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HOUSTON-Colvill Office Properties has taken over a 1.1-million-sf leasing assignment for a trio of Galleria office buildings after a Chicago-based owner opted to transfer rather than bid the duties.

Jones Lang LaSalle held the class A assignment at least three years at the complex: Post Oak Tower, Galleria Financial Center and 2700 Post Oak Blvd. Jones Lang LaSalle declined comment on the lost contract.

Chip Colvill, the Houston firm’s principal, tells GlobeSt.com that Simon Property Group in Indianapolis will continue as property manager for the three buildings. He says the office portfolio is riding at 85% occupancy partly because 2700 Post Oak Blvd. had to be emptied for an asbestos abatement and re-tenanted. One of the first tenants in the door was CB Richard Ellis Inc., which took over 30,000 sf. The portfolio’s overall tenant base is a mix of energy-related and financial industries.

In getting the assignment, Colvill is facing another 144,000-sf vacancy in the near future as Burlington Resources heads out Post Oak Tower’s door for the CBD. He says the upcoming large block of premier office space has “generated significant interest” plus he’s floated a proposal to a user looking to land in excess of 100,000 sf. There are other deals in the hopper for the portfolio at large and the first could close in 30 days, he says.

Owner Walton Street Capital LLC has put more than $7 million into upgrades at the three office buildings, targeting elevators and lobbies. Colvill says the renovation along with a reconstruction of the Galleria mall and road improvements will only solidify the repositioning play. Equally significant is the accessibility of the under-construction West Loop; the new Westpark Tollway; Walton’s $28-million investment into upgrades at the Westin Oak and Westin Galleria hotels; and its share of the tab at the Galleria, of which Walton owns 40%. Colvill says the dynamics are such that concessions aren’t going to be part of the strategy. The quoted rate is $21 per sf for Post Oak Tower and 2700 Post Oak Blvd. while the Galleria Financial Center is tagged $19 per sf.

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