Tuscany Court, Joe's Carpet lead 3Q real estate deals

Two properties listed and sold by R.B. Murray Co. are among the big movers in the third quarter in the Springfield area as a couple of familiar commercial properties enter a relatively flat vacancy market.

Ross Murray of R.B. Murray Co. said the company sold the 28,000-square-foot Tuscany Court fronting James River Freeway that is home to the University of Phoenix last quarter, as well as a roughly 25,000-square-foot property adjacent to Interstate 44 that had housed Joe’s Carpet.

Through Midwest Property Investment LLC, investment partners Todd Johnson and Ken Straus purchased Tuscany Court, 1343 E. Kingsley St. The partners, Murray said, have plans to perform light remodeling of the building that has nearly 11,000 square feet available for lease. As part of the deal, R.B. Murray Co. will manage the property, Murray said. Both Murray and Johnson declined to disclose the purchase price of the property that was listed for $2.9 million.

“It was really sold as an investment property,” Murray said, adding it had been on the market about six months.

The new owners were in for a surprise when multiyear tenant University of Phoenix announced, after the acquisition, it would phase out its Springfield campus operations next year. The for-profit university, which operates 200 campuses nationwide, plans to close 90 instructional centers and 25 campuses, said University of Phoenix spokesman Ryan Rauzon.

On the north side, Ozark Community Hospital purchased the former home of Kansas City-based Joe’s Carpet in August for an undisclosed amount. The property was listed for $1.25 million, and was on the market for about 18 months.

The hospital is renovating the building, 1540 E. Evergreen St., for Evergreen Clinic, which would initially house two offices – Advantage Therapy LLC and the practice of orthopedic surgeon Dr. Edwin Roeder. Both groups are moving as a result of the August sale of the Orthopaedic Specialists of Springfield building. Mercy purchased the 77,000-square-foot structure, as well as the assets of the independent orthopedic group, for an undisclosed amount to support operations in Springfield and Joplin.

During the third quarter, a couple other notable properties became available under new listings. Among them are the former Murney Associates building, 620 W. Republic Road, and the Sterling Hotel, 312 Park Central East. The Murney building, listed for $3 million, is owned by commercial property brokerage Warren Davis Properties LLC. CJR Commercial agent Skip Liebman began listing the Sterling for $589,000 about a month ago for architect and developer Allen Casey.

Midwest Property’s Johnson, who works by day as a Shelter Insurance agent, said he and Straus have purchased a couple of properties together, though he declined to disclose them. Johnson said he’s a 15-year veteran of investment properties, and the Straus family owns Subway stores in the area.

Outside of University of Phoenix, Advanced Laser Clinics is the only tenant in the Tuscany Court building.

Developer Bill Jester, who died in 2010, built the office structure for more than $1 million in 2001 and signed University of Phoenix to a seven-year lease in mid-2004, bringing the property to 100 percent occupancy at the time. Following Jester’s death, Stillwater National Bank and Trust LLC took possession of the building. The property was owned in 2012 by Greenwich, Conn.-based SW Tuscany Court LP, according to Greene County assessor records.

“Todd was looking for an investment-grade income property that had a potential upside,” Murray noted. “He’s painting the exterior facade right now, striping and sealing the parking lot, giving it a nice little face lift, and then it will be available for lease.”

Murray said Midwest Property’s moves are consistent with market trends he’s noted since 2008. “There hasn’t been as much new construction from the ground up as there was in 2005 and 2006 where you’d see developers buying raw dirt and developing buildings. What you have seen with retail and office properties is – if the location is strong enough and there is demand – developers go in and redevelop the structures already in place,” Murray said, pointing to a spat of student housing properties in center city.

Liebman of CJR Commercial said only recently did architect Casey decide to make a focused effort to sell the Sterling Hotel downtown. In 2002, Casey told Springfield Business Journal he was planning to renovate the former hotel into a mixed-use property with a restaurant, office space and loft apartments. He purchased the property for $129,000 in 1998. Casey, who through Sterling LLC owns the former Sansone Hotel developed by John Woodruff in 1911, hired Liebman to sell the 23,000-square-foot property in mid-September.  

The four-story property has been renovated on the outside and gutted on the inside, according to Liebman. He said it could be used as an office building or mixed-use with commercial and residential space.

“I think he just feels that the time is right. There are lots of things going on in center city right now,” Liebman said.

For example, a recent downtown listing of Liebman’s is being converted into a boutique hotel. The historic Vandivort Center will soon be transformed into a hotel under the direction of new owner MBH LLC, which is managed by brothers Billy and John McQueary. The sale of the 44,000-square-foot property closed Sept. 12 for an undisclosed amount from center city property owner and developer Scott Tillman. Liebman was one of two listing agents to sell the Vandivort to Tillman on behalf of the owner, First Home Savings Bank, in January.

“There has been a lot of talk through the years about putting a historical or boutique hotel downtown and for one reason or another people who were interested in the past didn’t proceed,” Liebman said.[[In-content Ad]]