Changes are afoot at the Hughes Center months after it landed new owners.
The 1.4 million-square-foot center at Flamingo and Paradise roads makes up about 20 percent of the Las Vegas Valley’s Class A office market, so whatever it does will be influential. Changes thus far have ranged from small — a modified name — to significant, including speculative tenant improvements and new commission structures that have already brought in several major tenants.
A remake of sorts was inevitable when Blackstone subsidiary Equity Office Properties dropped $347 million on the park in September. Perhaps the most visible early difference is the new name — The HC | Hughes Center, designed to reflect “something a little more hip, new and cutting-edge,” said Ryan Martin, senior vice president at Colliers International, the brokerage that handles leasing for the center.
Equity Office Properties has also spent seven figures renovating vacant spaces on a spec basis, transforming interior walls into glass for a more open feel, upgrading lighting and adding the collaborative workspaces in vogue today.
“It’s not your typical office with an assistant out front anymore,” Martin said. “They’re taking that Silicon Valley approach to space and making it a more open, work-play environment.”
Equity Office is also taking a new tack with the commissions it pays brokers who bring in tenants. The company boosted commissions from 4 percent to 5 percent, and it’s paying in full as soon as tenants ink a lease. That differs from conventional practice, which is to pay half of the commission upon signing, and the other half when the deal actually begins. That traditional pay structure can mean big delays getting paid if a tenant needs a few months to remodel before it moves in.
“As the landlord, Equity Office Properties is taking a lot of risk up front, but we also understand this is how brokers make a living,” Martin said. “We want to make it as easy as we can.”
The changes have already brought in high-profile business: Ernst &Young, Consumer Portfolio Services and Lockheed Martin Corp. have signed new leases.
Equity Office is also planning changes along its Restaurant Row, Martin said. The company is looking at tearing down the shuttered Hamada of Japan and replacing it with a building that has four more affordable eateries, such as fast-casual Asian options.
And there’s now a drive-through Starbucks that serves beer and wine, a first for Southern Nevada, Martin said.
On the way are more directional signs and branding on buildings to help visitors find their way around the 68-acre site.
“The Hughes Center is a well-known, well-received brand, but it’s evolving into that next generation of users,” Martin said. “We’re trying to cater to that next evolution of people looking for office space. The market has evolved dramatically, and the branding and the overall package we’re delivering echo where things are headed.”
■ NAIOP Southern Nevada recently announced its 2014 officers and board of directors. Mike Montandon, a former North Las Vegas mayor who’s now with Insight Investment Partners, is president. American Nevada Co.’s Charles Van Geel is president-elect, and Kirk Boylston of EJM Development Co. is immediate past president. Dana Berggren of Avison Young is secretary, and John Restrepo of RCG Economics is treasurer.
Directors are: Sallie Doebler of Jaynes Corp.; Jeff Foster of ProLogis; Jay Heller of Heller Cos.; Christopher Larsen of PGAL; Jennifer Levine of Voit Real Estate Services; Mike Mixer of Colliers International; Kyle Nagy of CommCap Advisors; Rod Martin of Majestic Realty Co.; John Ramous of Harsch Investment Properties; and Mike Shohet of Jones Lang LaSalle.
■ Interwest Capital Corp. of La Jolla, Calif., ended a year of large local commercial deals with a big buy of its own.
The private equity firm spent $75 million in early December to buy Destinations Living One, a 1,113-unit portfolio of four local senior-living properties mostly in the southern Las Vegas Valley.
CompassRock Real Estate will serve as property manager. Interwest officials said they’ll continue to operate Destinations as age-restricted communities, and there’ll be “capital improvements to keep the properties fresh and competitive.”
■ Brokers with Colliers International also reported several big, year-end deals.
Dean Willmore, SIOR, represented buyer Designs for Health in its $3.3 million purchase of a 42,292-square-foot industrial building on 2.8 acres at 151 Gallagher Crest Road, inside Gibson Business Park. Ben Millis of Newmark Grubb Knight Frank represented seller Super Brands LLC.
Scot Marker represented landlord Centra Pecos Legacy LLC in its $2.5 million, 60-month lease renewal to 24 Hour Fitness USA. The health club reupped its lease on 42,010 square feet of retail space at 2556 Wigwam Parkway, inside the Pecos Legacy Center.
Taber Thill helped Quest Software lease 7,800 square feet of office space at 2340 Corporate Circle, inside the Green Valley Corporate Center. American Nevada Realty represented landlord Tech Park 6 LLC in the $975,294 deal.
David Grant and Phillip Dunning represented landlord MCP Airport Center LLC in its 126-month lease of 2,560 square feet of retail space to China Dragon Eastern LLC. The lease, for property inside the McCarran Marketplace at 5905 S. Eastern Ave., is worth $625,139. Bryan Houser of Albright Callister &Associates represented China Dragon Eastern.
Contact reporter Jennifer Robison at firstname.lastname@example.org. Follow @J_Robison1 on Twitter.