Two-Building Eldridge Place Reportedly Draws $50 Mil for Seller

HOUSTON-The Brookdale Group, LLC, a privately held commercial real estate investment firm based in Atlanta, has purchased a two-building office project in the Energy Corridor sector of west Houston.

The property, which includes 519,000 sf of office space, has been sold for approximately $50 million, according to people familiar with the transaction. The buildings, Eldridge Place One and Eldridge Place Two, have been purchased from Allied Waste Industries of Scottsdale, AZ. The project had been the world headquarters of Browning Ferris Industries, a waste disposal firm that was purchased by Allied Waste in July 1999.

Tenants in the complex include PricewaterhouseCoopers, Paine Webber, Bank of America and the world headquarters of Global Marine, an offshore drilling company. The buildings are located at the corner of Eldridge Parkway and Memorial Drive. This section of Houston, near Interstate 10 West and Eldridge Parkway, is called the Energy Corridor due to a large concentration of offices for energy companies, including Shell Oil Co., Conoco and BP Amoco.

In the last three years, a number of new suburban office buildings have been constructed in the corridor, causing an increase in the office vacancy rate. But there has been steady progress in filling the new space. “Approximately two million sf of the six million sf of new space added to the Houston office market between 1997 and 1999 was constructed in the Energy Corridor,” says Peyton Collins, executive director of Insignia/ESG in Houston. “Although the Energy Corridor currently reports a 15% vacancy, historically it has been one of the strongest office markets in Houston, even during the late ’80s and early ’90s.”

Insignia has been retained by the new owners of Eldridge Place for leasing and management services. Before year-end, several new leases will be announced in the Eldridge Place complex, which is 65% occupied, Collins says. Brokers in the Houston and Phoenix offices of the Insignia/ESG real estate firm have represented Allied Waste in the transaction. Insignia/ESG manages over 3.25 million sf of office, industrial and retail space in Houston.