Posted 18 August 2006 - 07:47 PM
Build it and they will come: Planned tower is filling up
Fort Worth Business Press - Aleshia Howe - August 21, 2006
Since announcing plans for a new 16-story office building in downtown Fort Worth last week, area developers say they have already been approached by enough interested parties to fill up the 300,000-square-foot space – and it hasn’t even broken ground.
“We have enough interest to fill the building right now,” said Johnny Campbell, Sundance Square president and chief executive. “But you never know how many interests will pan out, so we will continue to aggressively lease this project.”
The planned Class A office tower, dubbed The Carnegie, will be located at the corner of Third and Lamar streets, which is currently a parking lot across from the central Fort Worth Library. The building is named after Fort Worth’s original Carnegie Library.
Real estate investor Ed Bass is the lead project developer.
The development will become a part of the Sundance Square portfolio and will be managed, operated and leased by Sundance Square Management. Campbell said the building will exemplify the vision for Sundance Square and for downtown Fort Worth. Construction on the tower is scheduled to begin in January with the building’s projected completion date set for June 2008.
“This building will be a beauty for downtown, but it will also fit perfectly into the Sundance portfolio,” he said. “And it will have all of the amenities and the securities that come with Sundance.”
EOG Resources, an independent oil and natural gas exploration and development company, committed to leasing 50,000 square feet several months ago, Campbell said. EOG already leases space in the Chase Bank and Woolworth buildings, both in Sundance Square. The company is headquartered in Houston, but has a growing presence in Fort Worth.
William R. “Bill” Thomas, senior vice president and general manager of EOG’s Fort Worth office, said he and his company are pleased to have reached an agreement with Sundance Square Management.
“It is our goal to provide excellent office space for our employees and have the flexibility to continue the success and growth of EOG’s Barnett Shale operations,” he said.
According to site plans, the building, which will have a footprint of 19,000 square feet, will feature multiple retail locations on the bottom floor. Campbell said the retail will likely include at least one food venue, along with soft retail. Each of the 16 floors within the structure will have 13-foot, 4-inch-high ceilings – an upgraded feature not typical in downtown office buildings.
“This is a true Class A office project, which means that all types of businesses looking for that will find this appealing,” he said. “This is also a building that respects the 19th century architecture of Fort Worth, but has all of the modern amenities that you would expect to find in a building of this caliber.”
Campbell said developers have been in talks about the project for more than eight months, but the May release of Moody’s Investor Service ratings that described downtown Fort Worth as one of the hottest real estate areas in the nation, played a large role in the decision to develop.
“We knew we were going to do something with the land, but the fact that vacancy in downtown is above 95 percent really made the decision a clear one,” Campbell said.
Besides the access to a nearby parking garage, which currently serves The Tower, Campbell said the planned location for The Carnegie will also feature a growing Third Street corridor.
“There’s a connectivity that’s starting to grow west on Third Street, and when you couple that with the atmosphere that’s there already with the neon signs and the available retail, this location is perfectly suited for office space.”
Construction costs are not yet available and Campbell said rent rates will not be disclosed to the general public, but will be available to individual companies that submit proposals. However, Campbell said, the rates will be in line with the current downtown office market.
At the start of 2005, industry experts predicted office rates in downtown Fort Worth would climb to $30 per square foot during 2006. According to Nasser Haghighat, director of research at Downtown Fort Worth Inc., the current vacancy rate for Class A office space is 3.7 percent – a lower-than-average number. The average rate for Class A office space in downtown is $26 per square foot, Haghighat said, and The Carnegie’s entrance to the market will be great timing.
“With the vacancy rates so low, I don’t think that 300,000 square feet of space will have a significant effect on the market,” Haghighat said. “There is obviously a lot of demand for Class A office space so it is probably going to go very fast. It might not even be vacant for long enough to touch the market numbers.”
Architect David Schwarz is designing the building. Schwarz’s firm also designed Fort Worth’s landmark Nancy Lee and Perry R. Bass Performance Hall as well as the Chase Bank Building, Sundance West Apartments and the Barnes & Noble block, all in Sundance Square. The firm designed the American Airlines Center in Dallas and Ameriquest Field in Arlington.
In a release following the announcement of the project, Bass said Sundance Square has gained notoriety as a prestige location for high quality Class A office space.
“The Carnegie will continue this tradition, with terrific proximity to all of Sundance Square’s amenities,” he said.
Elaine Thomas, spokeswoman for EOG, said the company wanted to stay in Sundance Square, but needed to consolidate its offices and The Carnegie offered the perfect solution.
“Our Fort Worth office … is a great location,” Thomas said. “Our employees like being there in Sundance Square and it’s just a very good place to do business and a good base for our Fort Worth operations.”
Sundance Square is a 20-block commercial, residential, entertainment and retail district in the center of downtown Fort Worth.