Wasted Space: 2NEWS investigation on building vacancy around Tulsa

TULSA - It's not hard to find a For Lease sign in downtown Tulsa, in what's supposed to be the hub of our city.

So why build new when there's so much empty?

One Place is going up across from the BOK Center and Northwestern Mutual is moving in, leaving its south Tulsa offices, but the company has been criticized for not moving into an existing downtown building that needs to fill space.

"A lot of the existing buildings, which are really neat art deco buildings, did not fit our specifics of what we needed for growing," said Lance Franczyk with Northwestern Mutual.

One Place will house an 18-story office building and a five-story office building. The buildings will be brand new and Franczyk says the architects are able to build to Northwestern Mutual's specific needs.

And that's just it, the top of the line buildings, known as Class A, are hard to come by in downtown. It's the other types, Class B and C, that are left.

"You'll also notice that the vacancy in the A product is less than 9% right now," said Jared Andresen, with Grubb & Ellis, a real estate company.

Downtown Tulsa's vacancy rate is about 25 percent, according to Andresen. The city of Tulsa says the city's overall average is 14 percent.

Andresen says the vacancy downtown has to do with investing in the property.

(Grubb & Ellis did an analysis on Tulsa building vacancy, Tulsa Office Market, that studies 2011 and the trends with projections for 2012. If you're reading this on your phone or tablet, copy and paste http://bit.ly/tulsaspace into your browser)

"It's the landlords that don't have the capital or the interest to put money back into their buildings that continue to lose tenants," said Andresen.    

Andresen notes that one group, Kanbar Properties, owns 22 percent of the buildings downtown but account for 57 percent of the vacancies and says the issue is over upkeep.

Kanbar says it's working to improve that, starting with, "Our premiere customer service to retain the customers we already have. We have also done, recently, a remodel in the Bank of America building and we're on a new chiller in this building here (sic the Chase building). Things to enhance the buildings is what we'll continue to do to reduce vacancy rates," said Carol Craig with Kanbar Properties.

Plus, Kanbar says it has leased out some space for some of the pop-up shops that have now become permanent since they opened for the holidays. There's one store called Made in the Philcade building near 5th and Boston. Also, Craig says Kanbar is working to sell some buildings that are empty, while filling vacancies in the buildings that are almost full.

What about midtown?

Shopping centers along south Harvard are also filled with "For Lease" signs.

Premier Popcorn is surrounded by vacancies in the shopping center near 41st and Harvard, and owner Tom Phillips says those vacancies could affect his business.

"That has some challenges to it because number one, it makes the shopping center look a little more deserted and you're not bringing in as many people," said Phillips. "Traffic's not flowing through when you don't have another business there."

But empty storefronts span the city, take the area of 41st and Darlington by I-44 near Best Buy and Bed Bath and Beyond.

"It's a great idea, in a good location, but the ingress, egress, if you notice trying to get off and on there is not as easy as a retailer needs it to be," said Andresen.

And then there are the shops by the Spirit Bank Event Center on south Memorial in Bixby. They're fairly new, but many sit empty.

Andresen says in this case many of the storefronts don't face Memorial or a main road and that can be a problem.

"You can only have real, true retail on the frontage and what they wanted to do was created retail going back, deep and then an event center," said Andresen.

So it seems it all comes down to location, building maintenance and getting the word out that your business is there.

As for Tom, he's been creative with his popcorn shop.

"Honestly, the biggest form of advertisement we have is, we put a popcorn sign out by Harvard on the road and that has been the one thing that has drawn people in more than any form of advertising we've done so far," said Phillips.

As for Franczyk, he's hoping Northwestern Mutual will be one of many businesses to stake its claim in downtown. His hope, "That downtown grows. It becomes the spot regionally for people to come. It's a hub for downtown where we do spin-off businesses to south Tulsa, north Tulsa into Sapulpa," he said.

Print this article Back to Top


Special reports in May