HOUSTON-Clay Development & Construction Inc. is pushing full throttle on a repositioning plan for a 26-acre office and industrial complex, bought in an all or nothing deal from Hanover Compressor Co. after a two-year run on the market.

Robert Clay, president of the locally based industrial development firm, tells GlobeSt.com that he sat down at the closing table with a 12-year tenant in hand for two office buildings totaling 57,700 sf. And that, he says, was key to the $5-million takedown since he, like other industrial developers, couldn’t be weighted down by two vacant office buildings while trying to redevelop a 26-acre industrial holding that included 88,000 sf of manufacturing space. “In order to get it, we had to take it all,” he says of the northwest Houston acreage at Tanner and Thompson roads.

The Thomas Road Business Park’s first tenant is Aqua Services, which moved in immediately and freed Clay to focus on finding a tenant for a 58,000-sf manufacturing facility and five support buildings with another 30,000 sf. He’s now in the final stages of negotiations with a tenant for the entire 8.5-acre manufacturing complex. He predicts the deal with the oil and gas company will be inked by Oct. 15.

With the existing inventory turning over so fast, Clay has kicked off talks with “two or three others” for build-to-suits on the 13-acre balance. Clay, who’s built nearly 700,000 sf on 125 acres in the northwest submarket, says demand is such that spec product won’t be necessary.

Hanover, represented by Gary Mabray of Colliers International’s Houston office, brought the asset to market two years ago when it moved to a new facility in North Houston, but Clay didn’t make a move on the holding until earlier this year after he wrapped up a neighboring 55-acre industrial development. “Two years ago, there was other land to buy. Now, it’s almost all gone,” he says. “This area is so hot that we want any land we can get. It’s truly running out of space.”

The office tenant signed a 12-year pact and got a $4 per sf to $4.50 per sf improvement allowance, according to Clay. The initial quote on the class B-minus space was 75 cents per sf to $1 per sf monthly. The manufacturing space, with a five-year lease looming on the horizon, carried a 35 cents per sf quote. And, both are triple net leases.

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