Concordia set to pick home

Austin Business Journal - August 25, 2006

by Jenny Robertson

ABJ Staff

Shortly after Concordia University decided to leave its Central Austin campus, the school looked at a vacant office complex in Northwest Austin formerly occupied by Schlumberger Ltd. With hundreds of acres of woodland and airy, bright buildings, the site seemed perfect -- but in the end was deemed too pricey.

Now, almost a year and a half later, the property is no longer out of Concordia's grasp. In fact, sources familiar with the deal say the university's bid to buy the old business park is set to go through soon.

The former Schlumberger Ltd. campus will likely become the new home for Concordia University.

Concordia officials say their proposed new home would allow them to better serve their students. Real estate experts say the move would mark a creative reuse for the property, which has been on the market for more than three years.

The university announced last year that it would move from its landlocked, 23-acre campus in Central Austin. At the time, the Schlumberger site proved too expensive, says Concordia President Thomas Cedel. Last fall, the school narrowed its choices to two sites in Round Rock and Manor out of more than 30 options.

But in December, Schlumberger sold its campus to a Houston real estate firm, Lionstone Partners Ltd., for an undisclosed amount. The property became more affordable, Cedel says, and "began moving up the list rapidly." The school decided early this summer that it would pursue the property, though Cedel says he can't announce whether the land is currently under contract.

The school seeks to buy about 385 acres of the almost 440-acre tract, university documents say. Tax records show the entire property appraised at more than $20.5 million, but Cedel says the land is worth more on the market.

The school, one of 10 colleges in the nationwide Concordia system, has previously estimated that the move could cost $100 million. In May, the system's governing board approved the Austin university to take on as much as $25 million in long-term debt for the move. It also said the school's funding model should not rely on more than $20 million in fundraising.

According to university documents, Concordia is conducting a due diligence phase in its site acquisition. That phase officially ends Aug. 31, "at which time the school will make a substantial down payment on the property." University officials are waiting to complete due diligence before making a formal announcement about the purchase.

To manage the project, Concordia has hired Austin-based firm Herndon Stauch & Associates. The school's move could take two years to complete.

Built in 1987, the former Schlumberger site already houses six buildings totaling 195,000 square feet. Concordia will renovate that existing space into classrooms, a library, student services space and a cafeteria.