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Commercial Real Estate
Business Observer Friday, Apr. 26, 2019 2 months ago

Lease sparks office activity at Water Street Tampa

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Chicago-based accounting firm becomes the first office tenant in $3 billion project transforming downtown Tampa
by: Kevin McQuaid Commercial Real Estate Editor

Strategic Property Partners (SPP) has announced new hotels, restaurants, entertainment and even institutional users at Water Street Tampa, its $3 billion redevelopment of a 52-acre swath anchored by Amalie Arena downtown.

But no tenants have been revealed for the roughly two million square feet of new office space that SPP, a partnership between Tampa Bay Lightning owner Jeff Vinik and Bill Gates’ Cascade Investment, is planning  — until now.

RSM US LLP, a fast-growing Tampa branch of a Chicago-based network of independent accounting practices, says it will relocate to SPP’s Sparkman Wharf retail and office complex from another downtown building in July.

RSM also plans to move a second time in 2021, into SPP’s 20-story 1001 Water St. project, a tower that will be one of the first new office developments in downtown in a quarter century.

“We as a firm want to be right in the middle of it all,” says Danny Jackson, RSM’s Tampa market leader. “Everyone here is fired up about doing something new, being somewhere new. We looked at a number of potential offices but ultimately said ‘let’s take a chance and trust in the momentum that Vinik and his group have created.”

The planned office shift comes amid significant employee growth.

In 2015, the firm opened in Tampa in the Wells Fargo Center, at 100 S. Ashley Drive, with just seven employees. Today, the practice employs 78, and projects that figure will top 100 by next year.

The moves should more than accommodate the company’s personnel surge, though.

From 4,500 square feet in Wells Fargo Center, RSM will slide into 9,500 square feet at Sparkman Wharf and as much as 22,000 square feet in 1001 Water St.

In all, Sparkman Wharf will contain 180,000 square feet of office space, along with 10 restaurants and a biergarten.

The building will be the first of three new office offerings in Water Street Tampa, along with 1001 Water St. and a 19-story building at 400 Channelside Drive.

SPP is expected to move into 30,000 square feet in Sparkman Wharf, the former Channelside Bay Plaza, when office renovations are completed later this year. The restaurants and biergarten debuted last November.

SPP CEO James Nozar describes Sparkman Wharf as “an entirely new working environment that is unlike anything else in the city.”

Among its unique features, the building has 40-foot ceilings.

Nozar adds the two-story project will provide a “well-rounded lifestyle that reflects what Water Street Tampa is all about.”

Jackson, too, says RSM was drawn to Water Street Tampa’s new hotels, entertainment venues and overall lifestyle for its younger workforce.

“Our employees like the idea of being able to walk to work, of having multiple restaurants all around,” he says. “The concept of being able to have a work/life balance at Water Street really kept screaming at us the more places we looked.”

Jacksons says, too, that he expects relocating to Water Street will help the firm recruit new workers — both from the Tampa area and from its other offices around the country in states like Illinois and Minnesota.

Commercial real estate brokerage Savills Inc.’s Chicago and Tampa offices represented RSM in the lease, while Franklin Street and JLL negotiated on behalf of SPP at Sparkman Wharf and 1001 Water St., respectively.

At 1001 Water St., SPP is expected to deliver the most expensive office space in Tampa, renting for roughly $55 per square foot on a gross rent basis, vs. around $35 per square foot for most Class A office space.

COURTESY RENDERING — Accounting firm RSM US will become the first tenant in Strategic Property Partners' planned 20-story 1001 Water St. office building when it debuts in 2021.

“It was significantly higher than other places we looked, but when compared to cities like Austin, and Charlotte, we thought the rent rate was very much in line,” Jackson says of 1001 Water St.

Between Sparkman Wharf and 1001 Water St., RSM has committed to space through 2029 with some adjustment clauses, he says.

SPP intends to begin construction on the 380,000-square-foot 1001 Water St. building this summer, for a mid-2021 delivery.

“There’s something to be said for being a pioneer, and as a firm, that’s who we are,” Jackson says. “This will be an opportunity for us to bump into other businesses and centers of influence, and the building will offer many terrific amenities.”

 

 

 

 

 

 

 

 

 

 

 

 

 

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