Development of the 340,000-sf Towers at Shores Center began this week in Redwood Shores, Calif. with a little less than one-third of the space already leased. Located on the Highway 101 corridor, midway between San Francisco and San Jose, the two building, $113 million office development is scheduled for completion in fall 2001.

Cornish & Carey, listing agent for the Spieker Properties development, has so far preleased 101,000 sf for 15 years to the New York-based law firm Weil, Gotshal & Manges. The company will take four contiguous floors in the middle of the first completed building, Spieker CFO Stuart Rothstein told GlobeSt. While interest has been expressed in portions of the remaining space, no negotiations are underway, and no letters of intent have been submitted, Rothstein said.

The law firm will relocate from its current quarters on Sand Hill Road in Palo Alto, so the $90/sf rent probably seems paltry. Indeed, with Sand Hill rents pushing $150/sf, the law firm will no doubt be able to sublease its existing space for more than it will pay Spieker. The firm will likely occupy its new space toward the end of 2001.

Menlo Park-based Spieker, which owns and operates more than 7 million sf of office space throughout the Silicon Valley and San Francisco Peninsula markets, also announced third-quarter dividends on Wednesday. Common stock shareholders of record as of Sept. 29 will receive a third-quarter dividend of 70 cents a share on Oct. 20.

Rothstein said the Redwood Shores submarket is running a 1% or less vacancy rate, which the kind of demand Spieker said it would wait for when it purchased the property two years ago. For the kind of space the law firm wanted, Spieker was practically the only game in town. There will be more competition after Spieker lands a couple of more big deals and then begins work on filling out the smaller remaining spaces.

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