The Highest Price Ever? Houston Office Tower Hits Market
HOUSTON - After a year of singles, grounders and bunts, the investors may be ready to hit a grand slam home run in the Houston office market. In fact, it could be the biggest deal in Houston's real estate history.
The 36-story office building at 1000 Main Street in downtown Houston is being marketed for sale and it is expected to fetch more than $440 million or $526 per square foot - an all-time record or a per square foot price, according to Real Estate Alert.
The building, owned by an Invesco Real Estate partnership, is more than 99 percent leased, according to Real Estate Alert, an authoritative investment newsletter. CBRE is marketing the 837,000-square-foot building, which was formerly known as Reliant Energy Plaza.
Houston office investment activity has been slower in 2014, as it has been in many parts of the nation. So far this year, there's been only one trophy deal in Houston over $200 million: AEW Capital's $426 million purchase of a 90 percent stake in the Heritage Plaza building, according to Real Estate Alert. In 2013, Houston had six trophy deals.
The lack of inventory in the trophy-level price bracket could push prices upward and the 1000 Main sales price could be surprising.
Houston's highest price on a per square foot basis was H&R REIT's purchase of the Hess Tower in 2011. The 845,000-square-foot tower, which is located near Discovery Green park in downtown, sold for $442.5 million or $524 per square foot. The seller was a partnership of Trammell Crow and Principal Real Estate Investors.
The 1000 Main building was developed by Century Development and opened in 2003. The Invesco partnership bought the building in 2012 for $355 million.