The North Texas office market really picked up in 2012, so there was no shortage of options in selecting finalists in the Best Office Project category in D CEO’s Commercial Real Estate Awards programs. But in the end, these four contenders really stood out.
The relocation of the world headquarters of Christus Health to Irving from San Antonio was one of the area’s largest office transactions of 2012. Beyond the absorption of more than 227,000 square feet, the move will ultimately create 1,000 high-paying jobs.
Christus Health is one of the 30 largest hospital systems in the country. A team of brokers from CBRE, led by Kevin O’Neil and Phil Puckett, helped put the deal together, with plenty of support from the economic development crew at the Greater Irving-Las Colinas Chamber of Commerce. The landlord, Wells REIT, which the MacArthur Ridge office building Christus selected, was represented by J.J. Leonard and Burson Holman at CBRE.
The property won out over 16 other contenders; the deal takes the building to 92 percent occupied.
Frost Tower is a 22-story, build-to-suit project in Dallas’ Harwood district. The anchor tenant is Frost Bank, a longtime Harwood tenant. The 175,000-square-foot building will include two office penthouses with private balconies, as well as retail space and gardens. It unique due to its tall, narrow shape, with smaller, 11,200-square-foot floorplates.
Frost Bank’s lease will leave about six floors, plus the two penthouse spaces, available. Amenities include floor-to-ceiling glass on the office levels (offering views of downtown Dallas), a drive-through motor bank, retail lobby bank, access to the Katy Trail, and ample parking for both office and mixed-use tenants.The tower is the first phase of Harwood Village, a three-phase mixed-use project that will include multifamily, office, retail, and restaurant space.
Jihane Boury led leasing efforts for Harwood; Frost was represented by Bob Edge and Mike Gosslee of Cushman & Wakefield.
For years, Neiman Marcus has occupied two office buildings in downtown Dallas—1700 Pacific and Renaissance Tower. With both leases up for renewal, the luxury retailer considered combining the two groups and looking at other real estate options. But after a lot of evaluation, it decided to renew at both buildings and expand by one floor at 1700 Pacific.
The deals showed a commitment to the revitalization of downtown Dallas, and to the more than 400 employees who would continue to office near Neiman’s flagship store, which has been a central business district landmark for more than a century. It was a particular boost for Renaissance Tower, which had lost two lead tenants, Blockbuster and Winstead, in recent years.
Brad Selner, Brooke Armstrong, and Paul Whitman of Jones Lang LaSalle represented Neiman Marcus in its search and lease negotiations. “Neiman Marcus has had a 100-plus year commitment to downtown Dallas,” Selner said. “Its decision to maintain its corporate operations in two major downtown office buildings is a key anchor to the continued revitalization of the area. Without this type of commitment from major companies like Neiman Marcus, downtown’s continued reemergence would not be possible.”
Renaissance Tower was represented by Dennis Barnes, Celeste Fowden, and Clay Gilbert with CBRE. Berkeley Investments, owner of 1700 Pacific, was represented by Jeff Eckert and james Esquivel of JLL.
Call it State Farm’s own version of the bank bailout. Last fall, the Bloomington, Ill.-based insurance giant leased 400,660 square feet of former Citigroup space along Interstate 635 in Las Colinas for a new catastrophic operations center. It also leased 290,000 square feet of former Bank of America space in Richardson’s Galatyn Park and later added another 311,000 square feet of B-of-A space in the same four-building complex.
Those two short-term deals “clearly show that State Farm is getting ready for a much larger presence here,” said Bill Sproull, president and CEO of the Richardson Chamber of Commerce.
And indeed it is. State Farm has signed on for a record-breaking 1.5 million square feet of office space in a massive new mixed-use development KDC is planning near the intersection of State Highway 190 and U.S. 75. The 186-acre, $1.5 billion development “will be a huge economic stimulus for our economy and pay dividends for a long time,” Sproull said.
It adds up to a whopping 2.5 million square feet in North Texas office leases for State Farm. The company was represented in its deals by Randy Cooper and Craig Wilson of Cassidy Turley.
This year’s winner: State Farm