New 25-story office tower planned in uptown Charlotte
05/19/2014 1:39 PM
05/20/2014 6:46 AM
Groundbreaking is set for this fall on a 25-story office tower at Tryon and Third streets, a timetable that would make it the first tower to start construction in uptown since the end of the recession.
Babson Capital Management will be the anchor tenant for the new 634,000-square-foot building, to be called 300 South Tryon. Construction is slated for completion by the spring of 2017.
The building will be next to the Latta Arcade, on the site of a parking lot that was Google’s temporary home during the Democratic National Convention.
The new office building will be the first office tower completed in uptown since 2010, when the 48-story Duke Energy Center and 32-story 1 Bank of America Center opened. No new office buildings have begun construction uptown since the recession ended in 2009, said Andrew Jenkins, a real estate analyst with Karnes Research.
Cornerstone Real Estate Advisers, a global real estate investment management firm, owns the property and will oversee development; Spectrum Properties will develop, manage and lease the property.
Babson and Cornerstone are affiliates of the MassMutual Financial Group of financial services companies. Babson, which when combined with its affiliates has more than $200 billion under management, employs about 140 people in Charlotte.
The firm plans to relocate its existing Charlotte operations from the 45,000 square feet it currently leases in the Duke Energy Center.
Tom Finke, Babson’s chairman and CEO, said the firm plans to occupy about 200,000 square feet in the new building. He said Babson has enjoyed good success in Charlotte, growing from about 60 employees in 2008 or 2009.
The firm expects that to continue, and is positioning itself for continued long-term growth.
“We’ve grown quite frankly a little faster than we thought we would,” Finke said. “A lot of people came out of the (economic) crisis and struggled. We came out of it well.
“There’s a great opportunity to develop a first-class office building here in the heart of Charlotte, and we’re happy to be the anchor tenant.”
The new building comes amid growing development in and near South Tryon. Just south of it sits the new museum district with the Mint, the Bechtler and the Gantt Center for African-American Arts+Culture, as well as the Duke Energy Center.
Just to the west sits the new Romare Bearden Park, the Charlotte Knights’ BB&T Ballpark, and several new high-rise apartment complexes.
Several other office tower projects have been announced uptown in the past year, but are still seeking anchor tenants and haven’t yet announced groundbreaking dates.• Crescent Communities earlier this year unveiled plans for a 27-story office tower at Tryon and Stonewall streets. It would include street-level retail and a tree-lined “front porch” plaza fronting on Tryon.
• Portman Holdings, the Atlanta-based company that built the Westin hotel in 2003, last year announced plans for a 15-story, 350,000-square-foot office tower on top of the property’s parking deck at South College and Stonewall streets.
Jenkins said relatively few blocks of top-tier office space can be found uptown, even though the vacancy rate sits at 11.3 percent, compared to 2 percent in 2008, before the recession took full effect.
The new building’s impending launch might cause other developers to take an even more cautious approach to their own projects, Jenkins said, since Cornerstone’s head start might allow its tower to soak up big leases before the competitors’ towers open.
“I don’t think it expedites anything” for the others, Jenkins said. “If anything, it might sway them to hold back a little.”
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