World Class Buys 1.3 MSF Austin Campus
- Feb 15, 2018
One of the most notable office properties in Austin, has just come under new ownership. World Class Property Co. recently completed the acquisition of 3M Austin Center, the 1.3 million-square-foot home of consumer products manufacturer 3M’s electrical markets division. 3M will continue to occupy space at the property for the remainder of 2018.
Originally developed in 1987, the state-of-the-art campus at 6801 River Place Blvd. consists of 11 structures housing office space, labs and an innovation center. Additionally, trails and walking paths weave throughout the 158-acre site. Austin Center offers ample room for growth; the property can accommodate expansion to more than 3 million square feet. World Class isn’t concealing the fact that it has redevelopment plans on its mind.
“This unique property allows us the opportunity to create a one-of-a-kind destination in a phenomenal location in Austin,” Nate Paul, president & CEO of World Class Property Co., said in a prepared statement. There’s already a big selling point in place: The main building complex at Austin Center holds the distinction of being the largest contiguous office building in Austin. World Class expects to make space available for lease post haste, and the property’s location in northwest Austin’s high-tech corridor should prove beneficial to the company’s efforts.
“Although there are some signs that payroll expansion among professional/business services is slowing, Austin’s tech sector is more than making up for the reduced demand,” according to a fourth quarter report by commercial real estate services firm Savills Studley. “Tenants seeking high-quality space in core locations will need to start their search early and be aggressive during 2018.” Despite the cry for square footage among the tech crowd, World Class will have to limit its marketing at Austin Center for a little while, as 3M has a deal to stay put in its digs until 2019.
Office sales volume in Austin’s may have cooled in 2017, per the Savills Studley report, but it didn’t go cold. Within the last few months, Starwood Capital Group snapped up a 1.2 million-square-foot portfolio from Brandywine Realty Trust in a $333.3 million deal, and a joint venture of Lincoln Property Co. and Goldman Sachs purchased the 390,000-square-foot Chase Tower from Spire for an undisclosed amount. Intercontinental Real Estate Corp. shelled out $119 million, or a whopping $663 per square-foot, for the leasehold interest in 201 W. 5th, a 180,000-square-foot tower developed by Lincoln Property Co. in 2016.
And 2018 hasn’t gotten off to a bad start. In January, Lionstone Investments announced its acquisition of a two-building Rollingwood Center complex totaling 214,300 square feet.
Photo courtesy of World Property Co