UMMC’s Landmark purchase gets IHL nod
A sizeable chunk of downtown Jackson’s vacant office space will soon move to the occupied side of the ledger with the University of Mississippi Medical Center’s planned purchase of the Landmark Center.
The two-year-wait for an occupant for the 366,500 square-foot building at the corner of Capitol and Lamar streets ended Nov. 21 with UMMC getting a green light from the Board of Trustees of the State Institutions of Higher Learning to buy the building.
The Landmark Center, 175 East Capitol Street, has been empty since principal tenant AT&T departed two years ago. Downtown boosters had hoped the state would follow through on a previous plan to put the Mississippi Department of Revenue in the building. Those hopes died with the state’s decision to move the DOR into Clinton’s South Pointe Business Park, the former headquarters of WorldCom.
Boosters lamented the increase the empty Landmark Center made to the Central Business District’s overall office vacancy rate, bringing the total into the mid to high 30 percent range. Once most of the Landmark’s space is occupied, the vacancy rate for all classes of office space should return to a percentage in the mid to high 20s.
UMMC has been authorized to buy the seven-floor Landmark from Capitol Street Associates, a New York investment group, for $6.25 million. Each of the 15 members of the group must agree to the deal, the IHL says.
The $6.25 million is approximately half the amount Capitol Street Associates sought three years ago when the building was the recommended choice for the DOR home. However, UMMC must pay to replace the roof of the approximately 30-year-old building and renovate each of the floors as the medical center decides which part of its operations will occupy the floors.
Relocations into the center won’t begin until the roof is replaced and other build-out requirements are completed, said Tom Fortner, UMMC’s chief of public affairs.
As a work center, the Landmark can accommodate up to 1,000 employees, he said.
The Landmark will serve as a relief valve of sorts, allowing UMMC to shift increasing amounts of its administrative functions to the downtown building, thus freeing up capacity for the center’s medical treatment, research and education functions, Fortner added.
“We’re looking at all our options.”
UMMC plans to fill the Landmark one floor at a time, with the medical center’s Tele Health Services Group going in first and followed by various other administrative support departments.
Tele Health Services is a key component of UMMC’s rural hospital support network, offering a hardwire connection to each of the hospital’s emergency departments, Fortner said.
The network provides the rural ERs voice and picture two-way linkups to medical specialists at the Tele Health operations center. More than a dozen hospitals are linked to the network, which UMMC recently expanded to include psychiatric care and stroke treatment consultations.
For now, UMMC’s 300-member billing operation will remain at Clinton’s South Pointe Business Park. UMMC has about 10 years remaining on its South Pointe lease, according to Fortner, who added the medical center has discussed subletting the space with leasing agent Duckworth Realty.
“That’s all to be determined,” he said.
Fortner said estimates are that building the space the Landmark will provide would have cost UMMC $60 million.
Sen. David Blount, a metro Jackson resident and chair of the Senate Public Property Committee, pushed hard for the selection of the Landmark as the new headquarters for the state Department of Revenue. Gaining UMMC as the building’s owner and occupant is a satisfying consolation prize for Blount.
“I’ve been working on that building for about two years,” he said in an interview Monday. “It’s a good deal for the state of Mississippi, a good deal for University of Mississippi Medical Center and a great deal for the city.”
Blount said he will revive efforts this year to persuade lawmakers to support a proposal to consolidate more state offices into the Central Business District.
Blount commissioned a study by Millsaps College’s Else School of Management that projects a $5 million a year savings by reducing the state’s average rentable square footage for each worker by 33 percent, down to the federal standard of 218 square feet from the current 323 square feet. That calculation included the state buying the Landmark for about $6.5 million. A new Millsaps study to be presented to legislators in January will remove the Landmark from the calculation, Blount said.
“The fact remains we have agencies spread out all over the metro area with no comprehensive strategic plan.”
To sign up for Mississippi Business Daily Updates, click here.
FOLLOW THE MBJ ON TWITTERMy Tweets
Top Posts & Pages
- GreenTech holds grand opening of neighborhood electric vehicle plant
- NEW IN MADISON COUNTY — Mississippi Bio-Medical Business Collaboratory to be introduced Friday
- Turner Grain’s transition will help consolidate lawsuits alleging breach of contract
- Granddaughter of Barq's Root Beer founder dies at 90
- Mississippi Film Studios signs contract with New Orleans company
- MDOT cutting more than 40 jobs in Right-of-Way Division
- Mars Food expanding Delta plant; investing $31M and adding jobs
- David Duval, former British Open winner, joins Sanderson Farms field
- Board authorizes sale of company that owns Silver Slipper Casino
- Alcorn president launches new customer service task force