ICVA and Commercial Real Estate and Conventions and Tourism Groups and Capital Improvement Board and Tourism & Hospitality and Real Estate & Retail

ICVA eyes funds from sale by CIB of downtown's Ober building

August 14, 2012
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Proceeds from the city’s planned sale of the Ober office building near Bankers Life Fieldhouse would be used to help sustain marketing and sales efforts by the Indianapolis Convention & Visitors Association, officials said Monday.

The Capital Improvement Board of Marion County, which owns the downtown office building as well as the Fieldhouse, said in July it would try to sell the six-story structure at the corner of Pennsylvania and Maryland streets.

At a CIB meeting Monday, the board disclosed for the first time what it hopes to do with any money the building generates.

CIB wants to plug a $2 million funding hole that will open up next year for the ICVA due to the expiration of a $5.9 million grant from Merrillville-based White Lodging Services Corp., which owns the new JW Marriott hotel in downtown Indianapolis.

That three-year grant had funded four additional sales representatives at ICVA as well as an annual summer advertising campaign the association runs in such outlying markets as northwest Indiana, Cincinnati and Louisville. The advertising campaign costs $1.2 million each year.

“If I don’t get the $2 million, then I lose that summer campaign and I lose those four sales people,” ICVA CEO Leonard Hoops said after the CIB meeting.

Hoops said ICVA, which is charged with marketing Indianapolis to convention groups and to meeting planners, estimates that the extra sales staff and summer campaign generate $212 million in annual visitor spending in Indianapolis. That spending, ICVA figures, generates $7 million per year in tax revenue for the CIB.

The proposal now being discussed by Hoops and Ann Lathrop, the president of the CIB, is for the ICVA to raise at least one dollar in private donations for every three dollars generated from the Ober building sale.

So, to reach his $2 million goal, Hoops said, ICVA would need to raise $500,000 and receive $1.5 million from the Ober building sale.

Hoops said he has started to have conversations with potential corporate donors, which could include Eli Lilly and Co., Dow AgroSciences LLC, PNC Bank and perhaps even White Lodging again.

The CIB has not publicized an asking price for the Ober building. The board paid $5.5 million for the building in 1999 because it wanted to control the properties around the new Indiana Fieldhouse basketball arena, which was later renamed Conseco Fieldhouse and is now called Bankers Life Fieldhouse.

In 2004, the Ober building was appraised for a value ranging between $4.4 million and $4.8 million.

The CIB more recently has paid for two more appraisals, but has not disclosed their results. On Monday, the CIB voted unanimously to have the Metropolitan Development Commission of Marion County attempt to sell the building on behalf of the CIB.

“I think this is a really good approach,” Lathrop said. “It’s not ‘our mission’ to market an office building.”

The 62,500-square-foot building is about half occupied, with such tenants as Ratio Architects and NuOrbit Media paying rent of roughly $14 to $15 per square foot.

The Ober building generated total operating revenue last year of $557,000 and produced a profit of nearly $316,000.

 
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