October 2009

Counsel Cut Costs On Office Space

 Houston Site Acquisitions. Need Space ? We can help. Free Location Service Citywide.

By Brenda Sapino Jeffreys
Texas Lawyer
March 02, 2009
Article Link

The troubling news about the nation’s economy may really be a glimmer of good news for Texas firms looking to cut costs by renegotiating their office space leases or moving to new space.

“If you are in the position right now where you want to stay in the building and you want to extend your lease, this is a great time to go talk to your landlord about different terms,” says Jim Leary, executive director for Akin Gump Strauss Hauer & Feld. “Some landlords are hurting, too, because they have overextended because they’ve bought new buildings over the past two or three years.”

Leary, who oversees Akin Gump’s leases from his office in Washington, D.C., says Akin Gump has been very active in recent years in managing its office space throughout its 13-office network.

“We have been actively doing this in good times and bad,” says Leary, who says the 913-lawyer firm has returned some space to landlords in recent years and is currently trying to sublease some excess space in a couple offices. He declines to identify those offices.

Akin Gump isn’t alone in seeing opportunity to cut real estate expenses, or to increase their space at better terms.

Miles Holsworth, executive director at Dallas-based Locke Lord Bissell & Liddell, says the 710-lawyer firm began to evaluate its leases as a part of due diligence prior to the October 2007 merger of Texas firm Locke Liddell & Sapp and Lord Bissell & Brook of Chicago.

“We were really in front of what’s going to happen in the market,” Dallas-based Holsworth says.

Since the merger, the firm has made several office space adjustments that have cut costs, he says. That includes subleasing a floor at its Chicago office, and combining offices in Washington, D.C., into new space subleased from Sprint, he says. In New York City, the firm negotiated a lease in Three World Financial Center that had been previously occupied by Morgan & Finegan. On Feb. 2, Locke Lord announced that 33 lawyers from Morgan & Finnegan, including 13 partners, joined the firm.

Holsworth says the firm, which has offices in 13 cities, is “saving a lot of money” in rents over the past year-and-a-half because of the space adjustments.

Meanwhile, Holsworth says, the firm recently entered into a new long-term lease in JPMorgan Chase Tower in Houston that gives the firm new space for a conference room floor and the opportunity to build out the space in a way that standardizes offices to two sizes. Currently, there are about six different sizes of offices, he says. The new space takes up seven-and-a-half floors, compared to the current nine floors, but Holsworth says the floors are contiguous and the firm will use the space more efficiently once a build-out is complete later this year.

Some Subleasing

Renegotiating leases isn’t on the table at some Texas firms.

M. Lawrence “Larry” Hicks, administrative partner in Thompson & Knight in Dallas, says the firm is not trying to renegotiate its leases, but did take on additional space in Three Allen Center in Houston about six months ago. The firm has sublet that space, he says, but the firm intends to add lawyers in Houston and will fill it over time, he says.

“We are always looking for ways to save expenses, but we don’t have an abundance of excess space,” he says.

Kevin Richardson, office administrator in Houston for Jones Day, says the firm has exercised an option to take on an additional half floor at 717 Texas in Houston later this year. The firm is now housed on two floors in the building and is in the sixth year of a 15-year lease, he says.

Richardson says the firm negotiated the expansion more than a year ago.

John Strasburger, the partner in charge in Houston for Weil, Gotshal & Manges, says the firm redid its lease in the Bank of America Center in Houston in 2008 by extending it and renegotiating a blended rate for the longer term.

“We did it because it was a good time to do it. The interesting thing is, it’s kind of like housing prices, they never seem to go down in neighborhoods you want to live in. The same thing is true of Class A office space,” he says.

Strasburger says the firm may be able to capitalize at bit on the down economy in Austin when negotiating a new lease there, because the firm’s current lease in the Arboretum area is up in 2010.

Dan Butcher, managing partner of Strasburger & Price in Dallas, says the firm is looking at its leases, even though most have significant terms left on them. The firm has offices in Dallas, Houston, Austin and Frisco.

“We haven’t made any decision, but we are evaluating whether this is a good time to look at extending our leases and get a better rental or lease rate right now,” Butcher says.

He says the most likely action is subleasing some space in Frisco. The firm’s office is in Hall Office Park.

Tenant Retention

The opportunities for firms to have leverage over their landlords when negotiating new long-term leases varies from city to city in Texas, says Bob Cromwell, managing director of the office services division at Moody Rambin Interests in Houston.

He says the citywide office space vacancy rate in the Dallas area is around 20 percent, while it’s only about 12 percent in Houston. He believes that’s because Houston’s energy-based economy has not been as affected by the economic downtown. Cromwell says the Austin office market is “overbuilt” a bit, but San Antonio is “holding its own.”

Cromwell, who represents building owners, says while tenants believe rents should be going down because of the economy, those rates haven’t been affected much yet. He says rental rates have jumped 30 percent in Houston since the last economic downtown in 2001, and he doesn’t see landlords giving up those gains over the short term.

He says many tenants are negotiating one- or two-year leases because they are waiting to see where the market lands.

Theodore Brakatselos, president of Houston Site Acquisitions, who helps clients find office space, says landlords are being a little more aggressive at trying to retain tenants. However, he notes that there’s a “certain level of uncertainty in the market.”

He says some clients are wondering: “If we sit and wait, will we get a better deal?

Theodore Brakatselos is the President of Houston Site Acquisitions, a commercial real estate company. He has over 17 years of experience in commercial real estate and has represented a broad range of tenants and landlords over his career including star-up companies, publicly held companies, and overseeing portfolios for institutional landlords & investors. You can reach Theodore at 713-789-8700 or via the Web at www.hsaleasing.com

Why use a Houston commercial real estate broker? Tenant Representation.

Houston Site Acquisitions. Houston commercial real estate company.

Need Space ? We can help. Free Location Service Citywide.

By Theodore Brakatselos, President of Houston Site Acquisitions
Houston Chronicle
March 4, 2009
Article Link

We frequently speak with tenants who are interested in obtaining information regarding a commercial property and who have expressed difficulty in getting a return call when attempting to gather market research. Tenants (companies) that are not working with a broker will call on leasing signs posted in front of a building. What the tenant might not realize is that the building’s leasing agent at times is not in a hurry to return the call sometimes due to the size of their requirement or that the space advertised as being available for lease actually is not available at all. Typically, the leasing sign will remain in front of a building regardless of whether or not space is available. We also have found tenants get exhausted spending time conducting research on Web sites that contain only listings belonging to one landlord or Web sites that are paid-advertisement directories that contain very limited or outdated listing information.

Presenting current market options is one of the most beneficial services a broker can offer to tenants in addition to evaluating options when they are faced with renewing an existing lease, relocating/leasing space in other buildings, and exploring ownership opportunities such as purchasing a facility. As an added benefit, a broker familiar with the entire city at times might present options in other areas to consider that might not be offered in their particular submarket or existing location.

One important factor to consider when selecting a broker to assist with leasing space is to select one who is free of any potential conflicts of interest. In other words, when leasing space it serves a tenant well to select a broker who is not working for several landlords as well as (you) the tenant.

Securing a business location is extremely important and typically is the second highest line item in terms of operating expenses when operating a business. Many tenants believe that they are able to handle their company’s real estate needs on their own. One example of how some tenants substantiate their ability to handle their business real estate affairs is by reflecting upon how many leases they have successfully negotiated over the years. Lease terms vary and may extend over a period ranging from one year to 15 years. If a tenant has negotiated five leases over the course of 15 years, imagine how many leases a leasing agent working for a landlord has negotiated in comparison over the course of just a few months. When thinking about this example it is easy to understand why negotiating on your own behalf might not be such a good idea.

Every broker over the years develops their own style and technique of working on assignments and interviewing a broker when making a decision regarding your commercial real-estate needs is a good first step. A lot of brokers work for tenants on a commission structure, which doesn’t involve an out-of-pocket fee being paid directly to then by a company using their services, because it ends up being paid by a landlord who splits the commission between your agent and his or simply remains with that landlord and just sweetens the pot for him at the end of the day.

Additionally, a good broker not only will save a company a lot of time and money by allowing tenants to concentrate on their core business during the course of a real-estate transaction, but also will help save on intangible assets such as the time and effort involved in successfully closing a commercial real estate transaction.

Theodore Brakatselos is the President of Houston Site Acquisitions, a commercial real estate company. He has over 17 years of experience in commercial real estate and has represented a broad range of tenants and landlords over his career including star-up companies, publicly held companies, and overseeing portfolios for institutional landlords & investors. You can reach Theodore at 713-789-8700 or via the Web at www.hsaleasing.com

Leasing Space in Houston

Companies typically have three different types of commercial real estate to consider when researching site selections to lease for their company: office space, industrial space and retail space.

Office space users typically choose an area of the city that is ideal for their client base and have normal business hours, usually 8 a.m. to 5 p.m. during the week and either are closed or have limited service over the weekend due to the hours of operation/hvac system of an office building. Office space users tend to have clients visit at their location and are more image conscious as a result. Having the right office environment is especially important in being able to recruit key employees for companies.

Industrial space users tend to choose locations that are accessible to main arteries of the city and that are capable of receiving and/or making large deliveries by trucks and/or rail service. Industrial buildings typically have tall clear heights, which allows stacking of inventory on pallets or rack systems. They also may have a minimal amount of office area to perform administrative tasks and oversee business.

Retail space users tend to pay the most attention to the exact location of their business. Retail businesses heavily rely on exposure in selecting a location coupled with the demographics of a specific area. Retailers have to typically decide whether they believe their concept is better suited in a small neighborhood shopping center, a lifestyle center, or in a large regional mall. A retail location is also best suited to accommodate tenants with high parking requirements. A common expression in retail is: “out of sight, out of mind, out of business.”

Theodore Brakatselos is the President of Houston Site Acquisitions, a commercial real estate company. He has over 17 years of experience in commercial real estate and has represented a broad range of tenants and landlords over his career including star-up companies, publicly held companies, and overseeing portfolios for institutional landlords & investors. You can reach Theodore at 713-789-8700 or via the Web at www.hsaleasing.com

Leasing Space in Houston

Sales

RETAIL: Auto Pak-USA purchased a 39,204 square-foot property for a car lot at 4515 Texas 6 from Regions Bank. Randy Connell of Coldwell Banker Commercial United, Realtors represented both parties.

RETAIL: Realty 1 Properties purchased a 4,464-square-foot property at 6238 Richmond from IB Property Holdings. Vince Elder of Coldwell Banker Commercial United, Realtors represented the seller.

LAND: John Lawrie Inc. purchased 17 acres on Miller Road #1 near U.S. 90 in eastern Harris County for expansion of the company’s existing oil field pipe operations in the area. The seller was Guadalupe Ramirez. Andrew Sowell and Mike Boyd of Boyd Commercial represented the buyer.

Leases

RETAIL: Bulldog Burrito leased 2,500 square feet in College Park Village, 3335 College Park Drive, in The Woodlands. Javier Fernandez of Uptown Real Estate Group represented the tenant. Neal Wade of AmREIT represented the landlord, AmReit Monthly Income & Growth Fund.

RETAIL: VIP Nails leased 1,441 square feet at Market at Lake Houston, 7405 FM 1960 East. Peter Park represented the tenant. Neal Wade of AmReit represented the landlord, AmReit Lake Houston.

RETAIL: European Wax Center leased 1,182 square feet in the Plaza in the Park, 5150 Buffalo Speedway. Matt Reed of NewQuest Properties represented the tenant. Jodie Pearson of AmReit represented the landlord, AmReit Plaza in the Park.

RETAIL: Glass Doctor of The Woodlands leased 1,500 square feet at the Portofino Plaza on Interstate 45 North in The Woodlands market. Jeff Tinsley of The J Beard Real Estate Co. represented the landlord.

RETAIL: Deli Express renewed its lease of 6,413 square feet at 3460 Yale. Patrick Rollins of CB Richard Ellis represented the landlord, Cabot II–TX2M01, TX2W05, TX2W05-W09.

OFFICE: Frost National Bank renewed its lease of 18,816 square feet at 6750 West Loop South. Bill Boyer and Charles Gordon of CB Richard Ellis represented the tenant. Brian Strait of Navisys Group represented the landlord, McCord Development.

OFFICE: Fluenta leased 2,596 square feet in Ashford 6. Randy Mason of Colliers International represented the tenant. Bob Cromwell and Kevin Nolan of Moody Rambin Interests represented the landlord, Falcon Southwest.

OFFICE: Kingsmill Riess leased 2,175 square feet at 801 Travis. Candace Baggett of Calibre Group represented the tenant. Bob Cromwell and Kevin Nolan of Moody Rambin Interests represented the landlord, Goddard Investments.

OFFICE: Dale Carnegie leased 5,497 square feet in Ashford Crossing, 1880 Dairy Ashford. Theodore Brakatselos of Houston Site Acquisition represented the tenant. Terri Torregrossa of Moody Rambin Interests represented the landlord, Kennedy Wilson.

RETAIL: Ruby Tequila’s Mexican Kitchen has entered the Houston market with a lease of 6,800 square feet at the Commons at Willowbrook Shopping Center at FM 1960 and Texas 249. The Candle Warehouse has also leased 5,000 square feet at the same location. Greg Slusky of The Retail Connection represented Ruby Tequila’s Mexican Kitchen. Alex Makris, Jazz Hamilton and Matt Keener of CB Richard Ellis represented the landlord, The Commons at Willowbrook, on both transactions.

RETAIL: KCM Superstore leased 36,280 square feet at the Pointe West Shopping Center, 300 S. Mason Road, Katy, Doug Freedman of United Equities represented the landlord, Point West Center. Brenda Campbell with Re/Max Fry Road represented the tenant.

OFFICE/WAREHOUSE: Source Refrigeration & HVAC leased 10,500 square feet at 23235 Tomball Parkway. Joe MacDougall of MacDougall & Co. represented the landlord, 23235 Tomball Parkway Ltd. Jarrett Venghaus of Jones Lang La Salle represented the tenant.

RETAIL: Buffalo Wild Wings Bar & Grill leased 5,800 square feet of space at Greenway Commons, a Costco and LA Fitness anchored shopping center at Weslayan and Richmond.

RETAIL: Auto Pak-USA purchased a 39,204 square-foot property for a car lot at 4515 Texas 6 from Regions Bank. Randy Connell of Coldwell Banker Commercial United, Realtors represented both parties.

RETAIL: Realty 1 Properties purchased a 4,464-square-foot property at 6238 Richmond from IB Property Holdings. Vince Elder of Coldwell Banker Commercial United, Realtors represented the seller.

LAND: John Lawrie Inc. purchased 17 acres on Miller Road #1 near U.S. 90 in eastern Harris County for expansion of the company’s existing oil field pipe operations in the area. The seller was Guadalupe Ramirez. Andrew Sowell and Mike Boyd of Boyd Commercial represented the buyer.

Leases

RETAIL: Bulldog Burrito leased 2,500 square feet in College Park Village, 3335 College Park Drive, in The Woodlands. Javier Fernandez of Uptown Real Estate Group represented the tenant. Neal Wade of AmREIT represented the landlord, AmReit Monthly Income & Growth Fund.

RETAIL: VIP Nails leased 1,441 square feet at Market at Lake Houston, 7405 FM 1960 East. Peter Park represented the tenant. Neal Wade of AmReit represented the landlord, AmReit Lake Houston.

RETAIL: European Wax Center leased 1,182 square feet in the Plaza in the Park, 5150 Buffalo Speedway. Matt Reed of NewQuest Properties represented the tenant. Jodie Pearson of AmReit represented the landlord, AmReit Plaza in the Park.

RETAIL: Glass Doctor of The Woodlands leased 1,500 square feet at the Portofino Plaza on Interstate 45 North in The Woodlands market. Jeff Tinsley of The J Beard Real Estate Co. represented the landlord.

RETAIL: Deli Express renewed its lease of 6,413 square feet at 3460 Yale. Patrick Rollins of CB Richard Ellis represented the landlord, Cabot II–TX2M01, TX2W05, TX2W05-W09.

OFFICE: Frost National Bank renewed its lease of 18,816 square feet at 6750 West Loop South. Bill Boyer and Charles Gordon of CB Richard Ellis represented the tenant. Brian Strait of Navisys Group represented the landlord, McCord Development.

OFFICE: Fluenta leased 2,596 square feet in Ashford 6. Randy Mason of Colliers International represented the tenant. Bob Cromwell and Kevin Nolan of Moody Rambin Interests represented the landlord, Falcon Southwest.

OFFICE: Kingsmill Riess leased 2,175 square feet at 801 Travis. Candace Baggett of Calibre Group represented the tenant. Bob Cromwell and Kevin Nolan of Moody Rambin Interests represented the landlord, Goddard Investments.

OFFICE: Dale Carnegie leased 5,497 square feet in Ashford Crossing, 1880 Dairy Ashford. Theodore Brakatselos of Houston Site Acquisition represented the tenant. Terri Torregrossa of Moody Rambin Interests represented the landlord, Kennedy Wilson.

RETAIL: Ruby Tequila’s Mexican Kitchen has entered the Houston market with a lease of 6,800 square feet at the Commons at Willowbrook Shopping Center at FM 1960 and Texas 249. The Candle Warehouse has also leased 5,000 square feet at the same location. Greg Slusky of The Retail Connection represented Ruby Tequila’s Mexican Kitchen. Alex Makris, Jazz Hamilton and Matt Keener of CB Richard Ellis represented the landlord, The Commons at Willowbrook, on both transactions.

RETAIL: KCM Superstore leased 36,280 square feet at the Pointe West Shopping Center, 300 S. Mason Road, Katy, Doug Freedman of United Equities represented the landlord, Point West Center. Brenda Campbell with Re/Max Fry Road represented the tenant.

OFFICE/WAREHOUSE: Source Refrigeration & HVAC leased 10,500 square feet at 23235 Tomball Parkway. Joe MacDougall of MacDougall & Co. represented the landlord, 23235 Tomball Parkway Ltd. Jarrett Venghaus of Jones Lang La Salle represented the tenant.

RETAIL: Buffalo Wild Wings Bar & Grill leased 5,800 square feet of space at Greenway Commons, a Costco and LA Fitness anchored shopping center at Weslayan and Richmond.

Theodore Brakatselos is the President of Houston Site Acquisitions, a commercial real estate company. He has over 17 years of experience in commercial real estate and has represented a broad range of tenants and landlords over his career including star-up companies, publicly held companies, and overseeing portfolios for institutional landlords & investors. You can reach Theodore at 713-789-8700 or via the Web at www.hsaleasing.com

13715 Murphy Road. HSACQ

Industrial Space. Warehouse Space.

Houston Site Acquisitions.   713-789-8700 Free Location Service Citywide.

312 Main Street. Downtown Houston,Texas. HSACQ

Downtown Houston

Excellent location across from courthouse and on Downtown’s Bar-Restaurant-Cafe-Row.  Home to Nit Noi, Mia-Bellas, Clark’s, Dean’s, The Office Night Club, Martel’s Brandy Bar, Grum-Bar, Cava’s American Bistro, Cielo Mexican Bistro, Red-Cat Jazz Bar. Located on Main/Preston Light Rail Station. Courthouse, Hotel-Icon/Voice, UH Downtown, Minute Maid Park. Over the years this established block has outperformed and has continued to surpass any other block in downtown Houston in terms of having the highest density of combined restaurants, cafes, and bars located on the same block. Some of the best known and established restaurants, bars, and European style sidewalk cafes downtown are all grouped together on street level within this block creating unique synergy within a historical setting. Located within the Theater District, Historical District, and Entertainment Districts.

11767 Katy Freeway. Sublease Space Opportunity. HSACQ

Houston Office Space. Houston Office Buildings. Sublease Listing.

 

 

 

 Houston Site Acquisitions.   713-789-8700 Free Location Service Citywide.

Sublease Listing. Beautiful building in the Energy Corridor / Katy Freeway area with excellent views. Houston office space ready for immediate move in. It consists of a reception area, large conference room, 3 executive size offices along the glass, break room, equipment/storage/server room and open area for up to 12 cubicles. Make an offer!

 Start Search-Submit Your Request Now.

314 Main Street. $2,800,000. HSACQ

314 Main Street.

Houston Site Acquisitions.   713-789-8700 Free Location Service Citywide.

314 Main Street. Houston, Texas 77002.

Houston Office Building For Sale-Houston Commercial Real Estate

13715 Murphy Road: $4,000,000. HSACQ

Warehouse Space. Industrial Space.

Houston Site Acquisitions.   713-789-8700 Free Location Service Citywide.

116,000 SF bulk warehouse-distribution center facility. One of the best priced warehouses in the entire city. Excellent highway frontage & exposure on Murphy Road.  Dock-high tiltwall construction on ±5.70 Acres. ±1.5 miles south of Highway 59 and just north of Highway 90 in Stafford, TX.  Close proximity to Stafford Convention Center.