Price drop: Borders corporate headquarters in Ann Arbor now for sale at $10 million
How much is one of the largest office buildings in Ann Arbor worth?
The answer for 100 Phoenix Dr.: $10 million, based on a new listing for the property that since 1998 has been home to Borders Group Inc.
That leaves Agree Realty Co. of Farmington Hills holding the building on Phoenix Drive and facing either finding a new tenant or a buyer for the building.
In fall 2010, a previous listing priced the property at $18.349 million. However, that listing also touted a 12-year lease with a corporate tenant that had an option to renew. It also included an adjacent building, giving it a total square footage of 460,000 square feet.
The new listing is for the 330,000-square-foot main headquarters.
Borders once filled the property with as many as 1,800 employees, a number that's likely below 500 today.
Since the listing last fall, Agree has successfully listed and sold other properties in its multi-state portfolio that were solely leased to Borders. At that time, 27 percent of Agree’s $34 million in rental income came from 17 leases to Borders.
Today, Agree says it has 14 properties leased to Borders.
Meanwhile, the building is assessed by the city at $10.6 million, giving it an estimated market value of $21.2 million. That assessment reflects the quality of the rental income stream - it was $15.9 million in 2009.
The listing is with Steve Gordon and Jay Chavey of Signature Associates.
Comments
Craig Lounsbury
Wed, May 4, 2011 : 1:01 p.m.
"How much is one of the largest office buildings in Ann Arbor worth?" The correct answer will come when its sold. Its worth will be what someone is willing to pay.
15crown00
Wed, May 4, 2011 : 4:01 a.m.
Maybe they should pay someone to take it. Come up with any figure you want as to what is worth in theory per square foot but it's only worth that much if a buyer is willing to pay that much.
goingfast3579
Wed, May 4, 2011 : 1:28 a.m.
well let's see after it sits empty for years. Worth 10 mil. somebody that is friends with a politician will pick it up for about 2.5 and get 30 yrs. of tax breaks. So benefit locally a huge loss and still no good jobs or public benefit. Just an observation. Maybe do a write off and make it a transition for illegals. Or rec center. If people had good work they might have been able to buy books in the first place.
tdw
Tue, May 3, 2011 : 9:51 p.m.
Maybe UofM will buy it and take it off the tax rolls
Bob Martel
Tue, May 3, 2011 : 5:32 p.m.
At $30 per SF this property certainly makes sense for a user (i.e., owner/occupant) to acquire. After making typical improvements, I'd guess that they'd own it for a total cost in the range of $60 per SF which is still very competitive with most alternatives. The challenge is finding a 330,000 SF user. There just aren't that many around. I doubt that an investor (i.e., non-occupant owner) could get financing for the acquisition unless they brought a substantial tenant to the table. Again, a real challenge. I'm afraid that this building may simply be a very large white elephant.
Craig Lounsbury
Wed, May 4, 2011 : 1 p.m.
at least they don't have to repaint it to be a white elephant.
Tom Joad
Tue, May 3, 2011 : 4:43 p.m.
A monument to missing the boat. Perhaps Amazon can buy it and use it for an order fulfillment center
Wolf's Bane
Tue, May 3, 2011 : 4:36 p.m.
Do I hear 8 million... going once, going twice... !!! This is certainly embarrassing.