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W.V. Lottery offers $15 million for office tower

West Virginia LotteryWest Virginia Lottery: W.V. Lottery offers $15 million for office tower

CHARLESTON, W.Va. — West Virginia's plan to purchase the City Center West office tower for the Lottery Commission is $7 million short of the owner's asking price, according to state and local officials familiar with the negotiations.

The state Department of Administration's Real Estate Division has offered to buy the 13-story building for $15 million. Building owner General Corp. wants $22 million.

The Lottery Commission would relocate its headquarters to City Center West, which is beside the Interstate 64/Interstate 77 split near CAMC Women and Children's Hospital. State officials confirmed the Lottery's interest in the building Wednesday.

"We cannot disclose any details of any proposals or offers relating to real estate transactions during the negotiation phase," said Diane Holley-Brown, spokeswoman for the Department of Administration. "To ensure the best result for the state and state taxpayers, it would not be prudent during any real estate transactions to reveal offers and budgeted amounts while negotiation is underway."

In 2004, the Lottery Commission planned to spend $15 million to build a new headquarters in Putnam County. The Kanawha County Commission blocked the move, after filing a lawsuit to keep state government agencies in Charleston.

"The Department of Administration is handling negotiations," said Lottery spokeswoman Nikki Orcutt. "As far as any figures are concerned, we can't discuss them."

General Corp. owner Ed Maier also has declined to discuss the state's offer and his asking price. He has said state officials first contacted him about purchasing the building six to eight months ago.

City Center West's appraised value is $10.5 million, according to county records. That figure apparently was calculated based on a half-occupancy rate, said city and county officials.

Chesapeake Energy, the office tower's largest tenant last year, vacated the building in November, after closing its Eastern regional headquarters in Charleston. About 150 Chesapeake employees lost their jobs, while the remaining workers were offered positions at the company's headquarters in Oklahoma City.

"That building's worth at least $20 million," said Kanawha County Commissioner Kent Carper, who has publicly supported the Lottery's proposal to move to City Center West.

Rudy Henley, president of West Virginia Commercial LLC in Charleston, said City Center West's market value would depend on many factors, such as the owner's willingness to sell.

"If you're talking about taking a snapshot at a point in time, and a building's half empty, then that would decrease the value," said Henley, who is not involved with the negotiations. "But with commercial real estate, it's not a static number. In many situations, you can make arguments for as much as a 50 percent range of value."

In 2004, the Lottery Commission sought 70,000 square feet of office space for its operations.

The Lottery, which has 200 workers with 100 of those based in Charleston, said now wants 80,000 to 100,000 square feet of space.

"We'd obviously like to have room for growth," Orcutt said.

City Center West has more than 130,000 square feet of office space.

Holley-Brown said the state intends to honor all existing leases at the office tower, if the state decides to purchase the building.

State officials declined to say whether other state agencies would move there.

The Lottery wants a location that's easy for the public to get to. Lottery players who win $600 or more often come to the agency's office to claim their prizes.

City Center West is close to an interstate exit and has an attached seven-level parking garage.

"Accessibility for our players is important," Orcutt said.

Earlier this week, Gov. Joe Manchin announced he has authorized the state's real estate division to purchase a building or property for the Lottery Commission's headquarters within Charleston's city limits.

Manchin said the state was looking at several properties and expects to sign a deal within 30 to 45 days. State officials declined to name the sites, but confirmed that City Center West was at the top of their wish list.

"This is not the only option that we are considering," Holley-Brown said. "Each location has its own unique benefits, and, in turn disadvantages. It is part of the decision-making process to weigh all the disadvantages and advantages of each location in order to come to the end result to satisfy the needs of the state, and in particular, the agency at hand."

The Lottery Commission currently pays Kanawha-Roxalana Co. $413,824 a year to lease its headquarters at 312 MacCorkle Ave., across from downtown Charleston, as well as the adjacent building, the site of a former Steak & Ale restaurant.

Charleston Gazette

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2 comments. Last comment 7 years ago by Beatty500.
Page 1 of 1
rdgrnr's avatar - walt
Way back up in them dadgum hills, son!
United States
Member #73904
April 28, 2009
14903 Posts
Offline
Posted: February 26, 2010, 1:17 am - IP Logged

That building owner might wish he had grabbed that 15 million if the experts are right and commercial real estate tanks this year.


                                             
                     
                                         

 

 

 

 

                                                                                                   

"The only thing necessary for evil to triumph is for good men to do nothing"

                                                                                            --Edmund Burke

 

 

    Beatty500's avatar - kanji for_peace.jpg
    New Member
    Tucker Georgia
    United States
    Member #77465
    July 24, 2009
    1 Posts
    Offline
    Posted: March 3, 2010, 12:42 am - IP Logged

    I agree. The building owner may want to reconsider. If you have that much to spend, build your own building. 

    Since I do not know the area, I cannot comment with authority. Here in the Atlanta Metro Area, there is a growing vacancy rate for commercial real estate.

    Hope they can make a good deal. Maybe pass along some of the savings to the players.