Group hopes to revive interest in Wichita Executive Centre
08/25/2013 7:49 AM
08/25/2013 7:49 AM
The largest history museum in Wichita stands on Market Street between Douglas and First in Downtown Wichita.
A walk through Wichita Executive Centre, once the KSB&T building, reveals elevator machinery going back to the 1960s, textured wall tiles that were cool in the ’80s, and TWA travel posters mounted above a hotel swimming pool empty since 1999. Even the beautiful nearly $600,000 contemporary lobby is an artifact: It’s a piece of Real Development’s failed attempt to renovate the building in 2010 and 2011.
But time moves on, and the current owner, Security National Life Insurance Co. of Salt Lake City, is trying to bring the hulking building at 125 N. Market into the present.
Security National is in this position because it gave Real Development’s Dave Lundberg and Michael Elzufon a $5.6million bridge loan in 2011 to help them swing a massive real estate deal that later fell apart. Now, the company has taken ownership of the 300,000-square-foot-plus building.
Bryce Baker, Security National’s vice president of real estate, said the company has started on a $3million to $5million program to modernize the building’s systems and decor to lure more tenants. The building’s 220,000 square feet of office space is about 40 percent occupied. The 91,000-square-foot former Guild Plaza Hotel, which takes up floors six, seven, eight and nine, remains vacant.
Baker’s job is to revive interest in the building. The common areas of one floor and the lobby have been modernized to Class A space, he said, but much of the rest is closer to Class C space.
In a tour last week, Baker showed off the areas he plans to upgrade.
Over the next few months, crews will renovate the common areas of the 10th, 12th, 14th and 17th floors with contemporary colors and materials for offices. They will renovate the 19th floor, the once elegant Wichita Club, into event and meeting space.
“That’s a view,” Baker said, as he looked out over the rooftops of downtown. “You can’t sell it just on that, but you can’t get that view anywhere else.”
By the end of the year, the decaying sky bridge over Market Street will be repaired, even though it doesn’t actually connect with the vacant Exchange Place.
He also wants to put in a deli and a gym on the first floor. He said a tenant is even interested in reviving the giant rooftop time/temperature sign.
The present rate for office space is $12.95 per square foot per year. Once the renovations are complete, the rates would be higher, competitive with other top downtown properties.
His goal, he said, is to lease 50,000 more square feet over the next year.
Baker said one of the things that killed leasing under Real Development was deteriorating systems. The elevators would sometimes get stuck, concrete would fall from the roof of the parking garage and, in the scorching summer of 2011, the air conditioning didn’t cool the building adequately. Real Development hired Delton Sandefer’s Essential Property, which cut through the enormous backlog of maintenance issues. Complaints, Baker said, have all but disappeared.
Sandefer certainly knows the building. He has worked on it off and on since the 1980s. He helped close down the hotel. He knows how to operate the touchy old systems.
In eight to 10 weeks, crews will install a new chiller on the building’s 19th floor. The chiller, one of two that cools the building, will be lifted by crane, slipped through a removable panel in the side of the building and assembled on site.
The old Guild Plaza Hotel is a long-term project. The 138-room hotel could be converted into 80 to 90 condominiums or apartments. The pool on the sixth floor would likely be covered over and the area made into a common space for the tenants.
Tony Utter, leasing agent for the building, said that, so far, interest has been slow. It’s a slow leasing market, he said, and agents and brokers have a low opinion of the building dating back to the Real Development broken-air-conditioning days.
Few agents have even been in the building in recent years, he said. Real Development hadn’t had a tenant showing in the two years before it lost control of the building in July.
Changing the minds of agents and potential tenants means showing people what the plans are, and then following through, Utter said. Speeding up the process takes something else: money.
Security National is offering agents $50 restaurant gift cards just for bringing a client for a showing. It also offers higher than normal commissions. For the first three-year lease, Utter said, it’s offering agents a flat-screen television for a 3,000- to 5,000-square-foot lease. Lease more than 5,000 square feet, and get a week’s stay in Hilton Head. Get an entire floor leased, and the agent gets a week’s cruise for two to the Caribbean.
It’s going take proof to overcome resistance to the building, said Patrick Ahern, an agent with NAI Martens.
“Brokers are skeptical of out-of-town landlords making big promises, after the Minnesota Guys (Real Development),” Ahern said. “People will believe it when they see it. They are going to have to show people.”
Baker said he understands that.
“They’ll have to see we are making the kind of investments that had not happened before,” he said.