Baylor Seeds Expansion With 225,507-SF Deal

Baylor started shopping the Downtown market in November 2005 by exercising a termination option in its 187,998-sf lease at 2001 Bryan St. to get extra room so it could free up space on its main campus to expand clinical patient-care services, Steve Zimmerman, principal with locally based Trammell Crow Co., tells GlobeSt.com. Baylor jumpstarted the search with four years left on its term. At the end of the day, Baylor added 37,509 sf and pushed the term until August 2020.

"There were two or three that were very competitive," Zimmerman says. "By the time we zeroed in on Bryan Tower, we got a deal done very quickly. It was competitive to the very end." Among the options were the under-construction One Arts Plaza, a Billingsley Co. project in the Arts District, and Victory Plaza, an equally high-profile project that Hillwood is developing on the Uptown-Downtown demarcation line. In all, he says eight buildings could have accommodated the size requirement, but only four made the short list for tours.

The 1.1-million-sf Bryan Tower's space, teetering on the class A-B line, is quoted at $21 per sf plus electric. Though the settled rate is off limits, Zimmerman acknowledged "it was a competitive rate" that convinced the healthcare giant to stay in place.

Baylor occupies floors 22 through 28 in the 40-story tower. Zimmerman says the expansion added the entire seventh floor and part of the 29th story plus rights to contiguous space down the road. The tenant-improvement plans for both old and new space are still on the drawing board, but the goal is have the work done by the end of the third quarter.

Baylor is restacking its office space so it can hold 825 employees, a mix of its headquarters team and that of Health Information Management and Clinical Transformation. The Bryan Tower space will house corporate services, information technology, human resources, fiscal, legal and marketing. "With this move, more space at Baylor University Medical Center at Dallas will be available for expansion," Zimmerman explains.

The tenant's side was run by Jeff Cox, principal of the TCC-Baylor Alliance, Chris Herman, a TCC senior vice president, and Zimmerman. TCC principal Jon McNeil and vice president Russ Johnson negotiated for the owner, Spire Realty Group of Houston.