Everything you wanted to know about the Urban Core, Uptown and Downtown Dallas, Texas & Dallas Ft. Worth Area Real Estate - Its growth, prosperity, setbacks and unprecedented revitalization is told here...Randall Turner of Harvard Companies, Inc 214-373-0007, 3500 Oak Lawn Avenue, Suite 325, Dallas, Texas 75219
OVERstreet on SEVENTYfive in Dallas will total approximately 1.4 million square feet upon completion.
DALLAS — De La Vega Development will develop OVERstreet at SEVENTYfive, a 1.4 million-square-foot mixed-use project situated at the corner of North Central Expressway and Haskell Avenue in Dallas. The four-building project will deliver 767,000 square feet of office space, a 150-room hotel, 59,500 square feet of retail and restaurant space and a 462,000-square-foot residential tower.
During the last few years, the cost of a house in Dallas-Fort Worth has shot up to unheard-of levels — for those who can even find a house to buy.
North Texas residents know firsthand about high home prices. During the last few years, the cost of buying a house in Dallas-Fort Worth has shot up to unheard of levels — if you can even find a house to buy.
And the State of the Nation’s Housing 2017 study shows just how much the price of homes has increased in D-FW.
Turns out price gains in the area — when adjusted for inflation — haven’t matched the national price growth since 2000, according to a report from Harvard University’s Joint Center for Housing Studies.
Compared with prevailing prices in 2000, Dallas-area prices are about 25 percent higher when adjusted for inflation, Harvard’s researchers found. In Fort Worth, prices are up 18.3 percent over the same period.
On an annual basis, that means Dallas home prices have risen about 1.5 percent every year since 2000.
Nationwide, prices were up 32 percent in real terms and are up 40 percent or more in 153 metro areas. The biggest such increase in Texas has been in Austin, where values are 42.6 percent higher than 17 years ago.
But that’s nothing compared with the almost 97 percent gain in Los Angeles, the 84.3 percent hike in San Francisco and the 73 percent price rise in Miami. Those markets, and other major cities, have seen huge gains in prices even with the housing crash of a decade ago.
“We are seeing the housing market coming back to normal,” Harvard’s Chris Herbert said this week at a meeting of real estate journalists. “Last year, home prices finally reached back to their peak of 2006.”
But there are big disparities, Herbert told the National Association of Real Estate Editors in a sneak peek at the annual Harvard report.
“It depends on where you are in the country,” Herbert said. “It also depends on what neighborhood you are in.
“Ninety-seven of the 100 largest housing markets in the country have seen housing prices rise in the last year,” he said. “In only 41 of those markets are prices back to their peak. In 32 markets, prices are still 15 percent below their peak.”
Herbert said the biggest price hikes have come in the more affluent cities and in the richer neighborhoods.
“Low-income neighbors are much less likely to have gotten back,” he said. “In the Midwest and parts of the South, house prices are less than they were in 2000.
“Where you are in the country has enormous importance.”
That was certainly the case during the Great Recession, where coastal cities and markets in the desert Southwest lost billions in home values as Texas metros saw only slight declines.
“One reason we are seeing these housing prices go up so sharply in some markets is we have housing inventory that’s incredibly tight,” Herbert said. “At the end of last year, we were at the lowest point in decades. That first-time, entry-level market is where the market is tightest.”
Herbert said most of what the housing builders are producing is for more affluent, repeat buyers.
“We are not seeing homebuilders building entry-level homes,” he said, with only about 138,000 nationwide starts in that category last year. “We have very little new housing, making that part of the market very tight.”
Just as in the homebuying market, developers of rental units have concentrated on the higher end of the business.
“We are getting a saturation of luxury downtown rentals where we have built a ton of them,” Herbert said. “We have had big growth in high-cost rentals.”
Nationwide rentals priced under $800 a month have gone down more than 260,000 units since 2005, the Harvard study found.
“Forty-eight percent of renters and 24 percent of homeowners are not finding housing that’s affordable,” Herbert said.
Experts predict Amazon will use the Whole Foods stores, in part, as hubs for grocery pick-up and delivery, helping Amazon resolve the “last mile” dilemma.
The proposed $13.7 billion acquisition of organic grocery retailer Whole Foods Market by e-commerce giant Amazon holds the potential to upset the grocery cart, so to speak. Yet retail real estate investors should cheer the Amazon-Whole Foods deal, experts say.
Experts predict Amazon will use the Whole Foods stores, in part, as hubs for grocery pick-up and delivery, helping Amazon resolve the “last mile” dilemma of how to get products from local shipping hubs to nearby customers. Without a substantial brick-and-mortar presence, Amazon has struggled to effectively operate its AmazonFresh grocery pick-up and delivery service. Industry observers also expect Amazon to improve efficiency at Whole Foods’ distribution centers by incorporating the e-commerce company’s technology.
The Amazon-Whole Foods deal presents an opportunity for retail real estate investors, according to Matthew Harding, president of retail real estate services firm Levin Management. The combo with the e-commerce behemoth will help lessen “this perceived threat that all brick-and-mortar retail will be dead by next January,” he says.
Amazon’s purchase of Whole Foods should instill confidence in retail real estate investors, especially those whose portfolios include grocery-anchored properties, Harding notes. “Grocery-anchored shopping centers have always been one of the more stable property types within retail,” he says.
While retailers in other categories, including Sears, Kmart, Payless ShoeSource and RadioShack, are collectively shuttering hundreds of stores as they lose ground to e-commerce players, the Amazon-Whole Foods deal underscores the vital role of brick-and-mortar in the future of retail, Harding says.
Although the acquisition will disrupt the grocery business, it will also create “arbitrage opportunities” to buy grocery-aligned properties, says Joe McKeska, president and co-founder of Elkhorn Real Estate Partners, which provides advisory and investment services for the retail real estate sector, including grocery properties. Elkhorn is a division of A&G Realty Partners, a commercial real estate advisory and investment group.
“I think there are opportunities,” McKeska says. “But I think you also have to be more selective and more careful and more thoughtful in terms of how you make those decisions.”
McKeska — previously a real estate executive at Southeastern Grocers, owner of the Winn-Dixie, BI-LO and Harvey’s chains — says that from a macro perspective, retail real estate investors will need to weigh which grocers are likely to survive the shake-up and which are likely to wither. From a micro perspective, investors should scrutinize grocery store locations and market share, he says.
“It’s a good time for investors to really take a hard look at what they have in their portfolio,” McKeska says, “and make sure that they are comfortable with the assets they have and that it fits their overall investment profile and risk profile accordingly, especially in light of all the changes that are taking place.”
Through the acquisition, Amazon will control Whole Foods’ 440 stores in the U.S., as well as its 11 regional distribution centers, according to the Wall Street Journal. Those will be coupled with Amazon’s two drive-up grocery stores and eight brick-and-mortar bookstores, as well as its more than 70 fulfillment centers nationwide.
The Amazon-Whole Foods marriage — whatever shape it takes — will force other players in the grocery business, like Albertsons and Kroger, to adapt to the new environment and accelerate their growth strategies, notes Harding.
“They’re in a competitive industry. They know that Amazon and other players like Jet.com have been encroaching on their business,” he says. “If anything, [the Amazon-Whole Foods deal] will increase the need to modernize and evolve. And not everyone will do that.”
Grocery retailers that fail to modernize will fall by the wayside, just as some players in other retail sectors already have, according to Harding. McKeska expects the Amazon-Whole Foods deal to be something of a catalyst for “a wave of consolidation” in the grocery industry.
That’s a view shared by executives at Kroger, the country’s second largest grocery chain and once a potential Whole Foods suitor. In a June 15 conference call with Wall Street analysts, Rodney McMullen, chairman and CEO of Kroger, said the grocery business is “probably at the front end of the next phase of consolidation.” Michael Schlotman, Kroger’s chief financial officer, added that the anticipated consolidation will allow the grocery chain to increase its footprint in existing markets.
As if Amazon’s full-bore move into the grocery business weren’t enough, pressure on grocery retailers, including big-box mainstays Costco, Target and Walmart, is also coming from two German grocers that are expanding aggressively in the United States.
Discount grocer Aldi plans to remodel 1,300 of its 1,600 stores in the U.S. by 2020, and to add 900 more stores stateside by the end of 2022. Over the next five years, Aldi aims to invest $5 billion in new and remodeled stores. Meanwhile, discount grocer Lidl opened its first U.S. store on June 15 and intends to roll out as many as 100 stores along the East Coast by the summer of 2018.
At the same time, regional grocers Publix and Wegmans are broadening their footprints on the East Coast.
Not that long ago, Whole Foods had its own ambitious plans for expansion. In 2013, executives unveiled a strategy to grow to 1,200 stores nationwide. Later on, Whole Foods introduced a low-cost, pared-down concept called 365.
But in February, Whole Foods — amid a prolonged sales slump — abandoned the 1,200-store goal and announced the closure of nine stores. In the wake of the Amazon bombshell, McKeska wonders what will happen to the 365 format, which operates only four stores.
Even so, McKeska doesn’t think an Amazon-owned Whole Foods will pull back on opening more locations or redeveloping older ones. “I would be surprised if Amazon puts the brakes on that,” he says.
However, food industry expert Phil Lempert suspects Amazon will at least temporarily halt the addition of Whole Foods locations to take stock of the grocer’s expansion plans. The acquisition is scheduled to close in the second half of 2017.
“They’ll need some time to properly evaluate expansion locations,” Lempert says, “and look at what markets are over-stored and under-stored before they make a move.”
The development firm wanted to build in its hometown, in part, because the Las Colinas market continues to outperform in the North Texas region, said Matt Brendel, senior vice president and development partner for JPI.
The details of JPI's financing was not immediately available Wednesday.
Plans for Jefferson Eastshore include a resort-style community pool, a fitness center with yoga studio and a rooftop terrace overlooking Lake Carolyn.
Each apartment will have an urban mud room, high-end finishes within the homes and separate showers. Some of the homes will include private yards.
The $32 billion oil and gas company will kick off the first phase of Verizon's new Hidden Ridge development.
"Pioneer's building will stand atop the highest point of the former Carpenter Ranch in Las Colinas, so it's only fitting that a great building site such as this go to a great company like Pioneer," said KDC CEO Steve Van Amburgh, in a statement.
"We've worked very closely with Pioneer to design a building that amplifies the beautiful and natural surroundings of the land yet is appropriately scale for Pioneer's employee-focused culture and modest character," he added.
The new Pioneer Natural Resources campus was expected to get underway this summer, but the deal had yet to be announced by the developer or company — despite it being common knowledge in the real estate and business community.
The 10-story office building, which will sit at 777 Hidden Ridge near Hidden Ridge and John Carpenter Freeway, will include a glass curtainwall, stone facade with an adjacent seven-story parking garage.
Pioneer will also have a fitness center and cafeteria for its employees. This new campus will sit in a proposed Hidden Ridge mixed-use development that will significantly expand the amenities for Pioneer's employees.
The development group, which includes telecom provider Verizon, behind Hidden Ridge are expected to unveil plans later this year for the $1.5 billion project.
Dallas-based Woodbine Development Corp. launched a $85 million fund — Woodbine Legacy Investments — that made its first acquisition: The Hilton Dallas Park Cities hotel.
The 11-story, 224-room hotel at 5954 Luther Lane in Preston Center was acquired in an off-market deal for an undisclosed sum. The deal came after a long-standing relationship between Hilton and Woodbine.
With the $85 million fund, which will have the buying power of $250 million, Woodbine Legacy Investments plans to pursue low-risk, conservatively leveraged, full-service and upscale select-service hotels in high, barrier-to-entry markets.
Woodbine's leadership team will manage the fund with the intent to own the acquired properties in a long-term hold.
"With this fund, we are leveraging the relationships that Woodbine has developed over 45 years and sourcing unique opportunities in high-barrier-to-entry markets where we feel confident about the long-term cash-flow potential," said Dupree Scovell, managing partner and chief investment officer for Woodbine and WLI, in a statement.
Woodbine has been under the direction of Dupree Scovell's father John Scovell, who is the chairman and founder of the real estate firm.
One of the landmarks in Dallas' Oak Lawn neighborhood is close to a sale to a California investor.
Turtle Creek Village on Oak Lawn Avenue dates to the early 1970s and was one of Dallas' first mixed-use projects.
The 9-acre development was purchased three years ago by Dallas' Lincoln Property Co., which did a major overhaul of the project.
Los Angeles-based CIM Group — which has already made significant investments in Dallas — is closing in on a purchase of Turtle Creek Village, real estate brokers say.
The property has been marketed for sale since late last year by Holliday Fenoglio Fowler LP, which confirms the property is under contract for sale.
Turtle Creek Village is more than 90 percent leased with retail tenants including Tom Thumb, World Market, Zoe's Kitchen and Athleta.
CIM Group representatives declined to discuss the deal.
"CIM does not comment on transactions that it may or may not be considering," a company representative said in an email.
In 2012, CIM Group made a big play in central Dallas with the purchase of about two dozen properties along Henderson Avenue in East Dallas in partnership with Dallas' Open Realty Advisors. The private real estate investor has been working to redevelop some of the vacant properties in that acquisition.