New Owners Ink Final Pacts to Start 844,000-SF Repositioning

TCC's been holding leasing and management reins for 21 of the 22 years since San Jacinto's delivery, but it wasn't a given that the team would continue at the helm because IPC US REIT will often lease and usually manage its prizes. With word already on the street, TCC yesterday confirmed the new plan includes moving its DFW office from 51,000 sf at the neighboring JPMorgan Chase Tower into 85,000 sf on the third, fourth and fifth floors of San Jacinto Tower.

The TCC team of Matt Craft, principal, and David Reed, senior vice president, will lease San Jacinto Tower, which jumps to 71% occupancy with the inbound DFW office. Craft tells GlobeSt.com that the office will be moved in April when the lease expires next door at JPMorgan Chase Tower, where TCC's DFW office, fondly called "the Daily Planet" for its newsroom-style layout, has been in place since 1993.

A move of some sort had been anticipated by market watchers after TCC lost leasing and property management contracts for the 1.2-million-sf JPMorgan Chase Tower in August 2004. TCC's DFW office still manages and leases 52 million sf of office, industrial and retail product in the region, of which 7.9 million sf is Dallas CBD space. It has another one million sf under development around the metroplex.

The move to San Jacinto has been sealed with a long-term lease "at a market rate for that building," Craft says. San Jacinto's blocks of empty class A space are on the market for $17 per sf to $18 per sf plus electric.

With the deal-making put to bed, TCC is ready to lead a renovation of San Jacinto's lobby, common areas and Ross Avenue entrance. "This building has needed some tender loving care for a long time," Craft says.

Interviews are underway with architects and landscape architects. Craft says the goal is to go out for bids in the near future so construction can begin in the second quarter and wrap up by the end of this year. "It's not a gut and redo of the building," he says, citing the red and black granite interior's architectural significance. "It's not to take away the existing finishes, but to augment them. It's an A building about to go to an A-plus building in a double AA location."

The renovation design will be part of the "show" for Craft and Reed to court tenants for the 33-story high rise at 2121 San Jacinto St. "The new owner is poised and ready to do new leases. There are prospects out there," he says. "We're going to be responsive to the marketplace and chase down deals."

Craft says all large leases for this year and 2006 have been handled so the focus is boosting occupancy in a market where renewals are controlling the closing table. The 30-tenant roster includes PNL Cos.' headquarters office, which just signed the final paper for a 15% stake in the Toronto-based IPC US REIT's first investment in Texas.