Energy Firm Will Fill 101,600 SF in CBD

HOUSTON-Midstream energy company Targa Resources Inc. has signed an 11-year lease to take down 101,600 sf in a direct deal for the 1.7-million-sf Wells Fargo Plaza. Beginning in October, the energy firm will get keys to floors 43 through 46, some of which it has been occupying on a sublease basis.

Launched in 2003 with help from private equity firm Warburg Pincus, Targa Resources handles gas gathering, processing and pipeline asset acquisition. It acquired locally based Dynegy Inc.’s midstream natural gas in fall 2005–and took on some of its space in the 71-story CBD high rise at 1000 Louisiana St.

The leasing news is welcome to those familiar with goings-on at Wells Fargo Plaza as well as lead tenant, Dynegy, which has downsized in recent years and subleased portions of its floors. Dynegy still has a year or two before its lease burns off, but negotiations are under way, according to a Lincoln Property Co. contact.

“Everyone was concerned about what would happen when the Dynegy leases expired at Wells Fargo,” Mark Preston, senior vice president with Moody Rambin Interests in Houston, tells GlobeSt.com. “There’s been concern that a lot of space would end up on the market.”

Preston emphasizes the Targa deal is a positive sign for the CBD. “They’ve made a long-term commitment in the Dynegy portion of the Wells Fargo stack and that’s great news,” he adds.

Steve Burkett, Dan Bellow and Ronnie Deyo with Staubach Co.’s Houston office, were the tenant representatives. Lincoln’s Kevin Wyatt and J.P. Hutcheson represented the building owners, Metropolitan Life Insurance Co. and Metropolitan Tower Realty Co. Inc., which have the space on the market for $22 per sf. Brokers on both sides of the deal were unavailable for comment prior to publication.