Cost likely is reason housing development atop downtown Oklahoma City garage fails to advance

Business writer Steve Lackmeyer delves into why an effort to attract housing development atop a new Oklahoma City garage failed to draw any response.
by Steve Lackmeyer Published: February 19, 2013
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Advance to 2013, and downtown is enjoying a boom in housing development, where the apartment supply is constantly outpaced by demand.

Class A office space, meanwhile, is down to 4 percent, and the only large chunks of older, lower-rate office space are the troubled First National Center and the Dowell Center (formerly Midland Mortgage building) that is closed and slowly being renovated.

In such a market, why did the prospect of building housing, or even offices, atop the new garage fail to draw bidders?

Cost, as always, remains the simple answer. One developer who looked at the project explained that rental rates for such space would run at $3.50 per square foot to break even when the current market, at best, can support $1.75 a square foot.

Office space, according to this same analysis, would need to lease at more than $30 a square foot when the market at best might support $25 per square foot.

The concept of more sophisticated mixed-use urban development, however, is now a part of the widening discussion of downtown's future. And for that, this failed effort might not be seen as such a failure in years to come.

by Steve Lackmeyer
Business Reporter
Steve Lackmeyer is a reporter and columnist who started his career at The Oklahoman in 1990. Since then, he has won numerous awards for his coverage, which included the 1995 bombing of the Alfred P. Murrah Federal Building, the city's Metropolitan...
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