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MIAMISBURG — Kettering Health Network has paid $4.05 million for a south suburban Dayton landmark: the former Dayco office tower along Interstate 75 near the Dayton Mall.
It’s the latest example of local health care providers taking advantage of a depressed commercial real estate market brought on by a glut of vacancies.
The nine-story, 126,000-square-foot office building will serve as administrative support offices for Kettering Health Network, spokeswoman Elizabeth Long said. KHN’s executive leadership will remain at Ridgeleigh Terrace — once the home of inventor Charles F. Kettering — just south of Kettering Medical Center, she said.
The Dayco building gives the health network a highly visible location in the south suburbs.
The planned relocation of hundreds of employees there also will breathe new life into a key office building that hadn’t been fully occupied since headquarter employees of Dayco — a manufacturer of automotive belts and hoses — moved out more than a decade ago.
The health system plans to consolidate an undetermined number of administrative support jobs in the office building, Long said.
The office building can comfortably house between 400 and 500 employees, said Ed Blake, senior partner with Miller Valentine Group, which developed the building in 1983 and sold it to Kettering Health Network. The building is about 40 percent occupied, leaving space for an estimated 240 to 300 employees. Kettering Health Network plans to retain the existing tenants.
Chris Fine, development director for the city of Miamisburg, said health network officials told the city they planned to relocate the 250 to 300 people who work at the administrative services building on Kettering Health Network’s Sycamore Medical Center campus, which also is in Miamisburg. That building would then be repurposed as clinical space for doctors, he said.
Long called that possibility “conjecture.” She said at least some of those employees are expected to move, though not necessarily all of them. The administrative services building houses marketing, finance, accounts payable, information technology, patient financial services and purchasing employees.
Fine said he was told at least some of the moves could come yet this year.
Kettering Health Network’s chief competitor, Premier Health Partners, in April purchased the former regional headquarters of Fifth Third Bank in downtown Dayton as the site of its new headquarters. Premier paid nearly $3.7 million for that building, less than half the original asking price.
The original asking price on the Dayco building was $4.2 million, Blake said. “We had it priced to sell,” he said.
Blake said health systems such as Kettering and Premier benefit from their nonprofit status when they purchase buildings instead of lease them because their cost of debt is lower. And Miller Valentine benefited, too, despite the soft market for commercial real estate, he said. The sale removed a lot of office vacancy from the company’s portfolio and provided cash for an older generation of partners at Miller Valentine, he said.
Blake said the purchase should provide a measure of stability for businesses in the Dayton Mall vicinity.
Contact this reporter at (937) 225-7457 or bsutherly@DaytonDailyNews.com.
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