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April 13, 2001 - Real Estate Beat
Historic properties see new light as part of downtown office push
Nancy Sarnoff, Houston Business Journal
Beyond the disco balls and flashy nightclubs that saturate the northern end of Main Street in downtown Houston, a small subculture of alternative office dwellers is beginning to take shape.
Andrew Kaldis, a partner in the ownership of 917 Franklin, the old Commercial National Bank Building that sits on the corner of Main and Franklin, has been redeveloping the historic structure into 40,000 square feet of high-end loft offices. A handful of tenants have moved in, as the six-story building continues to be repositioned following years of vacancy. "We are the only ones with this much contiguous loft space, or what we call, `alternative work environments,' " says Kaldis, adding that Houston has less than a half-million square feet of historic, pre-World War II office space. The 1905 building is U-shaped with a light well that runs throughout the center of the property, a unique building characteristic for Houston.
Last year, Kaldis and his partners began planning their second downtown historic building renovation project by purchasing the Scanlan Building located at 405 Preston and Main. Construction is under way by G.T. Leach to redo the exterior of the building to its original design. Kaldis says the offices in the 11-story, 80,000-square-foot building will have a more casual and residential feel than the Commercial National Bank property. Rental rates will remain competitive with other office properties in the Central Business District, starting at $15 per square foot in the Scanlan Building, a few dollars less than the Franklin Street property. "Our target tenant is not looking at Houston Center," he says. "They are people that want to be part of an urban center." By leaving many of the building's architectural details intact, Kaldis and partners Brent Friedman, Tony Abyad, Gary Leach, James Crane and Frank Hevrdejs are receiving historical tax credits to redevelop both buildings. Strategis CRESA has been hired to handle leasing of the properties.
Kaldis is the son of Pete Kaldis, who for decades traded land in Houston. Pete Kaldis Realty Co., of which Andrew Kaldis is president, now operates as an asset management company. Kaldis created his own firm, A. Kaldis Interests, in the early 1990s. Since then, he has acquired a handful of Montrose-area buildings, including a portion of the Bookstop-anchored retail center at the corner of West Alabama and Shepherd, in which he is a partner with Houston-based Weingarten Realty Investors. Additionally, he owns a small center on Westheimer near Hazard. Paulie's restaurant is the main tenant in the project, which sits below residential units.
In downtown Houston, another group of developers is assuming a similar project across the street from Kaldis' Scanlan Building. Investors in the 402 Main Street Ltd. Partnership have been gutting and remodeling the building's nine floors, in an effort to bring the Depression-era building back to life. So far, several law offices have moved into the building, and an art gallery owned by Houstonian Joan Wich resides on the second floor. Located at the southwest corner of Main and Preston, the structure was formerly the Citizens National Bank Building.
© 2001 American City Business Journals Inc.
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03/17/03
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