Owner of former Anthem HQ exploring converting some space to parking

The former Anthem Inc. headquarters on Monument Circle. (IBJ photo)

Editor’s note: This story has been updated to reflect that the proposed parking would be on the basement level of the Anthem building, rather than on the ground level.

The owner of the former Anthem Inc. headquarters on Monument Circle is exploring the possibility of converting some of its basement space into parking, in hopes of enticing new office and retail tenants.

The four-story building at 120 Monument Circle is undergoing a feasibility study that would determine the cost of renovations to spruce it up for would-be tenants. Chief among the considerations is the addition of parking spaces on the basement level of the building, said John Vandenbark, an office broker with the Indianapolis office of CBRE representing Massachusetts-based building owner Franklin Street Properties.

The study also could include less-drastic ideas for modifying the building’s 213,600-square-foot interior, but Vandenbark said much of it would focus on parking and drafting a long-term strategy for the building.

The study is expected to last for up to 30 days, to be followed by several months of discussion on costs and return on investment.

“We’re engaging in that process now to see if [parking] makes sense,” Vandenbark said. “Ultimately, even if you can do it, you have to look at the cost. [Users] might be better off to just go pay for some parking spaces in the nearby area, because there’s plenty of that too. It’s just … something we’re looking at as an option.”

It’s so far not clear how many spaces would be added if such a plan moved forward, or where access points to the parking would be. But Vandenbark said the parking would be limited to the subterranean level of the building and likely would not encompass the entire level.

When in use by Anthem, the lower level included office space, conference rooms, fitness space and a large data room, Vandenbark said.

Anthem’s lease expired in December 2018, and the Indianapolis-based health insurance giant opted to consolidate its headquarters staff into its operations center about five blocks southeast at 220 Virginia Ave.

The move to explore new uses for the space follows an unsuccessful call for bids earlier this year. Franklin Street, which bought the building in 2010 for about $42 million, spent six weeks starting in mid-April accepting offers for the building.

Vandenbark declined to discuss how much the firm was seeking from a potential sale, but he noted that none of the several offers were “a price that we were comfortable with.”

A real estate source said Franklin Street had hoped to receive offers in the high teens to low 20s, but none of the bids were quite that high. Now, the building is back to being marketed solely for lease.

The owner had originally not been looking for a buyer, Vandenbark said, but with continued concern over whether downtown office users will need as much space after the dust settles from the pandemic, the firm wanted to see what its options were. 

Last year, CBRE and the Franklin Street group began discussing the possibility of splitting up the building for use by multiple large occupants, with a minimum office lease around 25,000 square feet. That option is still on the table.

Industry sources have previously told IBJ the asking rate for office space in the building is around $24 per square foot, on par with other prime spots in the downtown market.

The possibility of adding more retail tenants also is still being considered. Current storefront tenants include FedEx Office, H&R Block and Forum Credit Union, which collectively occupy a total of about 11,000 square feet.

Vandenbark said there are currently few prospects for the building, reiterating what he’s previously told IBJ: Leasing even a portion of the building could take years.

Few companies were in the market for massive amounts of office space before the pandemic, and that demand has only plummeted. In fact, some major downtown office users—such as Rolls-Royce—are shifting to a work-from-home model for many of their employees.

“It’s a big chunk of space and … we’ve got to find the right user,” Vandenbark said. “What great location with great signage—what a great front door to Indianapolis. Somebody is going to get some exposure with this building at some point.”