Granite Park Slam Dunks Gold-Plated HQ Pact

Come Sept. 1, UGS will take over the top floor and part of another in the six-story building at 5800 Granite Parkway, striking out on its own with a move less than two miles from its former parent's campus at 5400 Legacy Dr. The newcomer also is staking a claim as one of the Top 4 tenants in the 90-acre Granite Park complex.

The headquarters search was focused on the Far North Dallas cities, with Plano and Frisco again facing off for a gold-plated corporate tenant. Greg Fuller, managing director for Dallas-based Granite Properties Inc., tells GlobeSt.com that its chief competition in the final round of aggressive talks was Hall Office Park in Frisco.

Fuller says the long-term lease is a flat-rate package, which includes the right to put a sign on the building. The deal was negotiated by Jim Kirchhoff, Granite's leasing director, and UGS' John Coyle. As for the rate, it's under lock and key by a confidentiality clause. The market's dynamics undoubtedly shaved the quoted rent of $22.50 per sf plus electric by the norm of 10%, but the return for the building owner is a 99% occupancy on a 10-story, 256,000-sf office building--and filling space emptied in September 2002 when FM Global shifted to a twin, Granite Park Two, which is now 92% leased.

With the class A space practically gone in both buildings, the Granite team is trying to time the market to break ground on a 350,000-sf, 14-story Granite Park III. Fuller says the project is now in the pricing stage, but the best guess is it will cost $150 per sf, give or take, to bring out of the ground.

"We're out of space. From a supply side, we should be building, but the rates don't justify it," Fuller says. "The hope is to break ground in 2005 and deliver in 2006."