With all workers remote, a Charlotte company just sold its tower for $71M
Another Charlotte office building has switched hands, perhaps signaling a trend towards investor interest in existing space as office construction has ground to a halt.
Charlotte-based manufacturer SPX FLOW sold Ballantyne Tower for $71.5 million, according to a news release this week from JLL, the real estate firm that brokered the deal.
The site serves as the company’s corporate headquarters. But with all of its Charlotte-based employees working remotely, SPX FLOW is leasing a smaller space in the tower, according to Sydnee Peterman, who works in the company’s media department.
Florida-based Estein USA and Chicago-based Vanderbilt Office Properties purchased the 5.4 acre property at 13320 Ballantyne Corporate Place as a joint venture. The sale closed on July 10, according to Mecklenburg County records.
The sale represents renewed investor interest in Charlotte’s office space and a new trend of investors purchasing existing office buildings. Why? Because the office-job sector is growing while office space construction has hit a historic 12-year low, according to JLL.
“The market is realizing these assets will create significant investor returns as companies want to occupy these buildings with their employees in the office,” JLL’s senior managing director Ryan Clutter said in the release.
SPX FLOW’s Charlotte timeline
SPX Flow manufactures equipment like pumps, valves and filtration systems for such customers as Unilever, Abbot, Basf and Hyundai.
And Charlotte has seen SPX FLOW’s trajectory first-hand since its former parent company SPX Corp. set up shop in the city in 2001.
SPX made Ballantyne Tower its headquarters in 2010 and later purchased the building in 2014 for $6.4 million, according to county records.
In 2015, SPX’s board of directors approved a spin off of its flow business, creating SPX FLOW. That same year SPX, FLOW purchased the tower from its former parent company for $72 million, according to county records.
And in 2022, SPX FLOW became a private company when it was purchased by Lone Star Funds for $3.8 billion.
Although SPX FLOW sold the Ballantyne Tower, Peterman said the building remains its corporate headquarters.
The company is leasing a small space on one floor from the new owners. Its 65 Charlotte-based employees currently work remotely.
Peterman said the company decided to sell the property because of favorable commercial real estate market conditions. With employees remaining on a remote schedule, SPX FLOW has no plans to look for another space.
Charlotte’s office sales and construction
That hasn’t been the norm for other companies in the Charlotte region.
Coinbase, the nation’s largest cryptocurrency exchange platform, expanded its office footprint in the city, leasing 58,600 square feet at 110 East. And Trimont, the leading commercial real estate loan services provider in the U.S., plans to move 300 employees to uptown’s One South building next year.
However, SPX FLOW’s sale of Ballantyne Tower is on par with what the city’s office market has seen this year: investors purchasing office buildings.
In May, Highland Ventures purchased 525 N. Tryon for $24 million and plans to spend north of $10 million to $15 million to renovate the older building. Sam Stilp, president of real estate for Legacy Commercial Property, a subsidiary of Highland, said the purchase and renovation plan is an investment in the city’s growing office job sector.
Charlotte leads the 25 largest office markets in office job growth, according to a June report from real estate research firm Yardi Matrix.
That list includes cities such as Atlanta, Seattle and Austin, Texas. As of April, Charlotte saw a 3.2% year-over-year increase in office employment, “more than double that of any other top market,” the report said.
But most importantly, Stilp said the older building will be able to compete with newer spaces as office construction comes to an end for now.
The city is seeing a 12-year historic low in office space construction, with no office buildings set to open for the remainder of the year.
Stilp’s sentiment was shared by JLL regarding Ballantyne Tower, especially since the building is filled with amenities.
“We saw multiple bids on this offering, signifying renewed investor interest in the office sector,” said JLL director CJ Liuzzo in the news release.
The nine-story, 240,000-square-foot Ballantyne Tower was developed in 2011 and includes a roof-top terrace, a fitness center, tenant lounges and a 288-seat auditorium. The building is also 100% leased.
