Palmetto Center put on the block

By C. Grant Jackson, Business Editor Gjackson@thestate.com

The Palmetto Center on Main Street, home to SCANA's headquarters, is for sale.

BUYING AND SELLING MAIN STREET

The sale of big buildings along Main Street isn't anything new. Four big buildings have changed ownership over the past three years, including the Bank of America Plaza, sold twice.

1333 Main St.

The former Washington Mutual Building

Date sold: August 2004 Office space: 191,363 square feet

Sales price: $12.4 million, or $65 per square foot

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1441 Main St.

The Wachovia Building

Date sold: June 2004 Office space: 274,222 square feet

Sales price: $27 million, or $98 per square foot

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Bank of America Plaza

1901 Main St.

Date sold: December 2004 Office space: 302,340 square feet

Sales price: $33.76 million, or $111 per square foot

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NBSC Building

Main and Lady streets

Date sold: April 2006 Office space: 150,562 square feet

Sales price: $15.3 million, or $101 per square foot

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Bank of America Plaza

1901 Main St.

Date sold: May 2006 Office space: 302,340 square feet

Sales price: $43.5 million, or $144 per square foot

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SOURCE: NAI AVANT

The Palmetto Center, SCANA's downtown Columbia headquarters, is for sale, and at least two local developers are interested in the building.

Alan Kahn, who developed the Village at Sandhill, and Al Saad of Foster/Saad and Co., which has developed several downtown buildings, said their companies would respond to a request for purchase proposals from Grubb & Elllis/Wilson Kibler.

Grubb & Ellis, a Columbia-based commercial real estate firm, has been hired by the Palmetto Center's New York owner, Main Street Associates, to sell the property. The 20-story office tower at 1446 Main St. has about 456,000 square feet of office space, adjoining the Marriott hotelat Main and Hampton streets. SCANA said last year it would move when its lease expires in October 2009. The utility holding company is building a new corporate campus in Cayce.

SCANA subleases space in the Palmetto Center to Wachovia Bank. However, the bank has said it, too, plans to move its offices.

City officials are concerned about the impact of the moves on downtown. The SCANA move alone will take 900 employees out of downtown. However, new ownership for the building could clear the way for the search for new tenants, they said.

Billy Way of Grubb & Ellis expects to have marketing material ready to distribute to potential buyers in the next 30 days through his firm's 100 offices nationwide. "We have a very long database of investors that we will blast this out to simultaneously."

A sales price has not been set, Way said. The building was developed 24 years ago for SCANA and has never been sold on the open market.

"It is not an auction, but it is a similar process," he said. "Rather than us telling the market what we think it is worth, we will let the market tell us. That process has just proved to yield the highest price."

Kahn said he received a call Wednesday from Jeremy Wilson, chairman of Grubb & Ellis, trying to gauge his interest in the Palmetto Center. Kahn said he definitely would respond to the request for a purchase proposal.

Kahn said a mixed-use redevelopment -- converting part of the office building into condominiums -- is a possibility. But that would depend on the state of the local condo market, he added.

"A major, monumental building like that needs to be reused," Kahn said. "It is important we replace SCANA with another major occupant or with other uses that bring people downtown. ...... It is a good and worthy goal."

Grubb & Ellis also talked with Saad, who said he, too, probably would respond to the request for a purchase proposal. "We have a pretty large investment downtown. We developed and own the BellSouth headquarters (now AT&T) on Huger Street. We developed and own the Carolina First building, and we developed and own the Sylvans Building."

Saad said the Palmetto Center should be redeveloped largely as an office building. But, because of its size, it probably will end up as some kind of mixeduse, he said. It could have retail on the first floor, offices on the next few floors and condos on top.

"I would like to have seen SCANA stay in the building because I don't like the idea of dumping that kind of space on downtown Columbia," Saad said.

SCANA expects to move to Cayce before its Palmetto Center lease expires in 2009. However, the company does not have a firm moving date, said spokesman Eric Boomhower.

City and business leaders are concerned about the void SCANA's move could create downtown. Resolving the building's ownership has been a major issue.

Mayor Bob Coble said he and other city officials met Wednesday with Way. Coble said the city would work to provide added parking for the building. "We want to be full partners in making this work."

Matt Kennell, chief executive of the City Center Partnership, said that downtown business organization is focusing "on the environment of the area, to really make the location as desirable as possible."

That includes a new partnership with police to improve security.

The group also is working to bring more retail to Main Street. "After talking to the SCANA folks, the strongest attraction to that building is having places to eat and to shop," Kennell said.