Indianapolis' BMO Plaza office tower fetches $70 million

Indianapolis' BMO Plaza office tower fetches $70 million

By Staff Writer

Indianapolis’ 28-story BMO Plaza office tower has been sold for $70 million. A group of real estate investment companies based in Michigan and Florida made the acquisition.

Indianapolis’ 28-story BMO Plaza office tower has been sold for $70 million. A group of real estate investment companies based in Michigan and Florida made the acquisition.

The tower, at 135 N. Pennyslvania St., sits in the heart of downtown Indianapolis. It is also the sixth-tallest building in the city.

The new ownership group of the building is made up of Detroit-based developer Redico and Black Salmon, an investor from Miami.

Adam Broderick, John Robinson, Bruce Miller and Nooshin Felsenthal from JLL reprented owner Hearn Co. in the sale.

The building’s occupancy was at more than 80 percent at the time of the sale. Notable tenants include the U.S. Department of Defense, G.E. Capital Services and BMO Harris Bank.


Downtown office tower BMO Plaza sold in $70M deal

Downtown office tower BMO Plaza sold in $70M deal

By IBJ Staff

BMO Plaza, a 28-story Class A office tower at 135 N. Pennsylvania St. in downtown Indianapolis, was acquired by a group of real estate investment companies from Michigan and Florida. The new owners announced the acquisition this week.

The state’s sixth tallest building has been sold for $70 million.

BMO Plaza, a 28-story Class A office tower at 135 N. Pennsylvania St. in downtown Indianapolis, was acquired by a group of real estate investment companies from Michigan and Florida. The new owners announced the acquisition this week.

The $70 million price marks a whopping 75 percent increase over the $40 million that Chicago-based Hearn Co. and Boston-based equity partner CrossHarbor Capital Partners paid in early 2016 to buy the building from White Plains, New York-based True North Management Group.

The new ownership group is made up of Miami-based real estate investor Black Salmon, an affiliate of real estate developer TSG Group, and Detroit-based developer and investor Redico LLC.

JLL brokers Adam Broderick, John Robinson, Bruce Miller and Nooshin Felsenthal represented Hearn in the sale.

According to Black Salmon, Hearn spent about $6 million on a redevelopment plan to upgrade the tower’s lobby, common areas and fitness center, and add a tenant lounge and game room. Hearn also relocated its restaurant space, which has been a "revolving door," from the second floor to street level, and filled it with King David Dogs.

The improvements help raise occupancy from about 73 percent to more than 80 percent.

Key tenants in the 444,644-square-foot building include BMO Harris Bank, the U.S. Department of Defense and General Electric Capital Services.

In terms of square footage, the building is the eight largest office complex downtown. The only taller buildings in the state are Salesforce Tower, OneAmerica Tower, Regions Tower, Market Tower and 300 North Meridian.

CoStar Group, a real estate information service, said asking rents in the building range from $22.50 to $24.50 per square foot.

Developed by Phillip R. Duke and Associates, BMO Plaza opened in 1988 and was originally called First Indiana Plaza after anchor tenant First Indiana Federal Saving Bank. It became M&I Plaza in 2008 when Milwaukee-based Marshall & Ilsley Corp. acquired First Indiana and was renamed BMO Plaza in 2011 after Bank of Montreal bought M&I.

Black Salmon said it plans to make further upgrades to BMO Plaza’s common areas.

“We continue to identify key markets throughout the U.S. that are rich in opportunities for value investments,” said Ignacio Murman, head of acquisitions and managing partner for Black Salmon, in a written statement. “Our client base is composed of international participants, whose appetite is strong to streamline the investment process and diversify their portfolios with quality assets.”

True North took ownership of the building in October 2009 after former owners New York-based Crown Properties Inc. and Connecticut-based Greenfield Partners defaulted on their loans.

At the time, the building had just lost its largest tenant, the law firm of Bose McKinney & Evans LLP, and was less than 30 percent occupied.


Office tower called 'epicenter of downtown Columbus' sold to owner of Chicago’s John Hancock Center

Office tower called 'epicenter of downtown Columbus' sold to owner of Chicago’s John Hancock Center

By Evan Weese

A Columbus office tower has been sold to the owner of Chicago’s iconic John Hancock Center. Hearn Co. has acquired the 25-story One Columbus high-rise at 10 W. Broad St.

A Columbus office tower has been sold to the owner of Chicago’s iconic John Hancock Center.

Hearn Co. has acquired the 25-story One Columbus high-rise at 10 W. Broad St.

Financial terms of the sale by True North Management Group LLC were not disclosed.

The Chicago firm says it’s begun renovating the building’s lobby, corridors, fitness center and tenant lounge.

Hearn, which owns a number of prominent skyscrapers around the country – including the John Hancock Center in Chicago – touts the 32-year-old property as being at “the epicenter of downtown Columbus,” located at the intersection of High and Broad streets and overlooking the Statehouse.

Tenants of the 407,000-square-foot building include naming rights-holder U.S. Bank, the National Federation of Independent Business and Red Capital Group, according to Columbus Business First research.

Greg Thomas and Kirk Smith of CBRE Group Inc. previously handled leasing and, alongside Toronto's Avison Young, represented White Plains, New York-based True North in the sale.

Aaron Duncan and Collin Wheeler of JLL are handling leasing for Hearn's only property in Central Ohio.

“True North always had kind of a five-year hold timeline,” Thomas told me. “They had met that, or were getting very close to that, and they had had some good success leasing the building.”

The building’s occupancy rate was in the low-70s when True North bought it in 2011, Thomas said.

It is now in the low- to mid-80s, he said.

“I think that the appeal to the core (central business district) is there’s lots of organic expansion with tenants,” Thomas said. “We’ve really had strong absorption, we’ve seen various buildings lease up quickly once there’s some money invested in them.”

True North had acquired the property in 2011 for $27 million, according to the Franklin County Auditor, 12 years after it changed hands for $51 million.

An industry source said this month’s sale to Hearn was for $31 million.