Advertising agency Young & Laramore is putting its highprofile Massachusetts Avenue building up for sale as it prepares to buy and occupy a former school building in Lockerbie Square.
Y&L is listing its 17,000-square-foot building at 409 Massachusetts Ave. for $1.6 million, said Paul Knapp, the firm's CEO. The building includes 4,000 square feet of storage space in the basement, leaving about 13,000 square feet as usable office space, Knapp said.
The agency is leaving its headquarters behind after 15 years because the firm has outgrown it, Knapp said. The company has under contract the former IPS School 9 a few blocks away at 407 N. Fulton St.
Colliers Turley Martin Tucker has School 9 listed for $4.5 million. Both Knapp and Moses declined to reveal the purchase price, but both said it was less than the list price.
That building was vacated last fall by locally based insurance company International Medical Group, which purchased the former Indianapolis Life Insurance Co. campus at 29th and Meridian streets for its new home.
IMG renovated the school in partnership with the city in 1997, said Tom Moses, IMG's director of real estate. The building was constructed in 1899 as Clemens Vonnegut Public School 9. IMG outgrew the 50,000-square-foot building and now occupies 85,000 square feet at its new home, where another 55,000 square feet is leased to various tenants.
Young & Laramore won't take up the entire School 9 building initially, Knapp said. The firm plans to lease out about 14,000 square feet of the building until it needs the space for its own operations.
The move marks welcome growth at the firm, but Knapp said he and his firm's employees will miss being in the middle of the Mass. Ave. action. Although the new location will be only a few blocks away, it won't have a Starbucks across the street and a half-dozen or so restaurants on the same block, he noted.
"It's going to be an adjustment," Knapp said.
The company initially looked for a larger building on Mass. Ave., but quickly discovered none were available, he said.
Young & Laramore previously sought to alleviate the space crunch in 2001 by announcing a multi-use project for the northwest corner of Michigan Street and College Avenue. The project, proposed by a partnership between the ad firm's principals and Dinmont Development principal Brian Knapp (Paul Knapp's brother), would have included condos, 35,000 square feet of retail space and 100,000 square feet of office space.
That project fell apart in 2002 because of a soft market for office space and the loss of a major investor. Dinmont and joint-venture partner Hearthview Residential earlier this year proposed Lockerbie Park, a 100-unit condo development, on that site.
The School 9 deal is expected to close in the next two to three months, Knapp said. The firm plans to make some minor renovations to the building with a target move-in date late this summer, he said.
Young & Laramore is likely to find strong interest for its existing building on Mass. Ave., said local real estate experts. In the 15 years since the firm's principals bought and renovated the early 20th century building, the neighborhood has turned from a blighted strip to a bustling center of trendy restaurants and shops.
While the office market overall is still struggling to recover, Young & Laramore's building will likely be coveted by several small- to medium-sized firms.
"There are a lot of tenants out there in that 10,000- to 25,000-square-foot range that want to own their own building," said Ralph Balber, president of Indianapolisbased Halakar Real Estate. "It's a great little building in a growing area. The retail amenities make it great."
Young & Laramore's asking price of nearly $100 per square foot is somewhat higher than comparable downtown buildings have sold for in recent years. A building a block away, the 36,000-squarefoot Massala Building at 345 Massachusetts Ave., is listed for $3.3 million, or $92 per square foot.
That building is nearly fully leased, with MacNivens restaurant on the first floor and several office tenants. Both owner-occupants and investors have been looking at the building in the six months or so it's been on the market, said Scott Pollom, principal and senior vice president of investment services at CTMT, which is listing the building. Interest in the building has been high, but so far potential owner-occupants haven't been able to find the right mix of available space in the building, he said.
Local law firm Collignon & Detrick PC, which occupies 5,000 square feet in the Massala, bought the building in 2003. Pollom said the firm has made physical improvements to the building as well as renewed lapsed leases and raised rents closer to market-rate.