A local commercial leasing and sales agent confirmed Thursday the former American Stores office tower downtown finally has a potential buyer, one who has an eye toward luring some West Coast companies to Salt Lake City to occupy it.
According to Randy Freeman, an agent with Colliers Commerce CRG, Thomas Real Estate Advisors Inc., based in San Francisco, has signed a contract with Boise-based Albertson's Inc. to buy the 25-story office building for an undisclosed price. Colliers Commerce and Freeman represent TREA president Douglas Thomas in this market.
Albertson's has been trying to sell the building ever since it became the owner as part of its $12.9 billion acquisition of American Stores last year.
Freeman said Thomas is currently engaged in "due diligence" of the property — a legal term for investigating all of the details of a transaction. Assuming there are no problems with getting clear title — and it's not old enough to have accrued many obstacles since it's only 28 months old— the sale is expected to close later this year.
Thomas has indicated he will scour his home turf, Silicon Valley, for potential tenants for the 620,000 square-foot building at 299 S. Main. "He has been very supportive of (Gov. Mike Leavitt's) forays into that market," said Freeman, noting that while it is not suited for manufacturing, the tower would be a good site for corporate offices and technical development facilities.
But probably not without some major modifications if it is to be used as a multitenant facility. The building was constructed for a single tenant, American Stores, and as it now stands is ill-suited to being divvied up into small pieces for a lot of different companies.
American Stores employees had cubicles not offices. That would work for full-floor or multifloor tenants but it would likely have to be refitted for multiple tenants.
The American Towers building has been a major drag on the downtown office market. Last spring, a Chicago-based developer put plans for a 20-story Main Street office building on hold, citing the thousands of square feet of available space in the American Stores building as a competitive wild card.
Following the merger of Albertson's and American Stores in June 1998, about half of the workers in the building were transferred to other sites or laid off, leaving the building largely empty. Last December, the Salt Lake Organizing Committee for the 2002 Winter Games agreed to take over seven of the floors, but SLOC, of course, is not a long-term tenant. Its lease is due to expire soon after the close of the Winter Olympics in February, 2002.
Albertson's did not return calls seeking comment by press deadlines Thursday.
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