U.S. Attorney’s Office Relocating to Wells Fargo Plaza
Those of in the commercial real estate industry read what seems like almost daily, a report of some significant General Services Administration (GSA) lease in the Washington D.C. metropolitan region. The GSA is the real estate arm of the federal government who has been a primary driver of leasing activity in 2010.
In Houston, the GSA has leased 132,539 square feet for the U.S. Attorney’s Office for the Southern District of Texas at Wells Fargo Plaza in the Central Business District (CBD). The lease is one of the larger office lease transactions of 2010 for the Bayou City. The U.S. Attorney’s office will be relocating in late 2011 or early 2012 from 919 Milam, which is considered a Class B office building where it currently occupies 113,734 square feet in a lease that terminates July 26, 2013, according to Lease Inventory records on the GSA website.
Cost Effective Relocation?
Earlier this month, the Obama Administration issued a directive ordering federal agencies to cut $8 billion worth of building costs by the end of the 2012 fiscal year. I would note that Wells Fargo Plaza is one of the most expensive office towers in the city of Houston. Wells Fargo Plaza quotes a net rental rate of $28.00 per square foot and with 2010 estimated operating expenses of $11.50 per square foot, making the grossed up annual rate pushing $40.00 per square foot. The average asking rent for Class A office space in the CBD at the end of the first quarter was $35.57 per square foot.