Although it cost $34 million to rehab in 1995, the estimated value if turned into apartments is $10.2 million
Wheeler CowperthwaiteThe Providence Journal
PROVIDENCE − The state is seeking proposals for turning the Shepard building in downtown Providence, currently home to the Providence branch of the University of Rhode Island, into something new, possibly housing.
The former Shepard Company Department Store spans the entire block between Westminster, Clemence, Washington and Union streets. The building now houses URI's Alan Shawn Feinstein College of Education and Professional Studies, including its daycare center, library, cafeteria and auditorium. The building, with a gross area of 255,000 square feet, also hosts state Department of Education offices.
Department of Administration spokeswoman Laura Hart said the state wants to gather ideas about "innovative uses" for the building, which was renovated for URI in 1995.
"It's an important property to the downtown Providence community, and we want to make sure it is used in the best, most effective way," she said.
The state is looking for "conceptual proposals" for residential, retail and industrial uses, according to the request for information.
Interested parties have until Feb. 6 to submit ideas for the space, with a "concise narrative" on how to develop the property and the benefits to the city and the state. The city has the right of first refusal to buy the property.
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The timeline will depend on how many packets are received; the process is non-binding, Hart said.
Hart said the possible sale of the building came up through a change in leadership at the Department of Administration. In her final days in office, Gov. Gina Raimondo named James Thorsen as acting director.
"The question is, are we using it in the best way possible for the state and the current tenants?" Hart said.
The building has no parking spaces, so URI leases 800 parking spaces at the Rhode Island Convention Center garage and another 25 parking spaces for people with disabilities at a private lot on Clemence Street, according to an appraisal conducted in April 2022.
In an email, URI spokesman David Lavallee wrote that URI is "aware" of the state's request for information about the space and that it "plans to identify more appropriate spaces for its current and future operation in Providence." URI is "committed" to maintaining its child-development center somewhere in Providence, he wrote.
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Lavallee did not respond to questions about estimated replacement costs and how much URI currently pays to occupy the building.
URI is "expected to vacate in the next 12-18 months," according to the state request for information.
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When the state renovated the building for URI and the state Department of Education in 1995, it cost $34 million.
How much is the Shepard Building worth and why has it's value decreased?
When the state unveiled a plan in 2019 to possibly sell the building as part of a larger plan by the Efficiency Commission to save money, the Shepard building was appraised by Thomas Andolfo at $27.5 million.
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Andolfo conducted the latest appraisal for the state in May 2022 and found the building to be worth only $10.2 million, citing its best use as apartments, which would mean gutting the interior.
In an email, Andolfo would not say why, four years earlier, he appraised the building at $27.5 million, 63% higher than his 2022 assessment. He referred all questions to the Department of Administration.
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In his appraisal, Andolfo wrote that the office-space market was killed off by the pandemic, hotels in Providence have a high vacancy rate, retail above the first floor is "virtually non-existent" and trying to entice another university to occupy the building is "highly speculative and conjectural."
Re-use of the building would probably look like the Westminster Lofts in the former Peerless building, he wrote.
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Reach reporter Wheeler Cowperthwaite atwcowperthwaite@providencejournal.comor follow him on Twitter@WheelerReporter.
