Good news for downtown
Heritage Plaza to be sold in one of Houston's biggest real estate deals ever
The distinctive top of the building resembles a Mayan templePhoto by Ralph Bivins
The proposed sales price is $325 million, making it one of Houston's biggestreal estate deals ever.
The skyscraper stands out in the downtown Houston skyline.Photo by Ralph Bivins
Downtown Houston’s Heritage Plaza building, often the photographic centerpiece of numerous skyline pictures, is reportedly being sold for a whopping $325 million, making it one of Houston’s biggest real estate deals ever.
The 53-story building, with a top shaped like a Mayan temple, will be sold to the Brookfield Office Properties real estate firm, according to a report in Real Estate Alert, a reliable national trade newsletter that serves institutional real estate investing community.
The deal would set a new standard for investors contemplating buying skyscrapers in downtown Houston, said realty investment expert Mary L. Carolan, senior managing director of Allied Advisors of Houston.
“It’s going to set a watermark for the expectations of pricing for other Houston office owners,” Carolan said. “It’s a multi-tenant top-tier office building and I think this sets the tone.”
Carolan said Houston office towers had generally been thought to be capped at no more than $250 per square foot. The Brookfield deal, at $285 per square foot, breaks through that barrier.
The proposed sales price exceeds the top amount it was believed the building could fetch only a few months ago. A July CultureMap story speculated that the sale of the distinctive skyscraper could approach $300 million.
The Heritage Plaza sale to Brookfield, if completed as planned, could impact the market for years to come and give a new level of confidence to investors.
The 1.2 million-square-foot building, 1111 Bagby in downtown, was completed in 1987, just as Houston’s office market was in the midst of its worst decline ever. The tower was purchased in 2005 for $130 million by a group led by Goddard Investment Group of Atlanta.
Goddard has been working to sell the building for several months.
Brookfield, which owns the Allen Center high-rise complex and other major Houston buildings, could not be reached for comment late Wednesday.
