| The downtown Houston office market is a hot | | | | dunk. Two major tenants, Burlington Resources |
| topic these days. Recent months have seen a | | | | and Bank One, are expected to vacate CBD |
| flurry of activity, whether it be leases, | | | | space in 2006 after acquisitions by |
| move-outs, or acquisitions. It's no secret | | | | ConocoPhillips and Chase, respectively. In |
| that the downtown market continues to be | | | | the same building Burlington is expected to |
| plagued by average vacancies painfully close | | | | vacate, Calpine Corp. reduced the amount of |
| to 20% and stagnant rents. With the thought | | | | space they lease and subsequently lost naming |
| that things will improve in the near future, | | | | rights to the former Calpine Center, now |
| investors have been purchasing properties in | | | | known by its address, 717 Texas. |
| earnest. The fourth quarter news was | | | | |
| encouraging, notably EPCO, Inc.'s acquisition | | | | Questions still remain about when the |
| of 1100 Louisiana, a building in which they | | | | downtown office market will see a substantial |
| have subsequently occupied 300,000 square | | | | improvement. It did not happen with the |
| feet. Also, Wells Real Estate Funds paid the | | | | recent influx of New Orleans office tenants, |
| highest per-square-foot price in the Houston | | | | as some thought it would. However, strong job |
| office market's history ($286 psf) for 5 | | | | growth has many experts predicting a healthy |
| Houston Center. Rumor has it that | | | | 2006 for the Houston office market overall, |
| ChevronTexaco is interested in purchasing the | | | | and with the positive fourth quarter numbers, |
| remaining vacant former Enron building, while | | | | it appears the market is moving in the right |
| other energy companies have begun to reclaim | | | | direction. The office market had a |
| shadow space downtown. | | | | relatively strong showing in the fourth |
| | | | quarter, absorbing 414,678 square feet (SF), |
| Unfortunately, the Central Business | | | | the market's highest quarterly absorption |
| District's recovery is anything but a slam | | | | figure since the third quarter of 2004. |