Merit Energy has swapped its former Galleria-area home for a massive new headquarters in Two Lincoln Centre in the City’s north end.
The move marks one of Dallas’ biggest office leases of the year, with the oil and gas company securing more than 104,000 square feet over three floors. Merit will occupy floors 10 through 12 of the 19-story building at 5420 Lyndon B. Johnson Freeway.
If the transaction were ranked among those closed in 2023, it would have been the second-biggest office lease of the year.
Merit bills itself as one of the largest private oil and gas operators in the United States, serving “as a direct energy investment for institutional investors and family offices for more than 35 years,” according to a description on its website.
Global commercial restate firm Cushman & Wakefield participated in the transaction, helping relocate three existing tenants to accommodate Merit’s arrival.
Matt Schendle, Zach Bean, and Mary Frances Burnette represented New York-based Nuveen Real Estate, owner of Two Lincoln Centre, in the transaction. Jeff Ellerman and John Ellerman represented Merit.
Last year, The Dallas Express reported that Galleria North II, Merit’s former headquarters, was placed on the market. The 308,000-square-foot office, just one mile from Merit’s new space, was built in 1999 and underwent substantial upgrades in 2018.
To help attract tenants during a challenging period for Dallas office space, Two Lincoln Centre completed a multi-million dollar renovation in 2022. The renovation included outdoor tenant areas and high-end amenities, like a wine market.
As previously detailed in The Dallas Express, North Texas has suffered from elevated vacancy rates. In the third quarter of 2024, vacant office space stood at 26.7%, compared to the much lower 9.8% vacancy rate experienced by industrial properties during the same period.
During the first quarter of the year, Dallas experienced $1.62 billion in lost rent due to vacant office space, the third highest in the country and the worst in Texas.