DLA Piper has terminated a lease for the top four floors of a 25-story high-rise being built in downtown Austin. The global law firm would have been the anchor tenant in the office tower, called 405 Colorado.

In its first-quarter earnings call last week, Brandywine Realty Trust, developer of 405 Colorado, said the lease cancellation was the result of a contractor missing an interim construction milestone for the project. Brandywine, however, said it is on track to finish the building in the first quarter of 2021, which is close to the original schedule.

Brandywine's 200,000-square-foot project is under construction at Fourth and Colorado streets, one block west of Frost Bank Tower downtown. DLA Piper, which currently is in Frost Bank Tower, leased about 70,000 square feet at 405 Colorado.

In the earnings call, Gerard Sweeney, president and CEO of Brandywine, a real estate investment trust based in Radnor, Pa., did not refer to the building’s anchor tenant, DLA Piper, by name.

"Our lead 70,000-square-foot tenant terminated their lease pursuant to a one-time right-to-terminate, if we did not meet an interim milestone delivery date," Sweeney said. "Based on the original construction schedule, we had a significant cushion built-in to meet that milestone. The general contractor, while still being able to complete the project on time, missed that milestone date. We will naturally have a claim against that contractor, but right now our focus is on getting the project built and leased."

It is not known what, if any, role the coronavirus pandemic might have played in DLA Piper’s lease termination. The company did not return calls this week for comment. And Brandywine declined to comment beyond its earnings call.

In the call, Sweeney did refer to delays from a "short construction shutdown" in Austin.

Last month, work on many commercial and residential projects in the city of Austin and Travis County was halted for a period of time in March due to local orders allowing "essential" construction only, part of larger social distancing and stay-home mandates. But a subsequent executive order signed by Gov. Greg Abbott superseded the local bans and reopened the construction spigot by early April.

Sam Houston, office division partner with HPI Real Estate Services & Investments, said DLA Piper has signed a lease for the top three floors in another downtown Austin office building -- Colorado Tower -- that Parsley Energy no longer needs due to the decline in oil prices.

In the earnings call, one analyst asked Sweeney if the lease break by Brandywine’s anchor tenant was part of a trend that analysts should be watching for across the office sector.

Sweeney said no. He called the termination "a disappointment truly," but "a very, very unique situation for Brandywine, and I would expect throughout the rest of the real estate community as well."

"We’ve never done another development deal where we've had any kind of termination right by a tenant based on an interim milestone date," Sweeney said. "We did that really, I think, due to to market pressures in Austin to meet market conditions."

In response to a question by another analyst, Sweeney said there were discussions with the anchor tenant "where we worked to provide them a number of alternatives relative to short-term extensions to address their concern, and a few other things. And I think they just simply made the determination that it was in their interest to terminate the lease."

Sweeney said Brandywine has "reinvigorated" its marketing efforts for 405 Colorado. Real estate services firm CBRE is handling the leasing and marketing for the building.

Brandywine had a "great pipeline of deals before the crisis, and we expect that pipeline to reemerge and I've been in touch with a number of those prospects," Sweeney said.

Sweeney said due to the brief construction stoppage in Austin, Brandywine has slid the completion date for 405 Colorado to the first quarter of 2021.

In January 2019, Austin office brokers said the original completion date was December 2020, although they said that has been pushed forward a few times.

In a press release, Sweeney said that, despite strong first-quarter results and "robust" leasing activity, "the uncertainty surrounding the current state of the healthcare crisis has our tenants and prospective tenants focused on their employees’ safety and business rather than new space requirements. We have carefully assessed our 2020 business plan and revised guidance to reflect the current state of uncertainty and have also reduced 2020 capital spending by approximately $50 million, including $20 million of leasing-related capital." He said the company also bought $60 million of its common stock, funded in part through an asset sale.