Griffin Capital Essential Asset REIT, Inc. has acquired a six-story, 149,700 rentable square foot office building in Houston, TX, for $48.75 million plus closing costs.
The asset is 97 percent leased to Schlumberger Technology Corp under a triple-net lease that expires in January 2024. The asset is a mission critical financial hub for Schlumberger Technology Corporation, the world’s largest oilfield services company.
The remaining 3 percent of the building is leased to a Fitness Center, Citiline Deli and the management office.
The implied initial capitalization rate for the Schlumberger property is approximately 6.26%.
Schlumberger Technology Corp. supplies geoscience, engineering, drilling, and data management software products and computing services for the oil exploration and production industry.
The Schlumberger property is within Houston’s Energy Corridor Submarket and has immediate access to I-10 and Houston’s main transportation network. It is close to Schlumberger Limited’s corporate headquarters in the Galleria Submarket.
Schlumberger Technology Corporation has leased the Schlumberger property since 2012 and has executed two lease amendments to expand their footprint into virtually the entirety of the Schlumberger property.
The rent schedule for the remaining term of the lease is as follows:
Current $ 2,964,000 $ 20.50
February 2015 $ 3,036,000 $ 21.00
February 2016 $ 3,109,000 $ 21.50
February 2017 $ 3,181,000 $ 22.00
February 2018 $ 3,253,000 $ 22.50
February 2019 $ 3,326,000 $ 23.00
February 2020 $ 3,398,000 $ 23.50
February 2021 $ 3,470,000 $ 24.00
February 2022 $ 3,543,000 $ 24.50
February 2023 $ 3,615,000 $ 25.00
Griffin Capital Essential Asset REIT Property Management will be responsible for managing the Schlumberger property and will be paid management fees in an amount of 3% of the gross monthly revenues collected from the Schlumberger property.