BancFirst, Continental could buy OKC’s largest downtown garage
Oklahoma City is engaged in advanced discussions with BancFirst, Continental Resources and Bricktown parking operator Don Karchmer on a deal that could sell the city’s Santa Fe Garage to the two companies and assist BancFirst in connecting to a planned Bricktown garage.
Santa Fe Garage, 2 Santa Fe Plaza, is the city’s largest. It opened in 1972 and has 1,518 spaces and a ground-floor retail level that is home to the downtown branch of the UCO Business School and the Red Earth gallery.
City Manager Jim Couch said Monday a request for two memorandums of understanding in response to requests by the two downtown companies, neither of which control their own parking, are likely to be presented to the Oklahoma City Council on July 17.
“This is complicated and it’s not a done deal,” Couch said. “At the end of the day, Continental Resources wants to have secured parking, and they are motivated by having 500 people parking in the Cox Convention Center garage that is likely to go away. So we’re securing one of the largest employers in Oklahoma City.”
Timing of the deal, meanwhile, coincides with BancFirst confirming Monday its $23 million bid to buy the
36-story Cotter Ranch Tower that adjoins the Santa Fe Parking Garage has been by accepted by the U.S. Bankruptcy judge overseeing the fate of the tower. BancFirst is in the midst of a 30-day due diligence that Couch said is expected to end later this month.
“There is substantial deferred maintenance on the building,” said Jay Hannah, executive vice president of financial services at BancFirst. “Obviously, acquisition of a 500,000-squarefoot building without parking is a concern.”
Couch said the first memorandum of understanding would detail an agreement to move forward with sale of the Santa Fe Garage to BancFirst and Continental Resources.
He said the second memorandum of understanding would detail an agreement to assist BancFirst and parking operator Don Karchmer in creating an underground pedestrian tunnel or skywalk to connect the Santa Fe garage with an 865-space garage to built at Main Street and the BNSF Railway viaduct.
That garage was proposed by Karchmer a few years ago and then put on hold to allow for studies on how to build the structure without hampering future rail connection on an unused line that currently goes through a corner of the property.
Couch said Monday that study was completed and the proposed garage will not interfere with future rail connections.
The potential sale of the Santa Fe Garage also coincides with design work for a new public garage to be built by the Central Oklahoma Transportation and Parking Authority at E.K. Gaylord and the Oklahoma City Boulevard that will provide parking for the future Omni Hotel, convention center, Scissortail Park and the Chesapeake Energy Arena.
TAP, which was recently awarded the design contract, is being instructed to design a garage of at least 850 spaces that could be expanded to 1,100 spaces with future capacity of up to 1,400 spaces.
The potential increase in size coincides with a group proposing to build a 241-unit, eight-story apartment complex around the new garage. Once that garage and the new convention center open, it is assumed the Cox Center and its 950space garage will be a likely target for redevelopment.
Couch said Monday the proceeds of the sale of the Santa Fe Garage, controlled by COTPA, could go toward the new convention center garage, but is not required to finance it.
COTPA has borrowing capacity to build the garage, Couch said, but he added the proceeds from a sale of Santa Fe could “significantly” reduce the need for debt.
Currently COTPA garage system debt totals $20 million and the Santa Fe garage’s $1.7 million net revenue is a significant part of the pay down of that debt.
“Our financial advisers tell us we will be in good shape with the sale thanks to the capital we would have to work with,” Couch said.
Couch is hoping to get direction from the city council next week to allow BancFirst to decide whether to move forward with purchase of Cotter Ranch Tower, which has seen occupancy plummeting in recent years under its previous owner, the late James Cotter.
That purchase, as of Monday, remains uncertain.
“It has yet to be determined if this is the right acquisition for us,” Hannah cautioned. “It is too early and too uncertain in the evaluation process to determine if we will complete the purchase.”