MKF Properties recently purchased two buildings in the city: one downtown and another a two-minute walk away. Mark Foley Jr., president of MKF Properties, plans to turn the downtown space — which is next to Green Mountain Power’s Energy Innovation Center — into co-working space.
Foley is looking for tenants for the other building, just a block from the city’s central business district at 77 Grove St. It had been leased space for Central Vermont Public Service Corp. for years and later for GMP, until about a year ago. It has been vacant since then, and Foley has been working to buy the property for more than a year.
Foley recently purchased that property with its roughly 40,000-square-foot building from a New York investment company for $425,000. It’s assessed by the city at about $515,000. He also bought a parking area next door, which had been owned by GMP, for $60,000.
The downtown property, at 72 Merchants Row, had most recently been a pawn shop, but that too has been vacant for about a year and has fallen into disrepair, with boarded-up windows and deteriorating bricks in the front.
A “full restoration” is planned of that 3,000-square-foot, three-story building, which currently has no heat on its upper floors. When finished, Foley said, the building will have high-speed fiber optic lines, energy-efficient lighting, an updated facade and heat pumps.
“It will be north of $100,000 to get it right,” he said of the cost to rehab the building, with work expected to start around September.
By the end of this year, Foley said, the property will be turned into three floors of co-working space.
It will be connected to GMP’s Energy Innovation Center through a new door on the second floor to allow for the use of GMP conference rooms and space. A rooftop terrace on the neighboring GMP building will also be available to those at 72 Merchants Row.
“Hopefully it’s sized right for Rutland. We believe there’s demand for it,” Foley said. “We envision it as a fun, social and professional spot that will appeal to entrepreneurs, new businesses and business professionals who need space but not necessarily an office suite of their own.”
Steve Costello, GMP vice president, said he looks forward to seeing the building at 72 Merchants Row getting cleaned up.
“We’re really excited about it,” Costello said. “It’s a relatively small space, and by connecting, it makes his space more appealing to potential tenants, and we’re all about trying to make downtown as vibrant as we can, and when he proposed the idea of shared workspace we jumped at it. We love the idea.”
Foley bought the building at 72 Merchants Row from a Massachusetts owner for $42,000, which is just about its assessed value, according to city records.
Foley said the property that once housed CVPS will be “rebranded” as 77 Grove. While he has no specific plans, he envisions it being available for tenants needing 7,000 to 20,000 square feet.
“That building was built for a single user,” Foley said. “What we’re really doing is focusing on understanding what we have and making sure it is up to speed related to all the amenities that are necessary and making it tenant ready, showable ready.”
It can then be custom retrofitted for tenants, he added.
The deal with GMP to sell the parking spaces at 77 Grove came with an agreement that Foley pursue buying the building at 72 Merchants Row, helping to clean up a property adjacent to GMP’s Energy Innovation Center and put it under local ownership. In return, those parking spaces were important for Foley to make the purchase of 77 Grove come to fruition.
“It was a unique situation,” Foley said, “and GMP’s willingness to partner with us on 72 Merchants Row and to sell us the lots at 77 Grove was critical for us to make a deal work with the owners of the former CVPS/GMP building.”
Foley, who owns a downtown building that Castleton University uses as dormitory space, said there have been no talks about turning 77 Grove into another dorm for the school.
“We want to develop it as commercial space,” he said.
Mayor David Allaire said he’s glad to hear the news of Foley’s recent purchases.
“I’m very pleased to see both properties coming under local control,” the mayor said in a statement, “and to hear Mark’s plans for their redevelopment.”
