Office Real Estate News

TriNet snaps up $43M site leased to AT&T subsidiary

TriNet Corporate Realty Trust Inc., San Francisco, one of the largest publicly traded REITs, has acquired a 420,000 sq. ft. headquarters building in Parsippany, N.J., that is net leased to AT&T Resource Management Inc., a wholly owned subsidiary of AT&T.

The purchase makes AT&T TriNet's largest tenant, while the $42.8 million price tag is an estimated 50% discount to the building's replacement cost.

Baby Bell tower opens five months early

South Central Bell's 583,865 sq. ft. headquarters tower in downtown Nashville, Tenn., recently was completed five months ahead of schedule and $5 million under budget. The company's 1,800 employees from 14 area office buildings have now been relocated.

Carter, an Atlanta-based commercial real estate services firm, served as development consultant on the project. Earl Swensson Associates of Nashville was project architect. The general contractor was a partnership of Bell Construction Company of Brentwood, Tenn., and Brasfield and Gorrie, Birmingham, Ala.

New D.C. project breaks ground 56% leased

Construction has started on a $125 million, 340,000 sq. ft. office building at the corner of 19th and K streets in downtown Washington, D.C., thanks to substantial preleasing activity. The Kaempfer Company has signed law firms McKenna & Cuneo for 119,165 sq. ft. and Hunton & Williams for another 72,215 sq. ft. to surpass its 30% prelease target. Typical floors in the 13-story building average 26,000 sq. ft.

Designed by renowned architects Cesar Pelli & Associates, 1900 K Street is owned by a group of Dutch pension funds with investment assets in excess of $14 billion, managed by PVF Real Estate. The Kaempfer Company, founded in 1977 and considered one of Washington's most active development and investment firms., has developed over 3 million sq. ft. of commercial space in the Washington metropolitan area. (See page 114 for a better look at 1900 K Street and its architect.)

D.C. HQ project uses revenue bonds

A $69 million, headquarters office building for the American Association for Advancement of Science (AAAS) is now under construction at 1200 New York Avenue, N.W., in Washington, D.C., one block from Metro Center. AAAS will occupy the top seven floors in the 12-story, 200,000 sq. ft. building, while three floors will be leased to office tenants and the first and second floors will house facilities to accommodate a range of activities for scientists, educators, local students and members of the public.

The bulk of the financing ($52 million) is through D.C.-backed low-interest, tax-exempt revenue bonds approved three years ago. The bonds will save AAAS about $40 million in interest over the first 30 years of occupancy. The bonds are backed by NationsBank and will be marketed by Goldman Sachs.

The building was designed by project architect Henry N. Cobb of Pei Cobb Freed & Partners of New York, with Randolph Croxton of Croxton Collaborative of New York serving as consultant.

San Fran's One Market gets new owner, new life

Equity Office Properties Inc. is now seeing the fruits of pumping $37 million into renovating and repositioning San Francisco's One Market, the city's second largest commercial building. The recent grand unveiling of the 1.45 million sq. ft. property was by all counts a success for the nation's 10th-largest owner and manager of office buildings. Cesar Pelli is project architect.

Equity plans to use One Market as a stepping-stone to further buys in the Bay Area. The company already owns 3.8 million sq. ft. in California property.

ONE TO WATCH

Hines, TCW, Dean Witter Form New Venture

Emerging market countries are the target of a new venture just announced by Hines Interests Limited Partnership, The TCW Group, Inc. and Dean Witter Realty Inc. These three players will be searching out acquisition, development, operation and disposition opportunities on a global basis, focusing primarily on developing modern office, residential and mixed-use space in emerging European, Asian and Latin American countries for Hines Interests' existing clients and other blue-chip American, European and Asian multinational corporations.