HOUSTON – (Realty News Report) – Skanska is selling its remaining 10 percent ownership stake in Bank of America Tower, a skyscraper it developed in downtown Houston.
The buyer, an affiliate of Beacon Capital Partners, agreed to pay $24 million. The deal will close in the third quarter, Skanska reported.
The 35-story, 780,000 SF Bank of America Tower is located on a downtown block bounded by Capitol, Travis, Milam, and Rusk streets.
Construction of Bank of America Tower was completed in second quarter of 2019. Tenants include Bank of America, Waste Management, Winston and Strawn, Quantum Energy Partners and Skanska’s own offices.
At the end of 2019, Beacon Capital Partners bought a 90 percent stake in the tower from Skanska, for $373 million. Now Beacon returns almost two years later to buy the remainder for $24 million.
The office market in downtown Houston has been soft and vacancy is high. Madison Marquette reports downtown vacancy was 22.9 percent in the second quarter with the downtown availability rate over 29 percent. New and improved office buildings are outperforming older competing buildings, which can be attractive to tenants with an array of technology advancements and improved design. That advantage is called the “flight to quality.”
Skanska’s Next Downtown Tower Breaks Ground
Skanska USA Commercial Development recently broke ground on another building in downtown Houston. Called 1550 on The Green, the 28-story, 375,000-SF office building will be located adjacent to the Discovery Green urban park.
A key tenant has been signed – the Norton Rose Fulbright law firm and CBRE is handling leasing. It’s being built on part of an assemblage of surface parking lots near Dallas, Lamar and La Branch streets, which Skanska acquired in 2019 for $55 million.
Matt Damborsky, Skanska’s executive vice president in charge of Houston, says its high-rise project, slated for completion in 2024, is receiving strong interest from would-be tenants right off the bat.
“When we started looking at the site, we thought it could be many things. We didn’t think office at the beginning. But we were able to pivot and come up with an office plan that’s very unique with a side-core design. I don’t think you see a lot of those in Houston. So that will give us the ability to have a lot of views into the park,” Damborsky says. Laying out the building interiors with the elevators and restrooms out of the way has other benefits. “We’re bringing in natural light into the elevator lobbies and natural light into the restrooms as well.”
July 20, 2021 Realty News Report Copyright 2021
Bank of America Photo courtesy: Skanska
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 http://tiny.cc/4a2g6y
Houston 2020 Ebook version https://tinyurl.com/4xm7z8b5
File: Skanska Sells Remaining 10 Percent
File: Bank of America, CBRE, Matt Damborsky, Skanska Sells Remaining 10 Percent Stake in Bank of America Tower to Beacon Capital.