The Wisconsin billionaire owner of downtown Boise’s BoDo is now also the owner of the Chicago-style Jefferson Place office building at Ninth and Jefferson streets.
The five-story, brick structure built in 1914 was acquired June 9 by Hendricks Commercial Properties in Beloit, Wisconsin, owned by Diane Hendricks, considered the second richest self-made woman in America.
Hendricks Commercial Properties acquired the office building where U.S. Sen. James E. Risch has his Boise office from Jacksons Food Stores Inc., itself a multi-billion dollar Boise company that has owned the structure long known as the Elk’s building since 2000.
The assessed value of Jefferson Place is $4.89 million, according to Ada County Assessor records.
“That building is really the sort of product we like,” said Rob Gerbitz, CEO of Hendricks Commercial Properties.
Gerbitz said Hendrick expects to redo the lobby and complete some tenant improvement work but leave Jefferson Place mostly as it is.
Midwesterners are gobbling up downtown real estate. David Baum of Chicago owns nearly the entire block of Eighth, Idaho, Ninth and Bannock streets.
“We really like the Boise market,” Gerbitz said. “We just constantly keep our eyes open for what becomes available. We’ve looked at The Owyhee. It’s a great building. We like it.”
Hendricks picked up the BoDo retail/office complex on Oct. 25, 2017, for $25 million, with intentions to redo the façade to better match the century-old 8th Street Marketplace across the street.
“The BoDo buildings are well built, but they don’t have the feel of the buildings across the street,” said Gerbitz, referencing 8th Street Marketplace. “Our job is to get (BoDo) so they feel like that.”
Hendricks has done extensive design work for a new BoDo look, but Gerbitz expects the approval process to extend well into 2019 before façade work begins.
“We don’t rush,” he said. “We’re not looking to flip BoDo or sell it.”
Gerbitz said Hendricks Commercial is attracted to Boise because of the relationships he has built with civic leaders.
The new owners of BoDo want to give the downtown Boise commercial/office/movie complex more personality.
Rob Gerbitz, sitting at Caffé D’Arte, looked across the street at 8th Street Marketplace – the 1903 Northrup Building and the 1904 Mercantile Building between Broad and Myrtle streets.
“Details,” said Gerbitz, president and CEO of Hendricks Commercial Properties. Hencricks is the Beloit, Wisc., firm that closed Oct. 25 on the $25 million purchase of the 118,977-square-foot, three-building BoDo.
Gerbitz said Hendricks expects to spend at least $3 million to dress up the BoDo exterior with historic detail between Broad and Front streets. BoDo opened in 2005.
“We already have an idea what we want to create,” he said. “We want the characteristics of what’s around them.”
8th Street Marketplace?
“Absolutely,” Gerbitz said.
8th Street Marketplace owner Ephraim Greenwall welcomed the news.
“It’s always wonderful to have new blood and new money come into the submarket,” Greenwall said. “To have them attempt to make the look consistent can only be good for the entire area.”
Gerbitz and other Hendricks staff started meeting with BoDo tenants Nov. 8. He plans to move ahead with the façade work right away.
“They need a facelift,” Gerbitz said. “Best way to say it, they need a personality. Why are downtowns booming again? They have personality.”
Gerbitz has been CEO at Hendricks Commercial for 10 years. Though based in Wisconsin, Gerbitz said the company has become “ingrained” in Indianapolis, where the company is redeveloping an 11-acre former downtown Coca-Cola bottling plant and has already redeveloped a former iron foundry as the 200,000-square foot mixed-used Ironworks at Keystone.
Gerbitz works for Diana Hendricks, second richest self-made woman in the U.S., as declared by Forbes magazine earlier this year. Since August, the New York Times and Forbes have both written long profiles on Hendricks, who owns Hendricks Commercial Properties and also the ABC Supply roofing supply chain.
“One thing Diana said to me, ‘I want a product I can be proud of.’” Gerbitz said. “We’re not going to skimp on things.”
Gerbitz said that a year ago, he looked at Boise, Chattanooga and Kansas City as places to research for growth.
“What we like is the demographics,” Gerbitz said. “Boise is one of the best-growing cities. It gives us an opportunity to show what we can do.”
Gerbitz has seen the countless “best of” lists.
“Boise is always on that list,” he noted.
BoDo came up for sale in March, and Hendricks Commercial entered into negotiations in May.
BoDo was built for $65 million. Colliers International listed it for $30 million. Gerbitz said he paid just over $25 million.
“We were getting a very solid deal,” he said.
Gerbitz visited Boise four times during the negotiations and walked and biked much of downtown. He also climbed Table Rock.
“In commercial real estate, you need to be on the ground,” he said. “You need to see it, see the people walking by. Quite frankly, after the first time I was here, I get it. The thing I found with people I talked to is they are genuinely positive (about the community). I went to the state of the city address. It was a lot of fun. People I never met in my life, they talked to me like they knew me all my life.”
He won over Diana Hendricks, too.
“She said to me, ‘I’ve never been to Boise, Idaho.’ She said, ‘I’m getting this.’”
BoDo owners envision more downtown projects
BoDo will not be a one-off for Hendricks Commercial Properties.
But Gerbitz first did have to win over some staff with committing to far-off Boise.
“One of my guys said ‘Do we want to fly three hours every time we need to do something?’” Gerbitz recalled.
He recommended that this skeptic run around downtown and the neighborhoods and walk the alleys.
“We like downtowns,” he said. “We love old buildings. We don’t mind building things either.”
Gerbitz can see Hendricks Commercial laying claim to property in the 8th Street area or near the Capitol or even building something on the surface parking lots downtown.
“Most of those surface parking lots used to have buildings on them,” he noted.
Looking for a tenant for the Urban Outfitters vacancy
Hendricks Commercial Properties inherited a 10,360-square-foot vacancy created by the July departure of Urban Outfitters, which had been a BoDo tenant for 10 years before moving to The Village at Meridan.
The space is represented by Colliers International, which itself is a BoDo tenant.
“We tried to zero in on what we would like to see and what we don’t want to see,” Hendricks Commercial CEO Rob Gerbitz said. “We don’t rent space just to rent space. We want the right tenant. We’re not interested in a convenience store.
“We want something that would be special to that space,” he continued. “We want something that would bring extra life. We’re looking for dynamic, let’s just say restaurant, local, a regional operator, not a chain. I’d love to find a retailer, something like women’s apparel. That would probably require splitting the space. Those are the two biggest drivers.”
The quickly approaching holiday season isn’t a deterrent.
“We want to be in serious discussions by the end of the year,” he said.
A Beloit, Wisc., commercial real estate firm has purchased the BoDo commercial complex in downtown Boise for $25 million.
Colliers International in Boise has had the three-building, 118,977-square-foot complex listed for $30 million since March.
Hendricks Commercial Properties closed on BoDo on Oct. 25, said Clay Anderson, who handles investment brokerage services at Colliers.
“We are helping them find more product in the Boise market,” Anderson said.
Hendricks mostly operates in Wisconsin but also has projects in Indiana and Florida. Rob Gerbitz, president and CEO of Hendricks, developed the five-story, 200,000-square-foot, mixed-use Ironworks at Keystone in Indianapolis that includes 36,000 square feet of street-level retail space, 120 upscale apartments and a 120-room Ironworks Hotel Indianapolis that opened in September, according to the Hendricks website.
Expect visual changes at BoDo, Gerbitz said.
“The first thing is for us to get know our tenants and let them get to know who we are and what we are about,” Gerbitz said. “Then we will start work on the vision for the buildings and really focusing on the exterior re-branding of the buildings.”
BoDo TIC LLC had owned BoDo since 2007. The entity had acquired the retail-office complex at Eighth and Broad streets that opened in 2005 from BoDo developer Mark Rivers.
Downtown Boise’s BoDo commercial complex has a potential buyer.
“We’re in the process of negotiating a contract with an investment group,” said Clay Anderson, who handles investment brokerage services at Colliers International in Boise. “It’s too early to tell (if the sale will go through). Next week I’ll have a much clearer idea.”
Colliers International in early March listed the three-structure, 118,977-square-foot complex for $30 million. These are the buildings that include P.F. Chang’s, Edwards Cinema and Yoi Tomo Sushi & Grill.
“We had a large amount of interest,” Anderson said. “In the end, we had eight offers.”
Anderson offered no details about the investor group selected for negotiations.
BoDo, opened in 2005 at Eighth and Broad streets, has had only two owners. Arlington, Va., developer Mark Rivers built the 118,977-square-feet project and sold it in 2007 to the current owners BoDo TIC LLC.
Downtown Boise’s BoDo commercial complex generated more than five potential buyers as the call for offers period ended April 28.
Colliers International in early March listed the three-structure, 118,977-square-foot complex for $30 million.
“More than 100 parties downloaded information,” said Clay Anderson, who handles investment brokerage services at Colliers. “There was a lot of good interest.”
Anderson wouldn’t say exactly how many parties submitted offers to buy BoDo other than “more than five.”
Colliers this week was evaluating the offers. Anderson said Colliers could have a better idea in the week of May 8 of who the ultimate buyer may be.
BoDo was a $65 million downtown redevelopment of former Union Pacific Railroad yards envisioned by Arlington, Va., developer Mark Rivers. He built BoDo in 2004 and 2005 and sold it in 2007 to BoDo TIC LLC, the current seller.
Colliers is a BoDo tenant as are P.F. Chang’s, Caffe D’Arte, Ann Taylor Loft, Office Depot and Edwards Cinemas. BoDo opened in fall 2005.
Long-time tenant Urban Outfitters will leave downtown Boise’s BoDo commercial district to relocate at The Village at Meridian.
The Village announced that Urban Outfitters will open in a 10,000-square-foot space in front of Z Gallerie in August.
Urban Outfitters has been a BoDo tenant since 2007. The Philadelphia-based retailer’s lease on 10,141 square feet ended at the end of last year and the store is now operating on a six-month extension, said Kelly Schnebly, property manager at Colliers International, which manages BoDo.
Urban Outfitters did not respond to calls from the Idaho Business Review.
Other recent BoDo departures include the Snake River Winery tasting room in March, and the Boise State University store, which is moving soon to the Clearwater Building. Jos. A. Bank, an original BoDo tenant from late 2005, closed a year ago.
Urban Outfitters is the second national retailer along with Anthropologie in recent years to move from downtown Boise to the Village at Meridian.
Colliers International in early March listed the downtown Boise commercial complex at Eighth and Broad Streets. It includes three structures that amount to 118,977 square feet. Offers are due by April 28 but no offers have been made, said Mike Christensen, who handles retail brokerage services at Colliers and is representing the seller.
Colliers is a BoDo tenant as are P.F. Chang’s and Urban Outfitters. Ann Taylor Loft, Office Depot and Edwards Cinemas have been tenants since BoDo opened in fall 2005.
The BoDo property includes the Sycamore building between Broad and Front streets and between Eighth and Ninth streets; the Capitol Gateway building, also between Broad and Front and between Eighth and Capitol Boulevard and the retail portion beneath the Myrtle Street garage on Broad Street, known as Building 8.
The Colliers listing states a capitalization rate of 6.25 percent for the BoDo property.
BoDo was a $65 million downtown redevelopment of former Union Pacific Railroad yards envisioned by Arlington, Va., developer Mark Rivers. He built BoDo 2004 and 2005 and sold it in 2007 to BoDo TIC LLC, the current seller.
“It’s a good time to sell based on the market conditions,” Christensen said. We’re seeing a lot of demand for investment property.”
BoDo is the Treasure Valley’s third large commercial real estate offering in recent months, along with Washington Group Plaza and the Hewlett-Packard campus.
BoDo does not include the historic Eighth Street Marketplace buildings on either side of Eighth Street between Broad and Myrtle streets.
Since BoDo opened, the area south of Front Street to either side of BoDo as blossomed with the opening of JUMP, the J.R. Simplot Co. corporate headquarters, Trader Joe’s, the 185-room Residence Inn by Marriott now in the closing stages of construction and the Inn at 500 boutique hotel that opened in January.
This story was updated at 10:15 p.m. April 13 to add details.
UpCycle Studio, a local indoor cycling, yoga and TRX training startup, plans to open sometime around Thanksgiving in the former Jos. A. Bank space in downtown Boise’s BoDo district.
UpCycle will showcase 30 Stages SC3 Series bikes on three staggered rows in a room that can recreate outdoor settings with video and use data generated by riders to create competitions, co-founder Allen Traylor said.
Nearly all the riding sessions involve instructors. Sessions are scheduled before work, during lunch and after work. At times, a live DJ will assemble the soundtrack.
With the great outdoors just outside the door, why an indoor studio? Traylor said the downtown setting is especially ideal for downtown workers to get a ride close to work.
“I’m an avid cyclist, mountain biking and competitive,” Traylor said. “In the winter months, I do all my training inside. When it’s 110 degrees, I go inside.”
UpCycle will also have a lounge area with three first-come, first-serve private showers and a women’s-only area with four private showers.
“We’re getting away from the gym, locker room environment,” he said.
Along with cycling, UpCycle will have a room for yoga and TRX training. The latter leverages gravity with the user’s body weight to do exercises, according to the TRX website.
Co-founders Traylor and Christine Maldonado met through mutual friend Anna Alton in November 2015. They first looked elsewhere in downtown Boise.
“We didn’t think we could afford BoDo,” Traylor said. “But it was more space and within budget.”
The 4,325-square foot, $300,000 project was designed by Matt Rhees at The Architects Office in Boise. VERTICAL Corp. of Boise is the general contractor.
Lumber executive Rick Bennett has purchased the historic Drake Cooper building in downtown Boise’s BoDo District.
Bennett acquired the structure at 416 S. Eighth St. for an undisclosed amount on Nov. 3. The Ada County Assessor’s Office assessed the property, a one-time Boise Mill & Elevator building and later a Sears, Roebuck & Co. grain warehouse, for $1.43 million.
The two-story building at Eighth and Myrtle streets dates from the early railroad era, built in 1910, according to Chelsee Boehm in the Boise Arts & History Department. The Drake Cooper – currently named for the advertising firm tenant – is on the same block as the much larger Eighth Street Marketplace, which was built a few years earlier, also as a railroad warehouse.
Bennett is the president of Bennett Forest Industries, which is the actual owner of the building. The purchase is part of his company’s efforts to diversify beyond lumber, he said.
Bennett Forest Industries jointly owns Idaho Forest Group, a Coeur d’Alene-based lumber company, with Riley Creek Lumber.
“I’ve been buying buildings for five or six years, an office building in Coeur d’Alene, some light industrial down here (in the Treasure Valley),” Bennett said. “This is my first building in downtown.”
Bennett said he may buy more buildings in downtown Boise but not for another year or so.
“When you buy a building like this, you’re buying an income stream,” Bennett said.
The tenants are Drake Cooper, this month named the No. 2 Best Place to Work by Outside magazine; RDG Filings, a document filing and converting firm; and Urban Design Firm.com, a multimedia design firm. Bennett said the tenants will remain.
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