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March 13, 2019  

Goldman Team Lists Upgraded Austin Offices

A Goldman Sachs Asset Management partnership plans to market a recently renovated office building in Austin that could fetch about $235 million.

The 390,000-square-foot Chase Tower, at 221 West Sixth Street in the Central Business District, is about 90% leased. The estimated value works out to just over $600/sf. Goldman and its partner, Lincoln Property of Dallas, have awarded the listing to Cushman & Wakefield, which is expected to begin the marketing campaign soon.

The 21-story building was completed in 1974. The Goldman team acquired it in January 2017 for $175 million, or $449/sf. CBRE advised the seller, Spire Realty of Dallas.

Goldman and Lincoln then renovated the Class-A property and raised rents on new leases to more than $40/sf on a triple-net basis. However, the average rent remains the below the market rate, so part of the pitch is that a buyer would have room to raise rents as leases roll over.

The tenant roster includes WeWork, which has subleased several floors to Facebook.

The private Headliners Club is on the top floor. The property also includes a 2,900-sf fitness center and an adjacent seven-story garage with 740 spaces.

The Central Business District’s 10.8 million sf of office space was 92.3% leased at yearend. Class-A space was 94.1% leased, with an average gross asking rent of $58.16/sf, up 6.8% from the previous year.