In the News
TECHIE TENANTS FILL THE "TELECOM HOTEL"
It once was one of downtown Greensboro's biggest white elephants. The hulking, once-grand Guilford Building fetched just $110,000 when Guilford County government put it on the auction block seven years ago. The building was just too run down, outdated in outside appearance and interior equipment.
Now it's a high-tech marvel, hard wired with fiber-optic cable and filled nearly to capacity with telecommunication companies, Internet businesses and advertising agencies that cater to e-commerce. The building's success is a hopeful sign that long-neglected downtown buildings might have a profitable future in the region's new, service-oriented economy. But it's also a story of one family taking a great risk that has paid off 50 times above its initial investment, which was less than the cost of a moderately priced, single-family house. The building auctioned for so little is now worth an estimated $5 million, largely because it attracted a key tenant who installed state-of-the-art telecommunications equipment four years ago.
"We have 11 floors above ground and we're now making renovations on floor eight," said part-owner and office manager Diana Poston. "We have a lot of long-term tenants, some with leases of 20 years or more." Poston's sister-in-law, Linnie Vickrey, bought the property at South Elm and South Washington streets from the county against the advice of some of her relatives. The county had owned the property for five years and considered, but ultimately decided against, renovating it for government offices. "I really had bitten off more than I could chew, but I didn't want to admit it," said Vickrey of her 1993 purchase.
The new buyer was then an assembly line worker at Lorillard Tobacco with real estate experience, but not enough to single-handedly reinvigorate a once-profitable skyscraper that had fallen on hard times. She enlisted help from her partners in the venture - son Raymond Holliman, brother Robert Poston and his wife, Diana Poston. They put together a business plan to turn the building into general office space not all that different from many other office buildings.
But even as Guilford County was transferring title to the building, which is 73 years old, forces were taking shape in the larger economy that would turn Vickrey's initial business plan inside out, yet make a stunning success of her gamble.
The federal government's deregulation of the telephone industry was the key. It spurred the creation of many new telecommunications companies, a process given another boost by the growing popularity of the telephone-dependent Internet.
In late 1995, DukeNet, a subsidiary of Duke Power, rented space in the Guilford Building and ran a huge fiber-optic cable into the building. That's the "umbilical cord" used by all those telecommunications companies. It's a huge trunk line that can carry thousands of conversations at one time.
Since the arrival of DukeNet's cable, about 20 other telecommunications companies and Internet services have moved into the former bank and office building. The owners of the once woefully outdated building have hoisted a banner facing South Elm Street that says it all: "Wired For The Future." "The telecommunications industry has picked this building as a 'telecom hotel.' That's what has saved this building," said Holliman, a retired Greensboro firefighter who supervises renovations and improvements to the Guilford Building's mechanical systems.
Affordable space is part of the secret to the Guilford Building's success. But that success also stems from a location near the intersection of the two major electrical lines that serve downtown, giving tenants a backup power source if one line goes out.
That's crucial to telecommunications companies operating 24 hours a day, seven days a week. In addition, DukeNet has a huge diesel generator in the building's basement as another backup.
"We're pretty invincible as to power outages," Holliman said. Holliman said the building has an occupancy rate approaching 95 percent. That's "probably as high as it has ever been since the 1930s," he said. Some suites once home to dentists, lawyers, insurance agents and nonprofit programs are stuffed to the ceiling with millions of dollars in the latest telecommunications equipment.
Seventh-floor tenant ITC-DeltaCom operates a switching center, much of it filled with racks of fiber-optic gadgetry that receives calls from throughout the Southeast and - in microseconds - switches them onto other lines toward their destinations.
Researchers keep finding new ways of compressing more conversations onto each tiny, fiber-optic line, said Dave Schumacher, the company's Guilford Building switch manager.
"It's amazing. It just keeps snowballing," he said. Downstairs, in another suite, Scott Harrington presides over the business side of CryptoComm, a company that specializes in e-commerce and Internet business development.
Harrington said it's a real plus to have so many Internet-savvy companies in the same building, including advertising agencies that are a source of new customers and new ideas for his 18-month-old business. "People stop by and we can handle a proposal right here in 10 minutes," Harrington said, "as opposed to having to set up an appointment next Thursday across town."
Meanwhile, the Guilford Building's roof is home to a variety of antennae and other high-tech communications gear, some of it belonging to TV stations that use it to beam signals from news crews in the field to offices in Greensboro and Winston-Salem.
The Guilford Building opened in 1927 as home to the old Greensboro Bank and Trust. The building was designed by Charles Hartmann, the same architect who planned the Jefferson Building several blocks north on Elm Street. It was bought in the 1980s by Jefferson-Pilot and 1st Home Federal Savings and Loan for residential redevelopment. They eventually decided that the building couldn't feasibly be renovated for apartments and gave it to the county in 1988.
County officials considered using it for government offices, but soon decided it was better to sell a building that needed so many basic improvements.
Indeed, it takes Hallimar Properties, the Guilford Building management company formed by its family owners, about a year to renovate each floor. "We do a complete demolition," Holliman said.
Even so, the partners try to retain the building's special 1920s' flourishes, such as marble trim and office doors with frosted glass. But it's not always easy to balance the architecture of yesteryear with the telecommunications industry.
"It's a challenge to combine their high-tech needs with our historic preservation," Poston said.
But considering how bleak the Guilford Building's outlook seemed just six or seven years ago, what a wonderful problem to have.