fargo.

"This acquisition epitomizes our fundamental value investment strategy of opportunistically capitalizing upon market dislocation and demonstrates Onward Investors' continued commitment to playing an active role in Minneapolis' revitalization," Jon Lanners,a partner at Onward Investors, said in a news release.

In 2019, Wells Fargo Center sold for $315 million to Miami Beach-based Starwood Capital Group. At the start of this year, city assessors valued the building at $173 million, a 23% drop from the year before — and a sign of the struggles office buildings faced in the wake of the COVID-19 pandemic.

Wells Fargo Center is currently 62% leased with up to 110,000 square feet of contiguous available space. Since 1988, the 1.15 million-square-foot building's occupancy has averaged 95% as one of Minneapolis' highest-quality "trophy class" office buildings.

According to the release, Starwood Capital Group made "considerable renovations," and the new owners plan to "continue to strategically invest in the property." A spokesperson for the investment firm declined to comment on the deal.

Representatives for Onward Investors, global asset manager Cross Ocean Partners and New York-based Neuberger Berman did not respond to requests for comment Friday.

"Pairing state-of-the-art amenities with timeless design, the Wells Fargo Center is well-positioned to attract tenants seeking a premier building in a dynamic urban environment," the release said.

The property's iconic status has not made it immune to the downtown office market's game of musical chairs: Wells Fargo Center recently lost accounting firm KPMG to the newly constructed North Loop Green.

The overall office vacancy rate for downtown Minneapolis at the end of the third quarter was 23.4%, according to brokerage firm Colliers. That figure has continued to climb following the pandemic as some companies reevaluate the amount of space they need in the era of remote work.

On top of lost income from downsizing tenants, some office building owners are facing loan maturities and struggling to refinance at higher interest rates. That's caused some borrowers to hand buildings over to their lenders, as was the case with downtown's Capella Tower, which transferred to New York-based Metropolitan Life Insurance this year.

Other owners have cut their losses and sold properties at steep discounts. In September, a pair of office towers known as the Forum sold for $6.5 million, representing a discount of more than 90% discount from 2019, when the towers sold for nearly $74 million.

Ryan Watts, a member of the CBRE team that brokered the Wells Fargo Center sale, said he could not comment on the specifics of the deal. But the sale is perhaps an early sign of the downtown office market starting to pick up again, he said.

"We are expecting to see more activity in '25 than we did in '24," Watts said. "There are a lot of investors that are interested in getting back into the office market — in the new version of it."

Because borrowing options remain limited and costly, the best-positioned buyers will likely be those with deep pockets, particularly for buildings as large as Wells Fargo. Onward Investors last month partnered with Edina-based Willow Peak to acquire another downtown Minneapolis office building at 300 1st Av. N. The five-story property traded for $5 million.

"Knowing that they're local and have investments here always makes us even more confident in what's going to happen with the building going forward," said Adam Duininck, president and CEO of the Minneapolis Downtown Council.

He said he's hopeful the new owners of Wells Fargo Center will invest in the property, as several other recent buyers have done, "with a tentative optimism about the future business prospects of downtown Minneapolis."

"It's just such an important asset to downtown," Duininck said. "It's one of those that means quite a bit even symbolically, if not economically, to what's going to happen for the future of downtown."