With office vacancy rates in the District of Columbia at 20 percent and climbing, officials believe that converting office buildings to residential space is an important component of revitalizing downtown Washington. These complex projects pose both practical and administerial challenges, however. For developers, one important consideration of such a redevelopment is its real estate tax implications. High hopes District leaders announced earlier this year that they hope to add 15,000 residents to the central business district over the next five years – an ambitious goal. The hope is that bringing residents to live downtown will create a more vibrant neighborhood where people live, work, and dine. The stark reality is that the District of Columbia has one of the lowest return-to-office rates in the country. Actual occupancy in the D.C. metro was only 43 percent in mid-April and drops below 25 percent on Fridays, according to Kastle Systems, which tracks office occupancy. Workers simply aren’t returning to Downtown D.C. While residential conversions may be one piece of the puzzle in addressing D.C.’s downtown woes, converting an office building into a residential property is no small feat. Here are a few important factors relating to real estate taxes to keep in …
CLEARWATER, FLA. — Kennedy Wilson Brokerage, a division of Kennedy-Wilson Properties Ltd., has brokered the $19.6 million sale of an eight-story office building in Clearwater. Gary Goodgame, Jeremy Dee and Max Browne of Kennedy Wilson Brokerage represented the seller, Mercury Casualty Co. (i.e. Mercury Insurance), in the transaction. Convergent Capital Partners, a Tampa-based investment group, is the buyer and is planning to make renovations to the property. Located at 1901 Ulmerton Road, the 157,000-square-foot building is located on a 7.3-acre site in Clearwater’s Feather Sound area and features a gym, café and five-story parking garage. The building was delivered in 1999 and currently has approximately 100,000 square feet available for lease. K.C. Tenukas, Kristin Kenney and Nick Baldwin of CBRE will be marketing the building for lease on behalf of Convergent Capital.
IRVINE, CALIF. — Premier Workspaces has taken over a co-working location at 100 Spectrum Center Drive in the Irvine Spectrum area. Formerly a Carr Workplaces, this 24,200-square-foot location offers ninth-floor views, 87 private offices, three serviced meeting rooms, an on-demand office and a common area lounge with on-site hospitality staff. This latest transaction expands Premier Workspace’s footprint in Irvine to more than 233,000 square feet across 10 locations.
AUSTIN, TEXAS — IBM will relocate its Austin office campus to The Domain, a 300-acre mixed-use development on the city’s north side, by 2027, according to several media outlets including The Austin American-Statesman and Axios. The former publication reports that IBM, which employs about 6,000 people in Austin, will take about 320,000 square feet across two newly constructed buildings at 11901 MoPac Expressway. The latter publication reports that the interconnected buildings will both rise 14 stories and that the tech giant intends to occupy the entirety of one tower and a small portion of the other. Bo Beacham and John Barksdale of CBRE represented the landlord, Hines, in the lease negotiations.
Feil Signs Nonprofit Insurance Organization to 20,984 SF Office Lease Renewal in Metairie, Louisiana
METAIRIE, LA. — The Feil Organization has signed Louisiana Citizens Property Insurance Corp., a nonprofit residential and commercial real estate insurance organization, to an office lease renewal in the New Orleans suburb of Metairie. The company will continue to occupy its 20,984-square-foot office on the seventh floor of the Galleria office building for another 125 months. Sandra Corrigan of SRSA Commercial Real Estate represented the tenant in the lease negotiations, and Scott Graf of Corporate Realty represented the landlord. Located at 1 Galleria Blvd., the Galleria is a 22-story, 466,110-square-foot office building that offers a fitness center, food service, an ATM, car wash service and onsite security and management.
HOUSTON — Global chemical manufacturer LyondellBasell has signed a 318,504-square-foot office lease for its new U.S. headquarters at Williams Tower, a 64-story building in Houston’s West Loop/Galleria submarket. Craig Beyer and Kevin Saxe of CBRE represented LyondellBasell, which is relocating from downtown Houston, in the lease negotiations. Nina Seyyedin and Warren Savery of CBRE represented the landlord, Atlanta-based Invesco Real Estate. A timeline for occupancy was not disclosed.
CHICAGO — Law firm Burke, Warren, MacKay & Serritella PC has renewed its 47,000-square-foot office lease across the 21st and 22nd floors of AMA Plaza in Chicago. The firm plans to renovate its space with an interconnected staircase between the two floors as well as new technology, conferencing space and a café. Joe Learner of Savills negotiated the firm’s initial lease at AMA Plaza more than 25 years ago. Rich Dale and Laura Schueren of Savills will oversee project management of the office renovation, which is slated for completion in 2024. AMA Plaza is the last and largest building in the U.S. designed by renowned architect Mies van der Rohe.
CINCINNATI — Rubenstein Partners LP has unveiled a new sky lounge and outdoor rooftop deck on the 14th floor of 312 Elm Street, a 378,000-square-foot office building in downtown Cincinnati. The space features a tenant lounge area, training room and alternative workspace. It is also available for events. Rising 26 stories, 312 Elm Street offers views of the city skyline. Additional amenities at the property include a recently renovated lobby and a large fitness center. Rubenstein purchased 312 Elm Street and the neighboring 312 Plum Street in 2015 and embarked on a renovation plan for both buildings with a focus on common areas, streetscapes and amenities.
SOUTHFIELD, MICH. — Guardian Alarm has sold its 66,000-square-foot office headquarters in Southfield. The company has signed a new lease for 37,111 square feet at 26711 Northwestern Highway in Southfield. The new office will include a state-of-the-art alarm monitoring command center, updated training facilities and an expanded customer care center. The move also enables Guardian Alarm to consolidate its administrative offices, which are currently located in two separate buildings. The company expects to complete the move by late summer. Dan Verderbar of Friedman Real Estate represented Guardian Alarm in the sale and the new lease.
LAS VEGAS — Deloitte has leased a 14,000-square-foot office space in Phase II of UnCommons in Las Vegas. The firm’s space will be on the third floor of the development’s fourth office building, which will be completed this summer. Deloitte will take occupancy in late 2023. Matter Real Estate Group owns the building.