by Bradley Parsons
Staff Writer
As downtown residences and restaurants routinely fetch $1,000 daily rents from Super Bowl visitors, managers of the City’s huge cache of vacant offices are increasingly wondering how to get their properties off the sidelines.
Commercial landlords usually negotiate their leases for years not days, but the possibility of turning a quick profit has them considering alternative uses for their property.
Property manager Ray Moore at 550 Water Street said he’ll have 150,000 feet of space available for office use by day, but said he’s open to suggestions for after-hours uses as well.
“We’d be glad to lease space for just an evening or for an afternoon if the situation is right,” said Moore. “There’s a lot of activity around that time, you keep hearing about people renting a house or apartment for $20,000. We certainly want to throw our names into the hat.”
Moore’s realtor, CB Richard Ellis’ Oliver Barakat, is pursuing Super Bowl tenants for the building. Moore has heard only inquiries so far, but he expects to have some agreements by the end of the year. Moore wouldn’t speculate on what kind of rents office space might generate. The market rate will emerge over the next four months, he said.
Duke Addison, president of Addison Commercial Real Estate, said office space could demand rents similar to hotel rooms and private residences.
“The River City Brewing Company supposedly got $1 million for the week, that’s the high side of the market. The low side is probably around five or $10,000 that you hear people getting for their apartments,” said Addison.
Of course, the supply side of the office market is more crowded than residential. A study by Barakat found the office vacancy rate hovering around 19 percent. Several buildings have entire empty floors to offer. Still, it’s unlikely property managers would consider such short-term agreements unless the financial upside was substantial said Addison. Property managers usually demand at least a three-year lease from renters. The length of commitment assures landlords that their tenants will take care of the building.
“Typically, with offices, you’re usually talking about a three-to-five-year commitment, not three to five days,” said Addison. “But if the market is able to provide the opportunity to make substantial income over a short period of time, then you’ll certainly see people willing to respond to that.”
Addison said he’s been contacted by several parties interested in leasing his clients’ offices. But he wants to be sure the property won’t be abused before he closes.
“You have to protect yourself. You have to ask, ‘Who’s having the party? Because some revelers are going to be considerate and some are going to think it’s a frat house and see how many times they can punch holes in the walls.”
Addison said any deals he negotiates will likely include, “a substantial deposit.”
Some property managers already have party-planning experience. 100 Laura Street’s Maurice Nichols has OK’d parties in the building’s lobby and allowed entire floors to be converted into makeshift nightclubs. The Jacksonville Film Festival took up all 13,000 feet of the sixth floor, bringing pedestaled dancers, strobe lights, bars and a chocolate fountain to space that was originally intended for cubicles and copiers.