GlobeSt.com EXCLUSIVE: Class A Rush Fills 214,522 SF in Las Colinas

IRVING, TX-In a class A rush for office space, a quartet of tenants for a combined 214,422 sf has handed the high rises of Las Colinas their biggest wins this year and most activity in one week for at least three years. The largest deals, both signed in recent days, fill 95,000 sf in the Plaza at Las Colinas and 81,069 sf in Las Colinas Corporate Center I.

“I would definitely and confidently say this is our deepest level of activity for three years,” Dennis Barnes, senior vice president in CB Richard Ellis Inc.’s Dallas office, tells GlobeSt.com. The CBRE win is the granddaddy of the deals: GE Commercial Finance Corp. taking down 4.5 floors or 25% of 300 E. John Carpenter Freeway, which lost its last bit of income June 30 when the clock ran out on Citigroup’s long-empty space. GE, consolidating sites in Las Colinas and Tarrant County, will use the just-leased space to house a truck financing and leasing operation bought last fall from Citigroup.

The planned move-in is Oct. 1, according to Barnes who teamed with CBRE’s senior vice president Randy Cooper to negotiate the deal with GE’s tenant rep, Matt Heidelbaugh, a Dallas director with Cushman & Wakefield of Texas Inc. “They’re swinging hammers as we speak,” Barnes says, adding the deal clearly translates to absorption for the submarket.

The 401,000-sf Plaza at Las Colinas, owned by Chicago-based ITW Mortgage Investments Inc., is quoted at $18.50 per sf to $19.50 sf. Barnes says the pipeline is holding 50,000 sf to 75,000 sf of deals that should close within 60 days and another 250,000 sf to 300,000 sf that’s looking to land in Las Colinas, an office submarket shouldering a 35% vacancy in its urban center.

An 81,069-sf renewal by H.D. Vest Financial Services, a non-bank subsidiary of Wells Fargo & Co., was put to bed practically in sync with the GE lease. The three-floor financial services’ tenant re-upped three years early in the MetLife-owned building at 6333 E. Campus Circle Dr., says Robert Deptula, principal with Fort Worth-based NAI Stoneleigh Huff Brous McDowell. He, NAI principal Nora Hogan and Bob E. Williams with Wells Fargo Corporate Properties negotiated a long-term lease with the building owner’s brokers, Elliott Prieur and Lee Nix with Lincoln Property Co. in Dallas.

“MetLife worked hard to meet all of the financial parameters to structure a win-win for both parties and retain the largest tenant in the two-building complex on a long-term lease,” Deptula says. The package includes renovating floors four, five and six for the seven-year tenant so it can match up it to Wells Fargo’s traditional office spaces, he explains. The work will be completed before the next tax season begins. The 159,212-sf Las Colinas Corporate Center I’s quoted rate is $20 per sf to $21 per sf plus electric.

Adding to the stellar news, the Office of Thrift Supervision cut an early extension for a 28,336-sf office, pushing out the term roughly five more years in Las Colinas Tower II at 225 E. John Carpenter Freeway. “It was kept kind of quiet,” says Bill McClung, a C&W executive director in Dallas. “We evaluated the present situation and made them aware of what the market was. They like the location…and felt confident with extending their lease before their other lease was up.”

McClung, who teamed with C&W senior director Michael Gosslee, says the extension was inked about three years early. “I think they met the market,” McClung says. “They did what they should have done.” Tom Cruikshank vice president and leasing director for Jones Lang LaSalle Americas Inc. negotiated for building owner, Colonnade Properties of New York City. The 352,165-sf building carries a quoted rent of $12 per sf to $19 per sf plus electric.

Five-year tenant, Aeroxchange, shaved about 5,000 sf from its eighth-floor office in the 363,536-sf east tower of Williams Square at 5221 N. O’Connor Blvd., but held tight to 10,018 sf with a 10-year lease, says Mark Dickenson, senior vice president for Atlanta-headquartered Cousin Properties Inc. He says the 1.4-million-sf trophy’s pipeline has 100,000 sf in five deals, which are expected to close in 30 to 45 days for the New York City-based TIAA Realty Inc.’s property.

Ric Kanaztar, assistant director in Dallas for Studley, says Aeroxchange had “one or two buildings” in its sights. “Being in Williams Square is a great image,” he says, “and we got the economic savings as well.” The complex’s quoted rent is $21 per sf to $22 per sf plus electric. Besides Kanaztar, Studley associate Craig Wilson worked the deal.

“This is just the start,” McClung says about Las Colinas’ comeback. “I’m not going to say four deals are going to make a trend.”

Nonetheless, says NAI’s Hogan, “people are staying and people are moving in.”

Dealmakers, in part, credit the uptick to the recent decision by Fluor Corp. to relocate its world headquarters from Aliso Viejo, CA to a 120,000-sf build-to-suit in Las Colinas. “The overall economy has rebounded. Corporate America is starting to expand again,” Dickenson says, “and Las Colinas is a reflection of corporate America.”