Wells & Co. Purchases Mars Property Underground Parking, Possible Two-Story Building Planned For Site Of Old Mars Hotel

The pile of rubble that was the Mars Hotel has a new owner.

Wells & Co. purchased the site Friday at a sheriff’s sale for $106,000.

The company is also close to buying the neighboring Fairmont Apartments, 315 W. Riverside, from Diamond Parking. That building, which was gutted by the same fire that burned down the Mars Hotel last summer, will be turned into office space with the possibility of some retail on the first floor.

Ron Wells said the plan is to build an underground parking garage on the Mars site to service the Fairmont.

“It’s not a bargain when you add the liens and cleanup costs,” he said, “but it makes our project entirely different because it makes it more appealing from a vehicle-access standpoint.”

Wells estimated the liens will cost $80,000 and it will cost an additional $40,000 to clear away the rubble.

Cleanup, he said, will proceed when Wells & Co. holds clear title to the property.

At a minimum, he said, a two-level, 72-space garage would be built on the site. But Wells said he is also considering constructing a two-story building above it.

Joining a new building to the Fairmont would increase the footprint of the first two floors from 12,370 square feet per floor to 21,000 square feet per floor, which Wells said could appeal to larger tenants.

The Fairmont’s 83,695 square feet will be converted into class A office space.

Class A space is typically defined as new construction, but since only the shell of the Fairmont remains, Wells said the restored building will feature state-of-the-art electronic and computer wiring, a high-speed elevator and an all-new heating and air conditioning system.

But this class A space will also come with $1.8million in first-year historic renovation tax credits.

“That’s really the key to make projects like that work,” said Wells. “Without that, this wouldn’t pencil out.”

Since past projects such as buildings in Carnegie Square and Steam Plant Square have allowed Wells & Co. to accumulate as many historic tax credits as it can use, the company will create an investment company and sell part ownership of the Fairmont to other partners - possibly building tenants - who can take advantage of the tax credits.

Construction won’t begin until contracts are signed with those partners, he said.

The Fairmont, said Wells, should command top-dollar lease rates and will not compete with the proposed downtown office tower.

A group of investors - including Kiemle & Hagood CEO Jerry Hagood and downtown property owner Wendell Reugh - is interviewing architectural firms to design a 20-plus-story office tower on the southeast corner of Howard and Riverside.

“My target is to make (the Fairmont) nice enough and beautiful enough that it’s worth $24 a square foot,” said Wells. “The demand is good. I absolutely think this has no adverse impact whatsoever on (a new) high rise because this will be completed long before the high rise will be finished.”