Case in point is a 36-story office building at 444 N. Michigan Ave. in Chicago.
New York-based Andalex Group manages the 625,000-square-foot office tower it co-owns with WestWind Capital Partners of Atlanta, an affiliate of Kan Am, a German syndicator of real-estate funds. Last year, Andalex embarked on a $3 million renovation of the building's lobby area, which is nearing completion.
The renovation involved cutting back the oversized, 4,600-square-foot lobby and moving it from the center of the building to the north side to create about 3,000 square feet of additional retail space and reopen a 4,000-square-foot restaurant at the back end of the lobby that had been closed for security reasons after the terrorist attacks on Sept. 11, 2001. Because the restaurant is located near the building's elevators, Andalex shuttered the space to ensure that only tenants in the building could access the elevators.
The office space in the building is about 90 percent leased. A restaurant, which is expected to open in December, may also help retain at least one tenant that has been in the building for six years.
Last year, Andalex Group added retail space to another building it owns in Cincinnati. Like the Chicago property, Andalex reduced the size of the lobby at the 537,000-square-foot Chiquita Center in Cincinnati, which allowed it to add 3,500-square feet of space that it rented out to a restaurant.
The owners of a large office and retail complex in San Jose, Calif., also are looking to expand its restaurant offerings by adding more retail space and possibly using the large outdoor plaza at the complex to generate additional revenue.
DivcoWest Properties, a real-estate investment and management firm based in Palo Alto, Calif., and RREEF, a real-estate investment adviser, are embarking on a $10 million renovation of Park Center Plaza, a 15-building complex with more than 700,000 square feet of office and retail space. RREEF acquired an interest in the plaza property a few months ago on behalf of a fund it manages for the California Public Employees' Retirement System, the nation's biggest public-pension fund.
The renovation plan includes adding a 5,000-square-foot food court to the existing 35,000 square feet of retail and restaurant space at Park Center Plaza, resurfacing the large concrete plaza area with cobblestones or brick and adding landscaping and seating to improve pedestrian access to the property.
