Talisman Energy USA, Inc. is one of Canada's largest global oil and gas exploration and production companies.

Talisman1   Talisman2

The challenge

In March 2010 Colliers' Calgary office contacted our Houston office to assist their client, Talisman Energy, to immediately secure 15,000 square feet of Class-A space in Houston's The Woodlands submarket. Talisman wanted to be in this high-profile, tight-occupancy submarket because they had entered into an agreement to purchase certain operations of a firm located there.

This was the first event in a rush to assist Talisman in their rapid growth in Houston. Over the next 18 months, Colliers' Houston office worked closely with our Calgary office and Talisman to gain expansion space twice and finally to negotiate space to accommodate the company's long-term needs.

A significant requirement was that Talisman be in an area of oil and gas company concentrations because the company would be hiring a large number of employees. This in a city whose oil and gas industry was experiencing explosive growth and employment was among the tightest in the nation.

The strategy

At the time of the first contact, Class A vacancy in The Woodlands was under 5%. Nonetheless, we identified 15,000 square feet in a recently completed building in The Woodlands. Within 60 days a 70-page lease had been executed by both parties.

To satisfy Talisman's first need for additional space - 30,000 square feet - we drew on tightly structured expansion language embedded in the original lease. We also leveraged the landlord's desire for flexibility to pursue a significant prospective tenant in return for Talisman acquiring improved expansion economics and structuring.

Six months later when Talisman estimated their actual long-term need would be 100,000 square feet more, Houston performed an in-depth review of all major submarkets within the Greater Houston area. We short-listed and vetted nine submarkets for office space opportunities; preponderance of oil and gas company concentration; and quality of adjacent residential communities, schools and local traffic patterns. Talisman's conclusion was to remain in The Woodlands and pursue a new development, Research Forest Lakeside.

A 70,000 square foot building was nearly complete, and the master plan included development of an additional 1.6 million square feet over time. Due to the dearth of options in The Woodlands and major players looking for space, the 70,000 square foot property was already in play.

The results

Just 20 months after Colliers' Calgary office contacted the Houston office, Talisman executed a two-year lease with the maximum amount of market concessions, structuring, and delivery for the entire 70,000 square foot building. Simultaneously, they executed a 12-year lease for the top six floors (150,000 square feet) of the developer's not-yet-fully-designed Gold LEED office tower.

In addition to transaction services, Colliers' Houston office has provided Talisman with construction and fit-up management and supplied interim Facility Management personnel until Talisman could manage those day-to-day details.