Editors’ Weekly News Roundup October 7 – October 11
Over the years, adaptive reuse has turned warehouses into residential loft buildings, movie theatres into retail space and office buildings into hotels. In the most-read Connect CRE story for the week ending Oct. 10, readers learned of another scenario: converting a fitness club into medical space.
Naperville Fitness Center to Become Surgical Center detailed the plans of a joint venture between Capital Healthcare Properties and HSG Medical to convert a 43,000-square-foot fitness facility in Naperville, IL into a specialized, cardiovascular outpatient ambulatory surgery treatment center. Reportedly, it will be the first of its kind in an outpatient setting.
Among the advantages for developers in large, less densely populated states is that land is not in such short supply (and probably costs less on a per-acre basis). Arizona Land Consulting took advantage of that fact and acquired acreage in the Grand Canyon State’s Pinal County, as reported in our second most-read story of the week, Arizona Land Scoping Mixed-Use Project on 600 Acres in Casa Grande.
Potential uses for the acreage include build-to-rent, light industrial, a data center and commercial/retail offerings. The acquisition for an undisclosed sum followed Arizona Land Consulting’s $136-million, all-cash sale of a parcel to data center developer Tract.
Ranking third among the week’s most-read stories was OpenAI to Lease 90K SF at SoHo’s Puck Building, which reported that the parent company of ChatGPT has agreed to lease space for what will be its first New York City office. The deal reflected local property owners’ hopes that the burgeoning artificial-intelligence industry will develop a bigger appetite for office space.
The Wall Street Journal reported that the OpenAI lease is part of a broader wave of AI businesses scooping up office space in tech hubs such as San Francisco, Seattle and Denver as well as New York City. The activity could help offset a trend among larger tech firms—as reflected in numerous Connect CRE stories over the past couple of years—to downsize their office space.
In fourth place for the past week was another redevelopment story, this time on the site of a defunct shopping mall in the Houston suburb of Baytown, TX. We reported in Demolished Baytown Mall Rising Again as Mixed-Use Projectthat Fidelis Realty Partners broke ground on San Jacinto Marketplace, a successor to the San Jacinto Mall that was razed two years ago.
As the name suggests, retail will be part of the mix of the redevelopment. However, it will also include residential, office and hospitality components. The hotel will come along later and will be built by a third-party developer.
The week’s roster of top five stories was completed by our reporting of an unusual transaction. Office Building Trades Twice in One Day in Unique Acquisitiontold how NAI Farbman brokers supported the gifting and trading of a 114,397-square-foot Class-A office building located at 28333 Telegraph Rd. in Southfield, MI between the H.N. and Frances C. Berger Foundation, Volunteers of America and Tamaroff Jeffrey Automotive Group. Edward Wujek, EVP at CBRE, also played a key role in making the deal happen.