Bank Developing First New Downtown Office Building in 15 Years

SPOKANE, WA-Vandervert Construction is in the throes of developing the first new Downtown office building this city has seen in 15 years. The 68,000-sf three-story class A office building replacing a vacant department store here will be complete next year and anchored by its owner, the Bank of Whitman.The downside is it will come to market at the peak of vacancy in the Downtown market. Due in large part to local developer Walt Worthy’s recently renovated Metropolitan Financial Center–now known as the Wells Fargo Building and sporting 120,000 sf of availability–Downtown vacancy is about 24%. “There’s going to be some buying of tenants,” listing broker Chris Bell of Tomlinson Black tells GlobeSt.com. “There are going to have to be some incentives offered.”Designed by locally based ALSC Architects, the Bank of Whitman Building is rising at 618 Riverside Dr., between the Bank of America and the Washington Mutual Buildings in the heart of the financial district. It replaces the former Lamonts-Newberry’s site, which had been vacant for some time and was considered an eyesore. It will have underground parking, a central lobby and atrium, and will be connected to the downtown skywalk system.It was originally conceived by Al Payne of locally based Payne Properties, who acquired half of the former Newberry’s department store out of bankruptcy in 1996 and last year optioned and acquired the other half. Payne then sold the development rights to Vandervert Construction, who promptly landed the fast-growing Bank of Whitman to be the anchor. Shortly thereafter, the bank in turn acquired the development rights and kept Vandervert on to construct the building. The Bank of Whitman will occupy the main floor of the building and lease out the top two floors.Bank of Whitman chief executive Jim Tribbett tells GlobeSt.com that the bank, which is 65% owned by employees, has always wanted a site Downtown and always owns its branches, of which there are now 18. When asked about coming to market at the height of Downtown’s vacancy, he says, “Life’s a risk. We are a long-term player here and wanted the best location in one of the anchor markets of our service area.”Not including the Bank of Whitman Building, there’s about 900,000 sf of class A space in Downtown Spokane in five main buildings, which compares to about 1.6 million sf of class B space in some 36 buildings. The full-service asking rate range for the Bank of Whitman Building is $19-$22 per sf per year, which is between $4- and $5 per sf higher than the class B space. The asking price includes a $25-per-sf tenant improvement allowance. Bell, who didn’t offer up how much free rent might be offered up for a long-term commitment, says he is in discussions with several businesses that are interested in the building, either as a place to relocate or as a place to open a new outpost. “We’re well positioned to attract outside users,” he says.