Sunday, April 6, 2003

Industry notes: Commercial real estate


Name picked for renovated Ford building

By Ken Alltucker
The Cincinnati Enquirer

The backers of an ambitious $10.5 million renovation of the abandoned Ford Motor building along Interstate 71 have settled on a new name for the building - the Historic Ford Factory.

Construction crews next Thursday will officially kick off construction of the Walnut Hills building that has long been considered one of city's most visible eyesores passed by more than 120,000 motorists daily. Now that eyesore factor is becoming a key to selling the building's colorful history.

Groundbreaking invitations circulated to community leaders prominently display the graffiti that, until recently, covered much of the building's facade. Crews also will unfurl a 40-foot banner showing a Ford factory worker with an apron displaying the logo of the various firms working on the project.

The complex project involved financing from LaSalle Bank and Wachovia and the commitment of Fisher Design to serve as anchor tenant, no small task in today's downtrodden office market.

Fisher Design will take the top floor of about 33,000 square feet. The design/build firm Al Neyer Inc. is competing construction. Steve Bloomfield is the project's developer.

The renovated office will yield 100,000 square feet of office space and is expected to be completed Sept. 1. Fisher Design will relocate more than 80 workers from its offices in Walnut Hills and Over-the-Rhine.

Michele Laumer of Carey Laumer Commercial Realty is leasing the building.

Location, location and tenant mix are vital

How important is location and tenant mix to an office building's value? Consider these recent two sales.

NAI Eagle of Cincinnati recently brokered the $42.1 million sale of the Wright Executive Center in suburban Dayton. Miller Valentine Group sold a majority interest in the building east of downtown Dayton to an affiliate of Cleveland-based Munsell Realty Advisors.

The 430,502-square-foot building with a smaller retail space along Interstate 675 boasts occupancy of 94 percent with many defense-related tenants such as Lockheed Martin, Boeing, Raytheon and Northrop Grumman. Other tenants include Computer Sciences Corp., Sun Microsystems, Pricewaterhouse Coopers, Accenture, State Farm Insurance and others.

"The tenant base is mostly military and defense contractors and is viewed to be very stable," said NAI Eagle's Chuck Ciolino, who brokered the deal with the help of Keith Yearout.

In Hamilton, investors last Wednesday scooped up International Paper's Knightsbridge complex at an auction for just $4.2 million.

Hamilton city officials were hoping a large corporation would buy the 366,000-square-foot tower and relocate hundreds of employees to the 57-acre site. Instead, a group of investors led by Hamilton resident William Rentschler were the high bidders in last week's auction conducted by Lakeland, Fla.-based Higgenbotham Auctioneers.

The building formerly was the headquarters for Champion International, but International Paper purchased the property two years ago and closed it.

Two Chicago investors last fall committed to buying and renovating the building, but they later backed out of the deal. The auction sales price was nearly $8 million less than what the Chicago investors offered to pay.

Duke awaits word on tenant in Chapter 11

Duke Realty Corp. officials anxiously await the fate of one of its larger tenants at its Pfeiffer Woods complex in Blue Ash. Divine, an information technology firm that rents a 28,000-square-foot space at Duke's Pfeiffer Woods, recently filed Chapter 11 bankruptcy protection.

Duke officials have heard no word on Divine's plans for Pfeiffer Woods. The company, based in suburban Chicago, did not return phone calls.

Ken Alltucker covers commercial real estate for the Enquirer. Call him at (513) 768-8384 or e-mail kalltucker@enquirer.com




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