Unico lists its City Centre office building and 2-acre parking lot for sale Downtown
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A large and aging office building and its adjacent 1.8-acre parking lot hit the market this week and present the next location for a possible significant high-rise in Salt Lake City’s Downtown.
Cushman & Wakefield listed the City Centre office building, formerly home to the Salt Lake Chamber, for an undisclosed price on Tuesday.
Seattle-based Unico Properties is selling the 236,000-square-foot building at 175 East 400 South in an apparent ongoing trim-down on its holdings in Salt Lake City.
“The pricing is a lengthy discussion,” Kip Paul, vice chairman of investment sales, told us by email.
If sold, the parking lot would represent more than a third of the easily developed Downtown land, according to Cushman’s estimate that takes into account a few important factors.
“It is estimated that there is less than 5 acres of remaining D-1 land available for possible development when removing sites controlled by the LDS Church, purchased by competitive developers and sites owned by high-net-worth families that are unwilling to sell,” the listing says.
The office building was built in 1986 and is less than 50 percent occupied, following a trend of high office vacancy rates for dated buildings with dated layouts and amenities. The remaining tenants, including a Planet Fitness on the corner of 200 E. 400 S., have an average of four years left on their leases.
City Centre’s occupancy rate has cratered with move-outs by the Salt Lake Chamber and the Salt Lake City office of the software vendor Workday, which defected to the suburbs.
A recent CBRE report found that, while cities across the country are setting new records for high vacancy rate, the rate is being pushed up by a small subset of buildings.
“Only 10% of all U.S. office buildings account for 80% of the occupancy losses between Q1 2020 and Q4 2022,” CBRE said.
Most buildings, meanwhile, are more than 90 percent leased. This is not one of those buildings. And given its presence in D-1 Downtown zoning, which has no maximum building height.
That dynamic has left the prices for aging office buildings plummeting. 170 S. Main, where Cushman & Wakefield posts up, has fallen in value by about 60 percent since its pandemic-era peak, Paul said.
Cushman is presenting the listing as a possible office-upgrade option, a development site for condos, apartments, student housing or hotels, or an office-to-residential conversion.
Paul said Unico decided to sell the building together with the parking lot but would consider selling them separately.
The location is within an opportunity zone.
READ THE LISTING HERE
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