Leasing Activity
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Technip USA Inc. signed three leases this quarter:
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Moving to consolidate its local operations, Technip USA Inc. has signed a lease renewal for 230,000 s.f. in Energy Tower I on I-10 & Kirkwood.
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The company also pre-leased 376,000 s.f. in Energy Tower II, a 447,000 s.f. building scheduled for occupancy in September 2009.
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Additionally, Technip has signed a short term lease for 79,000 s.f. in Phase I of The Offices at Park Ten (16285 Park Ten Place) to accommodate growth until the new building is completed.
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Worley Parsons Engineering leased approximately 200,000 s.f. in 6330 West Loop South. The company will relocate from Greenway Plaza.
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Mustang Engineering leased approximately 125,000 s.f. at 17000 Katy Freeway, a new building delivered in the third quarter of this year. Terms of the lease were not available, however, 50,000 additional s.f. in the building will remain in the control of Mustang Engineering for potential expansion space.
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Simmons & Co renewed their lease at 700 Louisiana for approximately 60,000 s.f.
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BP leased an additional 22,055 s.f. in Three Westlake Park. The expansion is coterminous with the existing lease.
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Companies currently in the market include:
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Dow Chemical is negotiating a lease for the entire building (343,000 s.f.) at 1254 Enclave Parkway. The building is under development with a delivery date in the third quarter of 2008.
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Locke Liddell & Sapp is in the market for approximately 250,000 s.f.
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KPMG is rumored to be negotiating for 125,000 s.f. at MainPlace (a 920,000 s.f. development by Hines in the CBD).
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Price Waterhouse Coopers is in the market for approximately 100,000 s.f.
Building Sales
Building Sales of note:
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Chase Merritt, in a joint-venture partnership with Pacific Coast Capital Partners, purchased the West Loop I and II office buildings for $59 million ($188/s.f.) from Lionstone Group. The two Class A high-rises total nearly 314,000 s.f., fronting 610 West Loop. The buildings are more than 87 percent leased to a mix of medical and professional service companies.
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Shorenstein Properties LLC purchased 2000 W. Loop South office building (nearly 355,000 s.f., Class A) for approximately $64 million ($179/s.f.) from Means-Knaus Partners LP and US Advisors LLC. The 37-year-old, 22-story building is currently 98 percent leased and will continue to be the headquarters of Means-Knaus Partners.
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Behringer Harvard Opportunity REIT I is under contract to purchase the single-tenant Northborough Tower (206,500 s.f., Class A) from Commercial Developments International for $32.9 million ($159/s.f.). The 14-story headquarters of Noble Energy Inc. is located at 100 Glenborough Dr.
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Younan Properties purchased the 1010 Lamar building (nearly 260,000 s.f., Class A) in the CBD, from KBS Realty Advisors for approximately $40 million (approximately $151/s.f.).
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Lowe Enterprises and Buchanan Street Partners have purchased the 3D/International Tower (406,000 s.f., Class A), located at 1900 West Loop South from Transwestern 3D/International LP. About 90 percent leased at the time of the transaction, the office tower sold for approximately $42 million ($103/s.f.). The property was built by Hines in 1979 and renovated in 2000.
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Cameron Management purchased the Minute Maid Building (351,000 s.f., Class B), located at 2000 St. James Place, between Westheimer Road and San Felipe Street, from the Coca-Cola Company for an undisclosed amount. With this purchase Cameron Management now has the largest block of contiguous office space in the Galleria area.
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Cameron Management purchased 1001 McKinney (373,000 s.f., Class B) at Main Street Square in downtown from USAA Real Estate. Built in 1947, the building was the first postwar skyscraper in the Southwest and is currently 78 percent occupied.
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Younan Properties is closing a purchase of a portfolio consisting of 650, 652, and 654 N. Sam Houston Parkway (420,410 s.f.) from KBS on December 18, 2007 for an undisclosed amount.
Properties currently being marketed for sale include:
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Williams Tower (1.48 million s.f., Class A), located in the Galleria area.
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St. Luke’s Medical Tower at 6624 Fannin Street (400,000 s.f., Class A, 100% occupied)
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Sugarland Town Square (135,000 s.f., Class A).
Construction
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Hines has begun the demolition of the buildings located on the block of the future MainPlace (920,000 s.f., Class A), located at 811 Main Street in the CBD. Delivery is currently set for the fourth quarter of 2010. The 34-story tower will be LEED Certified Silver.
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Trammel Crow announced its plans to construct a Class A, 871,000 s.f. project to be known as Discovery Tower. The new building will be located at 1501 McKinney on the east side of downtown. Construction is set to begin January of 2008 and delivery is scheduled for the first quarter of 2010.
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Transwestern has plans on the drawing boards for a 700,000 s.f., Class A building at Eldridge and Enclave. Upon approval, construction would commence in January 2008 and deliver in July 2009.
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OPUS Development has commenced the year-long construction of Energy Crossing I & II in the I-10, Highway 6 area. The two-building, 460,000 s.f. complex is scheduled to be delivered by the fourth quarter of 2008. No pre-leases have been signed.
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Dienna Nelson Augustine continues construction of Westway II and III located at 4424 W Sam Houston Parkway North. Totaling over 420,000 s.f. of office space, the buildings will be LEED Certified Silver and are scheduled to deliver in the first quarter of 2009.
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BehringerHarvard has proposed a 300,000 s.f. building, known as Three Eldridge Place, to be located on Eldridge and Memorial. Construction is anticipated to begin in the first quarter of 2008.
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