Trizec's high-stakes play isn't without precedence. The practice is becoming more frequent in today's leasing environment. Still, the Thompson, Coe, Cousins & Irons buyout came at a high ticket, paying through the expiration of late 2004 for 53,000 sf or the entire 11th floor at the prestigious Crescent, John Zogg, Crescent's leasing director, tells GlobeSt.com. More details about the buyout package will be forthcoming due to the deal's high profile.
In exchange, the New York City-based Trizec has made a 10-year slam dunk for 70,000 sf at the Plaza of the Americas, now 75% leased. It gets to fill the top three floors of the north tower, office space that's been empty for some time due to a tenant bankruptcy.
Thom Ridnour, Trizec's regional vice president in Dallas, says the bid was won because of the Plaza of the Americas' amenities and its strategic CBD positioning. "We believe they realized the benefits of being inside the loop (Woodall Rogers)," he says.
CBD building owners, of late, have taken heat over some law firms moving to the suburbs. Ridnour, an ardent CBD promoter, says the reality is "when the smoke clears, most of them are staying put."
A Cushman & Wakefield of Texas Inc. team spent six months weighing the offers from the ardent suitors, including the Crescent. Rick Hughes, C&W's senior director in Dallas, tells GlobeSt.com that the short list was pared to seven after surveying Uptown and the CBD. The plan all along was to stay close to the city's core.
Hughes says the 15-year tenant is "sad to leave the Crescent," but the deal was too sweet to pass up--from the economics to the amenities. He confides the firm will save about $1 million per year by relocating. The move will take place at the first of the year; finish-out was to have started yesterday. The signing took place about two weeks ago, but no one would talk about the deal until yesterday.
Zogg says he's dismayed about the decision. Still, the 53,000 sf isn't the primary focus these days since the tab is being picked up. More pressing is 115,000 sf that opens up in early 2003. The Crescent team is bearing down on some high-powered deals to fill two blocks of 66,000 sf and 44,000 sf.
Zogg is confident the high-rise will stay 100% occupied. The $36 per sf quoted rate is the highest in the city, but then the Crescent most often is played up as the "best building west of the Hudson." Even Hughes is confident that the law firm's space will be easily filled just because of the building's persona.
Mike Toon, Trizec's vice president in charge of the Plaza of the Americas, represented its interests in the high-profile talks. In addition to Hughes, the C& W team consisted of Noel Hutchinson, associate; Randy Thompson, senior director of program management; and Fred Maddox, senior director of project management. C&W also is handling construction management. BOKA Powell of Dallas is the architect for the office finish-out design for the 51-year-old firm. Founded in Dallas, the firm also has offices in Houston, Austin and St. Paul.
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