A little more than a year after acquiring the Downtown complex, the owner of PPG Place is eyeing a property makeover that could drastically alter the food court and Wintergarden as well as the space fronting Market Square.
Highwoods Properties is seeking to upgrade PPG's retail space and is considering the option of replacing the food court with a grocery, CEO and president Ed Fritsch said.
"We're evaluating a number of options, and that certainly is one of them," he said. "It is still early on. I think any Downtown worker or resident ... would love to have that type of shopping amenity in Downtown."
Highwoods paid $179.4 million in September 2011 to acquire the glass castle-like, six-building complex in the heart of Downtown and has boosted the office occupancy from 81.2 percent to more than 90 percent since then. It also is in the process of making $17.1 million in capital improvements, including new signs and directories and modernized air conditioning and heating systems and elevators.
Now the Raleigh, N.C., real estate investment trust is hoping to rejuvenate the property's retail offerings, particularly in Market Square. Mr. Fritsch said the glass and metallic 2 PPG space fronting the historic plaza is "not as vibrant and as in sync" with the other parts of the rejuvenated square, which is now filled with restaurants.
"We feel that our quadrant is under-energized compared to the other three quadrants. I think it's in everybody's interest to make all four vibrant and interactive," he said.
The PPG space on the square now is inhabited by a PNC Bank branch, a Crazy Mocha coffee shop, a GNC store and Serendipity, a fashion accessories retailer. There are a couple of vacant spaces in the walkway between Market Square and PPG Plaza, home to an ice-skating rink in the winter and a fountain in the summer.
Mr. Fritsch would not say whether Highlands plans to replace any of the retailers currently located on the square or those that occupy the food court.
"It's too early to answer that," he said. "We're weighing a number of options, including our customers who are there now."
But he added that Highwoods is looking for merchants who "are more than just 9-to-5 occupants. We're trying to work on some repositioning and trying to attract some other users so we can be more than 9-to-5 with some of those spaces."
To help with the retail makeover, Mr. Fritsch has called on Glenn Stephenson, a Highwoods executive who oversees Country Club Plaza, a 15-block entertainment district in Kansas City, Mo., filled with dozens of restaurants and more than 150 stores, including Pottery Barn, Apple, Williams-Sonoma, Talbots, Chico's and Sur La Table.
While Mr. Fritsch stressed that he wasn't suggesting that any of those retailers are prospects for PPG Place, he said he enlisted Mr. Stephenson to leverage his expertise with that being provided locally by the CBRE real estate firm.
Highwoods is seeking to upgrade the lower-level food court, which has lost the Grecian Isles and Au Bon Pain restaurants. Mr. Fritsch said the food court "still kind of resonates of 1984" when the complex opened and is in need of physical improvements as well as new energy.
"I think there's an opportunity to do some modernization there," he said.
The company also is looking at potential retail opportunities on the east and west sides of PPG Plaza and cosmetic improvements, such as new signage and lighting.
But perhaps the most intriguing changes could be in store for Wintergarden, a garden-like space that fronts Stanwix Street where employees can find a table to eat lunch, take a break or talk with co-workers. It also is used for holiday exhibits and private events, including weddings.
Mr. Fritsch described the Wintergarden as "15,000 square feet of prime real estate in the best part of Downtown." He believes it's under-used but is also a "little bit of a Rubik's Cube" to reprogram because it lacks air conditioning and restrooms.
Options under consideration include converting it into retail or restaurant space or perhaps something out of the ordinary like a car dealership. Mr. Fritsch said there is no reason to limit the range of possibilities at this point.
"Our thinking is that we've got 15,000 square feet of enclosed space. There is an opportunity to energize it," he said.
Mr. Fritsch said Highwoods has no set timetable for the upgrades, although he added he hopes to have some changes in place by the end of the year, if not sooner.
"We just have to figure out what pieces we can get to now versus later," he said.
Mark Belko: email@example.com or 412-263-1262.