Update: The height of the building was updated on Feb. 22, after the developers clarified the layout of the building.
The former News & Observer building across from Nash Square is set to be transformed into a massive office and residential project.
Acquisition Group, the California investment firm that bought the 3.3-acre property on South McDowell Street in 2017 for $22 million, plans to turn it into a mixed-use complex, and the first phase will be a 20-story tower that will face Salisbury Street, according to a statement from the company on Thursday. Fifteen floors of the building will be for office and five stories will be for parking, a spokesman for the developers said on Friday.
Acquisition Group is teaming up with the prolific Chapel Hill developer East West Partners to build the project. East West Partners has completed and sold several projects across the Triangle in recent years, including the Liberty Warehouse building in Durham and the Berkshire Chapel Hill apartments.
The first phase of the development, which will include retail as well as offices, is expected to be completed in 2021.
When completed, the tower — called The Nexus — will have more than 1.5 million square feet of total space, including more than 300,000 square feet of office space and retail. The next phases of the project, according to renderings, would include two 20-story residential buildings as well as a 13-story hotel that would be attached to the office building.
The second residential tower could get started in the first quarter of 2020, said Robert Brown, a spokesman for East West Partners, while the hotel and condo buildings don’t have a concrete timeline right now.
Acquisition Group has a long history of investing in downtown Raleigh and had eyed The N&O building for years before ultimately buying it.
The company invests in real estate, securities, and oil and gas, and has operations in Los Angeles and Santa Ana in California; in Sao Paulo, Brazil; Toronto, Canada; and Frankfurt, Germany.
In Raleigh, it owns Two Hannover Square, the 29-story skyscraper on Fayetteville Street that is home to BB&T, and it used to own several other properties in the downtown core.
“This is a one-of-a-kind property that connects Fayetteville Street and the Warehouse District. It provides the opportunity to make a lasting mark in Downtown Raleigh,” Acquisition Group President Sam Sotoodeh said in a statement. “We have put together a remarkable team that combines local experience and international expertise to create a new community in downtown Raleigh that will enhance the quality of life.”
Before moving its operations to Fayetteville Street last year, The N&O had been based at the McDowell Street property, which covers nearly a full city block, since 1907. The current building there dates to 1956.
The demolition of the building will likely be done sometime in the early summer, Brown said.
Architectural firm Gensler, which has offices in Raleigh, designed the master plan for the building as well as the initial office portion of the tower. Architect John Martin, an N.C. State University alumnus who works at Boston firm Elkus Manfredi, will design the residential portion.
The company said it will not need to ask for a rezoning of the property.
The new plans for the former N&O property are the latest in a string of projects that will make downtown Raleigh denser and much taller, while also significantly adding to its skyline.
Last week, the Boston-based firm The Fallon Co. submitted plans to the city to build a new 20-story tower on Hillsborough Street.
And earlier this year, Raleigh developers Kane Realty and Williams Realty submitted a rezoning request to ask for up to 40 stories to be built on the northern edge of downtown. That request came after Kane had already asked to build another 20-story tower in the Warehouse District.
And late last year, Five Horizons Development submitted a request to build up to 20 stories on South Saunders Street, in a move that would seriously expand the southern edge of downtown.