Ash Properties intends to renovate the BB&T Tower it bought July 24, and a $14.18 million mortgage made in September outlines what is expected.
Jacksonville-based Ash Properties, through Talara Investment Group LLC, paid $24.47 million for the 200 W. Forsyth St. property.
Transamerica Life Insurance Co. issued the loan to Talara Investment on Sept. 14.
Ash Properties won the property at auction in May, beating out more than 300 bids, and closed on the deal two months later.
The property had been in the hands of lenders after a foreclosure.
The purchase includes the 18-story Northbank tower and a seven-story, 700-space parking garage across Forsyth Street at 111 N. Julia St.
The renovation covenant in the loan states that Talara agrees to spend at least $1.5 million in out-of-pocket costs and expenses for deferred maintenance and to renovate, replace, repair and refurbish the property’s external appearance, common areas, restrooms, lobby and other elements, excluding tenant spaces.
Talara must submit a detailed written renovation plan for the improvements to the lender within six months of the mortgage date. The work must be completed within two years.
The required spending must include short-term expenditures detailed in the loan’s Exhibit C.
Those include reroofing BB&T Tower and a dozen improvements that include repainting and repairing the parking garage.
“Time shall be of the essence with respect to all obligations of the Borrower with respect to fulfillment of the Renovation Covenant,” says the loan document.
Another covenant states that Talara Investment also shall pay in full all unpaid tenant allowances/improvements, listed in an exhibit as $724,052 for five companies that lease space in the building. Those are due within 180 days of the mortgage date.
Those comprise Branch Banking and Trust Co.; Hall, Booth, Smith P.C. Inc.; Edwards, Cohen, Dawson, Mangu & Noble; Marshall Dennehey Warner Coleman & Goggin; and Government Employees Insurance Co.
Ash Properties said upon the purchase that it wanted to start immediately on improvements.
Randall Whitfield, COO of the commercial real estate developer, said work will encompass lobby renovations to include furniture, flooring and décor, bringing the common areas “up to a more modern and open look to generate the interest in and excitement of new tenants,” Whitfield said.
He said there also could be some exterior upgrades.
The 285,497-square-foot high-rise was built in 1975. Whitfield said after the sale the building was 64 percent leased.
The parking garage includes ground-floor retail space that is about 50 percent leased, Whitfield said.
That presents more opportunities for new Downtown tenants.
CBRE is handling leasing for the property and posted a flyer online that about 85,000 square feet is available. Of that, about 25,500 square feet is contiguous.
The rental rate is $20.50 a square foot.
CBRE reports that 16 spaces are available. There is available space on the first, second, fourth, sixth, eighth, ninth, 10th, 11th, 14th, 15th, 16th and 17th floors.
Ash Properties also bought the Exchange Building Downtown less than three weeks after the BB&T Tower purchase. The structure is on the same block as the parking garage.