Clark Tower renovation includes two restaurants, new-look lobby

Friday, October 29, 2004

Memphis Business Journal
By Jane Aldinger

In-Rel Management, Inc., seeking to boost Clark Tower’s status as a premier office property, has invested $750,000-$1 million in improvements and is opening a new restaurant, The Tower Room, in the former Summit Club space atop the building.

The Lake Worth, Fla.-based real estate firm has also signed a creative ground lease for Carrabba’s Italian Grill to construct a new restaurant in Clark Tower’s parking lot on Poplar.

The Tower Room will be operated by Aramark as a restaurant open to the general public for lunch Monday-Friday and for dinner Thursday-Saturday. It will also accommodate up to 500 people for banquets and other special occasions.

Aramark commonly conjures cafeteria images, but Frazier Baker, leasing agent with In-Rel, says the sit-down restaurant will serve all-American food in a mid-level price range, from $7-$10 at lunch.

In-Rel will invest about $300,000 into the restaurant’s aesthetic decor. Ron Riley, In-Rel’s director of leasing, says they hope to have live music for the dinner crowd and happy hour offerings for tenants to unwind after work.

“We want people to be inclined to stay up there after they eat and enjoy the views of the facility,” Riley says.

The Tower Room is located on the Clark Tower’s 33rd floor, providing panoramic views of the city as no other structure outside of Memphis’ Downtown can. Riley says the idea of reopening it as a private club was never an option.

Other new amenities at Clark Tower are flat screen televisions in all 12 elevators, a new monument sign, lobby improvements and a touch-screen tenant directory.

The television operator, Captivate Network, Inc., provides programming to elevators in office towers across the country, but the Clark Tower is the first office property in Memphis to have television screens in its elevators.

In-Rel has also replaced the bulky tenant directory with a touch-screen directory of all the Clark Tower’s tenants. Guests simply touch the first letter of a company’s name and can easily identify the suite number of the company they’re looking for.

In-Rel recently landed city approval to erect a 30-foot monument sign on Poplar in front of the tower. The new sign’s design is complementary to the building’s and will have space to advertise In-Rel and to highlight up to eight new or existing tenants. Lobby improvements include a rock garden in the lobby, new flooring and new artwork.

“The building has really good bones and a premier location,” Riley says. “We are giving the building a facelift and bringing it into the 21st century.”

In-Rel officials hope The Tower Room will boost the tenant base in the tower, which has improved by about 10% since In-Rel purchased it last year. Riley says they have increased occupancy from about 72% to 82% and are on pace to sign about 80,000 square feet of deals this year, including the 20,000-square-foot Tower Room deal.

Most of the deals signed over the last 12 months have been in the 2,000-3,000-square-foot range, as In-Rel’s main focus has been to stabilize the building’s occupancy.

Carrabba’s will build a 7,000-square-foot restaurant on Poplar in Clark Tower’s parking lot and will support an employee base of 80-100 people. In-Rel is reconfiguring the parking lot and will not lose the building’s necessary frontage parking. Carrabba’s is a dinner-only establishment and therefore should not interfere with the Tower’s tenant base.

The Houston-based Italian restaurant chain is represented locally by franchisee Bob Frey. Frey says he is investing about $2.7 million to build the restaurant in Memphis, and although it is still moving through the stages of city approval, Frey hopes the restaurant can be open by June 2005.

The Carrabba’s concept was founded by Johnny Carrabba in Houston, and all of its food is prepared daily from scratch. It is a division of Outback Steakhouse, Inc., and this will be Carrabba’s first location in the Memphis market. Frey currently operates nine Carrabba’s locations, including two in Nashville and one in Knoxville.

Frey says Carrabba’s should mesh well with the other dining options in the neighborhood.

“Here comes a great Italian option that we think with our fresh food profile and upscale, comfortable and casual atmosphere, is going to be a great fit for that demographic,” Frey says.

Choosing to locate in the heart of Memphis, Frey says he has been looking for a location here for years. Driving up and down the Poplar corridor, he approached Riley and In-Rel about the possibility of building on Clark Tower’s property.

Frey says he resisted the temptation to build a restaurant in the suburban markets because he feels his restaurant concept fits well with its East Memphis neighborhood.

“I wanted to be (in Memphis) first and felt very strongly that who we are would be a day-in and day-out resource for the neighborhood,” he says. “I think we can further the destination feel of that area of Poplar as a dining destination, and that drove me.”

In-Rel prides itself on being a hands-on, responsive owner and attributes that to the success the Clark Tower has seen since it last changed hands.

“There’s not a whole lot of corporate red tape to go through to get a deal done here,” Baker says.

And with the technological and aesthetic improvements and the addition of two new restaurants, In-Rel has invested heavily in its premier office property.

“It was a building with potential, and we came in and threw some money at it,” Baker says.

Garnering $17.50-$18 per square foot rental rates, Riley says he is pleased with the amount of leasing the Tower has seen in the last year and hopes that will continue to rise as the economy recovers and potential tenants see the Tower’s improvements.

“We’ve got some good momentum,” he says. “70,000-80,000 (square feet) is a lot of space to lease in a down market, and (the restaurants and improvements) will only help our efforts going forward.”

In-Rel purchased the Clark Tower in August 2003 for about $40 million.

In-Rel also owns 6263 Poplar and Lynnfield Office Park. The 100,000-square-foot Poplar property was In-Rel’s first purchase in the Memphis market, for $6.8 million in 2001. The 281,000-square-foot office park was purchased in December 2002 for about $21 million.

CONTACT staff writer Jane Aldinger at 259-1727 or jaldinger@bizjournals.com