Tuesday, September 06, 2016

Developer eyes new high-rise residential for Dallas’ popular West Village neighborhood

The 4-story Gables Turtle Creek apartments on Cole Avenue would be replaced with taller buildings. 

One of the first apartment projects built in what is now Uptown is being eyed for redevelopment.
The Gables Turtle Creek rental community at Cole and Lemmon avenues was built in 1994 and is located across the street from the popular West Village retail complex.
The 232-unit, 4-story apartments were one of the first developments in the Cityplace project.
Since then, the area around the West Village and across Uptown has gone high-rise with increasingly taller buildings.
Developer Gables Residential wants to start tearing down its 22-year-old apartments to replace part of the complex with taller construction.
"This was one of the first projects as part of the West Village and Cityplace development," said Gables' Katy Slade. "It's underbuilt compared to the amount of density allowed there.
"Currently the site is entitled for 378 units," she said. "We've owned it for more than 20 years."
Gables is asking for city approval to build a tower of about 20 stories on part of the 7-acre site. The block fronting along Blackburn Street would remain low-rise construction.
"It's zoned for residential, and we'd be happy to keep it that way or go mixed-use if that's what the community wants," Slade said. "Phase one of our redevelopment would be along Lemmon where there is heavier traffic."
Gables has already begun meetings with residents in the area and is talking with potential architects.
The developer just leased up its Gables McKinney apartment project, an 8-story building at McKinney and Routh with a Whole Foods grocery store on the ground floor.
"This is one of the best neighborhoods in Dallas and more an more people want to be here," Slade said. "It's a natural spot for density.
"This is really a hub for Uptown."
With higher land prices and more interest in the area, recent apartment developments in Uptown have grown much taller.
Just two blocks away from the low-rise buildings Gables wants to tear down, developer Forest City is building a 23-story apartment and hotel tower on Blackburn Street.
Written by Steve Brown/Dallas Morning News 

Friday, September 02, 2016

Frisco’s office market heats up, thanks to the Dallas Cowboys and growth along the tollway

The Dallas Cowboys headquarters building, The Star in Frisco, is just opening and is mostly leased.

Sure, Plano gets the headlines, with big office deals by Toyota, JPMorgan Chase and Liberty Mutual Insurance.
But just across the highway in Frisco, office builders are courting companies that want to be close to the action.
"That whole corridor of Frisco has an appeal," said Kevin Bradshaw, division manager of insurer FM Global, which just became the largest office tenant in The Star in Frisco, the Dallas Cowboys' complex on the Dallas North Tollway at Warren Parkway. 
The company is also the largest firm to announce a move to Frisco this year. FM Global has had its operations in nearby Plano for 17 years.
Bradshaw said the company looked at two other Frisco projects in the works — Wade Park and Frisco Station — before deciding where to move its more than 160 workers.
"We pretty much knew where we wanted to go," he said.
With demand for office space so strong, developers are scrambling to get more projects out of the ground in Frisco.
"Frisco is close to what's happening at the epicenter of the tollway and S.H. 121," said Greg Biggs of commercial real estate firm JLL.
Only about 15 percent of Frisco's office space is empty, according to commercial real estate firm JLL. And the newest buildings are quoting rents of between $30 and $40 per square foot.
"Based on current demand, we need more office space in Frisco," said Jim Gandy, who heads the Frisco Economic Development Corp. He said most of what's available is small spaces.
"We will soon have three speculative office buildings under construction for the first time," he said.

New buildings ahead

Hall Group just disclosed plans for a 12-story office tower in its Hall Park development on the tollway at Gaylord Parkway.
The 162-acre office campus, which has more than 2 million square feet of buildings that house about 180 companies, is more than 95 percent leased.
"The majority of tenants we see at Hall Park are an average of 5,000 square feet," said Kim Butler, director of leasing with Hall Group.
Those companies typically expand later, she said.
"That has been the success of Hall Park — the growth of the existing companies here," Butler said. "When they say small business is the backbone of the economy, that's where we are seeing growth."
The Dallas Cowboys and developer Lincoln Property have had so much success with their 400,000-square-foot Star office building that the partners are planning a second project.
"We are starting to look at another building — it will be on the tollway," said Stephen Jones, Cowboys executive vice president. "We are looking at another medical office building as well.
"You can't replicate this location," he said. "We are right in the middle of everything."
VanTrust Real Estate and Hillwood  Properties plan to break ground next month on a seven-story, 228,000-square-foot office building in Frisco Station on Warren Parkway.
"We are hoping to start construction in the next two to four weeks," said VanTrust executive vice presdient Geoff Meyer. "Once we start pushing dirt on the site it will make a big difference in inquiries we are getting."
And Goveia Commercial is building a three-story, 90,000-square-foot office in Stonebrook Business Park on the tollway.
Written by Steve Brown/Dallas Morning News 

Cowboys' The Star lands biggest business tenant, makes plans for 2nd office building

FM Global is leasing office space on the top two floors of the Dallas Cowboys' new headquarters office building at The Star
mixed-use complex in Frisco.

The Dallas Cowboys have scored the biggest business tenant yet for The Star in Frisco, the team's new $1.5 billion headquarters.
FM Global — one of the world's largest commercial and industrial property insurers — is taking office space on the top two floors of The Star's office building  west of the Dallas North Tollway.
The insurance giant is trading its current location in West Plano for a 50-yard-line seat on the Cowboy's new Frisco practice field. It joins Bank of America and the Dallas Cowboys World Headquarters as tenants in the new building.
With the latest deal, the new building is substantially leased
"We just have a little bit more to finish up on the west side," said Stephen Jones, Cowboys executive vice president. "If we had it do over again this thing would be taller — we probably would have gone for a few more floors."
Jones said the Cowboys' Blue Star Land and developer Lincoln Property Co. are already working on a second office building at The Star to take advantage of business interest in the mixed-use development.
"We have something so unique with our office building," he said.
FM Global is taking more than 79,000 square feet of the 398,000-square-foot office building on Warren Parkway.
Jones said that like Bank of America, which is leasing 60,000 square feet of offices, FM Global is a longtime business partner of the Dallas Cowboys. FM Global provides the football club with property and builders risk insurance.
"Knowing that we will share the Dallas Cowboys new headquarters with faces and companies that are so intimately familiar to us makes this project even more special," Jones said. "All the things that come with it, including offices overlooking the practice field, are unique.
"They can take a client or future employee down to the training field," he said. "Whether you are trying to sell somebody or trying to recruit employees — that was a big driver for FM Global."
FM Global has done business with the Cowboys since 2002, said Kevin Bradshaw, senior vice president and FM Global's Western Division manager.
The Rhode Island-based insurance firm will move more than 160 employees to The Star starting in the spring.
Bradshaw said FM Global looked at several other locations in Frisco before landing at The Star. Mary Stoner Yost with Colliers International advised the company in its selection.
"One of the big draws it had when we considered it are the amenities that are going to be there," he said. "We met with the Joneses and agree with what the vision is for The Star.
Written by Steve Brown/Dallas Morning News 

Tuesday, August 30, 2016

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Love Field boom prompts another real estate play on Mockingbird Lane

The 7-building Oakbrook Plaza complex on Mockingbird Lane was built in the 1970s. 

The ripple effect of growth around Dallas' Love Field airport is driving another real estate project.
A Grapevine investor has purchased a 9.3-acre office project just west of Love Field - the latest in a series of properties in the area to be redeveloped.
2GR Equity and Legacy Capital have acquired the Oakbrook Plaza office development at 1515 West Mockingbird Lane.
The project includes a 7-story office building surrounded by six, 1-story buildings and was constructed in the 1970s.
The buildings contain 177,000 square feet of space.
"Redevelopment activity along Mockingbird Lane was key to our interest in the property," 2GR principal Elizabeth Roll said in a statement. "With the end of the Wright Amendment boosting traffic at Love Field, the ever expanding Medical District and multiple multifamily, retail and hospitality developments either planned or underway in the immediate area, Mockingbird Lane is one of the most exciting areas in Dallas."
The new owners will remodel the buildings and have renamed the project, Mockingbird Office Park.
Dallas' TXRE will lease and manage the property. The buildings are almost 50 percent leased.
The Oakbrook Plaza purchase is a latest in a series of new investments along Mockingbird Lane between Stemmons Freeway and Love Field.
Written by Steve Brown/Dallas Morning News 

Monday, August 29, 2016

New York-based WeWork picks Uptown tower for first North Texas location

WeWork is taking two floors in the new 1920 McKinney project. 

One of the country's biggest coworking office providers has landed in Uptown with its first North Texas outpost.
New York-based WeWork is renting two floors in the new 1920 McKinney office tower, which is a block north of Klyde Warren Park.
The company will occupy more than 40,000 square feet on the seventh and eighth floors of the office tower, according to Dallas building permits tracked by Buildzoom.com.
Almost $6 million is being spent to build out the new WeWork office.
WeWork - which has locations in more than a dozen major U.S. markets - looked at multiple locations in central Dallas before picking the new Uptown tower, property agents say.
The 6-year-old shared office company has already has a location in Austin.
And the firm has expanded internationally with locations in Canada, German, the U.K., the Netherlands and Israel.
Earlier this year WeWork authorized the sale of $780 million in stock.
WeWork is one of several companies in North Texas that plan to provide collaborative office space for start up companies, creative firms and other businesses that utilize the flexible workspace.
Written by Steve Brown/Dallas Morning News 

Tower sale in Dallas' Uptown expected to shatter price records

The 17Seventeen McKinney tower is expected to sell for $188 million or
$510 per square foot.
This is  the summer of new real estate records in Dallas.
And a pending building sale in Uptown is expected to set another all-time high sales price.
The 19-story 17Seventeen McKinney office tower has been up for sale for several months.
Dallas-based real estate investor Gaedeke Group has contracted to purchase the building - located on the north side of Woodall Rodgers Freeway - for what will be the highest per square foot price for a Dallas-area office building.
The 6-year-old high-rise is expected to fetch $510 per square foot for the building which is 98 percent leased, real estate brokers who are tracking the deal say.
The 17Seventeen McKinney sale would be even higher than the recent purchase of the 2000 McKinney tower, which sold for an estimated $502 per square foot to German investors.
The 369,000-square-foot 17Seventeen McKinney tower is leased to tenants including Regions Bank, Bain & Co., Huitt-Zollars and Colliers International.
Developer Granite Properties built the office tower, which is part of a one-block complex that includes retail space and the Gables Park 17 apartment tower. Granite Properties officials declined to comment on the pending sale.
Holliday Fenoglio Fowler LP has been marketing the office tower for sale.
Gaedeke Group - which owns other office buildings in the Uptown and Oak Lawn areas of Dallas - competed to buy 17Seventeen McKinney against several other investors including California State Teachers retirement fund, according to a report by Real Estate Alert, a New York-based property investment newsletter.
If Gaedeke Group completes the Uptown purchase as expected, the commercial real estate firm will have top office properties in two of the hottest real estate markets in North Texas.
Gaedeke Group is also building a 14-story office tower in the $3 billion Legacy West development in West Plano. The 327,856-square-foot One Legacy West tower opens at the end of this year at Legacy Drive and State Highway 121.
Written by Steve Brown/Dallas Morning News 

Major beer, wine firm adds southern Dallas distribution center in I-45 corridor

Constellation Brands' new Hutchins warehouse will be just west of the Union Pacific Intermodal complex
on Wintergreen Road.

Another big distribution deal has landed in the Interstate 45 corridor in southern Dallas County.
Constellation Brands — one of the country's largest distributors of imported beers and premium wines — is building a large new warehouse in Hutchins.
The New York-based company plans to break ground on the 450,000-square-foot project on Sept. 8. The planned industrial building will be in the Prime Pointe Industrial Park at 1600 W. Wintergreen Road.
Indiana-based Scannell Properties is developing the building. Evans General Contractors is the construction firm.
The project is being built for both Constellation Brands and California-based logistics company Biagi Bros., which handles shipping for the firm.
Constellation Brands bills itself as the No. 3 beer company in the U.S. with imported brands including Corona Extra, Corona Light, Modelo Especial, Modelo Negra and Pacifico.
Written by Steve Brown/Dallas Morning News 

Monday, August 22, 2016

Why is Maxwell Drever spending $240M to save an iconic Dallas skyscraper?

Maxwell Drever, chairman of Drever Capital Management in Dallas. 

Maxwell Drever likes to garden.
The California real estate investor doesn't mind getting a little dirt under his fingernails to make something bloom.
"I'm a master gardener — I love taking gardens and making them really spectacular," Drever said. "I love restoring gardens.
"And I love restoring buildings, too."
In downtown Dallas, he's cultivating one of his largest projects ever, turning an empty 52-story skyscraper into a city in itself.
Drever and his firm will spend almost two years converting the half-century-old former First National Bank tower into a combination of apartments, retail, hotel rooms and parking. The developers recently released updated plans for the more than $240 million project plus a new name for the tower: The Drever.
Drever Capital Management bought the marble and glass high-rise out of bankruptcy earlier this year.
"We get calls when properties are in trouble because that's kind of my reputation," said Drever, 75, who travels around the country looking at deals. "We heard it was in foreclosure, and it was an opportunity."
Drever said he had previously passed on investing in the project but took another look after the previous owners couldn't get funding to proceed.
"We were able to get favorable pricing and tax credits — that was not on the table before," he said. "Unless you have those tax credits, this deal will not work."
To obtain millions of dollars in historic tax credits, Drever and local partner Bryan Dorsey have made the development more of a restoration, retaining original features of the tower's exterior.
"This building is such a classic," Drever said. "The marble is from the plains of Marathon, Greece.
"You could never reproduce it," he said. "I used to do property closings in this building back in the 1970s."
Built in 1965, the 1.3 million-square-foot skyscraper was once the tallest west of the Mississippi River. It was designed by Dallas architect Thomas Stanley, who worked with famed designer George Dahl's firm.
The tower has had some legendary tenants over the years. Oilman H.L. Hunt used to have his offices there, as did members of the Murchison family.

Comfortable in Texas

Over the years, Drever and his companies have owned or built more than 170,000 apartments all over the country.
After the real estate downturn in the 1980s, he was one of the biggest buyers of distressed property in the nation.
"In 1988, we started buying big time after the crash, a lot of it in Texas and Dallas," Drever said. "We bought a lot of buildings before people woke up" — almost 18,000 apartments by the time he was done. "Dallas has always been like a second home to me."
While he's working on the downtown project, Drever and his family are spending a lot more time here. Son Noah, 32, and daughter Isabelle, 29, are working on the project, too, along with other North Texas deals.
"My son didn't want to come to Dallas," Drever said. "He stayed here two years, and we had to pry him out of here."
Drever Capital Management just teamed up with a local developer, The Alder Group, to build a 243-unit seniors apartment community in Allen.
"We want to do more of those seniors projects," Drever said.
The company also owns a loft apartment building in Dallas' Deep Ellum district.
The downtown project is its top priority, of course. It's one of the biggest skyscraper redevelopments in the country and the largest in Dallas.
And handling 1.5 million square feet of space "didn't bother me a bit," Drever said. "All you do is add zeros.
"We've been in this business for 50 years," he said. "I had no problem going forward on this, especially in the Dallas market."

City incentives

Turning the lights back on in the vacant tower at 1401 Elm St. has been a longtime goal of downtown Dallas leaders.
The city pledged almost $50 million in economic incentives to make the project happen.
Karl Zavitkovsky, director of Dallas' office of economic development, said the city is encouraged by Drever's plans.
"When I heard Maxwell Drever was interested during the bankruptcy, I was happy because I had good experiences with him," Zavitkovsky said. "I know he and his investment fund were responsible and had deep pockets.
"He does think unconventionally but has the capacity to get things done."
Zavitkovsky said when he was a banker in the 1980s, he had firsthand experience with Drever's operations.
"He was the largest apartment owner in Houston at one time," Zavitkovsky said. "We all recognize that this is a difficult project but important for downtown Dallas.
"We're doing everything we can to be supportive."
The former First National Bank headquarters is one of the few vacant towers left in the central business district.
"We'd like to buy more, but there isn't that much more priced like we'd like," Drever said. "There aren't a lot of cities that have a downtown 50-story building like this."
Written by Steve Brown/Dallas Morning News 

Friday, August 19, 2016

D-FW commercial building starts are up 27 percent in first half of 2016

More than $2.8 billion in commercial starts were recorded in North Texas in the first six months of 2016. 

Dallas-Fort Worth commercial construction starts have risen by 27 percent in the first half of the year, compared with the same period in 2015.
And the D-FW area ranked in the top 10 markets in the country for commercial and apartment building, according to a new report by Dodge Data & Analytics.
Starts of  more than $2.8 billion in North Texas commercial projects were recorded for the ranking.
Dodge Data tracks project including office buildings, stores, hotels, warehouses, garages and service stations and multifamily housing.
Nationwide, commercial and apartment building starts dropped 5 percent during the first half of the year from 2015 levels.
One of the biggest declines was in Houston, where building starts plunged 44 percent.
"Markets such as Miami, Washington, D.C., Boston, and Dallas-Fort Worth, which had been early participants in the recovery process, continue to see strengthening activity in 2016," Robert A. Murray, chief economist for Dodge Data & Analytics, said in the report. "This has outweighed the weaker activity that's been reported in Houston, adversely affected by the slowdown in the nation's energy sector, as well as by the first half 2016 pullback for several tech-related markets such as Seattle, Austin, and San Jose following their elevated performance in 2014 and 2015."

Written by Steve Brown/Dallas Morning News 

Chicago investor buys Irving's Verizon campus valued at $344M

Chicago-based investor Mesirow Financial has acquired Irving's Verizon regional headquarters — a 51.2-acre, 1.15 million-square-foot campus — valued at $344 million.

Terms of the deal were not disclosed. Verizon will lease back the full property in a 20-year term with options to extend its lease.

The area surrounding the Verizon campus will include plans for a new mixed-use development in Irving. 

The deal will give Verizon an immediate financial benefit and will support the company's continuing interests in Irving's Las Colinas neighborhood, said John Vazquez, senior vice president and head of global real estate for Verizon.

"The extension of our tenancy through a sale and restructured lease affirms the value we see of having located in such a dynamic area for so many years," said Vazquez in a written statement.

Vazquez, along with a Cushman & Wakefield team led by Robert Elms and Jim Jordan, represented Verizon in the deal.

Garry Cohen and Douglas Barker of Mesirow Financial, along with partners Kawa Capital, arranged the deal on behalf of the buyer. The financing was structured in collaboration with a number of Mesirow Financial's internal groups.

"We are very excited to, again, partner with Verizon to help monetize a very strategic asset, this time in Irving," said Barker, a managing director at Mesirow in a statement. "In the last year and a half, we have monetized nearly $1 billion and 2.55 million square feet of key real estate for Verizon across two transactions."

Last May, Mesirow Financial acquired Verizon's campus in New Jersey, which was valued at $650 million, which are among the two largest non-government single asset credit tenant lease deals ever consummated, said Stephen Jacobson, a senior managing director of Mesirow's credit tenant leaseback and structured debt products group.

Written by Candace Carlisle/Dallas Business Journal

Thursday, August 18, 2016

Federal Reserve & Federal Government Report Card

Perot family's Circle T Ranch north of Fort Worth to be 130-acre mixed-use project

Hillwood and Howard Hughes Corp. are building the Northeast Tarrant County project,

Developer Hillwood will team up to turn part of the Perot family's Circle T Ranch north of Fort Worth into a 130-acre mixed-use development.
Hillwood said Wednesday that it will build the $1 billion Westlake project in partnership with Howard Hughes Corp., which owns a section of the land.
The proposed development on State Highway 114 will include a new 500,000-square-foot office campus for Charles Schwab Corp.
"Schwab caused us to really change the plans for the property," said Mike Berry, president of Hillwood Properties. "They need support development adjacent to their office campus.
"Our plan is to initiate the development in timing with their office uses," Berry said. "We are focused on adding some retail space, day care and fitness space and a possible hotel. "
Berry said the Schwab offices will face a small lake on the ranch.
Hillwood is building the Circle T project as part of its huge AllianceTexas development in north Tarrant County.
"Developing this mixed-use project at the Circle T Ranch represents a watershed moment in the 27-year history of AllianceTexas," Berry said. "Circle T Ranch offers some of the most beautiful land in North Texas, which makes it a prime destination for companies wishing to establish a presence in this region."
The Circle T mixed-use campus will be one of the largest projects Hillwood has done in North Texas.
"This is the first one that has been driven by a major corporate office user with a mixed-use development immediately around it," Berry said.
Plans for the whole project include 1.2 million square feet of office space along with adjoining retail and entertainment buildings. There will also be a 200-room hotel and residential communities.
Development plans also includes land for parks, open space and nature trails.
Plans released by Hillwood show more than a dozen office buildings and three large residential blocks. Retail buildings are along Highway 114. 
Architect Gensler designed the plans for the mixed-use campus.
Hillwood said development will start immediately.
"We are going to rework the entire lake," Berry said. "We will have to drain and dredge it.
"We are designing the roads and utilities," he said. "We are talking to initial retail users for this space."
Schwab plans to break ground on the first of its office buildings next summer.
The California-based financial services firm plans to house 1,200 workers in the regional office campus.
But the company has the option to more than double the size of its Westlake facility over time.
Hillwood and its owners, the Perot family, acquired the Circle T Ranch in 1993. Parts of the 2,500-acre property have been used to build office campuses for Fidelity Investments and Deloitte.
The front door of the spread along State Highway 114 at State Highway 170 has been held in reserve.
More than a decade ago there were proposals to build a regional shopping mall on part of the tract. Howard Hughes Corp. inherited that portion of the property from mall developer General Growth.

Written by Steve Brown/Dallas Morning News