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From: Mike Morse <mike@kscommercial.com>
Sent: Monday, March 6, 2023 4:04 PM
To: mcre13@gmail.com
Subject: 5040 28th
Henry – Expense information per your request. Please let me know how else I may be of assistance.
Thanks,
Mike,
I happened to be at the office when Henry McClure and his prospective buyers came by. They seemed to be very interested in all three units. McClure asked that I forward a copy of the Unit common area expenses to you, so that you could in turn, forward to him. I had the attached spreadsheet already prepared for 2021. If they would like last year’s, I could prepare it also. See you tomorrow at 2 pm at Starbucks. Thanks.
Robert Hansen
I think the disparity in values between second level spaces that are not handicap accessible vs. the main level space both cost per square foot and time on the market.
I sold 2,400 sq. ft. at 5883 29th , with a tenant in half the space paying $1,500 per month - second level space with no ADA access, in 2021 for 145k. It was on the market for three years. This is $60.42 per sq. ft.
I sold 1,600 sq. ft. at 5889 29th , which is a ground floor space, in 2022 for $122,500 – It was on the market for three months. This is $76.56 per sq. ft.
The cost per square foot difference is a little greater than $10 per sq. ft., but the time on the market is significantly different.
Mike,
I will try and meet with Jim this week. Maybe he doesn’t realize that I own 16% more of the building than he does, including 8% of the first floor. Perhaps the chart I developed will help him understand. Would you agree that the 1st floor space is $10 per square foot more valuable than the 2nd floor space, knowing that there is not currently a lift in the building? That is about a 12% difference in value. Please let me know your thoughts.
Robert Hansen
Robert,
Robert -
I think we are at a point that it will be beneficial for Jim and you to meet.
I had coffee with Jim this morning. He appears to be standing at 50/50. I told him that I thought the floors are similar in value once the cost of adding a lift is taken into account to make the second level accessible. That each of you can nit pick the others space, but the fact is that each of you have spaces that you like and that is what matters. That we have to find a buyer that likes the building as a whole and odds are strong that most buyers will want to modify each of your spaces to meet that buyers needs.
It is going to be your call on how to proceed and what split you are willing to take.
I told Jim that the value for each or your condos increases if you work together and he agrees.
You have a good building, with a good location, and a very pretty setting.
Thanks!
Mike,
Please see attached. If you have any reason to believe the information thereon does not reflect a fair and reasonable assessment of the building valuation for purposes of determining the Owner’s share of the proceeds from a sale, then please let me know. I think this might be in a format that Jim may understand and we should share it with him when we meet. Thanks.
Robert Hansen
I will follow up with Jim.
Have you had any further discussions? What are you thoughts on the attached?
Mike,
Where do we stand on getting this thing rolling?
Robert Hansen
Gentlemen,
I am touring Jim’s space, with Jim on Saturday morning. We all agree that the main level space is more valuable then second level space that is not handicap accessible. However, condition of space and deferred maintenance are also part of value. After I tour Jim’s space I will be able to provide my thoughts on values.
That said – Attached is an excel spreadsheet that I have started with formulas to be able to calculate splits of the sale proceeds. Change the percentages and the numbers will change.
Quick market update.
316 33rd – Sold 12-21-22 – Asking price 175k ($54.82 sf)– Sold for $165k ($51.69 sq. ft.)
3300 Van Buren – Sold 11-28-22 - Asking price $285k ($49.63 sf for full building. However, half the building is a finished basement. Thus the sale price is just below $100 per sq. ft. based upon the main level square footage.) Sold for $260k ($45.28 sf).
1266 S. Topeka – Sold 12-15-22 – Asking price $275k ($123.76 sf – OR $61.88) This building had fully finished basement as well. However, the square footage of the basement was not included in the marketed square footage. Sale Price - $235k ($105.76 sf OR $52.88).
Jim – See you Saturday morning at 7:30.
Thanks,
Gentlemen, (office search below)
Thank you for your time this afternoon. Below is a list of office buildings currently for sale between 2,000 and 15,000 sq. ft.
The list contains at least two properties that I know of that are currently under contract. 3300 Van Buren and 316 SW 33rd.
We have been marketing Robert’s condo spaces in the $77 to $79 per square foot range. We have not had much luck in this price range. The reasons being all the reasons we discussed at our meeting – Condo vs. full ownership – handicap accessibility issues – Inability to control expansion.
We discussed an asking price for the full building at $100 per square foot. I am going to use the building square footage of 8,000.
Yes, this is the upper end of the market for the space. Yes, the space can use some updating. Yes, somebody needs to pay for a long term solution to make the second level accessible.
Yes – This will be the best available building for sale on the market in the size range. It is unlikely that it sells for $100 per sq. ft. as the new owner will spend money to update the building. However, it might sell for $85 to $90 per sq. ft. to a user. This is obviously much better than the current asking price for Robert’s space.
The sum is worth much more than the parts.
3300 SW Van Buren | 3300 SW Van Buren St | Topeka | 66611 |
| Property Name: 3300 SW Van Buren Lease Comments: Multiple offices, reception, conference room, and finished basement for additional office space - 2,880 sq. ft. per floor. |
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990 SW Fairlawn | 990 SW Fairlawn Rd | Topeka | 66606 |
| Property Name: 990 SW Fairlawn Rd- BCC Business Services Property Subtype: Building - Low-rise Lease Comments: Three story elevator building on the corner of 10th & Fairlawn. Great access to I-70 as well as Wanamaker Retail Corridor. Previously CPA with mutltiple offices. Construction allows space to be opened up if cube space desired. Excellent parking with l |
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4015 SW 21st St. Building | 4015 SW 21st St | Topeka | 66604 |
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5040 SW 28th Unit 5 | 5040 SW 28th St | Topeka | 66614 |
| Property Name: 5040 SW 28th - Office Condo Property Subtype: Office Condo Lease Comments: Second floor, west wing suite consisting of 1,927 useable square feet is currently occupied by Heartland Clinical Consultants with a lease that expires in April, 2021. Space could be subdivided into two suites with separate entrances off the common lobby.
The space includes seven offices - one that includes a fireplace, a waiting room, and a small break room with a sink. A deck is accessible from two of the offices. |
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5040 SW 28th Units 4, 5, & 6 | 5040 SW 28th St | Topeka | 66614 |
| Property Name: 5040 SW 28th - Office Condo Property Subtype: Office Condo Lease Comments: Three spaces combined on two floors. |
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5040 SW 28th Unit 6 | 5040 SW 28th St | Topeka | 66614 |
| Property Name: 5040 SW 28th - Office Condo Property Subtype: Office Condo Lease Comments: Second floor, west wing suite consisting of 1,927 useable square feet is currently occupied by Heartland Clinical Consultants with a lease that expires in April, 2021. Space could be subdivided into two suites with separate entrances off the common lobby.
The space includes seven offices - one that includes a fireplace, a waiting room, and a small break room with a sink. A deck is accessible from two of the offices. |
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1605 SW 37th St | 1605 SW 37th St | Topeka | 66611 |
| Property Subtype: Office Condo Lease Comments: Three level office space with multiple offices and windows. Has kitchenette, restrooms, and lower level patio/garden area. Great opportunity to own office space with income potential by leasing 1st or 2nd floor. |
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5611 SW Barrington Ct. | 5611 SW Barrington Ct | Topeka | 66614 |
| Property Name: 5611 SW Barrington Ct. Sale Price: $1,800,000.00 |
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2445 SW Wanamaker Rd | 2445 SW Wanamaker Rd | Topeka | 66614 |
| Property Subtype: Medical Sale Price: $2,350,000.00 |
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316 SW 33rd St. | 316 SW 33rd St | Topeka | 66611 |
| Property Name: Former KANSAS CONTRACTORS ASSOC |
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