When the pandemic began, financial services company ADP sent its employees who worked out of a West Des Moines office building home to work.

As the pandemic waned, the company’s employees continued to work remotely. The Palisade building at 4900 University Ave. in West Des Moines sat mostly empty even though ADP continued leasing about 100,000 square feet of space.

Knowing that ADP wasn’t going to renew its lease, the building’s owner – R&R Realty Group – began making plans to update the two-story structure.

“We wanted to shed that 1980s feel and look,” said Paul Rupprecht, an executive vice president of the West Des Moines-based firm. “We wanted to bring the building back to life and make it look new again.”

The exterior of the building was changed from brownish red to light gray, a staining process that was completed last fall. The update increased the building’s visibility from 50th Street and University Avenue, Rupprecht said. “The visibility is what really sells this building.”

The company began making improvements to its office buildings in 2021 as a way to retain tenants and lure new ones. New amenities have included state-of-the-art fitness centers with treadmills, elliptical machines and Peloton exercise bikes and “grab-and-go” markets that provide food and beverage options for workers.

This week, R&R Realty Group announced that Co-op Solutions will occupy 99,700 square feet in the Palisade building, which has 163,196 square feet of space. Co-op Solutions, headquartered in Rancho Cucamonga, Calif., currently leases office space in Clive. The company provides services that support credit unions.

“Co-op is very pleased to have worked with R&R Realty on this new site for our staff members,” David Becker, chief financial officer for Co-op Solutions, said in a prepared statement. “The new location will be a flagship center for Co-op’s team to serve our credit union clients and it also signifies our long-term commitment to Iowa and the Des Moines metropolitan area.”

R&R Realty Group updated meeting and training spaces in the Palisade building but Co-op Solutions officials “decided they were going to use those spaces so frequently that they didn’t want to share it with other tenants,” Chris Curran, a senior vice president at the commercial realty company, said.

The Palisade building is part of R&R Realty Group’s Three Fountains office park. Other Palisade tenants will be able to use fitness and training centers and meeting rooms located in the park’s other buildings, Rupprecht said.

The Des Moines area has over 18.1 million square feet of office space, according to CBRE Inc. In the first quarter of 2023, 17.2%, or 3.1 million square feet, was vacant. The western suburbs, which include West Des Moines, had a vacancy rate of 17% with over 1.65 million square feet of unleased office space, in the first quarter, according to the report.

While companies are leasing space, negotiations are taking longer, Curran said. “It goes back to the culture the company is trying to create. They still believe in office space. They want their people to come in the office and they want [the company] to grow and expand. It is taking more patience to get deals signed.”

One of the things that attracted Co-op Solutions to Palisade was its closeness to fast food and sit-down restaurants and to retail areas, said Mark Mills, an R&R Realty Group vice president. “A lot of companies are being drawn to buildings that have modern features or that have been renovated recently. … It’s that flight to quality.”

JLL represented Co-op Solutions in the transaction. “We believe this deal is a testament to the fact that the office market is alive and well,” Justin Lossner, managing director of JLL’s Des Moines office, wrote in an email.

The Palisade building was first owned and occupied by Greyhound Lines Inc., which housed its nationwide accounting center in the structure, which was built in 1985. However, in 1992, Greyhound closed the center and moved the 400 jobs located in it to the company’s headquarters in Dallas.

R&R Realty Group, which owns more than 3 million square feet of office space in the Des Moines area, purchased the 17-acre site in 2006, making it part of its adjacent Three Fountains Office Park.

In 2019, a year before the start of the pandemic, the property at 4900 University Ave. was valued at $13.6 million. R&R Realty Group and Polk County’s assessor reached an information agreement regarding the property’s 2023 value, which was set at $5.9 million. (The building is valued at $550,000.)