SPP taps Cushman for Water Street offices

Water Street Tampa developer Strategic Property Partners (SPP) has switched teams and hired commercial real estate brokerage firm Cushman & Wakefield to both lease and manage a pair of new office buildings within its 56-acre, downtown development.

The first of the two towers, at 1001 Water St., is under construction and will be delivered next summer, next to the $152 million University of South Florida Morsani College of Medicine and Heart Institute.

The 20-story tower, designed by COOKFOX Architects, will contain 380,000 square feet and become the first new dedicated office tower to open in downtown Tampa in 29 years.

 To date, the building has lured just a single tenant, Chicago-based audit, tax and consulting firm RSM US LLP, to 15,000 square feet.

“1001 Water St. will be the premier, trophy office property in Tampa,” says Mercedes Angell, a Cushman & Wakefield senior director who is working to lease the SPP buildings with the firm’s Barry Oaks, James Garvey and Ashley James.

“We’re very focused on attracting the attention of local and regional tenants,” Angell adds.

Cushman & Wakefield’s Hank Brenner, Chris Brown and Brett Angarola will manage 1001 Water St. The firm also manages the three-office MetWest complex in the Westshore business district; the 38-story Tampa City Center; and 100 N. Tampa St.

Previously, SPP had selected brokerage rival JLL to lease and manage both new buildings.

But much has changed since.

When SPP broke ground on 1001 Water St. last year, JLL and officials there indicated they would seek to lure tenants from New York, Boston and Chicago that wouldn’t blanch at the roughly $55 per square foot asking rental rate.

By comparison, Class A office rents in downtown Tampa hover between $32 and $39 per square foot.

At the time, downtown office vacancy stood at about 9% and was shrinking amid a lack of new inventory, and SPP — a joint venture between Microsoft Corp. Co-Founder Bill Gates and Tampa Bay Lightning owner Jeff Vinik — believed it was close to signing tenants to take down five or more floors.

The last new office towers in downtown Tampa were completed in 1992, when the 42-story 100 N. Tampa St. and the 36-floor SunTrust Financial Centre debuted.

But the deals in 1001 Water St. didn’t materialize, and in the months since, COVID-19 has largely stalled office leasing activity throughout the U.S.

Today, Angell says marketing efforts will primarily be directed at firms in the Tampa Bay area. Gone, too, are the mid-$50 asking rents.

“The reality is most transactions are local,” she says. “We plan to be hyper-competitive with rental rates.”

She declined, however, to provide exact figures.

What has not changed at 1001 Water St., though, is SPP’s focus on wellness. Advanced air filtration systems are being installed and a penthouse amenity center will contain indoor-outdoor meeting rooms and expansive terraces throughout.

Angell contends that focus will help leasing efforts, especially as companies begin to return to offices.

Water Street Tampa’s first phase contains eight new buildings, all slated to be completed by the end of next year, including a 26-story, 519-room JW Marriott Hotel, a 172-room Marriott Edition hotel with 37 adjacent residences, more than 1,300 new apartments and 150,000 square feet of retail space.

400 Channelside is planned to contain 500,000 square feet of office space on its 19 floors. No date has been set for construction on the Gensler-designed building.

 “Cushman & Wakefield excels in the national and local Tampa markets,” says David Bevirt, an SPP executive vice president of corporate leasing and strategy, in a statement.