The state's downtown real estate

With developers swarming on downtown Raleigh, two state-owned properties could demand tens of millions of dollars in the near future.

• The two buildings — the old DMV headquarters on New Bern Avenue and the Division of Employment Security offices on Wade Avenue — are slated to be sold and will likely attract major projects because of their locations.
• Together they account for more than 21 acres of potential new construction space downtown.

Why it matters: It's rare that such large parcels near downtown Raleigh become available.

• In the case of the former DMV building, a new development there could help influence the trajectory of an area home to one of the city's largest historically Black neighborhoods. A future Bus Rapid Transit route is already spurring gentrification concerns there.

Driving the news: Appraisals done for the state estimate the properties could get around $43 million.

• The money would go toward rehabbing other state facilities and building new ones in downtown Raleigh. The News & Observer first reported the appraised value.

What they're saying: Chester F. Allen, executive vice president for CBRE's Land Services group in Raleigh, said interest will be high, especially because of how hard it has become to assemble properties of that size together inside of the beltline.

• "There's not many opportunities like that, and there won't be at that scale," he told Axios.

Flashback: The old DMV building's fate has been up in the air since the state decided to relocate the headquarters to Rocky Mount in 2019 — a move that was made due to how expensive it would have been to rehabilitate the aging office.

• Mayor Mary-Ann Baldwin has, in the past, floated the idea of the city buying it. She did not respond to a request for comment about the property's future.

State of play: Today that building — which was constructed in 1970, according to county records — is mostly empty. Asbestos contamination makes demolition the most likely path forward.

• The land could get $12 million, according to the appraisal.

The DES building on Wade Avenue, formerly the historic Rex Hospital, sits on nearly 16 acres of land.

• The appraisers believe it could be worth $31 million given its location near downtown and the Village District.
• This property will drive the most demand, especially if adjacent land owned by the State Employees Credit Union becomes available in the future, Allen said.

Zoom out: State-owned land has had a large influence on some of the region's biggest projects in recent years.

• The Fenton project in Cary was previously owned by the state, as was Bandwidth's under-construction headquarters near PNC Arena.
• Another key parcel currently being shopped: 22 acres of Department of Transportation-owned land in Cary adjacent to SAS Institute for around $9 million.

What's next: Sales of the properties could still be some way off. The state has not yet put them on the market and there are still many people working at the Division of Employment Security building.