CPEX may be moving

The Center for Planning Excellence may be moving out of the Baton Rouge Area Foundation building and into its own offices on Main Street. Chenevert Architects has been hired by Commercial Properties Realty Trust, the for profit arm of BRAF, to renovate 442 Main and 438 Main, two buildings next to Dimensions in Design. The two buildings have a combined 18,000 square feet in space, according to documents on file with the city-parish building permit office. One of the buildings, 442 Main, is known as the Saltz building because it was once home to Saltz the Tailor. Rachel DiResto, vice president of CPEX, says the planning organization is considering moving into the new building because it has outgrown its space. Mukul Verma, a spokesman for BRAF, says Commercial Properties is busy with ongoing projects, so the Main Street buildings won't be addressed until the end of the year. --Timothy Boone

Block expands into multi-family building

Block Construction, which started three years ago as a commercial builder, is expanding its focus. A new parent company, BlockCompanies, has been formed to oversee Block Construction and a new multi-family housing division, Block Builders. Jason Keller, Block president, says the company set up the division to meet the increasing need for apartments and condominiums. Block Builders has started its first project, an $8 million apartment-to-condominium conversion of Tiger Manor on July Street. The conversion of 233 LSU-area apartments should be completed by October 2009. Block Companies has more than $30 million in projects set for this year, including New River Center, an office park in Gonzales, and an office expansion for Cajun Constructors.

CVS Pharmacy coming to Bluebonnet-Burbank intersection

A two-acre site at Bluebonnet Boulevard and Burbank Drive is under contract to a developer who plans to build a CVS Pharmacy on the site. First Hartford Realty Co., a preferred developer for CVS, plans to acquire the property across Bluebonnet from the proposed Wal-Mart Supercenter. Mark Hebert of Kurz & Hebert, who is representing seller Jerry Pearson, would not disclose the sale price since the deal has not closed. Last summer, Wal-Mart paid $3.9 million for its 17.7-acre site. Hebert says he also is talking with "a large banking operation" about buying property next to CVS and entertaining offers to sell the remaining 14 acres on the site.

Poll: More than half expect interest rates to rise

The majority of Real Estate Weekly readers expect the Federal Reserve to raise interest rates before the end of the year. Fifty-two percent of the people who responded to an online survey say rates will increase. Of that group, 25% say rates will go up between a quarter and a half point, while 16% say rates will go up by more than a half point and 11% say rates will go up by less than a quarter point. Thirty-three percent say rates won't change between now and the end of 2008, while 7% say rates will drop by more than a quarter point. More than 150 people participated in the survey.

This week's question: How will $4 a gallon gas prices have an impact on residential development?

Tom Cook: Scott Fence acquires adjoining site

Scott Fence USA has purchased two lots totaling about 2.3 acres on Highlandia Drive adjacent to its existing offices for $1.2 million, or about $12 per square foot. Austin Earhart with Beau Box Commercial Real Estate brokered the sale last week. One of the lots was resold to Turner Industries, which will construct a personnel office building adjoining the parking lot. The site was flipped to Turner at the same $12-per-square-foot price tag, according to Earhart, so the company paid about $600,000 for the land. Mark Hebert of Kurz & Hebert brokered the sale of the lot to Turner. Turner intends to use the lot for parking, and might share the spaces with Scott Fence.

(Appraiser Tom Cook owns Cook Moore and Associates. Reach him at 293-7006 or TCook@cookmoore.com.)

Brian Andrews: Talking to the bank

It is amazing to read current accounts of homeowners trying to walk away from bad financial situations without ever having a conversation with their lenders about viable alternatives. Communication with the lender is an absolute must when things begin to turn sour or have the potential to turn sour and the earlier the better. This is true for commercial real estate developers and home builders as well. Open communications may avert a problem situation or may minimize the inevitable problems for the borrower and the lender.

A commercial lending relationship is typically project based, and the first step in the conversation should be a frank evaluation of how and why the project did not progress as planned. Starting with the original assumptions for the project, the discussion should focus on (1) factors within the borrower’s control, such as design, budgeting and execution, (2) factors outside of the borrower’s control, such as a rapid increase in the cost of materials, market shifts and changing demand, and (3) how these factors impacted the original plan.

While some borrowers may feel that “it doesn’t matter how we got here,” a lender’s willingness to go forward will most likely hinge on their confidence in the borrower’s ability to learn from mistakes, adapt to the current situation and adjust the development plan. A lack of focus about “how we got here” may tell the lender that the borrower does not know how the situation came to be and diminish the lender’s willingness to work with the borrower going forward for fear that history might repeat itself.

The conversation should leave the lender with the distinct impression that the borrower is aware of the issues, in control of the situation and capable of adjusting the plan. The next step is to propose a new plan and we’ll tackle that next week.

(Brian Andrews is a certified mortgage banker specializing in the financing of commercial real estate. His business is Andrews Commercial Mortgage and he can be reached at brian.andrews@acmla.com.)

Real estate recap: Antioch Family Church sells property; Alarm Center Security purchases Airline-Siegen site; Louisiana Culinary Institute building new school

Atlanta-area ministry moving in: Antioch Family Church has sold its building and 79,000-square-foot shopping center at Antioch and Tiger Bend roads to an Atlanta-area church for just under $1.6 million. Voices of Faith Ministries of Stone Mountain, Ga., bought the property and plans to start conducting satellite services at the church beginning Sept. 7. Voices of Faith is led by Rev. Gary Hawkins Sr., a Baton Rouge native. High-profile site for company: An alarm company has purchased a .6-acre tract at Airline Highway and Siegen Lane for $400,000 and plans to build a central monitoring facility on the property. Alarm Center Security plans to start building the office on the site of a former Exxon gas station within the next six months, says Benjamin Stalter of Maestri-Murrell Real Estate, who represented the buyer. Foodies rejoice: The Louisiana Culinary Institute has started work on a 30,000-square-foot building on Airline Highway between Arnold Lane and Jefferson Highway. The school should open in late September or mid-October, in the middle of the fall semester, says Charlie Ruffolo, a spokesman for the culinary institute. The school, which trains chefs, has been at its current location on Essen Lane since 2003, but they're running out of room.