[V]ermont officials are proposing a costly repair project for a state office building in downtown Burlington.
The Department of Buildings and General Services says it agrees with a consultant’s recommendation to repair a deteriorated parking garage under the Zampieri State Office Building at 108 Cherry St. That work carries an estimated price tag of $12.6 million.
The consultant’s proposal also advocates for additional building renovations; moving some state Health Department operations out of Burlington; and selling another Cherry Street building.
Buildings and General Services Secretary Chris Cole said he is not yet willing to commit to those aspects of the plan. But he said the parking garage project is paramount if the state wants to maintain ownership of the building.
“It’s at a point now where we either need to sell the building or invest in it,” Cole said.
The Zampieri facility, named for former state representative and buildings administrator John J. Zampieri, serves as the Department of Health’s headquarters and also houses other state offices.
Cole said the office portion of the structure is “perfectly fine.” But officials have been concerned for years about the condition of the parking garage underneath, where road salt and poor drainage has been damaging the concrete.
Because the garage is beneath the building, there are longer-term “structural concerns” for the entire property, Cole said.
Earlier this year, the state Legislature’s capital bill directed Buildings and General Services to develop long-range projections for three options – selling the Zampieri building; renovating the structure and continuing to use it entirely for state employees; and renovating the building for use by state employees and a “non-state entity.”
In response, department worked with White + Burke Real Estate Investment Advisors to examine 19 “probable development scenarios.”
The consultant considered options that included renovating, selling, or demolishing and rebuilding on the Zampieri site. Officials also took a wider view, considering the future of state buildings at 50 Cherry St. and 59 Pearl St.
White + Burke settled on a multifaceted plan that includes repairing the parking garage; renovating the Zampieri building; moving Health Department administrative staff to either suburban Chittenden County or Waterbury; moving state employees from 50 Cherry St. into the Zampieri building; and selling 50 Cherry St.
The consultant also said the state could lease about 38,000 square feet of “surplus space” at the Zampieri building to an outside entity, “which would provide a revenue source.”
Cost was one factor in the consultant’s decision. White + Burke said the price of renovating the garage and Zampieri building is $19.3 million, as compared to buying land and building a new structure in Burlington (about $30 million) or redeveloping 108 Cherry or 50 Cherry (costs ranging from $26 million to $48 million).
Keeping the Zampieri building also makes sense, the consultant said, because it’s a good spot for state staff who work directly with the public.
“The 108 Cherry St. building is extraordinarily well-positioned within the greater Burlington marketplace to serve its direct-service clientele,” the consultant’s report says. “The building is located immediately adjacent to the new downtown transit hub and is within close walking proximity to dense populations.”
The real estate adviser also said it could be a “significant challenge” for the state to unload the Zampieri building because “the Greater Burlington office market is oversupplied and is expected to remain so for the foreseeable future.”
In a December report to the Legislature, the department says it concurs with the consultant’s recommendation. “It is clear from the 20-year financial analysis that keeping 108 Cherry St. and immediately fixing the parking garage is the least costly option,” officials wrote.
But Cole, in an interview Wednesday, clarified that fixing the parking garage is the department’s top priority at this point. As for any additional renovations, and which employees should occupy the building in the future, Cole said “there needs to be another level of planning and analysis done” with the Agency of Human Services.
Cole is particularly skeptical about leasing state office property to a non-state entity, given the consultant’s report of “soft market conditions.”
“I don’t think it would be a prudent time for the state of Vermont to test the market for private office space in Burlington,” Cole said.
Regardless of the final shape of the state’s plans, officials say nothing is happening right away.
That’s partly due to money. Cole said $2.1 million has been allocated for analysis and design work related to the parking garage, but another $10 million would be required for the work.
Also, state lawmakers have to weigh in on the matter. Now that preliminary analysis has been completed, “the Legislature will take testimony and will make their own independent decision as to what they believe is the best option for the state of Vermont,” Cole said.
