HOUSTON – (Realty News Report) – The 1801 Smith tower has been sold, breaking what seem like an eternal dry spell in the capital markets world.
The 20-story office building was purchased by John Quinlan, an attorney and investor who also owns the adjacent 500 Jefferson building.
DRA Advisors was the seller of the 458,000-SF office tower, which was built in 1972 and was formerly known as 600 Jefferson.
Quinlan’s purchase price was $45 per SF, or approximately $20.6 million.
Whether you call it 600 Jefferson or 1801 Smith, vacancy has been a problem for the building in recent years. The Cullen Center Bank & Trust departed many years ago – in an era when Smith Street was the headquarters address of Continental Airlines and the “Crooked E” monument stood in front of the Enron building.
The 1801 Smith building was once known as Continental Center II. A remnant of that era was erased in 2019 when United Airlines, which occupied about 43,000 SF, moved out of the building. The tower’s occupancy rate drifted below 40 percent and drained even lower in recent years.
The Houston Fire Department moved out April 1, 2021, taking the building’s occupancy down to 15 percent. The fire department moved across the street to Quinlan’s 500 Jefferson building.
And with the coronavirus impacting the office market, finding new tenants is not an easy proposition. A recent $11 million redo beautified the 1801 Smith tower substantially, but the overall office market conditions have been rough across Houston.
A recent report from NAI Partners said Houston’s citywide vacancy rate was 23.9 percent in February, up from 21.8 percent a year ago. The softness in the office market and the building’s low sales price should enable 1801 Smith to compete by offering lower rental rates.
Located in the southern part of downtown, the 1801 Smith tower was part of the original Cullen Center, a 12-acre urban office development announced in 1959 by Hugh Roy Cullen.
April 3, 2021 Realty News Report Copyright 2021
Caption: The 1801 Smith tower in Downtown Houston has been sold. Photo credit: Ralph Bivins, Realty News Report Copyright 2021.
File: Downtown Houston Tower Sold for $20.6 Million
For more about Houston development, check out the book Houston 2020: America’s Boom Town – An Extreme Close Up by Ralph Bivins. Available on Amazon http://tiny.cc/4a2g6y