Impact on Houston CBD Office Market Should be Minimal
Kinder Morgan Inc. has agreed to buy El Paso Corp. for $21.1 billion according to multiple media reports this evening. The merger is the energy industry’s biggest transaction in more than a year and would create the largest natural-gas pipeline network in the U.S.
Downtown Houston Office Tenants
El Paso Energy owns their 32 story 912,323 square foot office tower located at 1001 Louisiana in Houston’s Central Business District, while Kinder Morgan leases approximately 225,000 square feet at nearby One Allen Center in a lease that runs to 2020. Should the merger be completed it should have little impact on the downtown Houston office market in the short term given the proximity of the two companies headquarters. Kinder Morgan has indicated it will attempt to sell El Paso’s exploration and production business.
Kinder Morgan and El Paso said they expect their deal to close in the second quarter of 2012, creating the fourth-largest energy company in North America.