Berry swoops in amid slump

Berry swoops in amid slump

July 3rd, 2011 by Mike Pare in Business Around the Region

Chattanooga businessman Jim Berry is adding to his downtown real estate holdings with the purchase of a well-known Chestnut Street address.

A Berry company, Republic Parking Systems International LLC, last week bought the three-story structure at 535 Chestnut St. that for many years housed IBM's Chattanooga offices.

The sale price was $1.8 million, or less than $23 per square foot, according to the Hamilton County Assessor of Property. The seller was listed as Southeast Local Development Corp., which had owned the building for the past decade.

Steve Hunt, managing partner of the Berry & Hunt real estate firm, said the group plans to call the 80,000-square-foot structure the Five Thirty Five building. He said the building is about half full with tenants, including Belhaven University.

Hunt said that Berry, chairman of Republic Parking Systems, is bullish on downtown despite the vacancy of more than a million square feet of commercial space in Chattanooga.

"Our downtown is thriving compared to some," Hunt said. "Downtown has a good heartbeat."

Last year, Berry bought the 17-story Chestnut Tower just across Sixth Street from Five Thirty Five. Now renamed Liberty Tower, the high-rise is getting a $20 million makeover as the Chambliss, Bahner & Stophel law firm prepares to shift to the site.

Berry also owns the 21-story Republic Centre building next door to Liberty Tower, where his parking company is headquartered.

Hunt said Berry additionally owns a parking garage on Sixth directly behind Five Thirty Five.

"That will have a lot of appeal" to tenants, he said, noting the Five Thirty Five will be renovated. "We'll spruce it up and continue to fill it up."

Chattanooga-based Republic Parking employs 2,600 people worldwide and up to 150 locally. It generates revenues of about $360 million a year, according to Berry.

Kim White, who heads the nonprofit downtown redevelopment group River City Co., said property purchases by major downtown landlords such as Berry and Henry Luken of Luken Holdings is "a great signal."

Tom Francescon, immediate past president of the Chattanooga Area Chamber of Commerce's Downtown Council, said he's encouraged by the investments in downtown.

"We have a lot of space available," Francescon said. "To me, (Berry's purchase) is an indication of the growth in the Chattanooga community."