First National Center

[Pete]

Thanks Toadrax! Looks like they are moving right along.

It will be very interesting to see what they do after this project is wrapped up.

[jbrown84]

That tile looks awful. Is it just ceramic?

[Pete]

jbrown, I'm sure it's marble.

It's to match the floor in the Great Banking Hall which is spectacular. I think they plan to carry it throughout the entire concourse.


And reading back through the original announcement, they said this phase would take a year, and it's only been 5 months.

[jbrown84]

Does that look like the marble that's in the Great Banking Hall? Anybody remember?

[Toadrax]

I think it is some sort of stone. They have a little cutting booth in front of the building where they are cutting it up with what looks like a saw that cuts them underwater.

I'm not an expert on tile.. so I could easily be wrong.

But.. like I said, most of the work has been done in the last week.

[jbrown84]

As long as it's real stone...

It just looked very ceramic-tile-in-the-nursing-home-lobby from that picture.

[Pete]

jbrown, you can see the floor of the GBH in photos earlier in this thread.

[Toadrax]

Oops.. the floor tiles are crooked and the people who were installing them seem to be gone.

I wonder if they got fired.

[jbrown84]

FYI

Today, Oct. 9, Milbank is promoting voter registration in the GREAT BANKING HALL. That's right, it's open to the public.

[metro]

Redeveloping OKC's historic First National Center
Pamela A. Grady
1.23.2009

In May 2006, California-based Milbank Real Estate embraced several ongoing projects, including converting the historic Roosevelt office building in downtown Los Angeles into 222 luxury residential lofts and building Sky Las Vegas, a new, 47-story, residential high-rise project on the Las Vegas Strip.

But when one of the firm’s partners learned of an Oklahoma City historical landmark being on the selling block, Milbank’s CEO, M. Aaron Yashouafar, says all the cards fell into place. His family’s firm – along with its partners, the Barlava family – jumped at the opportunity to purchase First National Center, 120 N Robinson Ave., an office building constructed in 1931 replicating New York’s Empire State Building. Purchase price: a cool $21 million.

A historical perspective
In today’s real estate scene, historical buildings of First National Center’s structural significance are rarely placed on the market.

“You can’t buy one of the most significant buildings in a city every day,” Yashouafar says, adding that luck was on their side when the deal came through as fast as it did, taking only three days from conception to completion. “Being a private company and family operation enables us to make a lot of out-of-the-box decisions. We looked at the pictures and read the literature about the building. It was a done deal.”

But Mayor Mick Cornett has some concerns with regard to what he calls the city’s most visible and highly priced landmark.

“I think whoever owns the building has higher responsibilities than most to making sure that it’s dealt with from a historic preservation standpoint, but also is vibrant and becomes a critical part of our Central Business District,” he says. “I expect a lot from whoever owns the First National Center. I want to see that building become, in a sense, what we’ve done for the Skirvin (Hilton hotel). I want to see that building become a visual icon of our community, instead of something that we’re just continuously working on. I think it’s going to take capital.”

Milbank retained architectural firm Beck & Associates to assist in researching historical elements and detailed design aspects of the 1 million-square-foot, art deco-style property before beginning renovations.

“Dealing with historic buildings is an art,” Yashouafar says. “We understand the significance of historic elements in a building, which are very distinguishable with old characteristics of a building. Not everything old is historic, but things that are historic are worth preserving. It is a challenge, and it is very rewarding to renovate a historic building and preserve the charm and importance that was created many years ago.”

To date, infrastructure renovations have been completed. Black granite, Gascogne blue limestone and Lagos blue limestone flooring were imported from Egypt and Brazil, and installed at the west entryway and lobby to match the building’s Great Banking Hall’s design. Chandeliers custom-made by McFadden Light in St. Louis were installed throughout the lobby, and a concierge desk soon will be added.


Who are these guys?
As local journalists began reporting on Milbank’s plans for renovating the building and how much would be spent, many skeptics voiced concerns on OKC blogs as to whether Milbank would actually come through on its promise to restore the property to its fullest potential, and many wondered, simply, who are these guys taking on this highly anticipated task? Citizens remembered the previous owners, who were full of promises that never came through, leaving tenants disappointed time and time again.

“There are out-of-state property owners ... who have been here, but no one’s really taken an active role like Milbank has, where even the CEO, the controller, the VP, they’re all coming in town regularly,” says Blake Renegar, associate with Sperry Van Ness. “And whether that’s to discuss matters with their management and leasing staff here in Oklahoma City or when you have the CEO coming down for an ice cream social, strapping on the apron and being the one who’s scooping the ice cream for all of the tenants, it’s just not something you see every day.

“It reflects their commitment to bring this building back to what it needs to be, and what it deserves to be: a premier office destination in the Downtown market.”

Throughout the company’s history, the Yashouafar family has built a reputation on purchasing and renovating historical buildings in metropolitan areas throughout the United States. The family initially began working in the real estate industry while living in Iran.

Milbank’s chief operating officer, Solyman Yashouafar, 62, is the eldest of the two sons. He began his career in retail, managing the family department store back home. He immigrated to California in 1979, when the revolution in Iran began. Eventually, he ventured into other aspects of commercial real estate with his father, the late Ataollah Yashouafar, and he now oversees the day-to-day operations of the family’s business in Los Angeles.

Aaron Yashouafar, 47, the younger brother, immigrated to the United States in 1977 to attend a private school in Palo Alto, Calif., but later transferred to Beverly Hills High School. That same year, the then-16-year-old junior in high school entered the family’s real estate business.

“Involuntarily, I was appointed assistant office manager of a building my father had just purchased called Encino Corporate Plaza,” Aaron Yashouafar recalls.

His duties included implementing lease negotiations, arranging tenant improvements and construction of the building, as well as managing day-to-day operations.

“I loved it,” he says. “When the other kids were going to McDonald’s and Burger King after school to have fun and drink milkshakes, I’d drive to our office and take care of business. We still own and manage that building today.”

Raymond Yashouafar, 33, vice president of operations, frequently joins his uncle, Aaron, in monthly trips to Milbank’s OKC office, where the duo meets with staff regarding updates to its ongoing renovation project. He and his brother Rodney Yashouafar, Milbank’s project manager, joined the family business, as well.

“I remember being in elementary school and watching the walls go up at one of our projects,” Raymond Yashouafar says. “We grew up in this business; it’s what we know. My phone is always on since we’re on call 24 hours a day. I try not to look at my phone once I get home. Although, if I see the red light blinking, I’ll check it. We have very understanding wives,” he says smiling.

Market winners and losers
“Not every risk you take is a winner,” Aaron Yashouafar says. “But in the case of the First National Center, we sure were the winner.

“We’re doing business in six different states, and Oklahoma is the healthiest of them all with its low unemployment and home values remaining high; it’s unheard of in this market in the United States,” he says, adding that Milbank’s Cielo Phoenix, a proposed $250 million, 36-story, twin-tower condominium project on Central Avenue in Phoenix, never came to fruition due to a decline in market conditions.

Aaron Yashouafar says construction continues on common areas throughout, and his brokers are currently in talks with several “large tenants” that have expressed interest in leasing large blocks of space in at First National Center.

Milbank continues to expand its portfolio of real estate, which currently totals about 8 million square feet. Meanwhile, Aaron Yashouafar says when it comes to investing in OKC, he would do it again if the right deal came along.

OKCBiz > Redeveloping OKC's historic First National Center

[Pete]

Has anybody been in that building lately and care to report on how things are looking?

I bet the new floor is a knockout. Would love to see some photos of the lobby and concourse.

Have they started on the new north entrance?

[sethsrott]

I am planning to stopping by the FNC and taking some pictures, once I do that, I will try and post them, or at least post links to them.
As to the question on the north entrance, the answer to the best of my knowledge is no, I was across the street at the Chase Building for a job interview, and I took the time to walk over and take a look, I didn't notice anything going on, if they have started it is only on the interior.

[TaoMaas]

I was across the street at the Chase Building for a job interview, and I took the time to walk over and take a look, I didn't notice anything going on, if they have started it is only on the interior.

Hey, don't feel bad. I work there and I don't see anything going on. I know they're doing SOMETHING because there are workers here after hours. But exactly what they're working on, I don't know.

[Midtowner]

Has anybody been in that building lately and care to report on how things are looking?

I bet the new floor is a knockout. Would love to see some photos of the lobby and concourse.

Have they started on the new north entrance?

I was there yesterday...

I know they've been working on the ceiling, but it wasn't memorable because I don't remember anything except it's been torn up lately.

[MikeOKC]

Such a wonderful building. That Grand Banking Hall holds many possibilities.

[soonerguru]

The work done so far is appallingly bad. They took out a ton of the great tiles in the lobby entrance and replaced them with tiling that would truly be at home at a suburban office park. It's really that bad. What's worse is there is no clear reason why they did it. They retained some of the original tile to go along with the faux-dentist office look. Also, they have done nothing to fix the constantly broken elevators. It appeared they were cleaning windows this week in a haphazard, perfunctory fashion. Unless there is something happening behind the scenes the "renovation" is a major disappointment, or mere real estate hype.

[metro]

http://newsok.com/first-national-cen...ad_story_title

First National Center's owner touts improvements
Leans filed against First National Center over debt
Oklahoman
BY STEVE LACKMEYER
Published: March 3, 2009

On a recent visit to First National Center, its owner, Aaron Yashouafar was clearly agitated by questions over unpaid bills and liens filed against the property.

Why, he asked, was this a news story and why wasn’t anyone writing about the improvements made by his family-run Los Angeles company, Milbank Real Estate?

Yashouafar prefers to talk about the millions spent to date improving the lobby and arcade in the historic tower and less visible improvements that he hopes will make the building more competitive for Class A tenants.

"In Los Angeles, I couldn’t pay a reporter enough to come around asking what bills I have paid,” Yashouafar said.

Until January, Yashouafar could have posed such questions and concerns to his public relations firm, Saxum Public Relations. But Saxum is suing Milbank over $15,000 in unpaid bills.

Milbank this past year also faced mechanic’s liens totaling $103,650 filed by Enercon and $84,420 filed by Environmental Action. Yet another lien, totaling $89,161, was filed in December by First Maintenance Co. for janitorial services.

All three liens were settled and released, while the lawsuit is ongoing.

Renzi Stone, owner of Saxum, said the lawsuit is a first for his firm.

"We’re a small business that relies on revenues on a monthly basis to sustain our company,” Stone said. "After 90 days, if a client hasn’t paid, we take action to recover the money. We were still delivering quality work through the middle of January. We resigned our account well over 90 days.”

Yashouafar declined to discuss the Saxum billings, saying he wasn’t familiar with "day to day” accounting. But his company is not having trouble meeting expenses, he said, and he dismissed any comparison with the building’s previous New York-based owners, who also faced liens and lawsuits prior to selling the property to Milbank.

"From the day I put my feet in this building, I keep getting blamed for what the previous owners did,” Yashouafar said. "But that’s not me. That ownership did not spend a penny in this building. We have spent millions and millions. The building is in much better shape than it has ever been.”

Yashouafar said improvements are continuing at the historic building, though slower than anticipated. He said work to date includes removal of asbestos in the east tower, which has allowed occupancy to climb from virtually nothing to 75 percent.

Overall, occupancy in the three-building complex has risen from about 30 percent to 47 percent.

[Pete]

Wow, he comes across as incredibly defensive which is more troubling than a few late paid bills.

However, we really need Milbank to follow through so he deserves some patience. I'm sure what he says is true; that they've been cleaning up lots of things that aren't necessarily apparent.

And as we should all know by now, dealing with these old structures -- particularly the ones that have been neglected for decades -- is tricky, time-consuming and expensive.

Looks like slow, steady progress is being made and I hope it continues.

[metro]

True, but one must pay their bills too, that affects the local economy when workers don't get paid....

[bluedogok]

Yep, if the clients that we have already performed work for would pay us we wouldn't have had some layoffs or an across the board temporary pay cut. Our balance sheet "looks" pretty good until you look at the A/R closer and some of those with the largest amounts due are at more than 6 months and most of those are projects that we quit working on about then because they were getting to 90-120 days and had no definite end in sight.

All of us are facing those kind of issues and a few hundred thousands in unpaid billings mean a lot to a small firm/business.

[Pete]

Yes, it sure would have been better for him to take responsibility for the late pays and vow to solve the problem. Obviously, he's not directly involved in the day-to-day accounting but it's still ultimately his responsibility to see that it's done properly.

Now that it's caused him some bad press perhaps they'll be more diligent.

[metro]

City council approves loan agreement for First National Center
OKCBiz
Pamela A. Grady
3.03.2009

The Oklahoma City Council today approved a $1.8 million Brownfields Cleanup Revolving Loan Fund Loan Agreement for First National Center.

The agreement, on a reimbursement basis, will cover the costs of asbestos abatement in the east building located at 120 N Broadway.

"They (owners of the First National Center) have already completed some of the work,” Oklahoma City Planning Director Russell Claus said. “They’ve been working on the asbestos for at least 12 months.”

Aaron Yashouafar, owner and CEO of Milbank Real Estate, said Devon Energy plans to occupy 75 percent of the east tower.

"They’ve already moved in some parts of the east tower,” Yashouafar said. “As we abate the asbestos, they (Devon Energy) do their tenant improvements and are expanding floor by floor.”

Yashouafar says Milbank has spent approximately $3 million on abatement costs thus far, but believes he will have spent close to $5 million by the end of the asbestos removal process which he says could take an additional four to six months to complete.

"This loan agreement shows how the city is cooperating and assisting developers to help with the remediation of environmental issues in this city,” Yashouafar said. “It’s a great help. We look forward to working with the city more in the future.”

OKCBiz > City council approves loan agreement for First National Center

[bombermwc]

Well give the guy a little break. He is right in that he inherited the problems of the previous owners. If he's brough occupancy up 17% so far, then I'm confident he can keep that number on the rise. If that happens, then that means he has more tenants to pay rent, which means he takes in more, which then means he can work towards paying off the debts. He would have known full well when he bought the place that the debts were there, so it's not as though he can ignore them. However, I bet a large amount of that debt can be settled out of court under this new ownership.

So far he seems to have done about a thousand times better than many of the owners in the last 10 years. At least SOMETHING is happening to bring the place out of the dark ages. FNC is just like a historic home....yeah it's fun to look at, but it's a money pit. It's hard to find folks interested in keeping those small floorplan buildings profitable in today's market. The price per foot for updating/maintaining a historic building is FAR higher than say Corporate Tower or Leadership Square. Think about how long it took to get something going at the Skirvin. How many millions was that one? How many failed owners. And that place had gone unoccupied for 20 years before something finally happened.

FNC has managed to at least keep it's doors open, even if they were falling off the hindges. The two structures have similar historic problems....the size of the floors. The rooms at the Skirvin are sooooo small. But the place is awesome sweet! FNC has really small floor plans as well, which makes it unattractive to a great many tenants. You'll see more small offices like lawyers or accountants and junk in there more than a significant corporate presence. That fact makes it that much more difficult to get a tenant in the first place. Keep in mind that Devon is a temporary occupant and the east tower is not the same floor structure as the main iconic tower.

So lets hang out a while and see what happens. Right now, he could use some support.

[Pete]

Ben has a nice interview with the FNC property manager on his blog:

OKCREview.com Office

After all this time, it sounds like very little has been done. I realize this is a very old structure but a year and a half and the arcade floor hasn't even been done?

Perhaps they've had a hard time finding the right people to get everything done correctly because something is clearly not right here.

[bombermwc]

Sometimes projects like this have a lot that goes on in the background that we don't get to see. Any historical structure's renovation requires much more time/effort/money than some average joe office tower. Of course we all wish things would move more quickly and have been let down so many times before, that we're reluctant to trust anyone. But a year and a half for a new ownership group to make changes isn't very long. It can take that long just to get everything lined up financially to figure out what you can even PLAN to do. They may have had an idea before, but that doesn't mean there was a lot of planning behind it before.

I'll give them another year. If they haven't made progress by then, then I'm all for hanging the new owners out with all the others.