Lauth Group Inc. is looking for new office space after the Indianapolis-based real estate developer's largest investor took control of the building it now calls home.
An affiliate of Chicago-based Inland American Real Estate Trust has taken over ownership of two buildings in the three-building Meridian Corporate Plaza, a Lauth-developed Class-A office complex just north of Interstate 465 between Meridian Street and College Avenue.
Lauth agreed as part of a settlement in bankruptcy court that it would not contest Inland's ownership of Meridian Corporate Plaza Two and Meridian Corporate Plaza One, where it has its headquarters, but Lauth retained control of Meridian Corporate Plaza Three, CEO Bob Lauth wrote in an e-mail.
Inland has appointed the local office of Jones Lang LaSalle to handle leasing and management of the buildings, replacing CB Richard Ellis.
Jones Lang LaSalle has listed Lauth's entire 66,000-square-foot headquarters building as available for lease. The second building, which is about 136,000 square feet, is 96-percent occupied. Amenities in the office park include a five-acre lake, Lulu’s Cafe, a 100-seat conference center and a Four Points by Sheraton Hotel.
Inland in April dropped a federal lawsuit against Lauth and a request for a judge to appoint a Chapter 11 bankruptcy trustee after Lauth conceded control of some properties where ownership was in dispute. Both sides also agreed to the appointment of a special mediator.
Inland invested $228 million in 2007 for an ownership stake in dozens of Lauth properties. But Lauth defaulted on its agreement to pay dividends to Inland in late 2008, and multiple Lauth subsidiaries filed for Chapter 11 bankruptcy reorganization in May 2009.
Lauth’s troubles began in early 2008 as demand dried up for the office, industrial and retail developments that had fueled its rapid growth. The company doubled its revenue from 2004 to 2005, then doubled it again from 2005 to 2006. During the same period, the value of Lauth’s project lineup jumped from $143 million to $592 million.
The company started 2008 with about 450 employees, but layoffs shrunk the staff to fewer than 40 in April.
CEO Bob Lauth did not respond to a follow-up e-mail by press time, so it was not clear how many employees remain or where the company could move.
Lauth Group still controls local office space at Intech Park and Clay Terrace, and its website lists 49,000 square feet of available space in the building it still owns at Meridian Corporate Park.