‘For Sale’ Sign Put Up on Enron’s Headquarters
First the “E,” now the whole enchilada.
Enron Corp., the company whose name became a catchword for corporate scandal, has retained New York real estate firm Granite Partners to sell its 50-story, 1.27-million-square-foot headquarters in Houston.
Enron has occupied the tower, which was built in the early 1980s, since 1985.
Under a complex arrangement, the tower is owned by Brazos Holdings, but Enron’s major creditors will receive most of the proceeds of the sale, said Richard Rudd, senior managing director for Granite’s in Houston.
Rudd said he hoped to close a sale by December. No firm asking price has been set for the building, but Rudd said he expected the building to fetch “somewhere over $100 million.”
Finding a taker may be difficult. The downturn in the economy, including the energy sector, has reduced the demand for pricey Houston real estate.
“It’s real ugly,” said Richard Zigler, director of research for O’Connor & Associates, a Houston-based real estate and research firm. “It certainly does not seem like a good time to lease a million square feet.”
Houston’s vacancy rate, including available sublet space, is approaching 19%, according to statistics compiled by Jones Lang LaSalle Americas. In addition, two new office buildings with a total of about 1 million square feet are scheduled to come onto the market soon.
Rick Budd, an expert on the disposition of real estate by bankrupt firms, said the sellers might be disappointed. “If they get $100 million or better I think they will be literally taking that money and running,” he said.
Bids are due by Sept. 19, and the sale must be approved by the Bankruptcy Court.
At the height of its glory days, 7,500 people worked at Enron’s Houston headquarters and other buildings. The company now employs 1,200.
Last year, Enron sold four of the crooked “E” logos that adorned the front of the building for prices ranging from $8,500 to $45,000.
Enron plans to move to another Houston building, 4 Houston Center, in March 2004.
