Situation Analysis
When an anchor tenant occupying 53 percent of the building
vacated in December 2003, 400 North Belt's overall occupancy sank
to 32 percent. Owned by Parkway Properties, Inc., a regional REIT,
400 North Belt is a 12-story, 225,000-square-foot, Class A office
property. In 2003 it was faced with serious leasing
challenges in a submarket with a 30 percent vacancy rate and a
negative yearly absorption of 400,000 square feet.
Owner's Goals
PRS and Mark Preston were selected to re-tenant the building
within six months. The project's abbreviated time frame was the
result of critical underwriting concerns by Parkway Properties,
Inc. The owner also planned to handle leasing and tenant
retention after Mark's specific assignment was complete.
Strategies & Solutions
Mark analyzed comparable properties in the market and identified
the property's competitive advantages. He and his team
fine-tuned rent concessions and rate structure. Since 95 percent of
all office leasing transactions in Houston involve a broker
representing the tenant, an interactive website was developed to
target brokers. The website was the first of its kind in the
market. It became a 24-hour infomercial on 400 North Belt, with
details such as stacking plans, lease agreements and floor plans
available online. Mark also initiated an informative, interactive
e-mail campaign for tenant brokers. In addition, Mark's team
established a creative commission index to include the in-house
leasing team as requested by the owner.
Results
No other building in the Greenspoint office market performed as
well as did 400 North Belt from January to June 2004. In the first
40 days, Mark's high-velocity leasing doubled the property's
occupancy. After six months, occupancy crested at 92 percent with
the signing of three global headquarters tenants, totaling more
than 140,000 square feet.
