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HOUSTON-New York City-based Trizec Properties ought to be dancing in the aisles after signing a sublease tenant to a direct deal for 142,968 sf at Three Allen Center. The independent oil and gas firm, EOG Resources, was operating out of 105,000 sf of pure sublease space in two office buildings in the complex. Trizec nets about 38,000 sf in the negotiations at a complex bearing 500,000 sf of empty office space.

The Enron spin-off, EOG, has been operating out of 80,000 sf of sublease space at Two Allen Center at 1200 Smith St. since its start in 1999. Enron leased the spot solely for EOG’s use, Steve Biegel of Houston’s Trione & Gordon LLP tells GlobeSt.com. Biegel represented EOG in its most recent lease at Three Allen Center.

The EOG-Enron pact called for EOG to move into Enron’s Three Allen Center space when the energy giant took up residency at its new office building, Enron Center South. Again, the deal was for sublease space. Enron’s bankruptcy threw all of those rights and agreements out the window. With bankruptcy court approval, Enron terminated its Three Allen Center contract.

Biegel says EOG then began negotiations with building owner, Trizec Properties, for a direct lease at Three Allen Center. The deal rolled in 24,268 sf of sublease space from Battle Mountain Gold to take the bottom line to 142,968 sf.

An industry insider has told GlobeSt.com that losing the Enron leases could actually be a good thing for Trizec since Enron was leasing the space at prices substantially below current market value. This will give Trizec the opportunity to raise its rates at the building, says the source.

The building owner of record is TrizecHahn Colony Square GP LLC. Trizec was represented by in-house representative, Paul Frazier.

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