The Teacher Retirement System has a 10-year lease for about 100,000 square feet of space in the Indeed Tower, which is still under construction on W. Sixth St. It will house TRS’ 180-person Investment Management Division. Several months ago, TRS initially refused to divulge the rental cost, explaining the agency feared that doing so would put it at a competitive disadvantage in the marketplace.
But TRS partially complied with a second public information request submitted this month by the Austin American-Statesman, and the newspaper reported that the base rental rate of $38.50 per square foot, or about $326,000 a month, will increase periodically to top out at $45.25 per square foot, or about $383,000 a month.
That’s an increase from $3.9 million a year initially to $4.6 million in the final year of the lease agreement, and it doesn’t include additional charges for operating expenses, such as TRS’ pro-rata share of property taxes and shared amenities, which commercial tenants also typically pay, the newspaper said.
Real estate experts told the American-Statesman that the rate is lower than the current average for top-end office space in downtown Austin, but it’s higher than the amounts paid for most state office leases in the city, many of which are outside the downtown area.
Since agreeing to the office tower lease, the TRS board has authorized its staff to enter into negotiations for long-term planning of a new TRS headquarters outside the downtown business district. TRS has outgrown its downtown facilities at 1000 Red River St., the agency says. TRS will evaluate whether to keep the Investment Management Division in the leased space in the Indeed Tower or eventually move the division to the new headquarters.
The TRS staff also is exploring opening regional offices in some areas of the state to reach more members closer to where they live.
Here is the full Austin American-Statesman story. https://www.statesman.com/business/20200124/trs-rent-starts-at-326000-per-month
Here is a newspaper editorial. https://www.amarillo.com/news/20200128/our-view-all-trs-lease-information-should-be-available-for-public-scrutiny/1