First National Center Purchased for $21m- OKC

[shane453]

Purchased 7 years ago for $5.5 million, sold now for $21 million! Can you believe that price increase?!?! Crazy! DT OKC real estate values have truly skyrocketed. Not only did the mysterious California investors buy the tower but also the 14 story buildings attached. It sounds like they're going to refurbish all of the offices but also we can't rule out some residential uses. Either way it will take a lot more vacant space away- either by signing new tenants or converting away to residential. Great news!

The beautiful 32 story tower with its grand banking hall and two 14 story buildings are included in the sale.

It's almost a million square feet of office space! (999,651 sf)

First National Center bought for $21m

By Richard Mize

The Oklahoman

California investors bought First National Center Friday in a $21 million deal that could change the tenor of an already dynamic downtown Oklahoma City.

The buyers, who were not revealed, have no connection to Oklahoma, said Tim Strange of Sperry Van Ness, which handled the sale of the city

[swake]

A million square feet for $21 million is a fire sale.

Kanbar bought 2.2 million of depressed space in Tulsa for over $100 million, still a long way for us both to go.

[jbrown84]

Thanks for chiming in with your rivalry smack, Swake.

[swake]

Values have "skyrocketed" to $22 a square foot?

$22 a square foot is ghetto pricing, that's not much higher than OKC's average for rent on downtown office space.

Tell me I'm wrong here, come on. You said and that article say it's indicative of a strong market, it's not. It's indicative of a hugely weak office market.

Sorry to highlight the facts on you, but I guess I'm just a hater to not see this price a sign of strength.

[swake]

Now, that all said, the sale is cause for a muted celebration since the current owners did nothing to help the property.

If the new owners really will spend the money to restore the property then you will have real cause to celebrate. I hope they do so. Just beware, the Oklahoman article is just a puff piece without facts. Maybe the new owners will talk and want to do something along the lines of what Kanbar is doing in Tulsa. If they do this will be great, right now it's just a property sale.

So far no plans have been released and the owners aren't talking. "To fill it up

[shane453]

Yes, it is very, very cheap. But the building was purchased in 99 for 5 million, meaning the price has increased by more than 400%. Downtown OKC real estate is VERY strong- by that I mean buy a building today and in a year sell it and you'll make a profit. Probably will be the same in Tulsa when a few V2025 projects are done (especially the arena) and Blue Dome grows a little more.

The company that is reportedly involved in the buying of the building specializes in rehabbing old office buildings into class A space, renovating historic properties into condos, and building new highrise residential projects. I think we'll definitely see something come of this.

Interesting to wonder if maybe Kanbar/Kaufman gave these California investors the idea to go look in Oklahoma for property?

[swake]

I wondered if the buyer wa Kanbar too, but, the article says the investors have no Oklahoma ties, and Kanbar has had business in Tulsa for many years.

For reference, Kanbar paid an average of just over $42 per square foot in 22 class B and C buildings (and a few entirely empty buildings) with 2.57 million square feet of total space for a total cost of over $108 million.

The price per square foot of this deal is just over $21 a square foot. So maybe OKC's office market downtown can soon get to where Tulsa's is, hmm?

I hope the First National is redone, it's a great building, but today article says that they are going to spend "several million dollars" to revamp the property. Several? Like four? That's just basic upkeep money on a building that size. There's no big work that's going to happen. Kanbar is reported looking to spend something like another hundred million in downtown Tulsa, at least. Hell, the four 2025 projects are going to spend $35 million redoing a fraction of the space that there is in the First National building.

The buyers got a undervalued building in a depressed but emerging market, they hope that residential conversions of other buildings with bring down the vacancy rate in downtown OKC and they can flip the building for a huge profit in just a few years. That's my guess.

[Okie]

I hope y'all heard what this joker had to say. Because here goes.

The price per square foot of this deal is just over $21 a square foot. So maybe OKC's office market downtown can soon get to where Tulsa's is, hmm?

You're hoping that OKC can at some point be as "good as Tulsa" is? Well sometimes bragging about overvalued office prices is barking up the wrong tree. But you've pissed all over that tree for a couple years now so that's really nothing new. Perhaps that's why Forbes ranked OKC's cost of business lower than Tulsa's, and why OKC came in at #13 and Tulsa around #43 (which is still very good).

For reference, Kanbar paid an average of just over $42 per square foot in 22 class B and C buildings (and a few entirely empty buildings) with 2.57 million square feet of total space for a total cost of over $108 million.

For referance if this was Tulsa the First National and the Skirvin would have already been wiped off the map. You talk about how many years ahead OKC's office market is behind Tulsa, when in reality Tulsa development is some 30 years behind Tulsa when it comes to urban renewal, and 15 years behind OKC when it comes to capital improvement.

That's just basic upkeep money on a building that size. There's no big work that's going to happen. Kanbar is reported... yadayadayadaaaa

Is that hot off the crystal ball?

[swake]

I hope y'all heard what this joker had to say. Because here goes.

You're hoping that OKC can at some point be as "good as Tulsa" is? Well sometimes bragging about overvalued office prices is barking up the wrong tree. But you've pissed all over that tree for a couple years now so that's really nothing new. Perhaps that's why Forbes ranked OKC's cost of business lower than Tulsa's, and why OKC came in at #13 and Tulsa around #43 (which is still very good).

For referance if this was Tulsa the First National and the Skirvin would have already been wiped off the map. You talk about how many years ahead OKC's office market is behind Tulsa, when in reality Tulsa development is some 30 years behind Tulsa when it comes to urban renewal, and 15 years behind OKC when it comes to capital improvement.

Is that hot off the crystal ball?

Tulsa is not "overvalued", it's stone cold, undervalued, cheap as hell, OKC is even cheaper. My reply was to the this comment in reference to the price of the first national tower:

"probably will be the same in Tulsa when a few V2025 projects are done (especially the arena) and Blue Dome grows a little more"

OKC is a cheaper business market becuase of lower wages overall, well, that is a big part of it anyway.

As for Urban Renewal in Tulsa vs OKC? Hmm. We have all the best of downtown still, Tulsa is an icon for Art Deco, some smaller less relevant buildings are gone but most of Tulsa's best buildings are in fine shape, the Tulsa National Bank Building (with the occupied great banking hall), the Philtower, the Philcade, The Adams Hotel, The Atlas Life Building, Boston Avenue Methodist, etc, etc. Most "at risk" buildings like the two Mayo buildings are being redone now. There is a glaring exception in the Tulsa Club building, but no one is tearing it down.

I.M. Pei tore down most of your downtown years ago.

as for the several million dollars quote, no crystal ball, the Daily Oklahoman

[shane453]

I'm not worried about any slipshod development at First National:

Center proposal unveiled

By Steve Lackmeyer

The Oklahoman

New owners focus on restoring 'jewel.'

A Los Angeles-based partnership that is building a $325 million condominium tower in Las Vegas announced Monday "several million" will be spent to restore Oklahoma City's First National Center as downtown's "crown jewel."

Alliance Property Investments Inc. and Carla Ridge LLC., both affiliated with Milbank Real Estate Services, closed on the $21 million cash purchase of the building on Friday.

Milbank will manage the building and oversee renovations.

Jason Little, who along with Gary Gregory of Sperry Van Ness represented the buyers, said the group typically moves fast with development and won't settle for the First National Center remaining 66 percent vacant. But offices may not be the only future tenants.

"Their goal is to spend the money to bring back First National," Little said. "They're not ruling out partial condominium conversion. They've done condominiums, both new and adaptive reuse."

Little did not identify principals of the buying partnership, and officials with Milbank could not be reached for comment. Milbank's Web site, www.milbankre.com, describes the company as one that transforms undeveloped land and distressed properties into "profitable, community-enhancing developments."

"Our promise is to develop new projects and renovate distressed properties, filling voids in surrounding neighborhoods while producing substantial returns for client investments," the Web site states.

Reopen hall to public

Immediate plans include reopening the Great Banking Hall to the public.

The entrance was roped off by the previous owners and remained empty since Boatman's Bank (now Bank of America) abandoned the tower in 1993 and moved across the street to Leadership Square.

"It will be used for special events," Little said. "They want to restore it as the focal point of the building. It's too remarkable a space not to be utilized."

First National Tower has been a downtown icon for 75 years, with additions built in 1957 and 1972.

Milbank's online portfolio indicates First National would be the company's first building outside of California and Nevada.

Among the company's properties is the Figueroa Tower in Los Angeles, which twice won the "Office Building of the Year" award from the Building Owner and Managers Association, and "The Roosevelt," a $125 million redevelopment of the Roosevelt Building from offices into 223 luxury condominiums.

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And the which downtown is better debate could fill many other threads... Let's just try to stick to First National Center here. This is really big news for DT OKC- taking away a million square feet of 66% vacant and 100% subpar office space in a downtown treasure to replace it with Class A offices, condos, and a public Great Banking Hall.

[jbrown84]

I want to know when they're going to let us in the Great Banking Hall. I've been dying to go up there. Never made sense to my why they had it blocked off.

[Okie]

Me and you will need to get a cameras then!

[swake]

Again:

By Steve Lackmeyer

The Oklahoman

New owners focus on restoring 'jewel.'

A Los Angeles-based partnership that is building a $325 million condominium tower in Las Vegas announced Monday "several million" will be spent to restore Oklahoma City's First National Center as downtown's "crown jewel."

Several, again, read it, it says several.

Look, I'm all for a rebirth of the building, and I never said slipshod, but there is no major overhaul going on here, the Oklahoman is blowing hot air. The building is going to get a nice basic update, nothing major.

Several million won't touch the needs this building has, there's no way it you can convert space to condos or recreate the building as class "A" space for that little money, or probably 10 or even 20 times that amount of money.

Again, it's a million square feet. The Vision 2025 housing projects are doing nearly $40 million in work on turning a fraction of that amount of space into condos. Isn't the Skirvin over $40 million?

[shane453]

As you said, the Oklahoman is currently not very sure about the specifics. They have no idea how much will be spent. IMO "several million" (less than 10 million) is not enough even to do a basic update on a million sf of space. $10 dollars per square foot? I doubt it. Much more will be spent to restore the building, and the company's mission statement is to create community enhancing, quality developments. Besides that, who DOESNT want in on the DT OKC housing market?

[swake]

As you said, the Oklahoman is currently not very sure about the specifics. They have no idea how much will be spent. IMO "several million" (less than 10 million) is not enough even to do a basic update on a million sf of space. $10 dollars per square foot? I doubt it. Much more will be spent to restore the building, and the company's mission statement is to create community enhancing, quality developments. Besides that, who DOESNT want in on the DT OKC housing market?

Millibank, again reading, is NOT the owner, they are property management. This is Millibank's mission statement but they are not the ones spending the money. And the Oklahoman not only said "several million", they put that value in quotation marks, someone on the buyers side said "several million".

Hopefully plans will change or will grow, but at this time the glowing remarks and cheering from the Oklahoman are just more example of it being a terrible, misleading newspaper.

[Okie]

Again:

By Steve Lackmeyer

The Oklahoman

New owners focus on restoring 'jewel.'

A Los Angeles-based partnership that is building a $325 million condominium tower in Las Vegas announced Monday "several million" will be spent to restore Oklahoma City's First National Center as downtown's "crown jewel."

Several, again, read it, it says several.

Look, I'm all for a rebirth of the building, and I never said slipshod, but there is no major overhaul going on here, the Oklahoman is blowing hot air. The building is going to get a nice basic update, nothing major.

Several million won't touch the needs this building has, there's no way it you can convert space to condos or recreate the building as class "A" space for that little money, or probably 10 or even 20 times that amount of money.

Again, it's a million square feet. The Vision 2025 housing projects are doing nearly $40 million in work on turning a fraction of that amount of space into condos. Isn't the Skirvin over $40 million?

Uhhh... Bob, are you talking about the entire price of every project or just the Vision 2025 money? I know that that wasn't too much more than $10M.

[swake]

Uhhh... Bob, are you talking about the entire price of every project or just the Vision 2025 money? I know that that wasn't too much more than $10M.

The vision part was just over $10 million, the $40 million is public and private money combined for the housing portions only. There is talk of more money for instance in the Mayo for hotel space and restaurant space.

[Okie]

Well that's kinda crappy, don'tcha think? But I held my tongue about attacking your claim for it's Vision contributions b/c I know that if OKC wasn't practically financing the whole Skirvin deal there would be nunya.

[swake]

Crappy how, held your tongue, what are you talking about, being a therapist again?

The Skirvin people were given the building and much of money to do it with, using CDBG for the Skirvin is a risk and a disservice to the intention of those funds, but that's JMO.

The Vision money is in the form of zero interest loans, not grants, so they are to be paid back. There's more money for downtown housing in the recently passed city bond issue too, I think another three million.