Devon Crosstex MLP (EnLink)

[lasomeday]

Devon and Crosstex just announced a new mlp and it will be in Dallas!

Devon Energy and Crosstex Energy to Create New Midstream Business - Yahoo Finance

[lasomeday]

There goes any chance of Devon building another tower in okc.

[HangryHippo]

I was just coming to post this. Ain't that a bitch.

Here's the measly write up from NewsOK. http://newsok.com/devon-to-form-new-...rticle/3895947

[Praedura]

Boo. Hiss.

[pickles]

There goes any chance of Devon building another tower in okc.

Uh, why?

[Bellaboo]

For all we know, it could from a lack of class A space. It could be temporary, or it could be something like Enable Midstream where they have operations within both companies, with the corporate officers in one place.
Time will tell.

[HangryHippo]

With such a dire lack of class A space, why aren't more spec buildings going up? At least two, maybe three? It would appear there's demand for this.

[jn1780]

Uh, why?

A possible second tower was theorized because of Devon's midstream business needing the additional space. Now their just spinning it off into its own company.

[HangryHippo]

What are the main differences between the MLP and the general partner this transaction created?

[adaniel]

For all we know, it could from a lack of class A space. It could be temporary, or it could be something like Enable Midstream where they have operations within both companies, with the corporate officers in one place.
Time will tell.

Really could be for a number of reasons. But just my best guess is it was much easier for DVN to partner up with another company who had more experience with the midstream side of things than to form their own company. And maybe Crosstex just doesn't want to move.

People who think this is something against OKC are reading WAY too much into this, as usual. That's just business, folks. If anything, Wall Street types who have been on Devon's rear lately will finally be satisfied and the company can move on with other endeavors. At last check the company is still staffing up like crazy and the building is just about full.

[Praedura]

With such a dire lack of class A space, why aren't more spec buildings going up? At least two, maybe three? It would appear there's demand for this.

Exactly!

Then again, there may be all kinds of stuff in the works that we don't know about yet.

[pickles]

A possible second tower was theorized because of Devon's midstream business needing the additional space. Now their just spinning it off into its own company.

While others have noted that Devon is a huge company that will eventually outgrow its current headquarters and have need for additional class A space. Which I have always considered the more likely reason they would build on the Preftakes block. People are reading way too much into this.

Maybe I'm not old enough to understand the beaten down mentality so many people in this city have, but I don't get the need fear the worst. It's like a battered spouse. Or a Cleveland Browns fan.

[adaniel]

Maybe I'm not old enough to understand the beaten down mentality so many people in this city have, but I don't get the need fear the worst. It's like a battered spouse. Or a Cleveland Browns fan.

I'll stop short of saying its an inferiority complex, but when every decision is overly examined and viewed as a slight against us (because if every company with business dealings is not moving here its because we obviously suck as a city), I have to wonder. I think its more like needy girlfriend syndrome. Like, "hey, I got lips injections and new boobs and hair extensions, why don't you love me?!?!"

[Pete]

Devon is already near to maxing out their current tower and do not want to build anything for a while, lest they raise the ire of shareholders. Remember, it was exactly this sort of spending that caused the revolt at both Chesapeake and SandRidge.

It's probably easier for them to set up in Dallas, especially because MLP companies are supposed to be physically separated from the company that spun them off. Right now, they the MLP is in Devon Tower and where else could a decent-sized concern be housed right now in OKC?

I wouldn't be surprised if the HQ moved to OKC after there is more office space available.

[HangryHippo]

Still though, if there's truly as much demand as there appears to be, why aren't we seeing more class A spec office construction?

[Praedura]

This lack of Class A space downtown is getting to be a real concern. It seems that I read some comments elsewhere on this board about some other company that had been mulling a corporate office in OKC, but couldn't find adequate space. Between this and the parking crunch... oy.

It's growing pains, which is mostly a good thing because it means that we're actually growing. But we really need to get things going here. Feels like we're in serious catch up mode. I guess developers 3 and 4 years ago just didn't forsee this.

[Teo9969]

Still though, if there's truly as much demand as there appears to be, why aren't we seeing more class A spec office construction?

Financing a spec tower is probably next to impossible.

[Pete]

^

Yes, it has been next to impossible. This is why there have been so few new tall buildings constructed in the U.S. in the last decade.

But, that's changing and that's why we are hearing about the possibility of three separate new towers in downtown OKC.


Remember, not only was Devon Tower not spec, they basically just paid cash for it. Very unusual circumstances and not the way almost all the other tall buildings in OKC were built prior. We should soon see a return to normalcy.

[Just the facts]

Oklahoman story from last month...

Devon prepares to launch midstream partnership | News OK

Devon Midstream Partners LP is one step closer to market.

...

DVNM will have no employees. It will be operated by the officers and board of its general partner, Devon Midstream Holdings.

So it appears that all the employees will come from Crosstex, which is already in Dallas.

[lasomeday]

It will be a net loss of jobs for OKC office, but in the long run they can use the money from the MLP to acquire more assets and develop the ones they have quicker.... which will cause a need for more jobs.

But currently they will be sending Midstream personnel to Dallas and will have a few people from Dallas move to OKC... very few.

[modernism]

Oklahoma City commercial development is really slow. Dallas, Houston, and Austin have so much commercial development going on its ridiculous.

[Plutonic Panda]

Those cities have extreme momentum and aren't slowing down anytime soon. OKC will get there soon, we are just warming up!

[Praedura]

Oklahoma City commercial development is really slow. Dallas, Houston, and Austin have so much commercial development going on its ridiculous.

Feels that way.

Well, hotel construction downtown is booming. And lots of residential complexes already in construction or on the horizon. So that part is going well.

But office buildings... yikes. Don't know why they aren't popping up like mushrooms right now. We do have the Stage Center tower that we may discover something about one of these days, I guess.
Parkside building is being worked on, sort of. And then... what else? Yeesh.

[lasomeday]

This deal will allow for more drilling and that will mean more service companies and other things to happen. So, more drilling in Oklahoma means more service companies locating in OKC, Tulsa, Stillwater, and Enid.

The trickle down effect of this is great for OKC.... but not the immediate effect if they had joined with Enable or another MLP in OKC. That would have been a monster deal with a 60 story tower to boot.

[adaniel]

No! If any business deal comes through and it doesn't immediately produce a 60 story tower its an abject FAILURE!

In all seriousness I agree with you. Devon has a mountain of cash and I've heard rumors its looking to acquire, but taking care of this and getting the Wall Street bros off its back was priority numero uno. Now that has been taken care of you will see a lot more movement on the acquisition front.