Duke Energy Keeps Charlotte Vacancies Low with HQs Move
- Feb 27, 2009
Despite major job loss and the struggling economy, the office market in Charlotte, N.C.’s Central Business District remains one of the tightest in the country with a 2.4 percent vacancy rate–according to a fourth quarter report by real estate services firm Colliers Pinkard–and loyal resident Duke Energy is doing its part to keep it that way. The company’s board has just given the green light for a long-term lease deal allowing the relocation of its corporate headquarters to 500,000 square feet in what will be a 1.5 million-square-foot high-rise that had been planned as a new headquarters for Wachovia Corp. After Wells Fargo & Co.’s $15 billion acquisition of Wachovia, the bank’s need for a new home base in what would have been named Wachovia Corporate Center disappeared, potentially leaving a sizable chunk of premier office space vacant upon the 2010 completion of the 48-story tower at 550 S. Tryon St. (pictured). “When Wells Fargo purchased Wachovia, Wachovia did an analysis of its space requirements and decided not to use the building for its headquarters,” a Duke Energy spokesperson told CPN. The sudden change of circumstances left the door wide open for Duke Energy to consolidate space occupied under soon-to-expire leases in Charlotte under one roof, and bring the operations closer to its current headquarters across the street at 526 S. Church St. Childress Klein is the developer of what will now be called the Duke Energy Center, and Batson-Cook Construction is serving as the general contractor. Designed by the architectural firm of Thompson, Ventulett, Stainback & Associates, the structure will be LEED certified. “This is an energy efficient building; we have been strong advocates for energy efficiency, and this will help us walk the talk,” the spokesperson said. Duke Energy’s new lease with Wells Fargo/Wachovia is actually an expansion agreement, as the company had committed to approximately 250,000 square feet in the planned skyscraper in August 2007. When Duke moves into the building in mid to late 2010, it will be left with the same amount of space it previously had in Downtown Charlotte, but it will have new state-of-the art digs for approximately the same rent. Duke intends to maintain offices in the adjacent 675,000-square-foot structure, which it owns. Other businesses that signed on for space at 550 S. Tryon in advance include Deloitte, which will occupy 82,000 square feet, and law firm Sonnenschein Nath & Rosenthal will make a home in 35,000 square feet of space. As for the future of Charlotte’s office market, darker times may be on the horizon. As per the Colliers report, the recession is finally catching up to the city and paving the way for a weaker market, and new downtown office projects scheduled to reach completion later this year and in 2010 will likely have an impact.