State keeps 'expensive' lease near Monument Circle, negotiates savings

INDIANAPOLIS - The state of Indiana renegotiated its most expensive rent payment months after the Call 6 Investigators questioned the expenditure.

As Call 6 Investigator Kara Kenney reported in July 2012 , the Indiana State Department of Health paid $2.3 million to rent 2 N. Meridian St., a building in one of the most desirable areas of downtown, just steps away from Monument Circle.

But Kenney has learned the state has renegotiated the lease and now pays $1.6 million for the space.

Records show the landlord, Goodman Jewelers, signed the new agreement with Indiana State Health Commissioner Gregory Larkin and Department of Administration Commissioner Robert Wynkoop on Dec. 21, 2012.

The amended lease extends over a nine-year period, through June 2022, for a total cost of $18.4 million.

Read: Amended lease in full  http://bit.ly/15tO7WI

Back in 2012, Steve Harless, real estate director for the Indiana Department of Administration, called the health department lease "expensive."

IDOA is the state agency that handles real estate and leasing for most of state government.

Harless said last week the negotiated rate represents a savings of approximately 25 percent, or $10.1 million over the term of the lease.

Kenney reported in 2012 the state also pays $464,467 to rent an off-site parking garage at 101 N. New Jersey St., for those state health department workers.

Harless told Kenney the state performed an extensive review of "some 12 to 15 properties" over a 10-month period, and factored in parking costs, utilities, housekeeping, furniture and other expenses.

"The review resulted in a comparative cost analysis to the taxpayer for the top choice locations," Harless wrote in an email. "This in turn, was used to make a decision that was in the best interest of the tax payer."

Harless said while they gave serious consideration to relocating ISDH to a suburb, it would cost approximately $3 million for the Indiana State Department of Health to move to another building.

"In addition, staying at the same location allowed for minimal disruption of agency operations," Harless said in an email to RTV6.

IDOA also pointed out that the lease has "termination for convenience" language, making it easier for the state to move later on.

In July 2012, the Call 6 Investigators reported 8,000 square feet of vacant space remained on the eighth floor of Government Center North.

The area was once occupied by the Indiana Department of Transportation, but it had been sitting empty for about a year.

Harless said the state moved two program areas of the Health Department into 8,500 square feet of vacant space inside the Government Center.

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