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The Chicago-based owner of the Capital Center office towers in downtown Indianapolis has listed the complex for sale.
Zeller Property Group, which purchased the 648,000-square-foot, two-tower property in 2018 for $63 million, has not disclosed its reason for selling the property, nor did it disclose an asking price.
The property consists of a 17-story tower to the north, at 251 N. Illinois St., and a 22-story south tower at 201 N. Illinois St. The buildings, completed in 1986, are connected by a glass atrium. Their tenants include Sponsel CPA Group LLC, Fifth Third Bank and accountants BKD LLP, as well as the Indiana Supreme Court.
According to Chicago-based brokerage JLL, which has been contracted to manage the sale of the buildings, the complex is about 61% occupied, with at least 199,000 square feet available for lease.
Zeller and JLL representatives did not respond to messages requesting comment for this story.
The owner in recent years has spent more than $18 million to revamp the property, with upgrades to conference space, a fully renovated lobby with an expanded bar and coffee area, a new outdoor patio and improvements to the complex’s fitness center. Zeller also modernized the properties’ elevators and built out multiple move-in ready spaces for prospective tenants.
The listing comes as two downtown office towers face foreclosures.
IBJ reported on Feb. 5 that the owners of the 36-story Regions Tower are facing a foreclosure suit after allegedly failing to pay off nearly $75 million of loans last year.
The owners, NG 211 N. Pennsylvania St LLC and Regions Tower MF LLC, missed an Oct. 1 deadline to cover the outstanding balance, according to Cleveland firm KeyBank, which is the debt servicer for the building.
In the foreclosure filing, Delaware-based Wilmington Trust National Association, which represents KeyBank, asked that the full amount of the outstanding debt be repaid immediately—along with accruing interest and legal fees—or the property would be foreclosed upon.
Foreclosure would send the deed to the Marion County Sheriff’s Office, which would put the property up for bid at auction, with Wilmington having an option of bidding to take control of the site.
In August, the owner of Circle Tower on Monument Circle was sued over alleged failure to repay debt. Chicago-based Expansive, through 55 Monument Circle Level Office LLC, has allegedly fallen behind on payments for its $13.5 million loan, also failing to maintain adequate communication with the bank about operations as required in loan documents.
The company owes about $12.94 million on its loan, according to that lawsuit.
Downtown is also continuing to face growing office occupancy problems, with the Indianapolis office of Cushman & Wakefield reporting a vacancy rate of 22.2% at the end of 2023.
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feels like this going to become(is) a serious problem for downtown Indianapolis. If you look at the areas just outside the circle (Mass Ave, Fountain Square, and the Whole Sale District) you can find constant development and revitalization. I’m concerned that the area directly adjacent to circle is going to be a ghost town that’s burdened with high vacancy rates and decaying structures.
It’s not, it’s Gonna thrive!! So will the whole metro area!!!!
Its not bad, as long as you don’t go out at night and avoid the human feces and urine on the sidewalks.
This is an issue that’s going on nationwide and not just in Indy. Take Louisville for example, the entire Humana tower downtown Louisville relocated all its employees from downtown as well as the Fish Third bank tower downtown moving all its employees to a new building in the NULU neighborhood. Downtowns are slowly dying in the midwest and cities even like San Francisco but Austin and Nashville continue to build office and residential towers. It’s like they’re immune from all of this.
I meant Fifth Third Bank tower Downtown Louisville.
Might have more tenants if they removed that art work on the eastside of the building. Or put a towel around his waist.
You must be ancient. The artwork was only controversial with the old prude set back in the 80’s, everyone else got over it. Don’t go into a museum of classical art or you might faint.
Seems to me that at the present vacancy rate, all the existing tenants would fit in the 21-floor tower and the other tower could become hotel, condo, apartment, or a combination.
Yes, that requires considerable investment, but apparently it made sense for the AT&T Blue Building at 220 N. Meridian next door.
Man, if we didn’t give the stadiums to the leftist activist out of towner Simons and the recovering junkie (though I pray he continues to improve) football owner think how bad it’d be …
Hang on folks, this is just the beginning..
Go woke, go broke. Elections have consequences. Unfortunately, the masses just want hand outs. Too many want the rewards without the responsibilities.
Who wants to be smell all the pot smokers, be pan handled, let alone robbed downtown?
Obviously all the work at home is part of it but so is Indy being soft on crime.