Commercial Properties Realty Trust, the Baton Rouge Area Foundation’s real estate company, has moved out of its offices in the IBM building to a building on Main Street that it has owned since 2016.
The move, which was not announced publicly but confirmed by sources familiar with the situation, will clear the way for a new tenant to take over CPRT’s former space on the 9th floor of the IBM building at a higher lease rate.
The new tenant is currently making a series of improvements to the space, which should be completed in the next few weeks. CPRT has declined to identify the new tenant until the firm itself is ready to make the announcement.
In the meantime, CPRT has relocated to the 8,000-square-foot space at 450 Main St. that it acquired in September 2016 for $1.6 million from Level Homes, which, at the same time, bought the former BRAF/CPRT office building at 402 N. Fourth St. for $3.6 million to be its new headquarters.
While the CPRT move from the IBM building, which it developed on behalf of BRAF beginning in 2013, might seem surprising, the deal makes financial sense for BRAF and CPRT.
Under the terms of the public-private partnership arrangement the led to the development of the 100,000-square-foot building, CPRT received a $30 million grant from the state to develop the office building for IBM, which agreed to create up to 800 high-tech jobs in return for 15 years of free rent.
CPRT was also able to leverage the deal by adding two additional floors of office space and two additional floors of parking to the IBM building from which it could generate income, as well as by developing an adjacent apartment building, 525 Lafayette.
In the more than three years since it opened, the office space on those two floors has been leased by BRAF and CPRT, Fishman Haygood law firm and Raising Cane’s.
The new tenant on the ninth floor will occupy more space than did CPRT and at a higher lease rate, which is currently averaging $29 per square foot, according to the 2019 Real Estate Trends.