Once entertainment giant Hasbro Inc. leaves its 135,400-square-foot downtown Providence office building, it’s unlikely the city will ever attract another large company into the prominent, six-story building across from the R.I. Convention Center, real estate observers say.
More likely, they say, the building will be occupied piecemeal, with vacancies remaining beyond Hasbro’s lease expiration in January 2025 – a prospect that doesn’t bode well for the city’s downtown business profile.
“The optics are never great when a company like Hasbro announces that they’re moving out of downtown Providence,” said Leeds Mitchell IV, executive vice president and associate broker at Providence-based MG Commercial Real Estate Services Inc. “It was a win for the city to get them in, and it’s certainly sad to see them leave.
“It’s a lot of space the market now has left to absorb, unfortunately,” he said. “And there isn’t a lot of demand for larger blocks of space in the market.”
The announced departure comes at a time when commercial real estate is at a crossroads with the growth of remote and hybrid workplaces following the COVID-19 pandemic diminishing demand for office space.
And Providence is no stranger to a high-profile building being vacant, Mitchell says.
With “the prominence of [Hasbro’s] location in the city – adjacent to the [Amica Mutual Pavilion] and the convention center – once the building goes dark, it’s going to be in everyone’s face, similar to the ‘Superman’ building,” he said.
However, unlike the iconic but aging Industrial Trust Co. Building, which sat entirely vacant at 111 Westminster St. since Bank of America Corp. moved out in 2013 and is undergoing a residential conversion, the Hasbro site will likely attract some tenants before the current lease expires, Mitchell says.
The property could serve as a barometer for what to expect in the real estate sector for the foreseeable future.
Timothy Howes, an associate professor and department chair of accountancy and finance at Johnson & Wales University, also doubts that a single, widely known tenant will move in.
Illinois-based Inland Diversified Real Estate Trust Inc. purchased the building in 2013 for approximately $29.8 million. The Providence tax assessor’s office lists the current owner as Inland Diversified Prov Lasalle Square.
Inland Diversified did not respond to a request for comment. And, although Pawtucket-based Hasbro said it was laying off about 1,100 workers globally, the company declined to disclose how many Rhode Island employees were laid off, how many worked in the Providence location or how much of the building the company used. Hasbro will maintain its global headquarters in Pawtucket.
As for what could occupy that space, Mitchell says everything from housing units, a hotel, traditional office space or even a school could be on the table.
Mitchell and Howes agree that the building benefits from a central location and Class A designation, with modern, up-to-date infrastructure – though, depending on how it’s used, some updates may be needed. It was constructed in 1987.
Hasbro’s departure undoubtedly comes as a disappointment to city leadership, Howes says, noting that Providence granted the toy company a tax deal when it leased the space in 2012 with “an expectation that Hasbro was going to put down some long-term roots.”
But Michaela Antunes, Providence’s director of communications for economic development, said that city leaders are keeping “an optimistic outlook on our economic future.
“The economic landscape of our city is promising,” Antunes said, and “boasts a higher quality of life for residents … at a more affordable price point.”
