The Arcade, an iconic landmark in Providence, is changing hands.
This week, Johnson & Wales University will relinquish ownership of the three-story building, giving it to a real estate partnership that already owns the land.
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The university, which bought the building in 1995, said it has lost between $100,000 to $250,000 each year on the Arcade, with last year being one of its worst losses.
The new owners will be 130 Westminster Street Associates LLC.
Ownership will be transferred Feb. 1 when the school’s land lease expires with 130 Westminster. Johnson & Wales paid $76,000 to Providence-based Gilbane Building Co. for the Arcade in February 1995.
“We never made money on the building, even though we had no mortgage,” said Merlin DeConti, senior vice president, facilities management, Johnson & Wales, and president of Griffin Realty Inc., a subsidiary of the university that’s technically the owner of the Arcade. “By maintaining the building, it was a way to give back to the community.”
DeConti said the school lost about $250,000 last year on the building.
“Since we bought it, we’ve lost between $100,000 and $250,000 every year on the Arcade, depending on occupancy levels,” he said. “The school typically gave away free or low-cost space to charity, nonprofit and artist groups, which didn’t help the bottom line.”
The building’s graceful, 22-foot granite columns may hark back to the architectural styles of ancient Greece, but the Arcade also embodies a thoroughly modern concept: it has the distinction of being the first indoor shopping mall in the United States.
During its ownership, the university invested in the historic building.
“We’ve made substantial improvements to the building and maintained its historic integrity,” said Miriam Weinstein, spokesperson of Johnson & Wales. “We’re confident that 130 Westminster will be a good steward of this building. It’s time once again for the building to be part of the Providence business community.”
A source familiar with the Arcade who asked not to be quoted by name said the high cost of security and maintenance was a factor behind the school’s decision.
“Johnson & Wales feels that they’re in the education business, not the building management or retail business,” the source said. “The school took over ownership of the Arcade to preserve and save it. It’s an historic building that needed to be protected and cared for.”
Built in the neo-classical Greek Revival style, construction of the Arcade was completed in 1828. The building’s 12 gigantic granite columns were quarried in nearby Johnston. Located between Weybosset and Westminster streets in downtown Providence, the Arcade features a sheltered walkway and an interior commercial center.
The Metropolitan Museum of Art has deemed the Arcade one of the best examples of 19th century commercial architecture in the nation. That rare distinction, though, hasn’t helped balance the building’s ledgers.
