The deal's off for Virginia Commonwealth University to purchase a Broad Street office building from the city, according to former city Chief Financial Officer Harry Black. “The economic downturn made the deal unappealing,” he says.
That means the renovated Theater Row building, a block from City Hall and directly across from the new federal courthouse, continues to languish.
Style Weekly reported in September that the university had made an offer on the building which is assessed at $25 million. A source close to the deal says the offer came in around $15 million.
Less than half of the Theater Row building is rented. VCU offices and the city's Department of Public Utilities occupy most of the rented space. But there is about 54,000 square feet, or three floors, of vacant space available for lease.
Despite having such city-owned space available, Mayor L. Douglas Wilder proposed moving the city's permits and inspections division from the first floor of City Hall to a space the city leases several miles west at the 3600 Building on West Broad Street.
In the Dec. 2 issue of his Visions newsletter, Wilder says the 3600 Building “is centrally located, offers plenty of free parking, and provides ample available office space that the City could readily rent.”
Wilder had planned to resettle the school administration to the space, but since his surprise relocation of that body from City Hall failed in September 2007, school administrators continue to occupy the upper third of City Hall.
The city kept paying rent on the vacant space at 3600 until April. Then officials renegotiated the lease and moved in 43 city workers.
Outgoing City Council President Bill Pantele wonders why Wilder isn't using Theater Row. “What I don't understand is that if the city has a building located a block from City Hall, and it's a very nice building, and they've got 60,000 vacant square feet [there], why the city would rent third-party space,” he says.
The pool of tenants eligible to occupy Theater Row is small. The building's financing requires the city only to rent to public tenants such as state or city agencies.
The city attempted to refinance the building last year in an effort to open it to private tenants, but abruptly pulled the plug on the deal in February 2007, straining relations with nationally recognized consultants, the National Development Council, who were helping with the plan.
The consultants had offered to pay local contractors — lawyers and architects who had been working on the refinancing — from a $380,000 fund of city money they were holding as part of a separate deal meant to spark economic development in Jackson Ward, Style reported in October.
Negotiations to settle have been sporadic, assistant city attorney Haskell Brown says: “It's not something that's going on right now with a lot of fervor.”