Houston-based Enterprise Products Company ("EPCO") and Hines, an
international real estate firm, have inked a definitive agreement.
Per the deal, an affiliate of EPCO will purchase Shell Plaza in the
central business district of Houston from the Hines U.S. Core
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EPCO and its affiliates are known to hold major interests in energy
Enterprise Products Partners LP
), along with real estate holdings in the Houston area, including
the 1100 Louisiana office building.
Shell Plaza, spanning 1.8 million square feet, is an office complex
comprising two buildings - One Shell Plaza and Two Shell Plaza. The
construction of Shell Plaza concluded in 1970. The North American
headquarters of Shell Oil Company and the law firm Baker Botts LLP
- Shell Plaza, was developed and designed by Hines and Skidmore,
Owings & Merrill, respectively.
The acquisition news was first reported in an industry trade
journal released last week that estimated the purchase price at
$550 million. However, the cost detail was not revealed by the
The deal is expected to be closed in August 2012 and is subject to
usual due diligence. Upon closure, Hines will remain responsible
for the management as well as lease of Shell Plaza.
EPCO was established in 1968 by the late billionaire Dan Duncan.
Currently, the affiliate acquiring Shell Plaza is under the
management of Duncan's daughter Randa Duncan Williams, Ralph
Cunningham and Richard H. Bachmann.
EPCO considers Houston an emerging hub for global finance, which
offers desirable environment for business growth and development.
The company's long-term investment in the region supports this
Enterprise Products Partners holds a Zacks #3 Rank, which
translates to a Hold rating for a period of one to three months.
Longer term, we maintain a Neutral recommendation on the stock. The
partnership faces competition from its peers
Kinder Morgan Energy Partners L.P.
Enbridge Energy Partners