Sweetheart Deal Shores Up 90-Month Sublease

Estech moved into 38,400 sf at 3701 E. Plano Parkway, a 100,000-sf empty structure that Verizon Wireless had built and then never occupied in IDI International's Plano Business Park. The tenant was able to make the most of a hungry market and Verizon's desire to fill the space before another building tenant brings its space out on the sublease market.

The tenant's representative, Scott M. Jessen of the Morse Co. in Dallas, says the finished deal came with five months of free rent to help cover TI costs, $150,000 of modular furniture and less than $7.50 per sf net for the rent. The tenant, in turn, did the finish-out on the "as-is" shell space to convert the network operations center into manufacturing space. Verizon walked away with a tenant for the 90-month balance of its commitment, Jessen tells GlobeSt.com.

In cutting the deal for Estech, Jessen and Scott A. Morse worked with Plano to get a regulation tweaked so that seven more dock doors could be added. The 1,100-acre tech district was created about five years ago, overriding complaints from development circles that the restrictions were too heavy-handed.

Estech needed 12 dock doors, the regs capped the design at five per 100,000 sf, Jessen says. But, the times have changed and the elected officials were willing to compromise for the 100 jobs and the sure-to-come revenue that will be generated from the light manufacturing and assembly business of the communications systems supplier. Plano also granted a tax abatement on business personal property and a portion of the real estate for the next seven years if Estech maintains at least 100 jobs, according to Jessen.

The last four months have been spent on changing the zoning to allow the construction, negotiations with Verizon and securing the abatement package. "ESI wouldn't be there if Plano hadn't loosened the restrictions to accommodate manufacturing," Jessen says, adding that it's believed to be the first such change since the district was created.

Estech relocated the manufacturing and distribution facility from about 15,000 sf that it occupied for the last decade and a five-year address of 18,000 sf for the corporate and sales offices from two locations in East Plano. "It was a significant upgrade in quality," Jessen says of the consolidation for his 11-year client into finished space with $30 per sf quality.

A Grubb & Ellis Co. team of Rick Tiller and John Kirby represented Verizon. Kirby, a 30-year professional, recently was named vice president for Dallas-based Weitzman Group, where he will specialize in office and industrial tenant representation.