California-based real estate firm KBS Capital Markets has entered into two leases at its Greenhouse offices in Houston, Texas.
The company successfully renewed the property’s second tenant, J. Connor Consulting, in the second quarter of 2021, according to a press release on its recent portfolio update meeting. The lease for the 32,066 square foot building has been extended from 2023 to 2031.
KBS has also signed a new lease for restaurant franchisor SPB Hospitality, which sublets the space to US multinational engineering firm AECOM. The lease is renewed of KBS’s agreement with SFB in March this year and is providing 42,000 square feet for a portion of that space to be vacated by AECOM in 2025. Greenhouse’s offices are located at 19219 Katy Freeway and are owned by KBS Growth & Income Real Estate Investment Trust.
The portfolio consists of four assets of approximately 600,000 square feet and a weighted average lease term of 3.5 years, said Marc DeLuca, KBS CEO and Eastern Regional President, in a interview.
The year with the largest expiration schedule depicted in the portfolio presentation is 2024, which DeLuca says is due to AECOM. Gio Cordoves, Western Regional President of KBS, provided more details on the relationship between AECO and SFB Hospitality during the signing of the lease.
“They are currently sub-tenants at AECOM and expire at the end of 2024, so this direct lease begins immediately after and extends through 2030,” he said.
“As Marc had discussed the expiration of AECOM’s lease at the end of 2024, the SPB lease now covers a considerable portion of this AECOM space and reduces our overall exposure at the expiration of AECOM’s lease by 67% of this property at 46%. Between SPB’s lease and J. Connor’s previous anticipated extension, these two transactions provide significant stability to nearly 40% of this property and, therefore, make it a much more attractive investment offer for potential buyers in the future.
KBS owned 16 properties throughout Texas as of March 2022.
[KBS Capital Markets] — Jacques Bell