"It just came about at the right time," says Todd Burnette, executive vice president of the Fort Worth office for Dallas-based Staubach Co. "Both velocities were similar. Pier 1 wanted a tenant or owner that didn't conflict with its business and Chesapeake didn't want to be in a building with another gas company." Burnette says the four-year-old building at 100 Pier 1 Circle never made it to the market although he's not saying that Chesapeake was the only one eyeing the 20-story building. "But to us, Chesapeake was the only real buyer," he stresses.
The Downtown building will be renamed to reflect the new owner's name, but the moniker has yet to be picked, according to Julie H. Wilson, vice president of corporate development for the Oklahoma City-based Chesapeake. "However, we will maintain a sensitivity to our tenants and friends at Pier 1 and make sure they continue to have the recognition they deserve as well," she adds. Chesapeake's Barnett Shale district headquarters will occupy floors 14 through 20 and Pier 1 will hold onto 250,000 sf in a seven-year sale-leaseback agreement.
Wilson tells GlobeSt.com that 300 to 400 employees will move into the offices in late summer. She says a new finish-out is planned for the penthouse floor, with some retooling on the other floors as well. Chesapeake currently has 115 workers in DR Horton Tower at 301 Commerce St. and others in field offices in Cleburne, Joshua, East Tarrant County and Dallas/Fort Worth International Airport. She says the four field offices will remain, but some employees will be shifted to the CBD building as will some landsmen and rights-of-way agents. "We don't have the plans firmed up yet," she says.
Wilson says Chesapeake most often builds from scratch, but the opportunity for an architecturally significant piece of Downtown real estate with built-in amenities like conference center, cafeteria, fitness center and 1,000-space parking garage were too good to pass up. "It's a nice presence in Downtown Fort Worth and right at the heart of our Barnett Shale operations," she says. "It gives us an opportunity to expand. It's also great because it allows Pier 1 to remain the building. It's good for Fort Worth." The glass and gray granite high rise was designed by Duda Paine Architects LLP of Durham, NC.
Wilson says 20% of Chesapeake's corporate activity is derived from the Barnett Shale. The company is one of the shale's largest mineral rights' leaseholders, amassing 256,731 net acres in Bosque, Cooke, Dallas, Denton, Ellis, Erath, Gaines, Hill, Hood, Jack, Johnson, Palo Pinto, Parker, Tarrant and Wise counties since 1990. Chesapeake has 800 operating wells in the Barnett Shale that produce 450 million cubic feet of net natural gas per day. Its investment to date in Texas is estimated at $15 billion.
"We will remain an Oklahoma City-based company, but certainly we will have a more expanded presence in Fort Worth with this office," Wilson says. "We make decisions quickly and we're glad to have this done."
The deal's brokers, Burnette and Staubach vice president David Walters, now have the task of finding a sublease tenant for Chesapeake's 40,000 sf in the DR Horton Tower. The to-be-vacated space is 18,000 sf on the sixth floor and 22,000 sf on floor 12 of the 28-story CBD high rise.
Burnette says the sublease rate has yet to be set. Given the CBD's 97% occupancy, it's bound to come close to the market rate, which ranges from $27.50 per sf to $29.50 per sf. "We've been conceptually talking to some folks, but until today, we couldn't tell anybody which floors it might be," he says, adding showings will begin ASAP.
News about the sale had the city buzzing. "This was just the perfect fit," Burnette says. "Everyone seems real happy."
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