New Downtown HQ Marks One Of Houston's Biggest Office Leases Of The Year So Far
Cheniere Energy signed a 151K SF lease in downtown's newly constructed Texas Tower, one of the largest leases signed in Houston so far this year.
The natural gas company is moving from its current headquarters at 700 Milam to Texas Tower, at 845 Texas Ave. It will take five floors, with 16K SF of private gardens and a 700 SF terrace.
The Cheniere lease alone is equal to half of downtown's leasing activity in the first quarter of this year, according to NAI Partners. As of the end of March, the downtown area reported more than 30% vacancy and had only leased 309K SF, most of it Class-A space.
Executives with developers Hines and Ivanhoé Cambridge said in a release that the amenities at Texas Tower are drawing tenants who want to work in the office.
“As the corporate world is embracing new ways of working and what it means for their business, we truly believe a highly amenitized workplace is key for talent collaboration, engagement, attraction and retention and that is what Texas Tower truly embodies,” said Ivanhoé Cambridge Vice President of Leasing Charlie Musgrave in a release.
“We’re thrilled to welcome this new line-up of Houston’s top tier tenants at Texas Tower, not only bringing the project to 70% leased, but most importantly, confirming how they share our vision of how the office of the future comes alive.”
Cushman & Wakefield's Chris Oliver, Trey Strake and David Guion represented Cheniere. Cushman & Wakefield's Michael Anderson represented the developers.
The developers also announced four other office leases: Chicago Title, Charger Title Co. and Novak Druce as well as an unnamed trading company. Altogether, those companies will lease an additional 55K SF.
Texas Tower is 1.2M SF in total; it was completed in December 2021.
The lease marks one of 2022's largest office deals to date in the relatively sleepy downtown area. Though large leases are available elsewhere in Houston, including a 658K SF sublease in Lake Pointe Plaza in Sugar Land, according to Colliers, one of the most significant leases signed so far this year was Enbridge's nearly 300K SF at Energy Center V in the Katy Freeway area.
With nine out of 10 large leases signed in the first quarter going to Class-A spaces, per Madison Marquette, office experts are clear they think the future of office is in new sustainable and amenitized space.
“We are hearing consistently from our new tenant occupants that Texas Tower’s curated amenities and tailored programming come together to create new energy and exciting experiences that are ultimately enticing employees back to their workplace,” Hines Senior Managing Director John Mooz said in the release.
None of Houston's largest office submarkets, including the CBD, Galleria and Medical Center, have Class-B or lower offices under construction. In the entire Houston market, as reported by NAI Partners, only 71K SF of Class-B office was under construction, mostly in the Woodlands and Conroe, compared to 1.6M SF of Class-A.
