The downtown St. Paul building that was home to the McNally Smith College of Music was sold this week for $6.5 million.

The buyer, M.A. Mortenson Co., inherits one longtime tenant in the History Theatre plus two recent additions: the Upper Mississippi Academy charter school, which is moving in this fall, and a new branch of the River Valley Church, which held its first Sunday service in September.

The college abruptly closed in December 2017 and filed for bankruptcy soon after.

In June, U.S. Bankruptcy Judge Katherine Constantine approved a deal to turn the building over to an investor group, Exchange Street Partners, which had bought the mortgage from Bremer Bank.

That agreement guaranteed there would be some money — about $867,000 minus court-related costs — to pay unsecured creditors. They primarily will be McNally Smith employees who never got their final paychecks. Some 250 employees, students and others filed around $6.7 million in bankruptcy claims.

At the time of that deal, Exchange Street Partners told the judge they’d had the building appraised at $4 million. The bankruptcy estate would have had to have sold the building for around $5 million just to pay off the mortgage, liens and unpaid taxes.

The ultimate sale price was higher than expected, but bankruptcy trustee Patti Sullivan said Thursday the estate did not have to pay for interest, utilities and other carrying costs while waiting for the building to sell.

“I do think we still had a good deal,” Sullivan said Thursday.

Colliers commercial Realtor Eric Rapp, who had the listing, noted the sellers had spent some money improving the building, too. The building, at 19 Exchange St. East, originally was constructed in the early 1960s to house the Science Museum of Minnesota, which relocated in 1999; the city then sold the property to the college.

Sullivan said the five-week federal government shutdown held things up but she expects to start distributing money to creditors in the coming months.

Meanwhile, McNally Smith’s insurance company is working to resolve claims brought by former students who say college officials misled them about accreditation and credit transfer.

The bankruptcy created uncertainty for the History Theatre, which hopes to have a multi-year lease signed soon.

“They’d like us to be here in the long term and we would, too,” Managing Director Karen Mueller said of Mortenson, a Minneapolis-based commercial builder and developer.

River Valley Church has a one-year lease that grants them access to a portion of the 120,000-square-foot building on Sundays.

Upper Mississippi Academy says it will use 45,000 square feet at first, leaving another 20,000 square feet available for lease.

The charter school, which has a 10-year lease, has about 290 secondary students but wants to grow to 425 or 525, executive director Harry Adler said. It’s finishing up an interior design plan and will begin renovating in the coming weeks.