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Carmel office/retail complex hurt by road project gets second chance

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Merchants Pointe, a two-building office/retail development at 116th Street and Keystone Parkway, is getting a fresh start after major road construction drove away tenants and caused a previous owner to default.

The larger of the two buildings is a 30,305-square-foot office building with ground-floor retail that was purchased Nov. 1 by a partnership with ties to Infinity Health Care. Infinity is involved in operating retirement communities and other health care businesses.

Moishe Gubin, a principal in Infinity who lives in South Bend, said about 30 people will work in the building by the time it’s fully occupied next March. A related pharmacy and a hospice/home health care agency will occupy the first-floor retail space.  

Immediately west of the office building is an 11,126-square-foot retail building partially occupied by McAlister’s Deli. Brownsburg-based Cranfill Development, which has the building under contract and expects to close by early January, is already marketing the space. The deli occupies about a third of the building and is the only tenant.

Merchants Pointe was developed by the late Gary Linder beginning in 2002. Linder later sold the buildings to a partnership that lost them to Indiana Bank & Trust last May.

The bank was asking $1.1 million for the retail building and almost $3 million for the office building.

Though neither building was completely empty, both had underperformed in recent years.

“Those properties were hit by multiple forces,” said Jaqueline Haynes, part of the Cassidy Turley team of brokers that listed the buildings for sale. She said a combination of the economy, road construction and other retail options in the area had pulled down occupancy.

“New retail development in Carmel has far outpaced demand,” said Haynes, who said Clay Terrace and new projects in City Center and in Carmel’s Arts & Design district were among those that lured away tenants.

In spite of other options that have sprung up for retailers, Merchants Pointe should recapture its appeal based on the area’s strong demographics and a good balance of residential and commercial populations, Haynes said. And now that road construction around the site is mostly finished “you have excellent access.”

The reconstruction of Keystone Avenue into a parkway with roundabouts is thought to have been the biggest drag on the buildings’ performance.

“Road construction temporarily paralyzed the area,” said Michael Cranfill, a retail broker for Sitehawk Retail Real Estate who is marketing the property for Cranfill Development. The development firm, owned by his brother and dad, owns retail centers primarily in Brownsburg, Avon and Crawfordsville.

This is the firm’s first property in Carmel. Cranfill said lease negotiations are already underway for 4,200-square-feet in the retail center that was previously occupied by The Extreme Outfitters, an outdoor gear store that moved about three years ago.

Road construction might actually help drive retail traffic to the property in the future. Cranfill noted that Keystone will be the official detour when the redevelopment of U.S. 31 starts later this decade, which will increase traffic counts.

Infinity Health Care’s presence will also drive traffic to the retail building. Merchants Square, a retail center just north of 116th Street with a Marsh grocery store as an anchor tenant, was another selling point for Cranfill. Immediately south of the property is the Woodland Country Club.

 

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  • Bakery
    Carmel also could use a stand-alone bakery (one not within a grocery store). Is Long's Bakery willing to relocate?
  • Tenants needed
    Suggest an office supply tenant i.e Office Max or Staples or other. Badly needed in the area.

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  1. The $104K to CRC would go toward debts service on $486M of existing debt they already have from other things outside this project. Keystone buys the bonds for 3.8M from CRC, and CRC in turn pays for the parking and site work, and some time later CRC buys them back (with interest) from the projected annual property tax revenue from the entire TIF district (est. $415K / yr. from just this property, plus more from all the other property in the TIF district), which in theory would be about a 10-year term, give-or-take. CRC is basically betting on the future, that property values will increase, driving up the tax revenue to the limit of the annual increase cap on commercial property (I think that's 3%). It should be noted that Keystone can't print money (unlike the Federal Treasury) so commercial property tax can only come from consumers, in this case the apartment renters and consumers of the goods and services offered by the ground floor retailers, and employees in the form of lower non-mandatory compensation items, such as bonuses, benefits, 401K match, etc.

  2. $3B would hurt Lilly's bottom line if there were no insurance or Indemnity Agreement, but there is no way that large an award will be upheld on appeal. What's surprising is that the trial judge refused to reduce it. She must have thought there was evidence of a flagrant, unconscionable coverup and wanted to send a message.

  3. As a self-employed individual, I always saw outrageous price increases every year in a health insurance plan with preexisting condition costs -- something most employed groups never had to worry about. With spouse, I saw ALL Indiana "free market answer" plans' premiums raise 25%-45% each year.

  4. It's not who you chose to build it's how they build it. Architects and engineers decide how and what to use to build. builders just do the work. Architects & engineers still think the tarp over the escalators out at airport will hold for third time when it snows, ice storms.

  5. http://www.abcactionnews.com/news/duke-energy-customers-angry-about-money-for-nothing

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