Riegel several years ago purchased Dayton’s tallest building (then called Kettering Tower), which is located across the street from the KeyBank property.
KeyBank Tower, located at 10 W. Second Street, is about 97% vacant and is losing tenants KeyBank and the Downtown Dayton Partnership this year.
KeyBank Tower is one of the office buildings at Courthouse Square, which local leaders want to see redeveloped because they say it could once again become a special public gathering space in the heart of downtown.
The Dayton City Commission this week is expected to vote on an assignment and assumption of ground lease agreement with Arkham Red that would last for 50 years.
Arkham Red proposes to pay $12,500 per quarter for a lease for KeyBank Tower and a $1-per-quarter lease for the KeyBank Tower conference center.
The city commission this week also could decide whether to approve an option agreement with the limited liability company for the KeyBank Tower property.
The agreement, if approved, would give Arkham Red the exclusive rights to purchase the KeyBank Tower property the building sits on from the city of Dayton for $10 if the company meets certain performance metrics.
Under the agreement, the company would have to invest about $4 million repairing and renovating the 27-story building.
Credit: JIM NOELKER
Credit: JIM NOELKER
Proposed repairs include repairing, replacing or upgrading the building’s elevators, chillers, boilers, cooling towers, roof and fire, security and electrical systems, city records state.
Other improvements could focus on ground level landscape, concrete and entrance work.
Another purchase requirement states that Arkham Red, its parent company or affiliates must fill 85,000 square feet of the tower within three years.
The building has about 379,500 square feet of space available.
Also, Arkham Red, or its tenants, also would be required to create or retain at least 90 full-time jobs in the building within the next three years.
Credit: Jim Noelker
Credit: Jim Noelker
KeyBank moved its Dayton headquarters into the office tower in 2008.
Previously, Mead-Westvaco, which included the former Mead Corp., and pulp and paper manufacturer NewPage Corp. had offices in the tower, but they moved out.
A company called THMG 10 West Second Street LLC owns and manages KeyBank Tower.
The option agreement says that Arkham Red and THMG have negotiated for a leaseholder sale, but the lease requires the express written consent for any assignment of leases.
This agreement is being considered at a precarious time for the downtown Dayton office market.
COVID has resulted in a major shift to remote work, which has reduced employers’ needs for office space.
Local leaders have voiced concerns that downtown Dayton’s office buildings could be underutilized, impacting other businesses that rely on foot traffic from daytime workers.
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