Today it's a hole in the ground, but in 2009 the northwest corner of Orange and 10th streets in downtown Riverside will be the site of the tallest and largest office building in the city.

The 10-story Regency Tower will cover 250,000 square feet and include a 4,500-square-foot restaurant pad and three levels of underground parking.

Silagi Development & Management in Thousand Oaks is developing Regency Tower on the site of the former Riverside municipal courthouse, which was torn down last year.

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Photos By Larry Rose

A steelworker sets rebar forms at the Regency Tower in Riverside.

"There won't be any other project in Riverside," said Moshe Silagi, owner and president of Silagi Development. "If somebody wants to be in this kind of Class-A office space in downtown Riverside, they'll have to sign with us."

Silagi Development is the top office developer in Riverside. The company has developed two other office projects in the city. Silagi Development owns and manages all of its properties.

Regency Tower will accommodate an estimated 1,000 jobs and will be the largest privately owned building in downtown Riverside.

No tenants have been signed, Silagi said.

Cost to develop Regency Tower wasn't released, but space in the speculative building will lease for $3.20 a square foot, about 40% costlier than average office leases in downtown Riverside, said Tom Pierik, senior vice president with Lee & Associates Commercial Real Estate Services in Riverside.

"Right now it's the biggest empty swimming pool in the Inland Empire," Pierik said. Pierik is marketing Regency Tower with Dave Mudge and Rich Erickson, both senior vice presidents with Lee & Associates Riverside.

"When it's finished it's going to be unlike any other office building in downtown Riverside," Pierik said. "It's going to be more like the office buildings on the west side of Los Angeles or in Orange County than anything you see in Riverside or San Bernardino counties. It could be a bellwether for all of downtown Riverside, if it's successful."

The building's underground parking garage will accommodate 325 vehicles, and an adjacent parking structure will handle an additional 400 cars. Getting so many vehicles underground helps solve one of the biggest hurdles to developing large Class-A office buildings in the downtown.

"Anywhere else in the Inland Empire, there's usually enough space to build a large parking lot," Pierik said. "But not in downtown Riverside, which is a very dense market. There isn't a lot of space."

Construction on Regency Tower began in February. Work crews moved 60,000 cubic yards of dirt to create space for the parking garage.

Despite the sluggish economy, Regency Tower will lease quickly, Silagi said.

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Lee and Associates senior vice presidents working on the Regency Tower project are Rich Erickson, left, David Mudge and Tom Pierik.

"This is a good time to building something like this," he said. "After the presidential election, and by the time we open, we should be out of this slowdown we're in now."

Silagi wants to attract law firms, insurance companies, financial institutions and more government agencies to Regency Tower, which is expected to be ready for occupancy in September 2009.

Regency Tower could bring a corporate headquarters to Inland Empire, something the region lacks, Los Angeles developer Alan Mruvka said.

"This could be the first of the next generation of Class A office buildings in downtown Riverside," said Mruvka, who has developed more than 200,000 square feet of offices in the city's downtown, including the 35,000-square-foot Iron Works building at 3850 Vine St. and the restored Santa Fe Depot, which contains about 8,000 square feet of office space.

"Downtown Riverside could look completely different in five years because of this project," Mruvka said.

Silagi will charge a higher lease rate in order to pay for a 250,000-square-foot building, particularly the extra cost of a three-level underground parking garage.

"I know this isn't the best economy, but I really don't think there's a chance that Regency Tower won't succeed," Mruvka said. "There's a huge demand for office space there.", and what's already there - government employees, law firms, accounting firms - make up a stable base. It's almost a recession-proof market."

Riverside has gone from 16 office buildings with a total of 305,677 square feet of developable space during the first quarter of 2004 to 70 office buildings with more than 1.5 million square feet of developable space in them during the first quarter of this year, according to CoStar Group Inc., an online real estate information service that tracks the United States and United Kingdom.

The city has about 1.4 million square feet of office space - a figure that includes non-developable space like hallways, lobbies and restrooms - under construction, including 500,000 square feet at the Riverwalk project, according to the city's economic development department.

"In terms of developable office space, we've probably added about 2 million square feet of office space during the past two years," said Tricia Hinckley, manager of Riverside economic development. "The demand is definitely there, and it's not just downtown. It's all over the city."

The city's various historic district restrictions deter office development in the downtown, Mruvka said.

Officials will be willing to clear space for more office development downtown if Regency Tower is successful, Hinckley said.

"I think the potential is there, especially as we add more residential downtown and that part of the city becomes more of an urban area," she said.