As 200 Central, the 28-story office tower that’s been home to some of the area’s best-known companies, wraps up its third decade, it’s getting a major facelift and a surge in popularity.
Vacancy rates have been cut in half, from nearly 35 percent when it was purchased by Third Lake Capital in 2017 to about 12 to 18 percent now, and they will drop still further if all the pending lease deals are completed as expected. The building is attracting tenants such as Dynasty Financial Partners, the financial services firm that is moving its headquarters from Manhattan to St. Petersburg, as well as other cutting-edge global companies and local firms including Synzi and 360 Advanced. It’s about to embark on a multi-million dollar renovation of the lobby that’s designed to open up the structure to more public uses.
“We have taken the building up several notches since we bought it, and it was already the best building in the market. Now, we think it’s the best building in the Tampa Bay market,” said Ken Jones, president and CEO of Third Lake Capital.
With space almost full at 200 Central and other downtown buildings, and rents on the rise, Third Lake – the investment fund controlled by the owners of Ashley Furniture HomeStores – is considering additional downtown real estate.
At 309,000-square feet, 200 Central is the largest office building in St. Pete and Jones contends it’s the city’s only Class A building — a designation given to the highest-quality office buildings in their market. However, the city of St. Petersburg classifies three other properties — First Central Tower, City Center and Morgan Stanley Tower, all owned by Feldman Equities — as Class A space.
Third Lake paid $65.7 million for 200 Central in 2017, according to Pinellas County property records. The company is spending lots of money on the building, said Wendy Giffin, director at Cushman & Wakefield, the tenant representative.
Third Lake is not saying exactly how much it will spend on the lobby renovation, but it is a major investment, designed to make the space more interactive, with collaborative areas for employees from building tenants to sit and talk.
“What we’re installing in the lobby is a refresh from a decorative perspective, but we’re also creating areas to sit and be on your phone with access to plug-ins, to work at tables, or sit in a lounge chair and enjoy a coffee from our Craft Kafe [one of the tenants in the building],” Giffin said.
200 Central lobby renovation
200 Central is getting another new restaurant, SoFresh, a Tampa-based company that makes healthy, cooked-to-order food. SoFresh will take the space occupied by Subway, Giffin said.
The lobby also will host more public events.
“Years ago, when Progress Energy owned the building, there used to be all sorts of public activities from Junior League activities to First Night activities and more. There were days when Grand Prix race cars filled the lobby. The Junior League hosted arts & crafts shows prior to the holidays. We’d like to do that again,” Giffin said. “We’re creating an area that can be pushed aside and have it open to groups for functions, holiday parties, Chamber of Commerce and Downtown Partnership events and the like.”
Cushman & Wakefield has been active in drawing tenants to the building. Robert Teachey, a senior associate at CBRE, worked with Dynasty on leasing the entire 15th floor, while Giffin has worked with companies such as Synzi, a healthcare technology firm, and 360 Advanced, an information security and compliance company.
200 Central is a “revitalization story,” said Maureen Huber, chief financial officer and chief information officer at Synzi.
The company — spun out last year from Stratus Video in Clearwater — leases the entire 20th floor, a total of 7,500 square feet. The company wanted a central location for its customers and employees, said AnnaMaria Turano, vice president of marketing, and it need space that would help attract workers to develop Synzi’s technology, which helps patients and their healthcare providers stay on track with their care regimen.
A key value at Synzi is collaboration, Huber said.
“Our suite is an open work environment with separate work areas for collaboration and ingenuity around team building,” she said.
There also are areas that allow for privacy and for fun.
“We have space that allows for us to take a break, get fresh thoughts and then get back to the workspace,” she said.
Third Lake is willing to work with company representatives and executives to find out what their needs are, such as additional capacity from data pipeline, engineering, and electric, Jones said.
“That includes getting creative in how we build out the space. It’s not just a matter of infrastructure, although we’re providing that as well. We’re working with new tenants, asking what they want to see in their space or what do your employees want. We’re incorporating all that feedback into not only the common space design, and working hand in glove with clients on the interior space to do what I call cutting edge, modern 2019 tech space.”
In addition to finding new tenants, Giffin wanted to be sure all the existing tenants were accommodated as well. One of them is 360 Advanced, which leased space in 200 Central prior to the Third Lake acquisition and now is expanding its footprint in the building.
CEO Dan Collins spent a year looking all over the Tampa Bay area for the right location and considered both buying property as well as leasing, before moving into 200 Central in October 2016.
“We could not find anything attractive from a purchase standpoint and from a lease standpoint we like the vibrancy of downtown St. Pete. It felt very up and coming and accessible,” Collins said. “The building changed hands since then and the new owners have done a good job planning renovations for the common area and brought in good tenants.”
360 Advanced is nearly doubling its space in the building, expanding from 4,200 square feet to 7,500 square feet and occupying the entire 21st floor. The company expects to be in its new space by July 1.
“The location and building reflected our culture and the way we wanted to present ourselves to clients, rather than being in an office park,” Collins said. “The fact that we could move here, be in a great building, with access to restaurants and shops and a waterfront view – that’s a great tool for us for recruiting and retention.”
Jones expects more tech tenants as well as companies that are not necessarily focused on technology.
“Dynasty is a finance company, but there’s a tech component to it. There are other companies that we’re talking to and there will be some announcements in the next few months that will make people say ‘wow,’” Jones said. “You’re going to see some wow tenants come in. I wouldn’t call them tech but they are cutting edge global companies and you will know the names. These are companies that appeal to a modern day 2019 workforce.”
Companies are looking at St. Petersburg because of its live-work-play vibe downtown, its arts and culture, dining and entertainment, and workforce, Jones said.
“All those factors combined are making companies take a good hard look at St. Pete and when they do that everyone comes to the same conclusion – this is a great city,” he said.
There’s still empty space at 200 Central, but “we have ongoing discussion with tenants that will fill every single square foot in the building,” Jones said.
As vacancy rates have fallen, rents are rising.
When Third Lake bought the building in mid-2017, rentals were in the $26 to $29 a square foot range. Now, they range from $28 to $35 a square foot.
The same is true citywide. Downtown vacancy for Class A office is down to 8.6 percent, according to a State of the Economy report presented in January. Vacancy rates have dropped every year since 2013, while rent has increased by $5.18 a square foot, the report said. The average lease space for downtown Class A office space is $30.11.
That’s got Third Lake Capital thinking about the future.
“We have to take a look at is St. Pete ready for another building or is St. Pete ready for another condo tower. Those are things we’re evaluating right now,” Jones said. “Right now we are looking at a lot of other options in St. Pete, both from the development perspective as well as the acquisition perspective. This is a baseball game, and we’re in the 2nd or 3rd inning of what we plan to do in St. Pete. ”
200 Central through the years
Construction on 200 Central was completed in 1990. Designed by Jung Brannen Associates, no expense was spared, said Wendy Giffin of Cushman & Wakefield. For instance, the marble in the building was quarried from the same quarry in Italy that supplied marble to Michelangelo.
At 389 feet, it was the tallest building downtown until the completion of ONE St. Petersburg, a residential development that’s 450 feet tall.
The building has had various names, including the Bank of America Tower and One Progress Plaza. In 2015, Priatek, a tech company that develops interactive advertising kiosks, bought naming rights to the building, and it was known as Priatek Plaza until last year.
Tenents in the building include The Bank of Tampa, global customer care company iQor, and Raymond James, among others.