The Houston City Council has approved changing the name of Ellington Field to Ellington Airport, according to the Houston Airport System.
The name change is intended to help grow the airport as a “greater economic generator,” HAS said.
“We’ve known for some time that our runways at Ellington are primed to serve as a reliever airport for both Hobby and Bush Intercontinental,” Houston Airport System director Rick Vacar said in a statement. “The name change will enhance our efforts to market this aviation asset to general aviation and commercial developers who want to operate at an airport with unlimited possibilities.”
Ellington Airport, located on the southeast side of Houston, currently has three active runways, a 24-hour Federal Aviation Administration Air Traffic Control Tower and two fixed based operators.
The airport also has more than 300 acres available for development, Vacar said.
Existing tenants have the option of continuing to use the Ellington Field name. For more information see : www.houstonrealtyadvisors,com or www,houstonrealtyadvisors,net
Friday, January 16, 2009
Wednesday, January 14, 2009
Houston, Tx. ends year with Postive Net Absorption
The Houston office market ended 2008 with positive net absorption, but it was the lowest annual absorption total since 2004, according to the Office Market Trends Houston report by Grubb & Ellis Co.
The quarterly report shows 470,678 square feet of positive net absorption during fourth-quarter 2008, resulting in 776,487 square feet of net absorption for the year.
In comparison, Houston posted more than 6 million square feet of positive absorption in the office market in 2007.
Class A office buildings were responsible for most of the 2008 net absorption, or net change in the amount of occupied space. A total of 165,184 square feet of Class A space was absorbed during the fourth quarter, resulting in 1.1 million square feet of positive net absorption for the year, according to the report.
The nicest office buildings also had the lowest vacancy rate among all classes of office space. Class A vacancy increased by 120 basis points to 11.3 percent for the quarter, the Grubb & Ellis report shows.
Houston’s sublease space rose by 116,261 square feet in the fourth quarter to nearly 2.6 million square feet. Despite the quarterly increase, Houston’s sublease space is only 1.6 percent of the overall inventory, which is lower than the national average of 2.3 percent.
The asking rent rate was higher at the end of 2008 than it was at the end of 2007, but Grubb & Ellis reports that rent increases have slowed and landlords are offering more concessions to tenants. For more information see: www.houstonrealtyadvisors.com or www.houstonrealtyadvisors.net
The quarterly report shows 470,678 square feet of positive net absorption during fourth-quarter 2008, resulting in 776,487 square feet of net absorption for the year.
In comparison, Houston posted more than 6 million square feet of positive absorption in the office market in 2007.
Class A office buildings were responsible for most of the 2008 net absorption, or net change in the amount of occupied space. A total of 165,184 square feet of Class A space was absorbed during the fourth quarter, resulting in 1.1 million square feet of positive net absorption for the year, according to the report.
The nicest office buildings also had the lowest vacancy rate among all classes of office space. Class A vacancy increased by 120 basis points to 11.3 percent for the quarter, the Grubb & Ellis report shows.
Houston’s sublease space rose by 116,261 square feet in the fourth quarter to nearly 2.6 million square feet. Despite the quarterly increase, Houston’s sublease space is only 1.6 percent of the overall inventory, which is lower than the national average of 2.3 percent.
The asking rent rate was higher at the end of 2008 than it was at the end of 2007, but Grubb & Ellis reports that rent increases have slowed and landlords are offering more concessions to tenants. For more information see: www.houstonrealtyadvisors.com or www.houstonrealtyadvisors.net
Tuesday, January 13, 2009
Aetna Takes 45,000 sq ft in Houston/Sugarland Area
Aetna Inc. will be the first tenant in a speculative Sugar Land office building that has stood vacant for more than a year.
Houston Business Journal - by Jennifer Dawson
The health care insurer will occupy two floors in Three Sugar Creek Center, a 154,000-square-foot Class A building that was completed in 2007 by Harry Green Interests Inc. Aetna employees will move into the six-story office building at Three Sugar Creek Boulevard by April.
Aetna was shopping for a new home because it currently subleases space in Sugar Land from Fluor Corp., and the Fortune 500 engineering company now needs the square footage. Aetna currently occupies about 45,000 square feet in Fluor’s building at U.S. Highway 59 and State Highway 6.
Joe Esch, executive director of business and intergovernmental relations for the City of Sugar Land, says the deal shows that the city needs speculative office space on hand when a leasing opportunity arises. He believes that the availability of the Three Sugar Creek Center building kept Aetna from moving out of Sugar Land.
“It proves that when companies start looking for space, they look for existing buildings,” Esch says.
Bruce Rutherford of Jones Lang LaSalle Inc., who represented Aetna in lease negotiations, says the firm wanted to stay in the Sugar Land area in an effort to retain the current employees, as well as attract future workers.
Aetna could have stayed at the Fluor site for three more years, Rutherford says, but decided to go ahead and relocate now. Fluor, which had more than 4,200 local employees as of late August, needs the extra space to accommodate its growing work force.
Jeff Bernhard, a market head for Aetna in Houston, says several factors were involved in the insurance company’s decision not to exercise options to extend the expired lease with Fluor. Aetna wants to be in a building with better parking, have its own cafeteria and have the ability to build technology into the space, he says.
Employees are on board with the new space, Bernhard says, because it comes with covered garage parking that’s connected to the building. As it stands now, he says, many employees have to walk quite a distance in the elements to get inside the Fluor office.
“It was not convenient for employees,” Bernhard says.
ELBOW ROOM
Aetna signed a lease in December for roughly 52,000 square feet of space in the new location, which will give employees a little bit more elbow room. Approximately 360 Aetna employees will report to the new office, though some work from home and on the road.
The Sugar Land office, which is Aetna’s headquarters for Texas and the surrounding states, will also get a technology upgrade as part of the move.
“There’s going to be a greater use of technology in this office than in prior offices,” Rutherford says. “This will become the poster child for advanced technology in Aetna’s offices.”For more information see: www.houstonrealtyadvisors,com or www.houstonrealtyadvisors.net
Houston Business Journal - by Jennifer Dawson
The health care insurer will occupy two floors in Three Sugar Creek Center, a 154,000-square-foot Class A building that was completed in 2007 by Harry Green Interests Inc. Aetna employees will move into the six-story office building at Three Sugar Creek Boulevard by April.
Aetna was shopping for a new home because it currently subleases space in Sugar Land from Fluor Corp., and the Fortune 500 engineering company now needs the square footage. Aetna currently occupies about 45,000 square feet in Fluor’s building at U.S. Highway 59 and State Highway 6.
Joe Esch, executive director of business and intergovernmental relations for the City of Sugar Land, says the deal shows that the city needs speculative office space on hand when a leasing opportunity arises. He believes that the availability of the Three Sugar Creek Center building kept Aetna from moving out of Sugar Land.
“It proves that when companies start looking for space, they look for existing buildings,” Esch says.
Bruce Rutherford of Jones Lang LaSalle Inc., who represented Aetna in lease negotiations, says the firm wanted to stay in the Sugar Land area in an effort to retain the current employees, as well as attract future workers.
Aetna could have stayed at the Fluor site for three more years, Rutherford says, but decided to go ahead and relocate now. Fluor, which had more than 4,200 local employees as of late August, needs the extra space to accommodate its growing work force.
Jeff Bernhard, a market head for Aetna in Houston, says several factors were involved in the insurance company’s decision not to exercise options to extend the expired lease with Fluor. Aetna wants to be in a building with better parking, have its own cafeteria and have the ability to build technology into the space, he says.
Employees are on board with the new space, Bernhard says, because it comes with covered garage parking that’s connected to the building. As it stands now, he says, many employees have to walk quite a distance in the elements to get inside the Fluor office.
“It was not convenient for employees,” Bernhard says.
ELBOW ROOM
Aetna signed a lease in December for roughly 52,000 square feet of space in the new location, which will give employees a little bit more elbow room. Approximately 360 Aetna employees will report to the new office, though some work from home and on the road.
The Sugar Land office, which is Aetna’s headquarters for Texas and the surrounding states, will also get a technology upgrade as part of the move.
“There’s going to be a greater use of technology in this office than in prior offices,” Rutherford says. “This will become the poster child for advanced technology in Aetna’s offices.”For more information see: www.houstonrealtyadvisors,com or www.houstonrealtyadvisors.net
Monday, January 12, 2009
Houston Pavilions gets 1st Office Tenant
The law firm of Sheehy, Serpe & Ware P.C. will be the first tenant in the recently constructed Houston Pavilions office building in the Central Business District.
The firm signed a long-term lease for 28,000 square feet of space, taking the top one and a half floors of the nine-story, 200,000-square-foot facility located at 1201 Fannin. The office is part of the four-block Houston Pavilions project bounded by Dallas, Polk, Main, Caroline that includes 360,000 square feet of retail space.
Ed Perkins of Sheehy, Serpe & Ware says the firm leased space at Houston Pavilions because it could gain access to good restaurants and other amenities; secure the top space in the office building; and locate close to Discovery Green park.
The law firm that specializes in a wide variety of areas currently leases space downtown in Two Houston Center at 909 Fannin. The firm is expected to move into Houston Pavilions in December 2009. For more infromation on why this is a great building check out: http://www.houstonrealtyadvisors.com/ or www.houstonrealtyadvisors.net
The firm signed a long-term lease for 28,000 square feet of space, taking the top one and a half floors of the nine-story, 200,000-square-foot facility located at 1201 Fannin. The office is part of the four-block Houston Pavilions project bounded by Dallas, Polk, Main, Caroline that includes 360,000 square feet of retail space.
Ed Perkins of Sheehy, Serpe & Ware says the firm leased space at Houston Pavilions because it could gain access to good restaurants and other amenities; secure the top space in the office building; and locate close to Discovery Green park.
The law firm that specializes in a wide variety of areas currently leases space downtown in Two Houston Center at 909 Fannin. The firm is expected to move into Houston Pavilions in December 2009. For more infromation on why this is a great building check out: http://www.houstonrealtyadvisors.com/ or www.houstonrealtyadvisors.net
Saturday, January 10, 2009
Despite downturn Kroger Expands n Houston
At a time when other retailers are scaling back expansion plans and closing their doors, Kroger Co. is set to open its largest location in Fort Bend County on Jan. 16.
The new 100,000-square-foot Kroger Signature Store will be located at 10250 State Highway 6 in Missouri City.
The store, which will be Cincinnati-based Kroger’s (NYSE: KR) second store in Missouri City, will offer a “Chef Shoppe” with a chef on hand to prepare meals for customers and an extensive wine selection complete with an on-site wine steward to assist shoppers in making their selection.
The store will also feature a “Kitchen Place” offering an assortment of kitchenware, a “Nature’s Market” offering natural food and organic selections, and a drive-thru pharmacy that will offer $4 generics. For more information see: www.houstonrealtyadavisors.com and www.houstonrealtyadvisors.net
The new 100,000-square-foot Kroger Signature Store will be located at 10250 State Highway 6 in Missouri City.
The store, which will be Cincinnati-based Kroger’s (NYSE: KR) second store in Missouri City, will offer a “Chef Shoppe” with a chef on hand to prepare meals for customers and an extensive wine selection complete with an on-site wine steward to assist shoppers in making their selection.
The store will also feature a “Kitchen Place” offering an assortment of kitchenware, a “Nature’s Market” offering natural food and organic selections, and a drive-thru pharmacy that will offer $4 generics. For more information see: www.houstonrealtyadavisors.com and www.houstonrealtyadvisors.net
Thursday, January 8, 2009
This Year, Pain To Replace Gain
Nary a Bright Spot in CoStar Group’s First-Ever State of the Market/Industry Outlook
The pain felt throughout the U.S. housing market over the past two years is going to catch up with commercial real estate in 2009 when the country will begin to see spikes in office vacancy rates climbing as much as 300 to 400 basis points with many markets expected to experience severe negative net absorption. That was the assessment of Andrew Florance, founder and CEO of CoStar Group Inc., as presented in the company’s first-ever 2009 State of the Office Market review and outlook delivered this afternoon from its Bethesda, MD, headquarters and webcast to CoStar clients across the country. Florance’s presentation laid out the economics and fundamentals detailing the impact of the financial meltdown on commercial real estate, finding little upside to report with all indicators projecting continued:
Constraint in the credit markets,
Dearth of investment and construction activity,
Corporate space contraction, and
Falling property values.The outlook is now for the current recession to take a higher toll, for a longer time, on commercial real estate than did the dot.com bubble burst of 2001-2002. Rather than try to reproduce the entire presentation or beat the dead horse that is the economy, here is recap of just some of the highlights.
ContractionUnlike in previous recessions in which the commercial real estate industry participated in its own demise through gross overbuilding, the current downturn was precipitated by an unparalleled run up in housing values and the subsequent burst of that bubble. Housing values continue to fall precipitously. Overlaying commercial office values with housing values, Florance showed that, while commercial values also experienced a rapid ascent, those values peaked at substantially lower levels than the housing peak. Also based on historical norms, it appears housing values still have a ways to fall, while commercial office space values have already returned to much closer what are their norms. That doesn’t mean that office values could hold at the level because clearly the market dynamics are working against them. The S&P 500 Index is down 40% from its highest levels and lower than what is has been in five years. The index is important to commercial real estate because without increasing stock prices, corporations will be less likely to expand. The lack of expansion is major drag on office space absorption, Florance said. In addition to stock price declines, initial public stock offerings that fuel the growth of newer firms have dried up completely this year. Corporate borrowing outside of federal government-assisted bailouts also has fallen to record lows - less than $25 billion/month in the most recent quarter compared to more than $400 billion just 18 months ago. The commercial mortgage backed securities (CMBS) markets also dried up completely in the fourth quarter and thus banks - were they even making loans - have nowhere to market or sell those loans to the secondary markets to make room to do more lending. The employment picture is also dismal. The U.S. economy already lost more jobs (1.9 million) in 2008 than during the dot.com bubble burst in 2001-2002. Economy.com is forecasting as many as 3.1 million job losses in 2009.
Inventory BuildupOne small bright spot to current commercial real estate conditions is that there was very little surge of new supply leading up the recessionary environment starting in December 2007. Commercial office space is entering the downcycle from a position of relative strength. Nor is CoStar forecasting much additional in the way of new supply coming onto the market through 2012. However, the office supply inventory is going to increase. In fact, the supply of available and vacant office space is beginning to increase as there is currently virtually no absorption of excess space occurring. Vacancy rates have begun to tick up as projects already under construction are being completed. Combining the forecasts for job losses in 2009 and a dwindling supply of newly delivered space, CoStar is predicting that U.S. office vacancy rates could climb from a base of 11.1% at the start of last year to 15.1% in 2010. Some U.S. markets will be hit harder than others but all are projected to grow to double-digit vacancy rates in 2009 and 2010. CoStar is projecting that the Phoenix and Detroit vacancy rates could exceed 20%. Job losses are also projected to be heavy in South Florida, the New York Tri-State area and San Francisco and those markets will likely see fairly steep increases in their vacancy rates over the next two years. There won’t be any clarity to when the markets can return to normal until the peaks in vacancies and the valleys in prices and rents hit top and bottom. In the two previous recessionary periods of early 1990s and 2001, office inventors did not return to the market until it was clear that the deterioration in conditions had stopped. And right now, the volume of investment activity is at or near its historical norms. So while the outlook for 2009 is grim, it is likely that the market for office building investments will remain flat through 2009. "The market needs to establish a new bottom before a recovery can take hold," Florance cautioned. "The sooner we reach it, the better off we'll be. If property values need to fall to X, it's better to get there in 18 months not five years." Faced with the grim outlook for 2009, a member of the audience asked Florance if he would advise the broker to give up his real estate practice and work on his golf game for the next 12 months. "Where do you golf?" Florance responded half jokingly before addressing the issue. "We adjust. As we've all seen the industry do in past down cycles, we focus on leasing rather than sales and on property management rather than on new development. And we become advisors. Your clients are going to need your expert advice."
More Distressed PropertiesFrequent readers of CoStar news are probably familiar with our coverage of distressed properties and delinquent loans. In preparation for its first market outlook, CoStar also undertook its first-ever complete analysis of delinquent and distressed properties in the CMBS market. CoStar identified nearly 1,200 commercial real estate loans that were either delinquent in loan repayments or had reached maturity without pay off of the loan. The principal and interest outstanding on those loans as of mid December totaled nearly $8.2 billion. CoStar also compiled a list of nearly 6,100 additional loans that servicers for the various securities have flagged as having potential credit concerns. The current scheduled ending balance of those loans totaled $57.8 billion. In addition, CoStar identified more than 160 properties that had been repossessed by various CMBS trusts. The properties had a loan value at the time they were taken over of more than $1 billion. Based on the properties most recent valuations, the bondholders were likely to take a loss of more than $300 million.
Go GreenNot wishing to end on a dour note, CoStar’s Florance concluded the U.S. portion of the forecast with a look at so-called green properties, which continue to enjoy a premium in the marketplace in terms of higher occupancy levels, rental rates and sale prices compared with "non-green" peer buildings. Currently in the U.S. only 1 in 15,000 properties are LEED or Energy Star certified. In fact, a new federal mandate that is set to go into effect in 2010 is that federal agencies will have to occupy green certified offices. According to Florance, the total federal requirement for green space outstrips the total available supply of green-certified buildings. In analysis of 9.8 billion square feet of office inventory in CoStar’s database, CoStar found that the national occupancy rate of green-certified buildings was 300 to 588 basis points higher than non-certified buildings and commanded rents that were anywhere from $3 to $18 more per square foot per year than the average rent. Green buildings also sold at prices that were up to 64% than the average. Written by Mark Heschmeyer COSTAR
For more information see: www.houstonrealtyadvisors.com or www.houstonrealtyadvisors.net
The pain felt throughout the U.S. housing market over the past two years is going to catch up with commercial real estate in 2009 when the country will begin to see spikes in office vacancy rates climbing as much as 300 to 400 basis points with many markets expected to experience severe negative net absorption. That was the assessment of Andrew Florance, founder and CEO of CoStar Group Inc., as presented in the company’s first-ever 2009 State of the Office Market review and outlook delivered this afternoon from its Bethesda, MD, headquarters and webcast to CoStar clients across the country. Florance’s presentation laid out the economics and fundamentals detailing the impact of the financial meltdown on commercial real estate, finding little upside to report with all indicators projecting continued:
Constraint in the credit markets,
Dearth of investment and construction activity,
Corporate space contraction, and
Falling property values.The outlook is now for the current recession to take a higher toll, for a longer time, on commercial real estate than did the dot.com bubble burst of 2001-2002. Rather than try to reproduce the entire presentation or beat the dead horse that is the economy, here is recap of just some of the highlights.
ContractionUnlike in previous recessions in which the commercial real estate industry participated in its own demise through gross overbuilding, the current downturn was precipitated by an unparalleled run up in housing values and the subsequent burst of that bubble. Housing values continue to fall precipitously. Overlaying commercial office values with housing values, Florance showed that, while commercial values also experienced a rapid ascent, those values peaked at substantially lower levels than the housing peak. Also based on historical norms, it appears housing values still have a ways to fall, while commercial office space values have already returned to much closer what are their norms. That doesn’t mean that office values could hold at the level because clearly the market dynamics are working against them. The S&P 500 Index is down 40% from its highest levels and lower than what is has been in five years. The index is important to commercial real estate because without increasing stock prices, corporations will be less likely to expand. The lack of expansion is major drag on office space absorption, Florance said. In addition to stock price declines, initial public stock offerings that fuel the growth of newer firms have dried up completely this year. Corporate borrowing outside of federal government-assisted bailouts also has fallen to record lows - less than $25 billion/month in the most recent quarter compared to more than $400 billion just 18 months ago. The commercial mortgage backed securities (CMBS) markets also dried up completely in the fourth quarter and thus banks - were they even making loans - have nowhere to market or sell those loans to the secondary markets to make room to do more lending. The employment picture is also dismal. The U.S. economy already lost more jobs (1.9 million) in 2008 than during the dot.com bubble burst in 2001-2002. Economy.com is forecasting as many as 3.1 million job losses in 2009.
Inventory BuildupOne small bright spot to current commercial real estate conditions is that there was very little surge of new supply leading up the recessionary environment starting in December 2007. Commercial office space is entering the downcycle from a position of relative strength. Nor is CoStar forecasting much additional in the way of new supply coming onto the market through 2012. However, the office supply inventory is going to increase. In fact, the supply of available and vacant office space is beginning to increase as there is currently virtually no absorption of excess space occurring. Vacancy rates have begun to tick up as projects already under construction are being completed. Combining the forecasts for job losses in 2009 and a dwindling supply of newly delivered space, CoStar is predicting that U.S. office vacancy rates could climb from a base of 11.1% at the start of last year to 15.1% in 2010. Some U.S. markets will be hit harder than others but all are projected to grow to double-digit vacancy rates in 2009 and 2010. CoStar is projecting that the Phoenix and Detroit vacancy rates could exceed 20%. Job losses are also projected to be heavy in South Florida, the New York Tri-State area and San Francisco and those markets will likely see fairly steep increases in their vacancy rates over the next two years. There won’t be any clarity to when the markets can return to normal until the peaks in vacancies and the valleys in prices and rents hit top and bottom. In the two previous recessionary periods of early 1990s and 2001, office inventors did not return to the market until it was clear that the deterioration in conditions had stopped. And right now, the volume of investment activity is at or near its historical norms. So while the outlook for 2009 is grim, it is likely that the market for office building investments will remain flat through 2009. "The market needs to establish a new bottom before a recovery can take hold," Florance cautioned. "The sooner we reach it, the better off we'll be. If property values need to fall to X, it's better to get there in 18 months not five years." Faced with the grim outlook for 2009, a member of the audience asked Florance if he would advise the broker to give up his real estate practice and work on his golf game for the next 12 months. "Where do you golf?" Florance responded half jokingly before addressing the issue. "We adjust. As we've all seen the industry do in past down cycles, we focus on leasing rather than sales and on property management rather than on new development. And we become advisors. Your clients are going to need your expert advice."
More Distressed PropertiesFrequent readers of CoStar news are probably familiar with our coverage of distressed properties and delinquent loans. In preparation for its first market outlook, CoStar also undertook its first-ever complete analysis of delinquent and distressed properties in the CMBS market. CoStar identified nearly 1,200 commercial real estate loans that were either delinquent in loan repayments or had reached maturity without pay off of the loan. The principal and interest outstanding on those loans as of mid December totaled nearly $8.2 billion. CoStar also compiled a list of nearly 6,100 additional loans that servicers for the various securities have flagged as having potential credit concerns. The current scheduled ending balance of those loans totaled $57.8 billion. In addition, CoStar identified more than 160 properties that had been repossessed by various CMBS trusts. The properties had a loan value at the time they were taken over of more than $1 billion. Based on the properties most recent valuations, the bondholders were likely to take a loss of more than $300 million.
Go GreenNot wishing to end on a dour note, CoStar’s Florance concluded the U.S. portion of the forecast with a look at so-called green properties, which continue to enjoy a premium in the marketplace in terms of higher occupancy levels, rental rates and sale prices compared with "non-green" peer buildings. Currently in the U.S. only 1 in 15,000 properties are LEED or Energy Star certified. In fact, a new federal mandate that is set to go into effect in 2010 is that federal agencies will have to occupy green certified offices. According to Florance, the total federal requirement for green space outstrips the total available supply of green-certified buildings. In analysis of 9.8 billion square feet of office inventory in CoStar’s database, CoStar found that the national occupancy rate of green-certified buildings was 300 to 588 basis points higher than non-certified buildings and commanded rents that were anywhere from $3 to $18 more per square foot per year than the average rent. Green buildings also sold at prices that were up to 64% than the average. Written by Mark Heschmeyer COSTAR
For more information see: www.houstonrealtyadvisors.com or www.houstonrealtyadvisors.net
Monday, January 5, 2009
HBJ Article tells the story NOW!!!
THEN
Date: March 14, 2008
Headline: ‘Downtown office towers jump off starting block in tandem’
THE STORY
Ground-breaking events were held in the spring for three new Class A office buildings proposed for downtown Houston.
All of the events were held within one week by three separate developers. The trio were among a handful of real estate companies that had been mulling over new downtown projects for a year in an effort to meet demand for office space.
Crescent Real Estate Equities LLC, Hines Interests LP and Trammell Crow Co. all announced plans to develop buildings, even though none of them as yet had any tenants.
The three buildings shared another similarity in that the developers all hoped they could obtain LEED Gold certification as sustainable green buildings.
In that busy week for real estate, Dallas-based Trammell Crow and financial partner Principal Real Estate Investors on Feb. 29 started construction of Discovery Tower — a 30-story, 871,000-square-foot office building at 1501 McKinney St. by Discovery Green park.
Houston-based Hines began construction three days later on a 1 million-square-foot office at 811 Main called MainPlace.
The Hines CalPERS Green Development Fund, a Hines venture with the California Public Employees’ Retirement System, is the developer of the 46-story building.
And Crescent held a VIP ground-breaking event on March 6 to launch the proposed 585,000-square-foot 6 Houston Center, which was set to begin construction by May in the block bounded by Rusk, Walker, Caroline and San Jacinto.
NOW
Crescent’s building never got off the ground.
Fort Worth-based Crescent was bought by Morgan Stanley Real Estate in a deal that closed in August — a transaction that changed it from a public company to a private one.
Information about Crescent’s deals became more difficult to obtain after the company was taken private. A Crescent representative was unavailable for comment on the status of 6 Houston Center.
Although Crescent’s building didn’t materialize, the other two projects are moving forward as planned.
Hines announced in May that KPMG LLP would become the building’s first tenant. The company will occupy nearly 109,000 square feet on the top four floors of MainPlace when the new tower is finished in 2011.
KPMG decided to relocate from downtown’s Bank of America Center building, where it now offices, in order to attract future employees with a showcase location.
Trammell Crow has not yet announced a tenant for the 30-story Discovery Tower, but real estate insiders predict that the space will be filled.
New York-based Hess Corp. has been mentioned as a likely candidate for the building.
The energy firm is said to be in the market for 800,000 square feet of space in a downtown building where it would be the sole tenant.
Discovery Tower, which will be finished around the fourth quarter of 2011, is likely to be the only office space that will fill the bill.
Jennifer Dawson HBJ
For more information see: www.houstonrealtyadvisors.com or www.houston realtyadvisors.net
or www.edayres.com
Date: March 14, 2008
Headline: ‘Downtown office towers jump off starting block in tandem’
THE STORY
Ground-breaking events were held in the spring for three new Class A office buildings proposed for downtown Houston.
All of the events were held within one week by three separate developers. The trio were among a handful of real estate companies that had been mulling over new downtown projects for a year in an effort to meet demand for office space.
Crescent Real Estate Equities LLC, Hines Interests LP and Trammell Crow Co. all announced plans to develop buildings, even though none of them as yet had any tenants.
The three buildings shared another similarity in that the developers all hoped they could obtain LEED Gold certification as sustainable green buildings.
In that busy week for real estate, Dallas-based Trammell Crow and financial partner Principal Real Estate Investors on Feb. 29 started construction of Discovery Tower — a 30-story, 871,000-square-foot office building at 1501 McKinney St. by Discovery Green park.
Houston-based Hines began construction three days later on a 1 million-square-foot office at 811 Main called MainPlace.
The Hines CalPERS Green Development Fund, a Hines venture with the California Public Employees’ Retirement System, is the developer of the 46-story building.
And Crescent held a VIP ground-breaking event on March 6 to launch the proposed 585,000-square-foot 6 Houston Center, which was set to begin construction by May in the block bounded by Rusk, Walker, Caroline and San Jacinto.
NOW
Crescent’s building never got off the ground.
Fort Worth-based Crescent was bought by Morgan Stanley Real Estate in a deal that closed in August — a transaction that changed it from a public company to a private one.
Information about Crescent’s deals became more difficult to obtain after the company was taken private. A Crescent representative was unavailable for comment on the status of 6 Houston Center.
Although Crescent’s building didn’t materialize, the other two projects are moving forward as planned.
Hines announced in May that KPMG LLP would become the building’s first tenant. The company will occupy nearly 109,000 square feet on the top four floors of MainPlace when the new tower is finished in 2011.
KPMG decided to relocate from downtown’s Bank of America Center building, where it now offices, in order to attract future employees with a showcase location.
Trammell Crow has not yet announced a tenant for the 30-story Discovery Tower, but real estate insiders predict that the space will be filled.
New York-based Hess Corp. has been mentioned as a likely candidate for the building.
The energy firm is said to be in the market for 800,000 square feet of space in a downtown building where it would be the sole tenant.
Discovery Tower, which will be finished around the fourth quarter of 2011, is likely to be the only office space that will fill the bill.
Jennifer Dawson HBJ
For more information see: www.houstonrealtyadvisors.com or www.houston realtyadvisors.net
or www.edayres.com
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