Brookfield Properties Unveils Another Chapter

HOUSTON – (Realty News Report) – Heritage Plaza was one of the last skyscrapers to break ground in Houston’s great construction boom of the early 1980s. By the time the downtown tower was finished in 1987, the Houston economy was in trouble. Financial institutions were failing, foreclosures plagued the real estate market and office vacancy reached catastrophic levels.

No stranger to adversity, a completely refreshed version of the 53-story building is being reintroduced to the Houston market in 2021 as the city revives from a coronavirus beat-down and last year’s historic oil price collapse. Office vacancy remains high – city’s the overall vacancy rate hit 24.4 percent in the second quarter, reports NAI Partners.

But the owners of Heritage Plaza, one of the most distinctive buildings on the skyline, believe the building’s big-budget redo has made the tower a standout.

Led by Houston-based Kirksey Architecture, Heritage Plaza’s redesign enhanced the volume and geometry of the interior space and focused on creating a clean and modern design.  Lighter finishes replaced the dark and heavy. using a brighter material palette.

The building, located at 1111 Bagby, has  1.1 million SF of Class AA office space and 29,000 SF of retail. And it’s connected to the tunnel system.

Building’s Top Inspired by Mayan Temples

A centerpiece in many city-booster promotional photos of the downtown skyline, Heritage Plaza features a distinctive stepped top which was inspired by Mayan temples. M. Nasr & Partners was the architect.

Construction on the redo began in October 2019 with O’Donnell/Snider Construction as the general contractor.

“The delivery of Heritage Plaza serves as a major milestone moment for our Houston portfolio,” said Travis Overall, Executive Vice President and Head of the Texas Region for Brookfield Properties. “We have spent the last five years transforming our Houston assets into best-in-class work environments that offer unmatched amenities and destination retail. The renovations are reflective of the changing workforce and meet the needs of current and future tenants.”

Brookfield Properties, like other downtown property owners, have been motivated to spend heavily to renovate aging buildings in the competitive downtown office environment. Houston’s 40-year-old buildings constructed in the 1980s boom cycle are now competing against newer towers, such as Hines’ Texas Tower, a 47-story building slated for completion later this year.

Massive Downtown Redo Program

At the Allen Center, Brookfield’s first big renovation started about five years ago, carrying a price tag of $48.5 million. Since then, Brookfield renovated most of its 10.4 million SF downtown portfolio – plus the firm redeveloped the 354-room Doubletree Hotel, rebranding it as the C. Baldwin.

In its redo spree, Brookfield Properties also renovated Houston Center and Total Plaza before finishing up Heritage Plaza. With the hotel, the firm’s downtown expenditures have been estimated around $200 million. Even more property upgrades are expected to follow.

In February 2014, Brookfield Office Properties Inc. entered into a joint venture partnership with AEW Capital Management, L.P. on Heritage Plaza. AEW is the majority owner in Heritage Plaza. Brookfield Properties has since continued to oversee the leasing, property management, and recent redevelopment of the tower.  AEW’s investment in the tower was about $475 million or $413 per SF for a stake that was believed to be around 85 percent.

“We believe that providing a first-class tenant experience is key to the long-term performance of our assets, and we are very excited about the new Heritage Plaza,” said Michael Byrne, Chief Investment Officer and Head of Private Real Estate and Debt at AEW. “In partnership with Brookfield Properties, we believe that we have executed on a project that will solidify Heritage Plaza’s place as one of Houston’s trophy office destinations.”

The “Reconceptualized Arrival Experience”

Key elements of the Heritage Plaza renovation include: a “reconceptualized arrival experience” with a new exterior glass curtain wall at the corner of Dallas and Brazos Streets.

Kirksey said the previously dark, heavy façade has been transformed through the integration of a glass curtain wall system. The three-story Kawneer 1600 Wall System offers unobstructed views between the interior and exterior allows natural lighting into the lobby.

There is now a sense of transparency and openness as tenants and visitors enter the main lobby.An escalator, which bisected the lobby, was replaced with a new stair that was shifted to the left side of the lobby, allowing for a more open floorplan. A new social stair anchors the space and serves as an alternative environment for working or socializing. The social stair includes banquette seating and a multitude of power and USB outlets.

Malarkey: “Hospitality Driven Palette”

“We wanted to really open up the crowded lobby by eliminating many of the entry columns and central escalator while not ignoring the decorative nature of the original space,” said Brian Malarkey, Executive Vice President, Director of Interior Architecture at Kirksey Architecture. “The result is a much more inviting lobby with a more hospitality driven palette.”

Kirksey’s design approach was rooted in creating a warm environment by integrating wood and plant life into Heritage Plaza’s redesign and opted for timeless materials that celebrate materiality.

“The playful color schemes selected for the rug and furniture packages lean toward jewel-toned blues and purples that marry beautifully with the natural materials added to the space,” Kirksey said.

Heritage Plaza also features a skybridge connection to the C. Baldwin hotel.

An energy company, EOG Resources. is the largest tenant at Heritage Plaza, occupying over 350,000 SF for its corporate headquarters. In January 2019, Big Four professional services firm, Deloitte extended its 204,210-SF lease after being a tenant for a dozen years.

Brookfield bought Heritage Plaza in 2010 for an estimated $321 million or $280 per SF from Goddard Investment of Atlanta. The exact price was never verified.

July 26, 2021 Realty News Report Copyright 2021

Heritage Plaza photo credit: Ralph Bivins, Realty News Report. Copyright 2021

For more about Texas real estate, check out the book Houston 2020: America’s Boom Town – An Extreme Close Up  by Ralph Bivins. Available on Amazon  

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