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Prominent downtown buildings offered for sale

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A trio of high-profile downtown properties are on the sale block, their owners hoping to take advantage of an improving market for financing real estate transactions.

The Capital Center, a two-building office complex at Illinois and New York streets, was listed with the local office of CBRE in early February and is under contract, said Andy Bannister, the listing broker. Bannister said he can’t reveal the potential buyer, which is expected to close on the purchase in a few months.

Also on the market is Rolls-Royce Meridian Center One and Two, which is being sold by an affiliate of Eli Lilly and Co. Lilly formerly occupied the 405,000-square-foot complex that used to be known as the Faris Campus. Marketing of the two-building property at Meridian and South streets is just ramping up, said Bannister, who got the listing last month.

The state’s tallest building, the 48-story Chase Tower at Ohio and Meridian streets, is also for sale. It was sold recently to Beacon Capital Partners LLC as part of a package of 14 office towers Beacon bought from Charter Hall Office REIT in Sydney, Australia, for $1.71 billion.

Beacon, which closed on the building earlier this year, is now marketing it for sale through the Chicago office of Jones Lang LaSalle and New York-based Eastdil Secured, a unit of Wells Fargo. JLL’s Bruce Miller, the listing broker, wasn’t available for comment.

Bannister said that while the owners of the buildings have different reasons for wanting to sell them, the common thread is that debt is plentiful and relatively cheap.

“The market’s not as frothy as five, six or seven years ago, but it’s better than it’s been for the last three,” said Bannister, whose been a broker here for 15 years.

The market is coming out of a period in which sellers and buyers were sitting tight.  “We’ve been in a cycle where there weren’t many transactions and therefore not a lot to base values on,” Bannister said.

The sales flyer for Capital Center says the two towers are 78.4 percent leased, with net operating income of $4.5 million. The 650,000-square-foot, multi-tenant property with an underground 525-space parking garage has been owned for about 12 years by an Invesco-managed German fund that is liquidating.  

Rolls-Royce Meridian Center includes more than 320,000 square feet of office space, a 48,000-square-foot fitness center and a cafeteria and conference center. It has more than 2,000 parking spaces, most of them in a multi-story garage.

The entire complex is occupied by Rolls-Royce, which announced in March 2011 that it would lease the property from Lilly. Bannister said Rolls-Royce’s commitment to the building exceeds 10 years, meaning that the buyer of the complex can count on a long-term, stable income stream.

Among large suburban properties on the market is One and Two Penn Mark, a two-building, 240,000-square-foot complex near 116th and Meridian streets that Bannister has listed. It is being sold by Chicago-based Westminster Funds.

Also up for sale is the former Eleven Fortune Park, a 150,000-square-foot building on the northwest side that is primarily occupied by Ascension Health through at least 2022. The building, which is now named Ascension Health Ministry Service Center, is owned by Netherlands-based IBUS Co. It is listed by Rebecca Wells and Jon Owens of Cassidy Turley and Ron Foster of Echelon Realty Advisors.

Jason Brown, vice president of CBRE Capital Markets debt and equity group, said a recent resurgence in the availability of financing options, such as commercial mortgage-backed securities, is good for secondary markets.

Brown said additional financing options make buying and selling easier in markets, such as Indianapolis, that are often overlooked by large banks and life insurance companies that finance big-ticket commercial real estate transactions.    

 

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  1. How much you wanna bet, that 70% of the jobs created there (after construction) are minimum wage? And Harvey is correct, the vast majority of residents in this project will drive to their jobs, and to think otherwise, is like Harvey says, a pipe dream. Someone working at a restaurant or retail store will not be able to afford living there. What ever happened to people who wanted to build buildings, paying for it themselves? Not a fan of these tax deals.

  2. Uh, no GeorgeP. The project is supposed to bring on 1,000 jobs and those people along with the people that will be living in the new residential will be driving to their jobs. The walkable stuff is a pipe dream. Besides, walkable is defined as having all daily necessities within 1/2 mile. That's not the case here. Never will be.

  3. Brad is on to something there. The merger of the Formula E and IndyCar Series would give IndyCar access to International markets and Formula E access the Indianapolis 500, not to mention some other events in the USA. Maybe after 2016 but before the new Dallara is rolled out for 2018. This give IndyCar two more seasons to run the DW12 and Formula E to get charged up, pun intended. Then shock the racing world, pun intended, but making the 101st Indianapolis 500 a stellar, groundbreaking event: The first all-electric Indy 500, and use that platform to promote the future of the sport.

  4. No, HarveyF, the exact opposite. Greater density and closeness to retail and everyday necessities reduces traffic. When one has to drive miles for necessities, all those cars are on the roads for many miles. When reasonable density is built, low rise in this case, in the middle of a thriving retail area, one has to drive far less, actually reducing the number of cars on the road.

  5. The Indy Star announced today the appointment of a new Beverage Reporter! So instead of insightful reports on Indy pro sports and Indiana college teams, you now get to read stories about the 432nd new brewery open or some obscure Hoosier winery winning a county fair blue ribbon. Yep, that's the coverage we Star readers crave. Not.

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