100,100-SF Deal Steels Dallas-Fort Worth Soft Spot

LAS COLINAS, TX-After two months of talking, Flowserve Corp., with $2.3 billion in global sales last year, has given a 100,100-sf hard commitment to the Las Colinas Urban Center, a class A soft pocket that has just corralled one of the largest expansions this year for the submarket.

Come January 2004, Flowserve will vacate about 60,000 sf at Millennium Center after a five-year stay for a retooled four floors in the Towers at Williams Square, a four-building, 1.4-million-sf complex now resting comfortably above the 90%-occupied mark. Talking terms is taboo about the “class A plus” golden deal that kept the search within the confines of the Urban Center, where canals, marble curbs and nine bronze mustangs are part of the everyday view.

“It was an excellent transaction for both parties,” Jeff Ellerman, senior vice president of Dallas-based Staubach Co., tells GlobeSt.com about the headquarters search, which began in April as he and Staubach vice president Kelley Kackley surveyed Las Colinas. Flowserve’s new lease picks up just as the one at Millennium expires.

Flowserve’s block of contiguous space backfills 75,000 sf vacated in September 2002 by Accenture, formerly Anderson Consulting Inc., when it shifted from the central tower to the east tower and doubled in size. “It’s a very attractive contiguous block of space in the tallest building in Las Colinas, with room to grow for Flowserve,” says Mark Dickenson, senior vice president for Atlanta-based Cousins Properties Inc., which holds the leasing and management contract for the landmark office complex at 5215 N. O’Connor Blvd.

While the main stars aren’t talking terms, the Towers at Williams Square has a basic quoted rate of $21 per sf to $24 per sf plus electric. Flowserve took a long-term lease for floors 21 through 24 and got its name on the monument as one of the perks. And, Dickenson says, the deal came “with no tearing up of a lease. We got a great tenant and long-term lease and Flowserve accomplished its goal for a new headquarters location.”

Dickenson negotiated for the building owner, TIAA Realty Inc. of New York City. And he, like Ellerman, quickly points out that the deal sends a strong signal of commitment for the submarket, which had a 35.5% across-the-board vacancy at the end of the first quarter, according to Julien J. Studley Inc.’s office analysis.

The central tower is the third Las Colinas building, all top caliber, in the last six to eight months to best 90% in occupancy. “The good buildings, with great sponsorship, are getting leased, even in a soft market,” Dickenson stresses.

Flowserve, now based at 222 W. Las Colinas Blvd., is one of the world’s leading providers of industrial flow-management services, with about 14,000 employees in 56 countries.