‘Invigorating to see this level of activity ... and great way to … begin 2011’
[caption id="attachment_27583" align="alignright" width="320" caption="Morgan Stanley Smith Barney plans to relocate to this northeast Santa Rosa office building in early 2011."][/caption]
SANTA ROSA -- Morgan Stanley Smith Barney's planned consolidation of its two Santa Rosa offices early next year will nearly fill one of the newest top-end office buildings in the city.
The relocation will put about as much office space back on the market in downtown Santa Rosa and the Fountaingrove area in the northeast part of the city as the wealth-management company is set to occupy starting in February.
Trading up by trading spaces has been a common feature of large local office leases this year, according to market experts.
Morgan Stanley signed a 10-year lease with Basin Street Properties for 23,000 square feet at 3562 Round Barn Circle. Basin Street completed the 63,000-square-foot, three-story office building in Fountaingrove Executive Center in late 2009.
The deal is the third in the past year Basin Street has attracted to 3562 Round Barn Circle from other Fountaingrove and downtown Santa Rosa office buildings, leaving about 11,000 square feet on two floors to fill, according to Shawn Johnson, managing partner of Keegan & Coppin, who represented Basin Street in the Morgan Stanley lease negotiations.
Pisenti & Brinker moved from another of Equity Office’s three Fountaingrove Center buildings. RBC Wealth Management moved from 100 B St.
Morgan Stanley Smith Barney is a joint venture between Morgan Stanley & Co.‘s Wealth Management Group and Citi’s retail brokerage units Smith Barney, Quilter in the United Kingdom and Smith Barney Australia. The venture was announced in January 2009 and took effect that June.
Morgan Stanley and Smith Barney had offices in Santa Rosa. Morgan Stanley occupies a 13,000-square-foot office in Equity Office Properties‘ Fountaingrove Center at 3558 Round Barn Blvd. Smith Barney is in 16,000 square feet at 111 Santa Rosa Ave. in downtown Santa Rosa, leasing nearly half the Westamerica Bank building.
“It’s invigorating to see this level of activity in the region and a great way to top off 2010 and begin 2011,” said Scott Stranzl, Basin Street Properties vice president of leasing, in a statement. “The Fountaingrove Executive Center continues to attract prestigious companies because there is still a demand for class A office space in premier locations.”
There have been a number of recent leases of large office spaces in the Santa Rosa area for tenants such as the county of Sonoma’s Employment and Training Division and Winzler & Kelly Consulting Engineers. Those two leases were both consolidations with minor expansions.
But most of the larger deals involve companies moving within the local commercial real estate market for similar amounts of space, according to Mr. Johnson.
“There have been a lot of companies on the sideline trying to determine whether they need additional space and what the needs of their businesses are,” he said. “Companies are taking advantage of the marketplace and doing deals. There are a few larger deals out there, but they are hard to get completed.”