Company drilling for success with ‘high-end’ condo project

By Steve Lackmeyer Business Writer


Three historic downtown Oklahoma City buildings owned by Kerr McGee will be renovated into “high-end” condos next year as part of a deal announced Wednesday by Kerr-McGee Chairman and Chief Executive Officer Luke Corbett.

The buildings, empty for the past 20 years, include the former home of Braniff Airlines, an early headquarters for Kerr McGee and a building that was once home to the Legislature.

The developers, Corporate Redevelopment Group, include principals who are no strangers to downtown housing. Bert Belanger, Pat Garrett and Anthony McDermid also are partners in the Triangle, a housing, retail and office development being built this winter along NE 3 and Walnut Avenue. The threesome also are about to begin construc- tion on Central Avenue Villas in Deep Deuce.

“A lot of exciting things are happening downtown,” Corbett said. “This will be upscale housing. This particular group came forward with what we thought is a viable plan, a plan they can accomplish. And it met the criteria we want: Something that is very nice for downtown and will continue the momentum.”

The approximately $40 million development will offer about 70 forsale condominiums and penthouses. The project would cover three Kerr McGee buildings with space totaling 270,000 square feet:

• 111 Robert S. Kerr Ave. is a seven-story, 38,736-square-foot building built in 1902. The property was a temporary home to the Legislature for four years.
• 135 Robert S. Kerr Ave. is an 11-story, 155,911-square-foot building built in 1921 that was once Kerr McGee’s headquarters.

• 324 N Robinson Ave. is a 10-story, 75,584-square-foot building built in 1923 that was once home to Braniff Airlines.

Terms of the deal or potential sale prices were not being disclosed Wednesday. Corbett said parking arrangements for the development are not finalized.

Corbett said his company has fielded numerous offers for the properties over the past decade, but he said the ideas or timing was never quite right.

“What’s captured our attention is what has happened to the downtown area after MAPS,” Corbett said. “If you look at the momentum we have in this city and the growth that’s occurring downtown, it’s breathtaking.”

Corbett said the agreement, which is expected to close within the next few months, imposes deadlines for development.

“We’re trying to have all this done by the Centennial in 2007,” Corbett said.
McDermid, the project architect, first publicly suggested the buildings could be converted into housing at a mayor’s conference three years ago. He praised Kerr McGee for carefully maintaining and securing the properties long after they were no longer needed.

“They have a 75-year history of being a great downtown benefactor. This continues that legacy of investments they’ve made for the public purpose, and now they see there is a demonstrable need for housing downtown.”

McDermid said the three buildings, especially the Braniff Building, are well-suited for housing because of their windows, views and natural lighting.

“The Braniff Building is one of the most storied buildings in Oklahoma City’s history,” McDermid said. “Although we don’t have specific designs yet, we will want to maintain the Braniff theme and record the history in some way.”

More uncertainty surrounds the property at 111 Robert S. Kerr, which had a concrete exterior placed over the original facade 40 years ago. McDermid said his group wants to restore the original facade but must consider costs and find photos or designs showing how the material was installed.

Belanger said he is not worried about adding too much housing to the downtown market.

“We think there is plenty of demand for all these products,” Belanger said. “We’ve got price-points at $100,000, $200,000 and $400,000. We don’t know what the lofts in the Kerr McGee buildings will cost, but it will probably be in the middle of that.”

Belanger said he’s fielding calls every week about the previously announced projects in the Triangle and Deep Deuce.

“Some are frustrated, frankly, that things haven’t developed more quickly. But we’re getting very close to having product that we can deliver.”

http://mysite.verizon.net/res17zef/condos1.jpg

http://mysite.verizon.net/res17zef/condos2.jpg

This is awesome news downtown. This will only further reduce the downtown office vacancy rate forcing other buildings to fill up faster thus hopefully getting a new tower sooner!

Here is what OKC Business had to say:


Kerr-McGee Heading $30 million to $40 million Project To Bring Luxury, Penthouse Living to Downtown OKC
View the pictures
Posted: Thursday, November 10, 2005

By Pamela Grady

pgrady@okcbusiness.com

Similar to Chesapeake Energy Corp. seemingly entering the commercial real estate business, it appears Kerr-McGee, too, is following suit by entering the market outside of oil and gas.

One of the largest U.S.-based independent oil and natural gas exploration and production companies, Kerr-McGee today announced it is partnering with Corporate Redevelopment Group LLC to renovate three downtown historic buildings the company owns into large luxury and penthouse condominiums.

Chief executive and Chairman Luke Corbett said details of Kerr-McGee and Corporate Redevelopment Group's respective financial stakes in the $30 million to $40 million project still were being negotiated.

As such, neither Kerr-McGee nor Corporate Redevelopment Group yet has discussed the parameters of the project with the city.

According to state Secretary of State records, Corporate Redevelopment Group was formed just two days ago - on Nov. 8. Its principals include William "Pat" Garrett, Bert Belanger, Anthony McDermid, Judy Hatfield and Jeff Van Hoose.

The buildings proposed by Kerr-McGee for redevelopment encompass more than 270,000 square feet.

The seven-story 111 Robert S. Kerr Ave. building was constructed in 1902 and totals 38,736 square feet. The 11-story building at 135 Robert S. Kerr Ave. totals 155,911 square feet and was built in 1924. And the 10-story building at 324 N. Robinson Ave. is 75,584 square feet and was built in 1923.

"These are buildings that Kerr-McGee's had for quite some time," Corbett said. "We acquired the buildings in the mid-Sixties and they have been vacant and unused for about 20 years.

"We've maintained the buildings, but, due to the fact that we've expanded our operations in Houston, Denver and places like that, we obviously need less office space here in Oklahoma City. So this is a terrific way to take vacant, unnecessary and unneeded office space and transition it back into a use that's being demanded in downtown Oklahoma City."

The principals of Corporate Redevelopment Group, in essence, have engaged themselves and their respective companies to head up the Kerr-McGee project.

That is, Garrett and Company will be responsible for project management; Anthony McDermid at TAParchitecture will head project design; Jeff VanHoose with VanHoose Construction will head construction services; Judy Hatfield with Equity Realty will be responsible for sales and marketing; and Bert Belanger will serve as the project's legal counsel.

The developers plan to offer approximately 70 condominiums and penthouses. If the three buildings are redeveloped purely for residential living, that would mean the condos would average about 3,800 square feet, making them the largest luxury residences in the downtown area.

However, McDermid with TAParchitecture said it's very possible the buildings will be some form of mixed use.

"We are still developing the concept for the project, but we know at this stage of the planning, there will be at least 70 condominiums at the two west buildings, the 135 building and the 324 building," he said. "We haven't talked any specifics but a little grocery store might be a wonderful contribution to the project. It's early in the development phase. What we've been given here is an opportunity and we're going to explore any and all options."

Just what the project means financially to publicly traded Kerr-McGee also is uncertain.

"At this point, we are facilitating the redevelopment," said Richard Buterbaugh, Kerr-McGee's vice president of corporate planning. "The titles will not transfer immediately. There's still negotiation that would have to take place as far as how the buildings are going to be used and subject to their final plans on what's going to be done with the buildings.

"But we're certainly providing every opportunity to get these buildings back into use. I expect sometime early next year we'll know more about the finalizations of the project," he said.

Corbett said eventually the properties would transfer to Corporate Redevelopment Group but, again, what that would mean financially to Kerr-McGee has not yet been finalized.

"We're staying involved at this point in time because we want to make sure this is a high quality project," Corbett said. "There would be certain standards that we would like see, and, secondly, this is a high-caliber group. We feel like they could complete the project in a timely manner. So those are the issue's we've resolved upfront."

McDermid said Corporate Redevelopment Partners hope to get the project started during the first quarter of 2006. He said the team currently is working on design concepts and that they would have to be approved by Kerr-McGee before presented to the city.

"You can expect to see us announce some ideas after Kerr-McGee's had a chance to review and approved them within 60 days," he said, adding the transfer of title of the buildings from Kerr-McGee to Corporate Redevelopment Partners was triggered by "performance criteria."

He didn't believe the eventual value of the mammoth project to Oklahoma City could be overstated, but the scope required the type of experienced team Kerr-McGee had assembled to undertake it.

"It's all about the team," McDermid said. "It's all about having a capable team of people you trust and can rely on to perform. We've got a great team on the project."

Wonderful news!

I really like this push to renovate the current real estate inventory for housing, inseatd of just building more inventory in a high vacancy area.

The Braniff Building is one of my favorite downtown.

Great news!

Awesome!

This is great news! Hopefully, the First National Building will be next on the list for rehabilitation. I predict that since we've had tons of national exposure lately because of the Hornets, this city is getting ready to boom like no other time in our history. I see a new tower going up within the next five years. It will be interesting to see how much the vacancy rate goes down when all these buildings are taken off the market and turned into residential complexes.

This is excellent news! I've always wondered about those old buildings. This will do so much for downtown OKC:

1. Dramatically reduce the office vacancy rate
2. Breathe life into the central business district
3. Move downtown housing from short-term rental environment to long-term ownership
4. Add real "big city" feel
5. Help economic development and recruitment efforts

I also like how this doesn't involve the lumbering idiots at OCURA. There is no apparent way for them to screw this up somehow, as they cannot get their dirty mitts on it.

This is a win-win-win-win-win for OKC!

I'm very excited about this news for all the reasons stated above, especially if it leads to a new tower downtown. That will be the culmination of everything we've done in my book.

Here are some more pics of the buildings involved:

Braniff Building, built in 1923, home of Braniff Airlines for a time (see http://www.dougloudenback.com/downtown/vintage/1.braniff.htm for more info and more links):
http://www.dougloudenback.com/downtown/vintage/1923.braniff2.jpghttp://www.dougloudenback.com/downtown/vintage/1923.braniff.jpg

Oklahoma City S & L, built in 1928, immediately south of Braniff Building:
http://www.dougloudenback.com/downtown/vintage/1928.oksavings.jpg

India Temple, built in 1902, which served as the temporary home of the Legislature (1913-1917).

http://www.dougloudenback.com/downtown/vintage/indiatemple2.jpg

My understanding is that none of the buildings, though part of the KM campus, are presently in use.

This will be very nice .... and I guess we will soon get an answer as to whether this is true or not: "If you build them, they will come." And ... as has been wondered for the Park Harvey Apartments ... parking?

I also like how this doesn't involve the lumbering idiots at OCURA. There is no apparent way for them to screw this up somehow, as they cannot get their dirty mitts on it.

hahahaha, so true and so funny. Yes, with OCURA off it, it will progress faster too! Another exciting day for OKC!

Wow,, if they can get the concrete facade off the India Temple, that will be very cool. I hope it's feasible for them.

I don't understand why they did stuff like put concrete and stucco over the ornamental architecture of The Skirvin and the India Temple. Hope they can get it off like you said BDP.

I'm excited also, I work there. I have been all thru those buildings, It is going to be an exciting next 2 years, I think they are going to build condos east of the RR tracks also.

did nobody notice that they mentioned there might be a mall grocery store included in the project? If they go through with that it would be a great start to show some of the bigger chains or a possible local entity that a grocery store is feasable downtown.