An entity linked to the Detroit Symphony Orchestra sold a block-long office building on Woodward Avenue that’s full of stable tenants such as the Detroit Medical Center, the University of Michigan and the symphony itself.
The sale comes at time when real estate values are soaring in Midtown and other parts of Detroit. Neither seller nor buyer would disclose the purchase price, but several commercial real estate analysts say a $19 million to $25 million sale would be comparable to other recent purchases.
The building called Orchestra Place, at the corner of Woodward and Martin Luther King Jr. Blvd., is next door to the performance space for the symphony. The performance venue, called the Max M. and Marjorie S. Fisher Music Center, was not part of the sale.
The buyer, Broder & Sachse Real Estate Services, has a growing portfolio of high profile properties in downtown and Midtown.
“This property is just great real estate in our neighborhood,” said Richard Broder, CEO of the Birmingham-based firm. Broder said they have no immediate plans for the property.
Orchestra Place, 3663 Woodward Ave., is a five-story “Class A” office building that’s 100 percent full, according to CoStar, a commercial real estate information service. The main tenants are the nearby Detroit Medical Center, which has various office staff in nearly half the building. Another key tenant is the University of Michigan Detroit Center. The tenants will remain after the sale is complete, the owners and sellers said Tuesday.
A spokesman for the nonprofit Detroit Symphony Orchestra said sale proceeds will be used to support the goals of our “strategic 10-year plan” but didn’t provide specifics about those goals. “Owning commercial real estate is not core to the DSO’s mission,” the spokesman Matthew Carlson added.
The orchestra’s board of directors have set up a task force to determine the best use of the sales proceeds “in a way that will reduce long-term risk and provide greater stability for the organization.”
The DSO’s current annual budget is $29 million, Carlson said.
The average sales price for office space in downtown and Midtown in the past year was $127 per square foot, according to CoStar. Orchestra Place, which has 151,693 square feet of office space, would fetch a higher than average price because of its prime location and its stable of tenants, said Peter McGrath, an associate for Colliers International, a commercial real estate firm.
McGrath noted that another downtown building at 150 West Jefferson was sold recently at $166 per square foot.