U.S. Bank has renewed its lease in the U.S. Bancorp Tower, but will shrink its footprint at "Big Pink" from 480,000 to 277,000 square feet.
The downsizing has long been expected. U.S. Bank, which sold the tower for $165 million in 2000 and has leased its offices there since, has subleased part of its space since 2004. It remains the largest tenant in the tower.
The renewal is one of the largest lease transactions in recent memory. The last to come close was in 2010, when U.S. General Services Administration took 265,000 square feet in the First & Main tower to house federal agencies while the Edith Green-Wendall Wyatt Federal Building was under renovation.
The tower's Seattle-based owner, Unico Properties, will take over U.S. Bank's subleases totaling 55,000 square feet in the building. It has also already leased 65,000 square feet of space U.S. Bank is giving up to Webtrends, a web analytics company.
Brian Pearce, Unico's senior vice president for property management, said the company already has prospects for the remaining space that will become vacant between now and June 2015, when the new U.S. Bank lease begins.
"I fully expect that space to be leased well before the bank gives it back," Pearce said.
U.S. Bank spokeswoman Teri Charest said the bank has been leasing unused space for many years, but was unable to make significant adjustments until the lease was up for renewal.
She said the Minneapolis-based bank has 980 employees in the U.S. Bancorp Tower, the company's Oregon headquarters, and that it is building in room for staff additions "to address our projected growth."
Many major users of central-city office space, including the financial services sector, are squeezing into smaller spaces, in part by reducing the amount of space dedicated to each employee.
Brokerage Kidder Mathews represented U.S. Bank in the transaction. Jones Lang LaSalle represented Unico.
The U.S. Bancorp Tower is also in the middle of a $12 million renovation of the lobby and south plaza. The work is expected to wrap up in mid-April.