Tuesday, June 30, 2015
Stock in Dallas-based Wingstop took off like a rocket Friday, in the company’s first day in the public market.
Shares of Wingstop Inc., trading on the Nasdaq under the symbol “WING,” closed at $30.59, up 61 percent from the initial public offering price of $19 a share. Investors hoisted the stock price to more than double the $14 figure that was at the high end of the company’s earlier estimated range.
“At the end of the day we're very happy,” said company chief executive Charlie Morrison. “I think investors are definitely interested in the growth story of Wingstop.”
Wingstop, one of the nation’s fastest-growing chicken chains, has 745 locations, including 700 in the U.S. and 85 each in Dallas-Fort Worth and Los Angeles. Those are the chain’s two largest markets.
About 97 percent of the locations are owned by franchisees who, like Friday’s investors, have been drawn to the chain’s appeal to millennials, its positioning in the rapidly growing fast casual restaurant segment and its strong cash generation. The company has posted increases in same-store sales for 11 consecutive years.
Morrison said the company is not giving growth guidance for 2015 or 2016. Eventually the company expects to triple the number of U.S. locations.
For Friday’s IPO, Wingstop offered up 2.15 million shares of stock, and affiliates of owner Roark Capital Partners offered 3.65 million. Roark purchased the company in 2010 and still will own more than 60 percent of the shares after the public offering.
The underwriters for the offering have a 30-day option to buy up to an additional 870,000 shares at the initial public offering price, less the underwriting discount.
Earlier this month the company estimated that its initial public offering price would be between $12 and $14 a share. A $19 price placed the value of the offering at about $110 million.
Morgan Stanley, Jefferies, and Baird acted as lead joint book-running managers for the offering, which is expected to close June 17.
Wingstop’s debut sets the bar high for another North Texas restaurant company looking to wade into the public market: Fogo de Chão Inc.
The Brazilian-themed, meat lovers’ paradise expects to raise between $67 million and $77 million in an IPO with a midpoint price of $17 a share. The company is owned by private equity firm Thomas H. Lee Partners LP, which will continue to own at least 80 percent of the company after the IPO.
Karen Robinson-Jacobs/ Dallas Morning News
Wall Street’s hunger for new restaurant stocks pushed another North Texas brand beyond its initial public offering price.
Dallas-based Fogo de Chão Inc., a Brazilian-themed full-service restaurant chain, debuted Friday on the Nasdaq after pricing late Thursday at $20 a share. The initial price was above the earlier stated range of $16 to $18 a share.
The stock closed at $25.75, up nearly 30 percent.
Fogo de Chão is the second North Texas restaurant chain to go public in a week. Last Friday, stock in Dallas-based Wingstop soared in that company’s first trading day, gaining 61 percent from the initial offering price of $19 a share. Before that pricing, the high end of that company’s range was $14.
Fogo chief executive Larry Johnson thinks consumers are drawn to his chain because of the value proposition, the ability to have an affordable “white tablecloth experience.” That in turn “resonates with investors,” he said as the stock price continued its day-one climb.
Johnson said he thinks investors will take note of the brand’s growing popularity and acceptance by different age groups.
The company’s 26 U.S. locations, which range in size from about 7,500 square feet to 10,000 square feet, bring in about $8 million each annually on average.
‘Concept travels well’
The company expects the store count to grow by at least 10 percent each year, with Fogo eventually launching at least 100 U.S. locations. Johnson offered no timetable for the full buildout.
“We are comfortable that the concept travels well,” he said of the chain’s popularity in different markets across the country. “When you put all that together, I’m confident investors are going to get the story and are going to reward us for our performance.”
No new locations are planned for North Texas this year, but next year Fogo plans to appeal to carnivores in Uptown, which already is home to several popular steakhouses including Morton’s and Perry’s Steakhouse & Grille.
The company, which is owned by affiliates of Thomas H. Lee Partners, sold 4.41 million shares in the IPO. Lee Partners retains control of the company.
Fogo de Chão, which came to the U.S. in 1996, is the latest restaurant chain to whet Wall Street’s appetite.
PrivCo, which provides financial data on privately held companies, listed four restaurant IPOs this year, each of which posted a significant first-day pop. Each one — Shake Shack, Bojangles, Wingstop and Fogo — was priced at about $20 a share.
Burger joint Shake Shack closed at about $46 during its market bow, and jumped to more than $92 in May.
Many investors are trying to find the next Chipotle. The Mexican-themed fast-casual chain went public in 2006 at $22 a share and closed the first day at $44 a share. The stock closed Friday at $614.22.
Unlike most of those chains, Fogo de Chão is a full-service restaurant, rather than fast food or the current industry darling, fast casual.
Johnson noted that his chain’s average sales per location are much higher than those for a fast-casual concept.
The flip side, noted Sam Hamadeh, founder and chief executive of PrivCo, is that expenses are higher at a large full-service restaurant.
“That’s something [for investors] to keep in mind,” he said. “That’s a very expensive operation. That could be a problem at the first sign of a slowdown.”
Darren Tristano, executive vice president of Chicago-based Technomic Inc., a restaurant research firm, thinks the success of fast-casual IPOs is helping fuel growth of other restaurant stocks.
“Fast-casual restaurant chains continue to dominate growth,” said Tristano. “Technomic’s forecast five-year compound growth for fast casual is greater than 10 percent. As analysts and consumer investors look toward continued patronage and success of fast-casual restaurant brands, IPOs have been and are likely to continue to be strong going forward. This success will likely positively impact other major restaurant brands with IPOs.”
Karen Robinson-Jacobs/ Dallas Morning News
Monday, June 29, 2015
It can start with a knock on the door, a letter in the mail, or both.
Property owners in older parts of town are being made offers they can’t refuse. Without empty land to purchase, investors and developers have to create their own clearings to build new projects.
If you have a lot of money, you can quickly put acreage together even in a densely developed part of the city.
We followed two blocks in Oak Lawn that were bought up over the last year. There’s one holdout, but after the land is ready, HEB’s Central Market has confirmed that it’s interested.
OGM Group, whose address is the same as a San Antonio-based law firm, has purchased 11 residential and commercial properties from 15 owners in Oak Lawn since August.
It bought a Taco Bueno, townhomes, apartments and businesses in two adjoining city blocks in the neighborhood sandwiched between Uptown Dallas and Highland Park. The blocks are on Lemmon and Bowser avenues between Throckmorton and Reagan streets. Together, the properties are on the Dallas County tax rolls for $7.75 million and make up about 3 acres.
OGM isn’t talking. A spokeswoman for Central Market, Heather Senter, said HEB is considering adding the property to its portfolio of land holdings in North Texas. But, she said, “they are still in the very early stages of evaluating this particular opportunity.” Plus, the property is “still being assembled and still in active real estate negotiations,” Senter said.
Only one property owner hasn’t sold to OGM. Nickos Panousopoulus, a Greek-American cobbler who runs Nicko’s Shoe Repair, owns the two-story building at 3900 Lemmon. He says he is considering an offer.
Taco Bueno, on the corner of Lemmon and Throckmorton, closed June 1 after selling to OGM in December. It was an older building that didn’t have a drive-through, and the company is looking for another Oak Lawn location, a spokesman said.
There are still tenants with leases to be dealt with.
La Madeleine at 3906 Lemmon has no plans to close, a spokesman for the Dallas-based restaurant company said.
Ron Berlin, a Dallas real estate investor, sold the two-story building that houses La Madeleine and a dozen other small businesses last fall. Berlin didn’t respond to requests to be interviewed.
It’s not clear from the secretary of state’s office incorporation filing who owns OGM. Paperwork lists “managers” Stephen Golden and Ami Gordon, who are partners in the San Antonio law firm of Golden Steves Cohen & Gordon and have done work for HEB. Gordon hasn’t responded to interview requests.
Anonymity is a big part of the process.
Carol Morrison was the first person to sell to OGM. Her former residence at 3929 Bowser is one of four New Orleans-style townhomes at the Villas of Franconia that were built in the late 1990s. The three others face Throckmorton.
When she was approached, Morrison said, she was told that the buyers were accumulating rental property in the area.
Related: Two more potential H-E-B locations pop up near Fort Worth; Allen HOA teases to H-E-B ‘coming soon’
Her advice to others: “Don’t let them rush you into a decision. They’ll dangle a carrot and then say it’s going to be off the table soon,” Morrison said. She realized too late that she had been priced out of her longtime Oak Lawn neighborhood. She has now bought a home in Addison.
OGM increased its offer to Morrison a couple of times by $10,000 each time. She was paid more for her house than she asked for, but she still regrets not doing more homework. “My home needed some work, but it was quality construction and high-end finish out,” Morrison said. “It breaks my heart that it’s going to be torn down.”
The sale closed Aug. 1, and the buyers gave her free rent through the end of the year. She moved out in January.
The timing of OGM’s offer was good for Sabu Varghese of 3512 Throckmorton. He tried to sell in 2013 but pulled it off the market because he and his wife were adopting a child. “We didn’t want to change our address and complicate the paperwork,” he said.
OGM also offered Varghese six months of free rent after the Aug. 6 sale. The adoption was finalized in November, and the family is building a house in Frisco.
“All through the process, they were very accommodating to our situation,” Varghese said.
An aging building on Bowser that had five individual condo owners who all sold in August has a chain link fence around it now. So does the Image Arms Apartments, which was cleared out of tenants quickly when it was sold in September.
Fighting the city
Putting these deals together often means dealing with a person who is not ready to sell.
Panousopoulus, who says he’s “about 90” and doesn’t want to retire, has been running Nicko’s Shoe Repair for 25 years. He intends to open a new shop on Oak Lawn Avenue if he agrees to sell his corner two-story building and the parking lot behind it.
He’s also running into problems with the city of Dallas.
Two years ago, he was told by the city that he had to make repairs to the exterior of the building. He installed new siding and a roof that cost him more than $30,000.
Now the city of Dallas Water Utilities department has turned off his water and told him that he owes more than $5,000. He was told he has a leak that would require tearing up his foundation to fix.
“I’m afraid they are going to create more serious problems if they break up the foundation,” he said.
Panousopoulus has a court date in July about a new citation for operating a “substandard structure.” Last week, at a required appearance for the charge that comes with a maximum fine of $2,000, Panousopoulus declined an option to pay a reduced $200 fine.
“I want to tell my story to a judge,” he said.
Panousopoulus believes the city is harassing him. He keeps good notes and records.
When asked why he doesn’t sell and make all these problems go away, Panousopoulus said, “I like to work. If I don’t work, I will die earlier.
“I need the activity,” he said.
Assembling land this way is going to become more common, Dallas real estate broker King Laughlin said. In the 1980s, Laughlin secretly bought land along North Central Expressway for the huge Cityplace development.
“When you have a fully developed city, nothing gets built on raw land,” Laughlin said. “You have to put it together to get enough to do anything. That’s the nature of urban development.”
The Cityplace acquisition took years and was over 1,000 transactions, he said.
“The key to all land assembly is you care only what your average price is for the whole thing,” Laughlin said. “You may pay $100 per square foot for one property and $20 for the one next door, and it all works out just fine.
“It’s not so much what you pay for these urban sexy locations,” he said. “It’s can you get it at all?”
Maria Halkias and Steve Brown/ Dallas Morning News
Not just Toyota and Liberty Mutual Insurance are moving to the new Legacy West development in Plano.
Some of the country’s top restaurant operators are heading to the $2 billion Collin County development, too.
Karahan Cos. – which also developed the successful Shops at Legacy retail center in West Plano – has already signed leases with a more than a half dozen big name restaurants for Legacy West.
And the developer has other eatery deals in the works.
Legacy West will also feature a one-of-a-kind food hall building with a market area, specialty food vendors and room for live entertainment, said developer Fehmi Karahan.
“We’ve been so pleased with the response we are getting to the retail portion of the development,” Karahan said. “This is going to be a step up from what we did at the Shops at Legacy.”
Construction started earlier this year on the $400 million Legacy West urban village, and the first building will open next summer.
The project includes 280,000 square feet of retail and restaurant space, a 300-room, $82 million Renaissance Hotel, hundreds of apartments and offices being built along the west side of the Dallas North Tollway at Legacy Drive.
Tommy Bahama – the popular fashion retailer – has rented a building in Legacy for a combination store and restaurant and bar. Called a Tommy Bahama Island store, the company one does one location a year.
Others are in Hawaii, Tokyo, New York City, Las Vegas, Orlando and 10 other spots around the country.
Dallas restaurateur Alberto Lombardi of Lombardi Family Concepts has rented three locations in Legacy West.
The Lombardi family will locate their Taverna, Bistro 31 and Toulouse restaurants in the project.
Phoenix-based chef Sam Fox’s Fox Restaurant Concepts will locate a North Italia and True Food Kitchen restaurants in Legacy West.
And New York chef Daniel Meyer’s Shake Shack will open its second Texas location in the development. Shake Shack has a location on South Lamar in Austin, plus spots in New York, Chicago, Las Vegas, London and elsewhere.
“We are on a very aggressive building schedule,” Karahan said. “There is huge interest from retail tenants.”
The 3-story food hall building will contain more than 30,000 square feet and will be located at the north end of the project.
Karahan said the idea is to take the best of popular market buildings in Seattle, Boston and San Francisco and “give it a Texas flavor.”
JHP Architecture and Gensler have designed the big retail building with stonework, glass and large doors. There’s will be a combination of indoor and outdoor spaces.
“I wanted modern Texas ranch style architecture,” Karahan said. “It’s a timeless style that fits in well with the rest of what we are doing.”
The planned food hall building will be located just south of where developers plan to build a 30-story condominium tower. And it’s also near Liberty Mutual Insurance’s planned twin-tower office campus along Headquarters Drive.
Within two years more than 13,000 people will be working in the Legacy West project – making it one of the largest new job centers in the state.
Real estate brokers say that the big corporate employers in the project have been attracted by the high-quality retail and apartments that appeal to their professional workers.
Legacy West is being developed by a partnership that includes Karahan Cos., Columbus Realty, KDC and J.C. Penney.
FedEx Office will open its new headquarters in the development later this year. Toyota and Liberty Mutual will start moving workers to the project in 2017.
Steve Brown/ Dallas Morning News
Candace Carlisle/ Dallas Morning News
Thursday, June 25, 2015
Wednesday, June 24, 2015
Seven mostly glass buildings – some up to five stories tall – will dominate Toyota’s new $300-plus million North American headquarters in west Plano.
The automaker unveiled architectural renderings of the 2-million-square-foot facilities Wednesday that showed buildings of varying heights in glass and Texas limestone arranged around a large central plaza.
Included on the environmentally sensitive campus will be dining, fitness and conference facilities — as well as a pharmacy, said Jim Lentz, CEO of Toyota’s North American Region.
At least 4,000 and perhaps as many as 5,000 employees will work at the $300 million facility west of the Dallas North Tollway and south of State Highway 121.
By the end of the year, Lentz said, Toyota should know how many employees intend to make the move to North Texas.
“Major corporate moves typically lose about 75 percent of their people, but I don’t think that will be the case for Toyota,” Lentz told reporters at the site. “As soon as I know, I will let you know.”
The 100-acre campus is scheduled to be completed in the first quarter of 2017.
“Bringing our team members together at this striking and inspiring new campus in Plano will help Toyota become a more cohesive, collaborative and innovative company so we can serve our customers better,” Lentz said at a morning unveiling of the renderings at the construction site.
The new buildings will permit Toyota to consolidate all of its major U.S. divisions – sales, marketing, engineering, finance and corporate services – at one campus.
Since arriving in Hollywood in 1957, Toyota’s various divisions have been spread among offices in California, Kentucky and New York. The company’s headquarters are currently located in Torrance, Calif.
The new buildings will have generous roof overhangs on the southern sides to cast shade, but will be positioned to let in as much natural light as possible, Lentz said.
The campus buildings will be constructed of Texas limestone, while native, low-water plants and landscaping will cover the campus.
Toyota intends to pursue LEED Platinum certification for the campus, the highest level possible from the U.S. Green Building Council.
In addition, the campus will offer features to catch and store water for irrigation and the office buildings and some parking structures may be fitted with solar panels for renewable energy.
|Overhead rendering of Toyota's new North American headquarters|
being built in Plano.
“Our work with some of the best designers, builders, architects – along with important input from our own team members – has inspired our thinking around how our new facilities can support and enhance the One Toyota Experience,” Lentz said.
The site will include a quarter-mile “check track,” as Lentz described it, where engineers can test suspension systems on different road conditions.
Terry Box/Dallas Morning News
Tuesday, June 23, 2015
Though it reveals little, Toyota has released a teaser image of the company’s new corporate headquarters in Plano.
A large rendering of the $300 million facility – which may house up to 5,000 employees – will be unveiled at a press event on Wednesday.
The image shows what apparently is a rectangular-shaped multi-story building front draped in a sheet.
Work on the 100-acre site near Legacy business park has already begun and is expected to be completed in the first quarter of 2017.
Toyota, the largest automaker in the world, is moving its North American headquarters to Plano, where it will consolidate all of its major divisions – sales, marketing, engineering, finance and corporate services.
Those functions are now spread among offices in California, Kentucky and New York.
The facility near State Highway 121 will be the first automotive headquarters to be located in Texas.
Steve Brown/Dallas Morning News
|Virgin Hotels' first location, in Chicago, opened in January.|
Florida-based Virgin Hotels will open a new location in Dallas’ Design District.
The hotel chain backed by Virgin Group plans to open a more than 200-room hotel on Hi Line Drive at Turtle Creek Boulevard in 2018.
Dunhill Partners – which last fall bought 33 acres and about 700,000 square feet of buildings in the Design District – will develop the new hotel with Vinculum Partners and the Crosland Group.
The hotel will also include a rooftop terrace with a pool, gym and spa.
”I could not have found a more perfect hotel for the Design District and everything it offers the City of Dallas than Sir Richard Branson’s Virgin Hotels,” Dunhill Partners CEO Bill Hutchinson said. “It will be the heartbeat of the hottest entertainment district and the biggest jewel in our crown.”
The first Virgin Hotel, in Chicago, opened in January. Work is underway on locations in Nashville and New York.
The hotel chain announced back in 2013 that it was looking for a location in Dallas. Company officials said they were considering spots in downtown Dallas and Uptown.
Dunhill Partners led a group of investors that bought the Design District properties last fall with plans to further develop the area.
Hutchinson said the new owners planned to upgrade existing properties in the area plus make plans for further development.
The neighborhood – which got its start as a business district in the 1950s – in the last decade has seen a real estate boom with new restaurants, apartments and retail.
Steve Brown/Dallas Morning News
Monday, June 22, 2015
When I was a youngster, the Meadows Building was always my “welcome to Dallas” sign.
Driving south on U.S. Highway 75, the office building said we’d officially arrived in Dallas from our home in Grayson County.
The Meadows Building, the flying red horse on the Magnolia Building and — later — the big Southland Life tower were the landmarks I watched for on Central Expressway.
Sixty years after it opened, the Meadows Building looks pretty much the way it did in the 1950s when it was proclaimed Dallas’ finest new business address.
The project was the creation of Dallas oilman Algur Meadows, who built the tower for his General American Oil Co. and other firms that wanted to be closer to residential neighborhoods in the Park Cities and North Dallas.
The nine-story office at North Central and Milton Street was one of Dallas’ first suburban office towers and set the tone for other freeway real estate developments.
Each side of the Meadows Building is different — facades constructed of pink marble, red brick and blue terra cotta tile. The green marble lobby has bubble light fixtures in the ceiling.
The construction cost of the building, designed by Dallas architect J.N. MacCammon, was $4 million. Originally there was a cafeteria and the exclusive Texas Club for building tenants and other members.
It once boasted “the largest hanging garden in the world,” according to news reports.
They claimed it was just “a seven-minute drive to downtown Dallas.” Maybe that was true in 1955, but I wouldn’t plan on that time today.
The familiar script roof sign and landscaped plaza on the south side give the property the flavor of a classic Miami Beach hotel.
Originally they were going to call it “Oil Center.” I’ve seen the old architectural drawing without the Meadows name. It just doesn’t look the same.
The California investor that has owned the property since 2003 has decided to sell the historic high-rise.
Cushman & Wakefield has been hired to peddle this one-of-a-kind property.
“Built in an era when smoking was good for you and a martini at lunch was common, the Meadows Building has remained a preferred location for area office tenants for 60 years,” Cushman & Wakefield says in a promotion for the building.
About 120 tenants occupy the 167,000-square-foot Meadows Building. It’s more than 90 percent leased.
With its location next to DART’s Lovers Lane commuter rail station, the building is in a prime spot for redevelopment. It’s the perfect size for small office tenants or for conversion into a boutique hotel and retail project.
The three-building Energy Square office tower complex next door is also for sale and is being marketed by HFF as a separate purchase.
Even though the Meadows Building is six decades old, I’m hoping that a new owner will keep the old place around for years to come. It’s still a landmark for Dallas.
Steve Brown/ Dallas Morning News
For three decades, the tallest thing at the southwest corner of the Dallas North Tollway and State Highway 121 in Plano has been a water tower.
Next week the empty water tank will be knocked down.
And going up right next door will be a 30-story condominium tower.
That’s right, deluxe condos sprouting in a field of sunflowers in Dallas’ north suburbs.
The condo tower is just part of a $2 billion development that will turn part of West Plano into a little slice of Uptown.
Along with the high-rise housing the planned Legacy West project will include about 800 apartments, dozens of new restaurants and shops plus a 300-room hotel tower.
Two years from now there will be more than 13,000 people working in the 240-acre development at offices for Toyota, Liberty Mutual Insurance and FedEx Office.
Still, news that a condo high-rise is coming to the former cotton fields of Collin County is catching some folks off guard.
“I’m shocked that something like this is taking place that far out in the suburbs,” said Judy Pittman, who has sold high-rise homes in Dallas’ Turtle Creek and Uptown markets for almost 20 years.
“People love Turtle Creek — it’s our Fifth Avenue,” said Pittman. “And many of the condo buyers on Turtle Creek have come from the suburbs — it’s not just the Highland Park crowd.”
But Pittman concedes that not everyone wants to move to central Dallas for high-rise living.
“The lifestyle is appealing,” she said. “Obviously, there’s a market out there in Plano, too.”
Developer Jim Duggan, one of the partners in the planned Legacy West condo tower, said the initial response to the building has been good.
The smallest units in the 150-home tower will be about 900 square feet and will start at over a half million dollars.
“Most of the buyers we are talking to are in the West Plano area,” Duggan said. “They are older empty nesters who are trying to get out of their big houses.
“We’ve also been contacted by people who are being relocated to the area and are interested.”
Toyota and Liberty Mutual will be relocating professionals from Southern California and East Coast markets where high-rise homes are old hat.
There are actually two condo towers being talked about for West Plano.
Another development group — Visions5 LLC — is pitching plans for a 17-story condo tower south of Legacy business park on Spring Creek Parkway. The building would have over 70 units.
Grapevine Lake tower
Still another condo tower is in the works in Denton County on Grapevine Lake.
Irving-based Realty Capital Management is rounding up buyers for a 14-story residential tower it wants to build in Flower Mound’s Lakeside development.
The tower would have about 48 units starting in price near $585,000.
Leslie Bardo of Realty Capital Management said there’s been ample buyer interest in the project, but persuading lenders to back the deal has been tougher.
“Financing for a suburban condo tower is a little different than looking for financing for a project in Uptown,” Bardo said. “It’s been an education to get the bankers to wrap their heads around it.”
Realty Capital is working with a Denver investment adviser to fund the project and homes to start construction later this year.
“We’ve had a super response,” Bardo said. “We have people in the area who want to stay in Flower Mound and are empty nesters.
“They are looking to downsize and love the idea of having a view of the lake.”
Steve Brown/ Dallas Morning News
A century ago the West End Marketplace building turned out thousands of cookies and candies.
Built in 1902 for the Brown Cracker & Candy Co., the plant was billed as the largest bakery for “crackers and fancy confections in the Southwest.”
Developers who are buying the vacant complex of red brick commercial buildings hope it will soon be turning out new jobs for downtown Dallas.
Granite Properties is purchasing the 240,000-square-foot property that in the 1980s was turned into a retail, entertainment and restaurant complex. Granite plans to convert it for startup companies, creative firms and high-tech businesses that want unique office space downtown.
The West End Marketplace project is one of several old buildings downtown being eyed as incubator space for new companies and bright entrepreneurs.
Owners of the bright blue 211 North Ervay building have taken a similar approach — turning an old office tower into a hot spot for new business.
While these operations still account for only a fraction of the office space downtown, attracting incubator spaces could eventually result in a big payoff for the central business district.
John Crawford, CEO of the economic development group Downtown Dallas Inc., said there’s more than 130,000 square feet of space dedicated to these purposes in the area now.
“This is a real opportunity,” Crawford said. “Ten years ago it wouldn’t have been thought of.
“We are just seeing the tip of this iceberg,” he said. “It will hopefully become a very successful movement.”
Crawford said he hopes some of the companies that start out small downtown wind up being bigger office users in the future.
“It’s the very beginning of how the big companies evolve,” he said. “Next thing you know people are in the market going public and hiring lots of workers.”
Small companies headed by young professionals could eventually wind up being big office players downtown, property brokers say.
“As firms grow they will hopefully stay downtown,” said Phil Puckett, executive vice president with commercial real estate firm CBRE. “If you have a building that is cool with its design and unique, it can attract a lot of attention.”
Millennials like the downtown revival story and the new residential and retail spaces being created in old buildings, said Mike Wyatt with Cushman & Wakefield.
“There is a new paradigm,” Wyatt said. “These business accelerators and co-working spaces are creating environments that really speak to the millennials.
“It’s not just about the space,” he said. “It’s almost a club environment where they can go and network and participate in business.”
Wyatt said buildings that might not be a good fit for large, multifloor downtown companies might better accommodate some of these new work spaces.
“It’s about the culture and the urbanity of downtown,” he said. “Downtown is becoming hip and cool.”
Steve Brown/ Dallas Morning News