Oil giant Chevron sold its empty 10-story office tower in Northwest Houston and took a massive haircut.
Doug Agarwal’s Capital Commercial scooped up the property at 1001 Noble Energy Way and adjacent parking garage for $18.2 million, or $35 per square foot, the Houston Chronicle reported.
The deal, which closed in late December, marks a significant price reduction from the $130 million, or $250 per square foot, the property was valued at before becoming fully vacant.
The 515,000-square-foot building once housed Noble Energy employees, who were relocated after Chevron acquired the company in 2020.
Austin-based Capital Commercial’s purchase is part of its aggressive investment at the lower end of the Texas office market, which has seen a rise in vacancies amid broader economic uncertainties.
The firm has been rapidly expanding its holdings across the region, buying up 1.2 million square feet of office space in Houston last year.
The acquisition adds to Capital Commercial’s growing portfolio in Houston, which includes several in the Katy Freeway area that were purchased at prices as low as $50 per square foot. The firm recently landed a 63,000-square-foot tenant for Offices at Greenhouse, at 19219 Katy Freeway in the Energy Corridor, which it bought for $87 per square foot last year.
The company’s ability to identify and secure undervalued properties has enabled it to weather the challenges posed by high office vacancies, with expectations that demand will rise as businesses return to office spaces and Texas continues to experience in-migration from other states.
The firm has been one of the most active buyers of office space in Texas over the past five years, according to Steve Triolet, senior vice president for research and market forecasting at Partners.
Agarwal aims to replicate the success of past investments, including the acquisition of the 11450 Compaq Circle Center property, which was just 30 percent leased when Capital Commercial bought it in 2022. That building is now 50 percent leased, with expectations it will be 75 to 80 percent leased by late 2026.
— Andrew Terrell
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