Enbridge to move Houston office to Energy Corridor, inks big sublease

By Olivia Pulsinelli, Houston Business Journal

Canada-based energy infrastructure giant Enbridge Inc. (NYSE: ENB) will move its Houston office to the Energy Corridor.

Enbridge has subleased nine floors in the Energy Center Five building at 915 N. Eldridge Parkway from Houston-based McDermott International Inc. That’s roughly half of the 18-story, 524,323-square-foot building, which was completed in 2016.

The exact square footage of Enbridge’s new 14-year sublease was not immediately available. However, the company currently occupies about 620,000 square feet at its nine-story office at 5400 Westheimer Court in the Galleria area. Based on the company’s current staffing levels, Enbridge only needs about half of the amount of its current space, spokesman Michael Barnes told the Houston Business Journal.

Enbridge has approximately 1,000 employees at its Houston office, and the new space will still have room for the company to grow, Barnes said.

The move is expected to start in July. Enbridge’s current lease in the Galleria area is set to expire in 2026.

“Enbridge is proud to be part of the Houston business community and the leader in the energy midstream business,” according to a statement sent to the Houston Business Journal. “Moving to the Energy Corridor places us front and center in the energy hub of Houston. We’ll be in close proximity to collaborate with many of our customers and colleagues. It’s an exciting opportunity for us.”

Names of the brokers who negotiated the Energy Center Five sublease were not immediately available. Trammell Crow Co. and Principal Real Estate Investors are the developer and owner of Energy Center Five.

After the spec office tower was completed in 2016, it remained unoccupied until McDermott leased the entire building in late 2018 and moved in about a year later. McDermott consolidated employees from five locations across the Houston area into the building.

The last time the Houston Business Journal ran its Largest Uptown & Galleria Employers List, in 2017, Enbridge ranked No. 1 with 1,868 employees in the area. Earlier that year, Enbridge closed its $28 billion acquisition of Houston’s Spectra Energy, creating a $126 billion combined company. Employees from Enbridge’s Houston office, which spanned eight floors at 1100 Louisiana St. downtown, were consolidated into Spectra’s existing space at 5400 Westheimer Court.

North Carolina-based Duke Energy spun off Spectra in January 2007. Prior to that, Duke Energy Gas Transmission, a subsidiary of Duke Energy, cut a sale-leaseback deal to stay in its 664,000-square-foot headquarters at 5400 Westheimer Court in July 2003, which was also a sluggish time for the office market.

As Dallas-based CBRE (NYSE: CBRE) recently reported, the office vacancy rate in the West Loop-Galleria submarket stood at 27.2% as of the fourth quarter of 2021. Similarly, the Energy Corridor’s vacancy rate was 27.3% for the same period.