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05 August 2004, 01:19 PM
Citigroup building sprawling complex
Financial giant's project in Irving is one of area's largest in years
10:55 AM CDT on Thursday, August 5, 2004
By STEVE BROWN / The Dallas Morning News
http://www.dallasnews.com/sharedcontent/dws/bus/stories/080504dnbuscitigroup.8022d.html
Financial giant Citigroup Inc. has quietly broken ground on one of the largest office projects built in the Dallas area in the last decade. The three-building complex with 625,000 square feet of space is under construction in Irving, just south of Interstate 635. Southeast of that site, Citigroup is also poised to build a 225,000-square-foot building on Royal Lane. In all, the four buildings will have 850,000 square feet – comparable to a downtown skyscraper – and cost more than $100 million. The projects have not been announced. Dallas-based Koll Development Co. is building the Citigroup complex in its Regent Center business park near the southwest corner of Interstate 635 and Belt Line Road.
According to building permits, the three buildings will each have three floors and will occupy almost 50 acres. Austin Commercial LP is the general contractor. The fourth three-story building is set to start this fall at Citigroup's 137-acre campus at Royal Lane and Colwell Drive in Las Colinas. Koll Development built the campus in 1998. Koll officials would not comment on the construction Wednesday, and Citigroup representatives were unavailable to provide details. Real estate brokers say Citigroup has been shopping for a location to consolidate its North Texas operations since last year. Cushman & Wakefield of Texas represented the company in its search.
The New York-based financial conglomerate has almost 6,000 employees in the area, according to The Dallas Morning News' D-FW Top 200 rankings for 2003. It has operations in several Irving locations and considered renting space, brokers say. While there is more than 4 million square feet of empty office space in the Las Colinas area, it's not too surprising that Citigroup chose to build, said Greg Biggs, who heads broker Julien J. Studley's Dallas office. "I'm assuming that they just couldn't find the mix of office space that met the needs of their business model," he said. "Almost 90 percent of the vacant space out there is in multitenant buildings," he continued.
"I'm just glad they are making this commitment to the Dallas-Fort Worth area," he said. "It could be as many as 3,000 employees housed in a space that size." And because Citigroup's buildings will be constructed with tilt-up concrete panels and steel framing, the cost "is significantly less than a 10-story building like you would see on the tollway," Mr. Biggs said. Developers said such projects cost from $130 to $150 per square foot to build. Office construction is in a slump – less than 300,000 square feet was being built in all of North Texas at midyear – but the Citigroup project would stand out even during a boom, said Jon Altschuler of Stream Realty Partners.
Huge deal
"It's a huge deal," he said, "and it had been fought over for a long time." "They are not building a 50-story ego building," Mr. Altschuler said. But the overall market would have benefited if Citigroup had decided to rent, he said. "We'd like to see them take down some of the existing vacant inventory," he said, "but there are plenty of others out there. "For every Citigroup, there's going to be 10 corporate users who can and will readily take down existing supply," he said.
Better times
Mr. Biggs said Citigroup's construction may signal better times for the North Texas office market, which has been burdened with one of the highest vacancy rates in the country. "There are a couple of other big deal on the heels of this one that are sniffing around," he said. Koll Development made a name for itself building major corporate projects in North Texas and elsewhere. Its local client list includes Nokia, First Horizon Home Loans, Burlington Northern Santa Fe, Siemens, Haggar and Nortel Networks. Citigroup has had operations in Irving since it bought Las Colinas-based Associates Corp. in 2000. The company still occupies the old Associates headquarters complex on State Highway 114, but those buildings are now owned by an investment partnership.
Financial giant's project in Irving is one of area's largest in years
10:55 AM CDT on Thursday, August 5, 2004
By STEVE BROWN / The Dallas Morning News
http://www.dallasnews.com/sharedcontent/dws/bus/stories/080504dnbuscitigroup.8022d.html
Financial giant Citigroup Inc. has quietly broken ground on one of the largest office projects built in the Dallas area in the last decade. The three-building complex with 625,000 square feet of space is under construction in Irving, just south of Interstate 635. Southeast of that site, Citigroup is also poised to build a 225,000-square-foot building on Royal Lane. In all, the four buildings will have 850,000 square feet – comparable to a downtown skyscraper – and cost more than $100 million. The projects have not been announced. Dallas-based Koll Development Co. is building the Citigroup complex in its Regent Center business park near the southwest corner of Interstate 635 and Belt Line Road.
According to building permits, the three buildings will each have three floors and will occupy almost 50 acres. Austin Commercial LP is the general contractor. The fourth three-story building is set to start this fall at Citigroup's 137-acre campus at Royal Lane and Colwell Drive in Las Colinas. Koll Development built the campus in 1998. Koll officials would not comment on the construction Wednesday, and Citigroup representatives were unavailable to provide details. Real estate brokers say Citigroup has been shopping for a location to consolidate its North Texas operations since last year. Cushman & Wakefield of Texas represented the company in its search.
The New York-based financial conglomerate has almost 6,000 employees in the area, according to The Dallas Morning News' D-FW Top 200 rankings for 2003. It has operations in several Irving locations and considered renting space, brokers say. While there is more than 4 million square feet of empty office space in the Las Colinas area, it's not too surprising that Citigroup chose to build, said Greg Biggs, who heads broker Julien J. Studley's Dallas office. "I'm assuming that they just couldn't find the mix of office space that met the needs of their business model," he said. "Almost 90 percent of the vacant space out there is in multitenant buildings," he continued.
"I'm just glad they are making this commitment to the Dallas-Fort Worth area," he said. "It could be as many as 3,000 employees housed in a space that size." And because Citigroup's buildings will be constructed with tilt-up concrete panels and steel framing, the cost "is significantly less than a 10-story building like you would see on the tollway," Mr. Biggs said. Developers said such projects cost from $130 to $150 per square foot to build. Office construction is in a slump – less than 300,000 square feet was being built in all of North Texas at midyear – but the Citigroup project would stand out even during a boom, said Jon Altschuler of Stream Realty Partners.
Huge deal
"It's a huge deal," he said, "and it had been fought over for a long time." "They are not building a 50-story ego building," Mr. Altschuler said. But the overall market would have benefited if Citigroup had decided to rent, he said. "We'd like to see them take down some of the existing vacant inventory," he said, "but there are plenty of others out there. "For every Citigroup, there's going to be 10 corporate users who can and will readily take down existing supply," he said.
Better times
Mr. Biggs said Citigroup's construction may signal better times for the North Texas office market, which has been burdened with one of the highest vacancy rates in the country. "There are a couple of other big deal on the heels of this one that are sniffing around," he said. Koll Development made a name for itself building major corporate projects in North Texas and elsewhere. Its local client list includes Nokia, First Horizon Home Loans, Burlington Northern Santa Fe, Siemens, Haggar and Nortel Networks. Citigroup has had operations in Irving since it bought Las Colinas-based Associates Corp. in 2000. The company still occupies the old Associates headquarters complex on State Highway 114, but those buildings are now owned by an investment partnership.