Elsevier Asks Duke for 146,000-SF BTS Office

The tenant, a subsidiary of Reed Elsevier Group PLC with its world headquarters in Amsterdam, Netherlands, is consolidating a few nearby offices into this new building for a regional HQ. Toby Martin, SVP with Duke, says the three-story building will have 48,000-sf floor plates and more than 825 parking spaces. "We weren't the only ones trying to get this business," he tells GlobeSt.com. He says he estimates that the project will cost about $200 per sf to build, or at least more than $25 million. The building should be completed next summer, Martin says.

He says the office market is strong everywhere in the St. Louis area right now. "It's a bit of an anomaly compared to the national office market, particularly in the suburban, value areas. There's very few good choices, and the good sites left are in play for the big office projects. It's really competitive in this market. But this is an excellent credit tenant, with each of the company's products doing about $4 billion to $5 billion in business."

The suburb competes well with downtown and the popular office location of Clayton, MO, Martin says. "There's challenges right now with the CBD, which is a little behind in its recovery. Clayton is almost a mini-CBD, with 10 million sf of high-rise. Maryland Heights is just well out there, with most of the buildings not needing structured parking, just open, free parking. It's just a low-cost environment for corporations, and that's right in Duke's wheelhouse."

Martin says he can't quote the planned rate for the 10-year lease, which will fully occupy the building. Rates in this area are averaging about $24.70 per sf, according to a Grubb & Ellis first-quarter market report.

Whitaker Varley, VP of leasing, represented Duke in the deal. Scott Panzer, principal with Newmark Knight Frank and head of its Strategic Occupancy Solutions practice, was joined by Lisa Campofranco in negotiating on behalf of the tenant.