Midtown Properties For Sale

[OKCTalker]

Midtown buildings for sale
August 29th, 2008 · No Comments

Following the recent news that Greg Banta parted ways with his Midtown Renaissance partnership to pursue other projects, it appears that a number of Banta’s midtown buildings have been placed on the market for sale. A recent search of office buildings for sale on Loopnet found six of Banta’s midtown Oklahoma City properties available for sale. These properties are 1100 and 1101 N. Broadway, The Guardian buildng at 1117 N. Robinson, The Shartel Professional Building at 1226 N. Shartel, Hadden Hall at 215 NW 10th, and 901 NW 13th.

It is unknown if these listings are the byproduct of Banta’s exit from his midtown partnership. According to Loopnet, these properties were listed on June 18 of this year, which was about a month before news leaked of Banta’s departure. No matter the reasoning, Banta is offering these buildings as a tremendous opportunity for another investor or developer to step up to the plate and have an opportunity to be a part of one of the key areas of redevelopment Oklahoma City is currently experiencing. There are those that are concerned about Banta’s exit and those concerns are justified; however, one can look at the flip side and see that Banta’s exit from midtown could be a benefit for the area by opening the doors for more developers and investors to carry on the vision that Banta casted for the area.

[mOKCie]

While the news seems discouraging for the plight of urban renewal, there might be a silver lining. This could actually facilitate a more rapid redevlopment of the Midtown Area.

Disclaimer: I am an outsider, having no contact with any parties involved. This is pure speculation. Please do educate me in areas where my ignorance leads to erroneous conclusions.

The Midtown Rennaissance was marketed as an endeavour for urban renewal in which all like-minded citizens could invest. To whatever extent that is true, the reality remains it was a speculative real estate investment just like any other. While I'm sure the investors would like to be considered civic pioneers, their financial bottom line is no different.

Maybe the investors didn't get as quick a return on investment as planned. Maybe the funds ran dry. Maybe they couldn't agree. I don't know. But I do know Banta was developing those buildings slowly, one at a time, as funds became available. The pricing on the buildings was understandably high, but it was still speculative, in no way reflective of current market value. Aside from the residential buildings, Banta had no real plan of specifically what would become of each building. The real investment still fell upon those investors who would develop a feasible business plan and were willing to pay the speculative price to carry out the plan. Banta was no more than a middle man in that sense, who profits only from mark-up. He didn't create the businesses and they didn't create themselves. That seems to be the cause of the sluggish development.

I haven't seen the recent prices on the buildings for sale, but if they are now closer to reality than what they have been, maybe people or businesses that entertained ideas for certain properties can acquire them and begin development on them.

Is it better for the building if the owner has an actual plan for the building or if the owner's only plan is for somebody else to have a plan?

Is it better for the building if the owner has the immediate funds to develop the building or if the owner is waiting indefinitely for a return on other investments before development may begin?

Like many, my wife and I have entertained ideas for businesses and residences that could occupy each building and imagined the metamorphosis of those buildings. But, like many, we have been discouraged because nothing has happened to most of the buildings except a transfer of title, a fancy sign, and a doubling of the price.

The only thing that will end when the buildings sell is Banta's hollow occupation. Development will not end. It may begin.

[Pete]

That's a very interesting perspective.

But to be fair, Banta did complete Plaza Court which is probably the most important building in Midtown. And he did it by bringing in a great mix of tenants that have helped create a real neighborhood in that area.

He also redeveloped some other buildings in the area and successfully leased them.

And more than anything, he had a vision and kick-started what was largely a dead area.


I suspect the realities of renovating old buildings combined with the current tight capital markets led to facing some harsh realities. Or maybe the stress of trying to put together these deals drove a wedge between the partners.

There certainly is the opportunity for others to step in, and maybe it makes more sense to divide up these properties among multiple developers. We have a whole host of locals that are involved in similar type of projects: McDermid & Co., Grant Humphries, Marva Ellard, Judy Hatfield and several others.

However, I think the prices on those buildings are going to have to come down first, otherwise I'm sure some of those people would have already stepped up before they were listed on the open market.

[wsucougz]

Can you fill us in on what the asking prices are? These are loopnet premium listings. Can't find them on the mls, either.

[Dan]

I agree with mOKCie and Pete Brzycki. Lots of good points there. Banta deserves real credit for Plaza Court. And for getting the ball rolling on the rest of midtown. That's a significant achievement, and he (and his investors) took some real risk in doing so. Pretty awesome. I'd love to buy him a beer (at McNellies!) and hear his story.

But, at the risk of seeming like a monday-morning quarterback with no skin in the game, it does seem frustrating that there was some degree of the Jim Brewer School of Development in play here. I.e., buy all the buildings you can and sit on them indefinitely, until you more or less win the lottery by other folks increasing your property values. I don't know, but that seems to hinder organic development as much as help it. At least he didn't board up the windows.

I fully and freely admit I could be wrong on the slightly negative take. Maybe they were trying as hard as they could and ran out of money. We don't know the real story, but that wouldn't surprise me. But it also seems like there is a fair measure of buy-everything-up-and-hold-out, as opposed to buy and develop. To the extent that's true, it's rather less admirable.

[Pete]

I can't see the prices either but the fact these properties have been for sell for months without buyers stepping up tells me they are asking more than the market will currently bear.

Especially since lots of other buildings in that area have changed hands in the last couple of years.

[wsucougz]

It's been awhile since I've taken a look at the loopnet listings, and I'm more amazed than ever about what some of these sellers think the market will bear. Someone needs to get the word out that this is not NYC or Chicago and Chesapeake isn't planning on buying up the entire city.

[The Old Downtown Guy]

Greg Banta did a nice job of getting Plaza Court and the North Walker Shops leased up, but they were the easiest of the Midtown Renaissance projects to complete and lease. The immediate surrounding area is in pretty good shape and Saint Anthony provided a ready made crowd for at least the lunch hour at the new restaurants. Cafe De Brazil was well established and the neighborhoods to the north, Mesta Park and Heritage Hills provided the basis for building some dinner trade.

The commercial buildings along 10th Street present much more difficult challenges. Lots of adaptive reuse planned for these buildings . . . light industrial and office conversion to residential and mixed use is much more difficult than getting some of the now completed retail space projects on line.

Also, the abundant Bob Howard cash that flowed into the Banta led "Renaissance" led to some over-paying for some of the buildings which now translate into asking prices that are out of line with reality. But, lots of demolition and cleanup has already been done on most of these buildings, and that adds value and has removed a lot of the blighted appearance, delapidation and unsightly trappings which are often a hurdle that new would-be developers and financial institutions have difficulty getting past.

In the end, the market will rule and if Bob Howard is willing to sit on the properties for a while, he can expect higher prices. If he wants to get some of his cash back sooner the asking prices will come down closer to the buyer's offers.

Lots of progress has been made in Midtown and the area may be in for a brief period of stagnation before the market can reabsorbe these properties. Things could easily be hopping again come spring.

Saint Anthony's new professional office building, expanded parking and new main entrance are coming on line, Tom Seabrook's residential project at 7th and Dewey is nearing the end of it's design and approval process and along with the rehab of the Cline Hotel building, these projects will help to maintain a little momentum over the winter months. 2009 could see some new faces in the revitalization of Midtown.

[ElmTree]

If it weren't for Greg Banta and his vision, there wouldn't be a Midtown thread to comment on. I don't know the specifics of the real estate transactions, but I do know that my downtown family at long last has a crown jewel in its neighborhood, a place we can have Sunday brunch, Monday morning coffee, and an afterwork cocktail. A place I can take my out-of-town visitors and beam with pride.

Banta took on the Midtown project (and risk) long before anyone had a mere interest in Midtown. To call his occupation hollow is to misunderstand how great things come to life. Copper thieves, crack heads, prostitution...or McNellie's, Prairie Thunder, YMCA, and 1492? Hollow? I just don't see it. Without Banta's vision, Midtown would be boarded up, dangerous during the day, and deadly at night. He and his partners deserve our applause. (Remember the sex offenders at Hand Up? Even they are gone!)

As for timelines, I'm surprised that the watchers among us don't understand how long it truly takes to get things done right. This isn't a Nichols Hills renovation to a single residence, which easily can take eight months. The traffic circle? The two-way streets? You can't extract Banta from this equation, even the parts that were accomplished by Saints and the city. Midtown is truly a feather for our city and, though I'm not a financial or real estate expert, I suspect it will continue on that path.

Finally, are there any other areas in Oklahoma City that we are ashamed of, areas that we'd love to see revitalized? If so, we should support those visionaries who don't look at pure profit and expediency.

[mcgrawsdad]

If it weren't for Greg Banta and his vision, there wouldn't be a Midtown thread to comment on. I don't know the specifics of the real estate transactions, but I do know that my downtown family at long last has a crown jewel in its neighborhood, a place we can have Sunday brunch, Monday morning coffee, and an afterwork cocktail. A place I can take my out-of-town visitors and beam with pride.

Banta took on the Midtown project (and risk) long before anyone had a mere interest in Midtown. To call his occupation hollow is to misunderstand how great things come to life. Copper thieves, crack heads, prostitution...or McNellie's, Prairie Thunder, YMCA, and 1492? Hollow? I just don't see it. Without Banta's vision, Midtown would be boarded up, dangerous during the day, and deadly at night. He and his partners deserve our applause. (Remember the sex offenders at Hand Up? Even they are gone!)

As for timelines, I'm surprised that the watchers among us don't understand how long it truly takes to get things done right. This isn't a Nichols Hills renovation to a single residence, which easily can take eight months. The traffic circle? The two-way streets? You can't extract Banta from this equation, even the parts that were accomplished by Saints and the city. Midtown is truly a feather for our city and, though I'm not a financial or real estate expert, I suspect it will continue on that path.

Finally, are there any other areas in Oklahoma City that we are ashamed of, areas that we'd love to see revitalized? If so, we should support those visionaries who don't look at pure profit and expediency.

Ok...just my perspective, but plenty of developers have wanted to do want banta had plans to do in midtown, but lacked a funding source. No bank in the world would have loaned on those properties under the speculation that they could be massively redeveloped and suddenly command the price per square foot that would have made the deal work. Banta would not have been able to do what he tried to do without the MASSIVE infusion of Bob Howard cash. In my opinion, the whole undertaking was a miserable failure. Banta stayed alive longer than he should have from a second round of cash infusion from Howard and partners. I think he learned that rehabing properties (especially commercial) is more difficult than it appears. Someone commented earlier that because he has gutted a bunch of the buildings they are now more valuable. Not really. To the developer they have some intrinsic value, but to the bank, they are actually less valuable from an appraisal perspective. (Many of these buildings are now in a condition that it is not possible to receive a commercial appraisal on). Even the plaza building is limited in its success. Nothing was done to make the building more pedestrian friendly (outside of throwing up a couple bicycle racks). Nothing was done to stem the parking issues (remember when this building was erected it was a mass transit stop - along the trolley route). In fact, most of Banta's former properties have significant parking issues...just ask 1492, McNellies, Irma's...etc. The plaza still has lease space available and probably will continue to have due to the parking. Furthermore, what I find a bit ironic is that banta may ultimately have more to do with a midtown slowdown than a renaissance. From an investors standpoint who wants to go into midtown when the last project was a failure. Also, because banta paid an average of over $40 per square foot for properties that should have been picked up for an average of $25 per square foot; now many of these properties will set on the market (boarded up with vagrants breaking in) for years because he over bought. Don't get me wrong, I'm not trying to kick a guy when he's down, I just think there were some serious mistakes made. There is a huge learning curve in rehabing commercial properties and you don't take on a project which you do not have the expertise to complete...especially with someone else's money. It always amazed me that all of these buildings were gutted prior to any new tenants anywhere in the scope of the midtown renaissance. There are no real economies of scale to take advantage of when dealing with tear-out, so why sink the cost into gutting all of those buildings instead of concentrating your funds on a few properties, completing them, finding tenants, then moving on to the next property.

[okyeah]

Ok...just my perspective, but plenty of developers have wanted to do want banta had plans to do in midtown, but lacked a funding source. No bank in the world would have loaned on those properties under the speculation that they could be massively redeveloped and suddenly command the price per square foot that would have made the deal work. Banta would not have been able to do what he tried to do without the MASSIVE infusion of Bob Howard cash. In my opinion, the whole undertaking was a miserable failure. Banta stayed alive longer than he should have from a second round of cash infusion from Howard and partners. I think he learned that rehabing properties (especially commercial) is more difficult than it appears. Someone commented earlier that because he has gutted a bunch of the buildings they are now more valuable. Not really. To the developer they have some intrinsic value, but to the bank, they are actually less valuable from an appraisal perspective. (Many of these buildings are now in a condition that it is not possible to receive a commercial appraisal on). Even the plaza building is limited in its success. Nothing was done to make the building more pedestrian friendly (outside of throwing up a couple bicycle racks). Nothing was done to stem the parking issues (remember when this building was erected it was a mass transit stop - along the trolley route). In fact, most of Banta's former properties have significant parking issues...just ask 1492, McNellies, Irma's...etc. The plaza still has lease space available and probably will continue to have due to the parking. Furthermore, what I find a bit ironic is that banta may ultimately have more to do with a midtown slowdown than a renaissance. From an investors standpoint who wants to go into midtown when the last project was a failure. Also, because banta paid an average of over $40 per square foot for properties that should have been picked up for an average of $25 per square foot; now many of these properties will set on the market (boarded up with vagrants breaking in) for years because he over bought. Don't get me wrong, I'm not trying to kick a guy when he's down, I just think there were some serious mistakes made. There is a huge learning curve in rehabing commercial properties and you don't take on a project which you do not have the expertise to complete...especially with someone else's money. It always amazed me that all of these buildings were gutted prior to any new tenants anywhere in the scope of the midtown renaissance. There are no real economies of scale to take advantage of when dealing with tear-out, so why sink the cost into gutting all of those buildings instead of concentrating your funds on a few properties, completing them, finding tenants, then moving on to the next property.

does plaza court really have a parking problem? I usually just park in the St. Anthony's parking lot...I don't really mind either. There are lots of parking lots around, and I haven't been towed

[The Old Downtown Guy]

I agree with some of what you say mcgrawsdad, but the Plaza Court area is very successful and will continue to become more so. There is no shortage of parking within a short walk. Complaints about a lack of parking were always the big deal about Downtown and Bricktown so now it's Midtown. It wasn't really the case with DT, BT and isn't the case with MT. I go to those restaurants all the time and have no trouble parking . . . ever . . . so what if I have to walk a block or two . . . it sounds like the ol' "nobody every goes there anymore because it's too crowded" line.

As far as the strategy of controlling a lot of buildings adjacent to one another and going through first and cleaning them up, you're right, it takes lots of cash. But it's virtually impossible to get any building rehabed and occupied when there is blight all up and down the same block. As far as financing . . . it's tough, but it can be accomplished.

. . . just my perspective, . . . what I find a bit ironic is that banta may ultimately have more to do with a midtown slowdown than a renaissance. From an investors standpoint who wants to go into midtown when the last project was a failure. . .

I don't see any failures in Midtown, though there may be some in the future. I do see work continuing on the Midtown Deli on Walker and new storefront being installed at NW 10th and Robinson. I am pretty sure that you will see other gutted buildings in the area make progress this spring and quite a few new tenants by fall.

Michael Smith

Pray For World Peace . . . pass it on

[metro]

I agree with ODG, Plaza Court is a huge success and will continue to be. Heck, MidTown Deli should be opening soon next to 1492. I do agree with mcgrawsdad, only on that he should have gutted just a few buildings at a time and found tenants and then moved on to a few more buildings, instead of gutting them all at once. It makes me even more mad they are looking for office tenants on the prime pieces of property on the corner of NW 10th and Broadway. At the bare minimum they should be putting prime retail on the bottom floors. Both of those buildings are perfect for an Urban Outfitters or other national retailer that AA and OKC despirately needs.

[MikeOKC]

mcgrawsdad, You wrote of not wanting to "kick a man when he's down" referring to Greg Banta. I'm sorry, but Greg Banta is not down. In fact, his prescience of economic events and getting out when he did was masterful. Banta is now doing what Banta wants to do without huge bank loans hanging over his head. Greg Banta is a visionary and is doing very well, thank you very much.

[mecarr]

I don't see how Midtown is the new Bricktown. Other than the Midtown Deli which has been in the works for a year, there has been zero new development in Midtown lately and I'm not aware of any future development. There are still two or three vacant spaces in Plaza Court. While you can't park in Plaza court after 6:00 b/c it's so crowded, you can just park across the street which is no big deal.

[mturner]

"Tom Seabrook's residential project at 7th and Dewey is nearing the end of it's design and approval process and along with the rehab of the Cline Hotel building, these projects will help to maintain a little momentum over the winter months. 2009 could see some new faces in the revitalization of Midtown. "-ODTG
Really- hasn't Seabrook's poor project been forced to redesign and redesign already? What indication is there that the usual suspects won't continue to obstruct new development in MidTown. Given recent opposition to some projects, and past objections to the referenced one, MidTown's stagnation may last quite a while. A shame, really.

[metro]

"Tom Seabrook's residential project at 7th and Dewey is nearing the end of it's design and approval process and along with the rehab of the Cline Hotel building, these projects will help to maintain a little momentum over the winter months. 2009 could see some new faces in the revitalization of Midtown. "-ODTG
Really- hasn't Seabrook's poor project been forced to redesign and redesign already? What indication is there that the usual suspects won't continue to obstruct new development in MidTown. Given recent opposition to some projects, and past objections to the referenced one, MidTown's stagnation may last quite a while. A shame, really.

In all fairness to ODTG, you're digging up one of his posts from last September, when the project WAS still alive. The Seabrooke project is dead and the land up for sale.

[mcgrawsdad]

mcgrawsdad, You wrote of not wanting to "kick a man when he's down" referring to Greg Banta. I'm sorry, but Greg Banta is not down. In fact, his prescience of economic events and getting out when he did was masterful. Banta is now doing what Banta wants to do without huge bank loans hanging over his head. Greg Banta is a visionary and is doing very well, thank you very much.

Mike...don't pee down my back and tell me its raining. Banta was forced out by his partners and money men because they no longer had the patience to deal with his continual excuses as to why construction was not getting completed. I do not fault banta except in the fact that it was a tremendous project he was trying to complete and you should know better than trying to develop a learning curve on a project in which you have staked your whole professional reputation on. I sincerely hope he comes out on top of all of this and continues to do well. Unless an individual is independently wealthy you can NOT do large scale projects unless you have huge bank loans or partners fronting the cash. Also, a developer who is doing very well typically isn't performing tear-out (demolition) on his developments. I commend the hands on approach...but. That being said, I like Greg, he's a hell of a guy and I commend him for shooting for the stars. That takes stones! I just don't believe in sugar coating a situation just because you like someone and feel a bit sorry for them. I hope he bounces back bigger than ever. I am pulling for him and wish him nothing but success. I hope he finds tenants for the Tower project. My desire is for all of those individuals who put their name, money, and time on the line trying to improve OKC to be successful in ways never dreamed possible.

[The Old Downtown Guy]

"Tom Seabrook's residential project at 7th and Dewey is nearing the end of it's design and approval process and along with the rehab of the Cline Hotel building, these projects will help to maintain a little momentum over the winter months. 2009 could see some new faces in the revitalization of Midtown. "-ODTG
Really- hasn't Seabrook's poor project been forced to redesign and redesign already? What indication is there that the usual suspects won't continue to obstruct new development in MidTown. Given recent opposition to some projects, and past objections to the referenced one, MidTown's stagnation may last quite a while. A shame, really.

Mr. Seabook's project as originally presented to the Urban Design Commission was totally inappropriate in scale and concept for its site IMO, and the designers, TAP, received that clear message not only from "the usual suspects" as you say mturner, but from the Urban Design Commission. A couple of redesigns later and the project was very close to receiving UDC approval. It is my understanding however, and unfortunately so, that Mr. Seabrook is in extremely bad health, which is the reason a for sale sign has reappeared on the vacant lots and the project has not gone forward . . . not because the first design was not rubber stamped by the Urban Design Commission.

BTW, please feel free to name the individuals you refer to as "the usual suspects". That would certainly be a more straight forward and honest approach IMO, but it's your post. As to your suggestion that the "usual suspects" are obstructionists, since you didn't name these mysterious individuals, I'm not 100% sure who they are, so even if I know them and what their reasons are for expressing their opinions in a public forum, it's hard to discuss their perceived obstructionisticosity (to quote an unnamed "famous elected official") here and I wouldn't presume to speak for anyone other than myself in the first place . . . but I can be just as much of a smart ass as the next guy if I choose to.

So, speaking for myself (see name at end of post for ID), as far as I know, there are still some solid commercial Midtown projects coming down the line in spite of the faltering world, national, and to a lesser extent local, economy, and I stand by my general conclusions that "2009 could see some new faces in the revitalization of Midtown". The Seabrook project may eventually be built, but no time soon.

As far as the design review process you appear to hold in such disdain, mturner, I think I'll start a thread about that rather than stray off topic here.

Michael Smith

Pray For World Peace . . . pass it on

[mecarr]

I stand by my general conclusions that "2009 could see some new faces in the revitalization of Midtown".
Pray For World Peace . . . pass it on

Any info on what those new faces might be? Retail, residential, restaurants?

[The Old Downtown Guy]

Any info on what those new faces might be? Retail, residential, restaurants?

I don't really have any inside dope mecarr. I am just looking at what I see going on in the area, the pace at which this incremental kind of development occures, what the economics are etc.

Jeff Bezdek has purchased the Mason's Furniture building on 4th Street, Rick Dowell is in the process of ruining another building on 5th Street, work is proceeding at 10th and Robinson . . . so things continue to happen.

Michael

Pray For World Peace . . . pass it on

[jbrown84]

rick dowell is in the process of ruining another building on 5th street,

lol

[MikeOKC]

Mike...don't pee down my back and tell me its raining. Banta was forced out by his partners and money men because they no longer had the patience to deal with his continual excuses as to why construction was not getting completed. I do not fault banta except in the fact that it was a tremendous project he was trying to complete and you should know better than trying to develop a learning curve on a project in which you have staked your whole professional reputation on. I sincerely hope he comes out on top of all of this and continues to do well. Unless an individual is independently wealthy you can NOT do large scale projects unless you have huge bank loans or partners fronting the cash. Also, a developer who is doing very well typically isn't performing tear-out (demolition) on his developments. I commend the hands on approach...but. That being said, I like Greg, he's a hell of a guy and I commend him for shooting for the stars. That takes stones! I just don't believe in sugar coating a situation just because you like someone and feel a bit sorry for them. I hope he bounces back bigger than ever. I am pulling for him and wish him nothing but success. I hope he finds tenants for the Tower project. My desire is for all of those individuals who put their name, money, and time on the line trying to improve OKC to be successful in ways never dreamed possible.

LOL! Where do you get your information??????? What complete and total BS!

[mcgrawsdad]

Believe what you wanna Mike...

[Jimslimmer]

From the outside looking in, mcgrawsdad's post on the Banta Midtown dissapearance seems the most logical I have read. I think the area will develop, but in a more focused, project driven style. While"build it and the will come" breeds good will, and in the short run, drives demand, in the long run it is un-sustainable unless there is an unlimited money pile that can wait for an indeterminate length of time for a return on the investment. The Donald Trump theory of Real Estate dosen't work on a micro level. (leverage to a level the bank cannot afford to forclose, and you achieve mutually assured destruction) I look for slower, more focused, Tenant driven projects throughout the area now that the splash has subsided