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HOUSTON-With the bids now open, the Houston Independent School District expects to announce in early June which developer gets a 24-acre piece of prized real estate bordering some of the city’s most prestigious neighborhoods.

Archon Group of Irving, TX came out on top with a $40.1-million offer for the five-building campus along Richmond Avenue in the Galleria submarket. Archon declined to comment on its offer and project plans.

Locally based firms VeriQuest Cos. Inc. and Morgan Group offered $40 million and $38.1 million, respectively. Despite a $32-million minimum, Fort Worth-based Trademark Property Co., partnering with Camden Property Trust of Houston, went ahead and kicked in an offer for $30 million at Friday’s bid opening in the HISD administration building at 3830 Richmond Ave. Donald Boehm, the district’s finance attorney, said Trademark’s offer will be reviewed even though it fell short of the ask. The “no shows” on the HISD’s “invitation” list were the locally based Wallace Halpin LLC and a South Texas investment group, led by Josef Marom of Bellaire.

The next step is a review of the bids and recommendation to the school board, which has the ultimate say in proclaiming it’s a done deal. The review committee includes a pair of CBRE/Trione & Gordon brokers, Phil Arnett and Doug Elliott, and Gary Hansel, HISD’s real estate manager, and Boehm. A closing date will be firmed up after the winner’s picked.

Arnett tells GlobeSt.com that the plan is to vacate the campus within two years. The campus contains three office buildings with 323,605 sf, a 44,832-sf elementary school and 4,500-sf operations plant. The buildings, deemed cost-prohibitive to renovate, could have been razed for $750,000, but officials knew the land would generate enough capital to build a more efficient administration building and then some since it’s in the heart of the priciest sections of town: River Oaks, Highland Village and West University. To some, it’s the Rodeo Drive of Houston, a high-priced corridor of single and multifamily development, upscale boutiques and low-rise office buildings.

Arnett says there are a lot of moving parts to the deal and many decisions still to be made. District officials have yet to decide whether to jumpstart construction with financing or make the close for the cash and give a credit at closing, rather than a leaseback, that would allow HISD to stay in place while its 300,000-sf replacement building rises on a 65-acre campus at the intersection of Loop 610 and US Highway 290. The catch to that is the tax-exempt status goes away once the deed’s transferred.

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