A famed Houston investor has taken two floors at one of downtown Houston’s most prestigious addresses.
Fayez Sarofim and Company has leased 60,800 square feet at Texas Tower, located at 845 Texas Avenue, according to Savills. The office lease is a shot in the arm for downtown Houston, which has struggled with high vacancy rates in recent years.
Hines and Ivanhoé Cambridge developed Texas Tower, wrapping up work in late 2021. It sits on the former site of the Houston Chronicle, bounded by Milam, Prairie and Travis streets in the heart of downtown.
The 1.2 million-square-foot, 47-floor tower has avoided the problems plaguing older downtown towers, hitting an 80 percent occupancy rate one year ago. Other tenants include Morgan Stanley, DLA Piper and Hines. The building was designed by Pelli Clarke Pelli.
Egyptian billionaire Fayez Sarofim founded his namesake firm in 1958 and made his fortune investing in blue chip American companies. The company currently holds nearly $32 billion in assets under management.
Fayez Sarofim lists its office at Two Houston Center, part of Brookfield’s 4.5 million-square-foot complex downtown. It is unclear whether the investor plans to keep any of its operations at the old space, and it did not respond to a request for comment.
Asking rents ticked up to $31.77 per square foot in the third quarter, according to Savills. Class A space is scoring slightly higher rates of $36.70 per square foot.
Houston tenants inked deals for 2.3 million square feet in the quarter, down from 2.5 million square feet in the third quarter last year. However, space available for sublease declined to 5.8 million square feet in the past year, a drop of almost 500,000 square feet.
All told, Houston’s office availability reached 29 percent, and inventory increased by 3 million square feet.
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