Guardian Building to be sold

[Allan]

One of Detroit's most beautiful buildings is being sold. I'm told that it is being sold for only $13.5 Million. I had no idea the occupancy rate for this building was so low...only 14%. At this point, I think the best option is to convert the upper floors into residential space. There is a 28.8% vacancy rate for offices in downtown Detroit, and it does not help that this building, as well as most other older buildings are only class B or class C office space.

Guardian Building gets new owner, plans

DTE sells to group that envisions retail or bank in ornate lobby

By R.J. King / The Detroit News

DETROIT -- DTE Energy Co. has sold the historic Guardian Building to a real estate group that plans to use the ornate lobby with its striking Pewabic tiled ceiling for stores or perhaps a bank.

The new owner, 500 Associates LLC., is a joint venture between New York Capital in New York and Sterling Group, a real estate firm in Detroit. The purchase of the 40-story, 750,000-square foot landmark was expected to be announced today. Terms of the deal were not disclosed.

DTE Energy decided to sell the tangerine brick structure last year after completing a merger with MCN Energy Group in 2001. MCN Energy, which moved to DTE Energy's headquarters at Michigan and Third, bought the Guardian in 1974 and used it for its central office.

One challenge for the new owners is securing tenants. The building has had just a 14-percent occupancy rate since MCN Energy's departure. Several businesses are interested in office space, said an owner's representative.

"We are strong believers in the continued strength and resurgence of the city," said Steve Ogden, vice president of the Sterling Group. "We are excited with the challenges the Guardian presents."

The Guardian's three-story, barrel-vaulted lobby will be converted from office to retail space next year, Ogden said.

Jim Bieri, president of Bieri & Associates Inc., a retail consulting firm in Detroit, said retailers are starting to scout the downtown Detroit market. Last month, a Borders Books & Music store opened in Compuware Corp.'s headquarters at Woodward and Monroe while fashion retailer Julian Scott is set to open a store this weekend at Fort and Shelby.

"Retailers are noticing more office workers and residents downtown," Bieri said. Since 2000, General Motors Corp., Compuware and EDS Corp. have moved downtown, bringing in more than 10,000 office workers.

SmithGroup, a large architectural and engineering firm that has 220 workers in the Guardian, said it would relocate several offices and conference rooms from the lobby to its upper floor space. SmithGroup designed the building in 1929 for the Union Trust Co.

"We're a little dismayed to be leaving the lobby, because it has been a great space to show our clients," said Russ Sykes, SmithGroup's director of operations. "On the other hand, we'd like to see other tenants come in."

You can reach R.J. King at (313) 222-2504 or [email protected].

[turlough]

Well finally some good news they saved a building I hope it will have at lease 80%occupancy rate it's a nice building. Thanks Allan

[Allan]

80%?! Most building owners downtown are lucky to get a 60-70% occupancy rate! Even the newly renovated buildings have trouble finding tenants. Unfortuanately the demand for office space is in the burbs, not the city .

[tocoto]

I hope to think the fact they bought it means it won't be destroyed. I can't see why people would not like high rise residential.

[turlough]

80%?! Most building owners downtown are lucky to get a 60-70% occupancy rate!  Even the newly renovated buildings have trouble finding tenants.  Unfortuanately the demand for office space is in the burbs, not the city  .

sorry I'm know for dreaming to big But as nice as this building is it should be 85%

[Allan]

I guess I'll be happy as long as we don't have to add the Guardian building to Detroit's list of abandoned skyscrapers. This building is far too beautiful to ever be destroyed. It is arguably the most beautiful building in the city. One of the main problems with the building is that it was developed as a one tenant building, and therefore does not have the ammenities as a multi tenant building. And renovations to add these ammenities would be very expensive.

I like the idea of putting residential on the upper floors of the Guardian. Right now there is very little residential space in the downtown core. And who wouldn't want to live in such a cool old building?

[ClevelandNO!]

typical detroit occupancy rates in the CBD are from 73-80%

[SNWEB]

Updates:

it got sold, and was restored greatly, and occupancy is high

their website is

http://guardianbuilding.com/

[dnast]

I'm glad I looked back up at the date as soon as I read the first paragraph of the first post, LOL...

I wish there was more to the website, but I'm glad to see the building doing well. I'll have to check out the retail area. The last time I went, there was nothing but frames where the stores would go in the room.

[Allan]

The retail promenade is very nice. I'll have photos of that on Monday night or Tuesday morning, depending on how exhausted I am from my Monday tour of Detroit. LOL.