Duke En­ergy an­nounces plans for new up­town tower

The Charlotte Observer - - Front Page - BY CASSIE COPE

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Duke En­ergy said Fri­day it will build a 39-story of­fice tower across from its Char­lotte head­quar­ters build­ing as it seeks to con­sol­i­date its of­fice space in up­town.

The build­ing will sit on what is cur­rently a park­ing lot in the 500 block of South Tryon Street in be­tween the Har­vey B. Gantt Cen­ter and St. Peter Catholic Church. The pro­ject is ex­pected to be com­pleted in 2022, the util­ity said.

Duke said it will con­tinue to be head­quar­tered in the 48-story Duke En­ergy Cen­ter. But the com­pany said it will exit three other of­fice build­ings in an ef­fort to shrink its real es­tate foot­print from 2 mil­lion square feet cur­rently to 1.5 mil­lion.

Duke said it will sell two of those build­ings, 526 S. Church St. and 401 S. Col­lege St. The Church Street prop­erty served as Duke’s pre­vi­ous head­quar­ters build­ing and sits one block over from it. The Col­lege Street prop­erty is next to the Char­lotte Con­ven­tion Cen­ter.

The third build­ing is at 400 S. Tryon St., next to the Bechtler Mu­seum of Mod­ern Art. Duke said it plans to exit its lease at that prop­erty.

“By con­sol­i­dat­ing of­fice space into a new build­ing, the com­pany will avoid spend­ing mil­lions of dol­lars an­nu­ally to man­age and main­tain sev­eral in­ef­fi­cient and ag­ing fa­cil­i­ties that are more than 40 years old,” Duke said in a news re­lease.

The tower is the lat­est pro­ject an­nounced along the in­ter­sec­tion of South Tryon and Stonewall streets, which has seen a flurry of con­struc­tion in re­cent years.

Con­struc­tion is on­go­ing on a 33-story of­fice build­ing at the old Char­lotte Observer site. Ten­ants will in­clude Bank of Amer­ica. Con­struc­tion also con­tin­ues on a 26-story build­ing at the for­mer site of a Goodyear auto shop.

Ally Fi­nan­cial has leased the ma­jor­ity of that tower.

Also in the area, a newly built Whole Foods opened be­neath a tower of high-rise apart­ments this year.

Duke said its new build­ing will be roughly 1 mil­lion square feet, in­clud­ing about 25,000 square feet of re­tail space, and have seven lev­els of above-ground park­ing. The build­ing will house about 3,600 em­ploy­ees, Duke said.

Char­lotte-based de­vel­oper Chil­dress Klein, which de­vel­oped Duke En­ergy Cen­ter, will de­velop the new build­ing. Chil­dress also de­vel­oped Mu­seum Tower, an apart­ment com­plex on top of the Mint Mu­seum. The apart­ments, next to Duke En­ergy Cen­ter, opened this year.

Costs for Duke’s new build­ing have not yet been dis­closed. A Duke spokesman said such de­tails are still be­ing fi­nal­ized.

In May, Duke paid about $27.5 mil­lion for about two acres of land at the South Tryon Street site, real es­tate records show.

Duke said it plans to even­tu­ally seek a buyer for the new build­ing and sign a long-term lease with that owner.

The util­ity does not own Duke En­ergy Cen­ter. In­stead, it leases space there from Wells Fargo, which in­her­ited the build­ing when it ac­quired Char­lotte’s Wa­chovia dur­ing the fi­nan­cial cri­sis.

Duke also said it plans to keep the 100 em­ploy­ees it houses in NASCAR Plaza in that of­fice tower for now. Duke’s lease runs out there in 2026.

All told, Duke said it has about 6,000 em­ploy­ees and con­trac­tors in up­town.

Duke En­ergy is the largest payer of prop­erty taxes in Meck­len­burg County, ac­cord­ing to the Meck­len­burg County Of­fice of the Tax Col­lec­tor.

The com­pany paid $26.2 mil­lion in 2018 on prop­erty val­ued at about $2.7 bil­lion.

Staff writ­ers Ely Por­tillo and Deon Roberts con­trib­uted. Cope: 704-358-5926; @cassiel­cope

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