Ten developers submit proposals for new DHHS campus

Ten submit proposals for 1-million- square-foot project

dbracken@newsobserver.comAugust 20, 2012 

Highwoods Properties, Kane Realty, Duke Realty and Craig Davis Properties are among a list of 10 developers that submitted proposals to the state for a new Department of Health and Human Services campus in the Triangle.

The state is seeking as much as 1 million square feet for the new campus, which represents an enormous opportunity for developers that have had few opportunities to bid on projects of this size in recent years.

A meeting last month to discuss the project drew a packed crowd, and developers had until Friday to submit proposals. Others submitting proposals include: Lookout Ventures, Lundy Management Group LLC, Red Rock Developments, The Keith Corp., Tri-Properties of Durham and 5401 North LLC.

Only the names of those submitting bids were released, not the specifics of each proposal.

DHHS will need between 600,000 and 650,000 square feet no later than June 2014, with additional space becoming available in 2017 and 2019. The state’s request said that preference will be given to sites that are in close proximity to the Dorothea Dix campus just west of downtown Raleigh.

The roughly 1,400 DHHS employees working on the Dix campus would be among the first employees to relocate to the new site.

But given the tight timeline and the fact that the Triangle has few locations that could accommodate DHHS’ space needs, the state is likely to consider sites throughout the region.

Craig Davis Properties of Cary submitted its proposal on behalf of Park Center FA LLC. Park Center is a nine-building office park at N.C. 54 and Davis Drive that is home to about 750,000 square feet of space. Lookout Ventures has assembled more than 1,000 acres in Apex for its Veridia project while 5401 North LLC is a subsidiary of Baton Rouge, La.-based Commercial Properties Realty Trust, which owns land in North Raleigh at the intersection of Interstate 540 and Louisburg Road.

Duke Realty has enough land for a new campus at Perimeter Park, where it already has built a campus for Lenovo. Raleigh-based Highwoods, meanwhile, owns land at Weston in Cary that could accommodate the agency’s needs. Kane Realty is the developer of North Hills in Raleigh.

According to the state’s request for proposals, DHHS is seeking to sign a 20-year lease for either an existing property or a build-to-suit campus that would include 850,000 to 1.05 million square feet. The request for proposals is the result of an analysis conducted of DHHS’ roughly 30 different state-owned and leased facilities in Wake County. Those facilities house about 4,300 workers.

The state has hired Grubb & Ellis Thomas Linderman Graham to represent it in the RFP process.

Bracken: 919-829-4548

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