State Shifts Office Into 100,375 SF of Flex

The move opens up the 141,902-sf Southfield building at 4000 S. Interstate 35 at the Ben White Boulevard intersection. Vic Russo, vice president of Jones Lang LaSalle in Austin, has begun marketing the office space.

The Workers Compensation Commission will take 100,375 sf at Met Center 10, a 345,600-sf flex building in the southeast submarket, for its state headquarters operations. It will have 500 to 600 employees at the site in a 10-year lease that starts running Oct. 1.

The move will reduce the agency's rent to $119,634 per month from $209,478, a state contact tells GlobeSt.com. The agency is taking flex space because it offers more options for space configuration and reduces cost to make changes to the space in the future.

The state contact also said the flex space would live up to its name should the workers comp commission be downsized or eliminated by the Texas Legislature. "The state would have greater flexibility in using this space for another state agency," the contact said.The agency joins the Texas Parks & Wildlife Department in the building. TPW leases 10,000 sf for its archeology and interpretations and exhibitions branches.

Meanwhile at the nine-story Southfield building, Russo has begun marketing the building for the owner, the San Diego-based Shidler Group. Built in 1985, it has housed the state agency for the past 10 years. "It hasn't been available on the market for quite awhile," Russo tells GlobeSt.com. "We do see it as a pretty good opportunity in that area, which is a fairly tight market."

Russo is looking for all takers, but thinks it could work for another single-use tenant. "In particular, I think it would be good for a new corporate location coming into Austin that wants high-profile exposure," he says. While the owner is looking to lease the building, Russo says "we would entertain a sales opportunity or sale/leaseback situation for the right opportunity."

The massive highway construction going on at that intersection is scheduled to be completed by May 2004, Russo says. It has accessibility to the airport, south to San Antonio, north on I-35 and west on Ben White. The building is in the south central submarket, just inside the boundary separating it from the southeast submarket. The vacancy rates of both submarkets are about 7.9%, about the lowest in town. The average asking rent in the south central market is $18.76 per sf and $18.18 per sf in the southeast.