Brown to buy Old Stone Bank Building for $31.5M

Brown University said Aug. 12 that it’s buying the former Old Stone Bank building, at 121 South Main St., for $31.5 million, adding to a string of major commercial property acquisitions by colleges in Providence.

A Brown spokesman said a purchase and sale agreement has been signed, and the closing is expected to occur in a few weeks. Morris & Morse, asset managers for Quincy Mutual Fire Insurance Co., the building’s owners, accepted the offer from Brown on Wednesday, Aug. 10.

Richard Spies, executive vice president for planning and senior advisor to Brown President Ruth J. Simmons, said the 121 South Main owners had “indicated to a few people, including us, that they were interested in selling,” and Brown seized the opportunity.

“We thought it might match up with our needs, so we began to talk with them,” he said. The university expects to need about 500,000 square feet of new space in the next five or 10 years, Spies said, and while it’s adding some on College Hill, it’s also spreading out into the city. This new deal, he said, “is part of that larger picture, if you will.”

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In its official announcement, the university linked the purchase to Brown’s Plan for Academic Enrichment, which has boosted faculty numbers and enhanced academic programs. Rebecca Barnes, director of strategic growth, said Brown’s challenge “is to ensure that suitable spaces will be available when they are needed. 121 South Main St. gives the university increased flexibility as it plans to meet its evolving needs for space.”

Built in 1984 by the Old Stone Corp., the 11-story, 160,000-square-foot structure includes office and retail space as well as a 160-space parking garage. Standing at the foot of College Hill, and just across the river from downtown, it brings Brown closer to its Ship Street laboratory, in the Jewelry District, and to two of Brown Medical School’s major partners, Rhode Island Hospital and Women & Infants Hospital.

“It seemed like a very good location as part of a larger strategic effort,” Spies said. Most of the building is occupied, with major tenants including the law firm Brown Rudnick, the U.S.

Department of Housing and Urban Development and Hemenway’s Seafood Grille & Oyster Bar.

Some of the leases run for another 10 years or more, Spies said, and Brown will honor them all; Hemenway’s in particular is expected to stay for the long run.

But 121 South Main St. is not meant to be investment property, Spies said.

“We bought it because we think it had strategic value to the university over a long period of time, and we can start to make use of that pretty quickly,” he said. About 10 percent of it is currently vacant, Spies said, and Brown is “looking carefully at the possibility” of occupying that space, and taking more “as leases expire over the next few years.”

If the building comes to be in “predominantly academic” use, the university said, it will go through the 15-year transition process from commercial to tax-exempt space outlined in a June 2003 deal between the city and several colleges.

Rhode Island School of Design has also acquired substantial amounts of commercial property along South Main Street, but it’s still leasing out most of it, and paying property taxes.

Separately, RISD is taking over the former Rhode Island Hospital Trust building at 15 Westminster St., leasing with an option to buy that officials have said is likely to be exercised.

Across the river, Johnson & Wales University owns a large chunk of commercial property in the Jewelry District.

Originally named Old Stone Square, 121 South Main St. was designed by internationally renowned architect Edward Larrabee Barnes, whose work includes the IBM corporate headquarters in Manhattan, the Walker Art Center in Minneapolis, the Dallas Museum of Art, the Thurgood Marshall Federal Judiciary Building in Washington, and the IBM World Trade Center in Mount Pleasant, N.Y.

The property was purchased by the Providence Washington Insurance Co. in 1992, after Rhode Island’s banking crisis, and was subsequently sold to Quincy Mutual Fire Insurance Co. in December 2001, at which time the facility was renamed 121 South Main St.

The building offers 142,000 net square feet of usable space in 11 stories, abutting the Providence River and the city’s central business district, according to Brown. The floors are serviced by three elevators.

“To some degree, opportunities will drive the timing of our plan for strategic growth,” Spies said. “A large block of class-A office space so close to Brown’s College Hill campus was a rare opportunity that will expand the university’s options for growth over time. Purchase of such existing high-quality properties is far more efficient than new construction.”

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