Chevron Skyscraper Proposal At 1600 Louisiana St.

[Triton]

I think he was referring to himself, and he is right. He doesnt disclose who he works for or what he does but hes always had the early scoop and hes never been wrong.

Yea, I misread what he wrote. We do have some great insiders here that get the scoop before the regular news outlets, but it's usually those same new outlets such as Biz Journals and Houston Chron that we share here on this forum and in other places. When we post those articles, we can usually agree that gives confirmation from a reputable, usually fact-checked source. That's why I've actually contacted Nancy hoping for any word on this and the Shell campus that I've been told about myself.

[urbanize713]

I cannot disclose the relationship but I personally spoke to someone who is ACTIVELY working on the tower project from inside Chevron. That conversation took place this year. They echoed what has been said on here wich is cash will be set aside/earmarked at the end of the year.

They stated that unless something drastic happens once funding becomes available the project will move forward.

Edited January 29, 2014 by urbanize713

[TBooze]

I have some new information on the Chevron deal. I have a source who's family is part of the limited finance partnership for the 58-story Energy Tower project in Midland. They are exceedingly wealthy and pretty clandestine on the details but here's what I have. His dad is a very well known businessman, philanthropist and investor. Take it for what it's worth:

 

Chevron's downtown tower is in jeopardy and might be scrapped all together.

 

Chevron has recently shopped Tower 1 and 2 (former Enron) to Texas Pacific. By recently, he means very recently (wasn't specific).

 

Exxon, according to my source, has set the example and both Shell and Chevron have taken notice. According to 'him', Exxon has shown that it is cheaper to build in the burbs, with the ability to spread out and own adjacent parcels of land for later expansion than it is to build in the CBD. His words, not mine. This makes sense that Chevron would be looking for cheaper capital investment projects since they're Australian project is running way over budget.

 

Btw, he also said the HQ of Exxon will relocate to the new campus in the next few years. He said this campus was built and designed strictly for that purpose. He also mentioned that a new high-rise of some sort will be erected near the campus as an "architectural marvel" when the HQ is relocated.

 

Chevron appears to be far more interested in the Camp Strake parcel than what we are being lead on to believe. He couldn't give me much information due to the sensitivity of the discussions taking place. When asked on a scale of 1 to 10 how serious they are of abandoning both downtown buildings and scrapping the third, my source said "8." 

 

He had no details on a Shell relocation to Montgomery County. The info. might seem vague but it was like pulling teeth to get the aforementioned out of him. If you have any specific questions, perhaps you can send them over and I can ask him but there's no guarantee I can get you an answer.

 

This is about as close to the horses mouth as you can get. Will try and dig for more info. later on. I just don't really know what probing questions to ask.

 

Hadn't read the Chevron post in a couple weeks so I missed this. This is truly a gem. While I find the entire posting hilarious I specifically want to address wxman's reference to ExxonMobil building an "architectural marvel" whenever HQ relocates to the campus. I've posted on the ExxonMobil post regarding this topic. I am an employee of ExxonMobil, and it has been communicated to us that there are currently no plans to relocate HQ. Having said that, plans can always change as we know. However, our current CEO has no desire to relocate. The commute via private jet is a short one to the campus from Irving. Also, HQ's staff is relatively small. There would be no need to build a tower when and if the decision is made to relocate HQ. The new campus is being built with enough additional space to accommodate the number of employees that would be relocating, again, WHEN and IF. Infact the new campus is being built with the forthought that we will be expanding, which means hiring new employees. The campus was designed with this in mind.

[Avossos]

Hadn't read the Chevron post in a couple weeks so I missed this. This is truly a gem. While I find the entire posting hilarious I specifically want to address wxman's reference to ExxonMobil building an "architectural marvel" whenever HQ relocates to the campus. I've posted on the ExxonMobil post regarding this topic. I am an employee of ExxonMobil, and it has been communicated to us that there are currently no plans to relocate HQ. Having said that, plans can always change as we know. However, our current CEO has no desire to relocate. The commute via private jet is a short one to the campus from Irving. Also, HQ's staff is relatively small. There would be no need to build a tower when and if the decision is made to relocate HQ. The new campus is being built with enough additional space to accommodate the number of employees that would be relocating, again, WHEN and IF. Infact the new campus is being built with the forthought that we will be expanding, which means hiring new employees. The campus was designed with this in mind.

 

I spoke to another XOM employee who said he does not think HQ would be moving... I dont see why it makes sense to have things so spread out, but whatever.

 

Shell / Chevron will be downtown for awhile. Even if Shell builds elsewhere, that process will take years. Chevron will probably build downtown, but who says they wont want a campus peice as well. I think the tower happens, but i may be too optimistic.

[ig2ba]

New information on this tower that I've heard in the last couple days:

• The final decision on whether to fund this project will be in Q3 of 2015.
• The construction will run through 2019. I'm not sure if this includes work after the building is already opened, or if the date that it will be opened is in 2019. I suspect that it includes the finishing touches.
• 850 feet now, but still 50 floors. I don't know which one is an error. Or maybe they're expecting future Chevron employees to be taller than current employees.
• They are hiring Chevron employees for this project starting now.

Except for the last bullet, I can't confirm that any of these will actually come to pass, but this is the latest info.

[Houston19514]

Hadn't read the Chevron post in a couple weeks so I missed this. This is truly a gem. While I find the entire posting hilarious I specifically want to address wxman's reference to ExxonMobil building an "architectural marvel" whenever HQ relocates to the campus. I've posted on the ExxonMobil post regarding this topic. I am an employee of ExxonMobil, and it has been communicated to us that there are currently no plans to relocate HQ. Having said that, plans can always change as we know. However, our current CEO has no desire to relocate. The commute via private jet is a short one to the campus from Irving. Also, HQ's staff is relatively small. There would be no need to build a tower when and if the decision is made to relocate HQ. The new campus is being built with enough additional space to accommodate the number of employees that would be relocating, again, WHEN and IF. Infact the new campus is being built with the forthought that we will be expanding, which means hiring new employees. The campus was designed with this in mind.

Nice info. Thanks. Any clue on why they are putting a bunch of people in The Woodlands instead of on tge new campus?

[H-Town Man]

Very interesting article in WSJ this morning about the financial situation with Chevron, Exxon, and Shell, but it's behind a paywall unfortunately:

 

http://online.wsj.com/news/articles/SB10001424052702303277704579348332283819314?mod=WSJ_hp_EditorsPicks&mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303277704579348332283819314.html%3Fmod%3DWSJ_hp_EditorsPicks

 

Had a graph showing expenditures vs. production at each of the three since 2009, and Chevron looked the worst: capital expenditures have soared 89% with production down 3% in that time. The Australia project in particular has gone up over 40% since it began, and remains a very tricky endeavor.  They're under pressure to show investors that their balance sheet looks good.

 

[jgriff]

Very interesting article in WSJ this morning about the financial situation with Chevron, Exxon, and Shell, but it's behind a paywall unfortunately:

 

http://online.wsj.com/news/articles/SB10001424052702303277704579348332283819314?mod=WSJ_hp_EditorsPicks&mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303277704579348332283819314.html%3Fmod%3DWSJ_hp_EditorsPicks

 

Had a graph showing expenditures vs. production at each of the three since 2009, and Chevron looked the worst: capital expenditures have soared 89% with production down 3% in that time. The Australia project in particular has gone up over 40% since it began, and remains a very tricky endeavor.  They're under pressure to show investors that their balance sheet looks good.

 

The LNG liquefaction boom in Australlia is probably over after this round of plants. It's so expenive to do business over there that they probably won't get a lot more investment.

[TBooze]

Nice info. Thanks. Any clue on why they are putting a bunch of people in The Woodlands instead of on tge new campus?

 

ExxonMobil made a strategic decision not to place all there eggs in one basket, so to speak. If I remember the briefing made available to all XOM employees via the company intranet correctly, it had something to do with the company's ability to continue functioning as such from a central location, given a massive debilitating event at one location or another. I'll search the archives to find that briefing so I can correctly communicate the proper intention, without posting any direct quotes from the intranet (company rules).

[swtsig]

ExxonMobil made a strategic decision not to place all there eggs in one basket, so to speak. If I remember the briefing made available to all XOM employees via the company intranet correctly, it had something to do with the company's ability to continue functioning as such from a central location, given a massive debilitating event at one location or another. I'll search the archives to find that briefing so I can correctly communicate the proper intention, without posting any direct quotes from the intranet (company rules).

 

I've always heard it was for more administrative and back office functions.

[Avossos]

New information on this tower that I've heard in the last couple days:

• The final decision on whether to fund this project will be in Q3 of 2015.
• The construction will run through 2019. I'm not sure if this includes work after the building is already opened, or if the date that it will be opened is in 2019. I suspect that it includes the finishing touches.
• 850 feet now, but still 50 floors. I don't know which one is an error. Or maybe they're expecting future Chevron employees to be taller than current employees.
• They are hiring Chevron employees for this project starting now.

Except for the last bullet, I can't confirm that any of these will actually come to pass, but this is the latest info.

 

Calrification please: the final decision on whether to fund this project, or final decision on funding for this project?

 

So this seems like a 2016 project.

[ig2ba]

Calrification please: the final decision on whether to fund this project, or final decision on funding for this project?

 

So this seems like a 2016 project.

 

Both. Once the final decision is made to fund, then the project has funding.

[tangledwoods]

 

The final decision on whether to fund this project will be in Q3 of 2015.

 

From what I have understood the final investment decision has been slated for Q3 of 2014 not 2015.

 

I think one BIG issue that some people here are missing is that the decision to build here or there is a big decision that isn't made in reaction to small events.  This tower has been on the drawing boards at HOK for a few years now and Chevron has been planning it for even longer.  The economics of building are resolved well before a building gets to this level of design.  It would be highly unusual for a company to pull the plug on something that is this far designed.

[JJxvi]

No. Exxon built a campus that Chevron only heard about in like the last 3 months, and it has shattered their world and caused them to rethink all of their facilities development. Its probably the most successful campus in history and its not even built yet. Chevron must follow suit, even if they have to move to Conroe.

[ig2ba]

From what I have understood the final investment decision has been slated for Q3 of 2014 not 2015.

 

I think one BIG issue that some people here are missing is that the decision to build here or there is a big decision that isn't made in reaction to small events.  This tower has been on the drawing boards at HOK for a few years now and Chevron has been planning it for even longer.  The economics of building are resolved well before a building gets to this level of design.  It would be highly unusual for a company to pull the plug on something that is this far designed.

 

That was the plan until they announced cost cuts last month. The cuts included delays in the new downtown Houston, Bakersfield, Covington, and Pittsburgh offices.

 

I don't mean to imply that anyone is pulling the plug. The project already has money to do preliminary engineering and this will continue, though at a slower pace than expected before. The final decision will determine whether and when they get the remaining 90% of the money for the project to proceed.

[TBooze]

I've always heard it was for more administrative and back office functions.

 

That is correct. That is the answer as to 'what' will be housed there. However, the answer as to 'why' its separated from the remaining campus is what my answer adresses

[Avossos]

I think it is best if we can keep all Exxon / Shell commentary outside this topic as best we can - i know it gets difficult because of relationships and trends.

 

But some of this has gotten really muddled when re-reading (I can't tell if the above post is about Chevron or Exxon something) haha.

Edited January 29, 2014 by Avossos

[swtsig]

That is correct. That is the answer as to 'what' will be housed there. However, the answer as to 'why' its separated from the remaining campus is what my answer adresses

 

it's my understanding that the reasoning for the seperation is more related to cost than any sort of continuitty function.  The campus space is exponentially more expensive to construct and operate compared to the substantially cheaper lease space.  In other words, XOM does not want to waste costly real estate in their campus for non-income producing administrative workers.  they initially debated on leaving them in Greenspoint (to which the Greenspoint District hung their hat when the initial campus anouncement was made) but XOM ultimately determined it created too great a gap within the company and did not want to alienate the administrative employees entirely.

 

although there is probably some merit to your point regarding business continuity, having their secondary location only 3 miles away isn't the most fail-proof continuity strategy.

[Trae]

No. Exxon built a campus that Chevron only heard about in like the last 3 months, and it has shattered their world and caused them to rethink all of their facilities development. Its probably the most successful campus in history and its not even built yet. Chevron must follow suit, even if they havto move to Conroe.

Yes this.

[Houston19514]

it's my understanding that the reasoning for the seperation is more related to cost than any sort of continuitty function.  The campus space is exponentially more expensive to construct and operate compared to the substantially cheaper lease space.  In other words, XOM does not want to waste costly real estate in their campus for non-income producing administrative workers.  they initially debated on leaving them in Greenspoint (to which the Greenspoint District hung their hat when the initial campus anouncement was made) but XOM ultimately determined it created too great a gap within the company and did not want to alienate the administrative employees entirely.

 

although there is probably some merit to your point regarding business continuity, having their secondary location only 3 miles away isn't the most fail-proof continuity strategy.

 

It all seems quite odd.  They plan a large campus for the purpose of consolidating their employees in one location; and then don't consolidate all their employees there, saying "we don't like to put all our eggs in one basket."  Bizarre. 

 

Their campus costs are exponentially higher than leasing office space?  Seems unlikely.  Especially if you consider what the marginal cost would be to add 1 or 2 additional buildings for the employees who are now being shuffled off to The Woodlands.   ExxonMobil already owns the land and has built the campus infrastructure.  Can they seriously not find a way to add 480,000 square feet of buildings for a cost that is not exponentially more expensive than leasing space at Hughes Landing?  If they can't, they maybe shouldn't be building and owning the campus to begin with.

[capnmcbarnacle]

That was the plan until they announced cost cuts last month. The cuts included delays in the new downtown Houston, Bakersfield, Covington, and Pittsburgh offices.

 

I don't mean to imply that anyone is pulling the plug. The project already has money to do preliminary engineering and this will continue, though at a slower pace than expected before. The final decision will determine whether and when they get the remaining 90% of the money for the project to proceed.

 

FWIW, I heard that the final decisions on the offices you mentioned, Bakersfield, Covington, and Pittsburgh (i.e., the extent of eventually moving part of those operations to Houston and obviating the necessity of new construction there), is what delayed the Houston tower, and that the Houston tower will be appropriately funded once those decisions are made.  It's worth noting that Chevron is moving forward with its Midland campus (uh-oh, a campus!), presumably because their future presence and needs have been well-settled.

[Triton]

So much conflicting information here. That's why I tried contacting Nancy Sarnoff but with no response back.

[ig2ba]

FWIW, I heard that the final decisions on the offices you mentioned, Bakersfield, Covington, and Pittsburgh (i.e., the extent of eventually moving part of those operations to Houston and obviating the necessity of new construction there), is what delayed the Houston tower, and that the Houston tower will be appropriately funded once those decisions are made.  It's worth noting that Chevron is moving forward with its Midland campus (uh-oh, a campus!), presumably because their future presence and needs have been well-settled.

 

I think there is very little to no work that could be moved from Bakersfield to Houston or Pittsburgh to Houston. They could always sell their assets in those locations, in which case people would be transferred to the purchasing company or have to return to home base. I think that's pretty unlikely since Chevron only exists in PA because they bought Atlas very recently (in 2011 I think).

 

I suspect Midland is going forward because the Permian is booming right now. A suburban campus in Midland means 4 miles from downtown, not 35 like Camp Strake is.

[cloud713]

A suburban campus in Midland means 4 miles from downtown, not 35 like Camp Strake is.

lol seriously? 4 miles away would be like that campus being in uptown Houston vs downtown.

[LTAWACS]

lol seriously? 4 miles away would be like that campus being in uptown Houston vs downtown.

I wonder if the midlandians are howling at chevron for building their campus in the middle of nowhere ...

[JJxvi]

Its probably a better location for Chevron. They should move everybody in Houston to Midland before Conroe.  Its West of Midland so its also closer to Odessa.  Midland is roughly the size of the Woodlands and Odessa is larger than Conroe. So an argument can be made that the "suburban Midland" campus is more "somewhere" than Camp Strake. The idea of moving to Camp Strake for a company that occupies 2 skyscrapers in downtown Houston  and is considering building a 3rd is ludicrous. Its not going to happen.

[Sellanious Caesar]

I work for Chevron. They will build downtown, the last I was told the tower broke 855 feet and was going to be possibly 52 stories and they are thinking about a few more floors but nothing official yet. The towers details aren't final yet, there's still a while before they get to it but just wanted to share.

If Chevron gets approved to build their campus they will not be building their campus near the Woodlands over downtown.

Edited January 31, 2014 by Sellanious Caesar

[bobruss]

Thanks for the positive update. There are so many projects going up in Houston right now that by the time the fans come to the Superbowl that were here for the last one in 2000, will think they're in the wrong city. The whole city is getting a major overhaul and I think its going to blow everyone away. What a great time to be in Houston especially if you are into this kind of thing.

Were going to look like a spread out Dubai with all of the cranes all over town. There's not an area of town that won't be affected in a positive way.

[arche_757]

^Well actually Bob, Galveston has seen very little impact from this current building boom.  I just thought I'd rain on the parade a little.

 

Good to hear that Selanious.  Infill!  And I'm thinking the new Chevron tower will be quite a nice building, even if it stays somewhat simplistic in its geometry?  I would also hope we will someday hear about some hospitality work near Chevron's downtown campus.

[ArchFan]

What Sellanious says rings true to me, also.  My guess is that the rumors about a Woodlands-area campus probably have to do with "Chevron Phillips", which is a joint-venture between those 2 companies that is limited to producing chemicals.  It is already based in The Woodlands.

 

I used to work for Chevron and my boss there used to compare it to a large ship:  it makes course changes very slowly.  Consequently, it seems unlikely to me that they would suddenly decide to move most of their Houston employees to The Woodlands just because ExxonMobil is doing that, after planning it for years.

Edited January 31, 2014 by ArchFan