Almost all the space in a prominent suburban office building that was vacated by a major tenant has been backfilled.
Grandview II, a Class A office building near the intersection of Interstate 459 and U.S. 280, saw about 54,000 square feet open up this month when Iberia Bank vacated the space. Wettermark Keith had also recently relocated to the Bruno Capital Building on Grandview Place.
But about 44,000 square feet has already been backfilled as Grandview Medical Center took almost 17,000 square feet, and an undisclosed tenant that is relocating from downtown signed a lease for about 27,000 square feet last Friday.
Sam Carroll and Matt Gilchrist handle the leasing for the approximately 150,000-square-foot building. They say building occupancy is now at about 88%.
“With the addition of these new tenants, Grandview II should be well positioned for years to come,” Carroll said.
Built in 1998, Grandview II provides surface parking and an on-site fitness room. The property is owned by an affiliate of the Derbyshire Group in Destin, Florida, which acquired the property in 2016 for $24.1 million.
The property is part of the Highway 280/Interstate 459 office submarket, which is the largest behind downtown. At 82.41%, it has the second lowest occupancy rate of Birmingham’s five submarkets, but at $21.24 per square foot, it has the highest rental rate behind Midtown.
Still, it had more significant leasing activity than any other submarket last year, according to a recent report by Graham & Co. It also saw the largest office sale transaction in 2019 with the acquisition of the Encompass Health headquarters building for $74.5 million by an affiliate of AR Global Investments in New York City.
The U.S. 280 corridor has seen a steady amount of activity, including several office renovation projects and retail projects like Tattersall Park.
There is a substantial amount of office space available in the metro area – due in part to a series of previous acquisitions, particularly in the banking world – but that hasn’t deterred investors and commercial developers from buying and upgrading a number of projects in the metro area over the past two years. That list includes several properties along U.S. 280.