Tuesday, June 21, 2005

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

Investment group buys downtown tower
Sale terms not revealed; California company sees opportunity in Dallas

DALLAS (DallasNews.com) - A downtown Dallas office skyscraper has been purchased by a nationwide investment group. A partnership assembled by Berkely Industries is buying the 50-story 1700 Pacific tower.

Terms of the sale were not disclosed, but the building had been for sale for more than $80 million.

The 50-story 1700 Pacific had been on the market for more than $80 million. Berkely is a family-owned company that has operated out of Los Angeles for the last five years but will be moving to Dallas. Jon Hamilton, a Berkely principal, said the purchase represents a good opportunity.

"With all the good things going on in downtown Dallas, you can still buy a first-class property for 50 percent of replacement cost," he said. "It's just a matter of time before it goes up" in value.

Mr. Hamilton has hired Lincoln Property Co. to manage the 1700 Pacific tower and Trammell Crow Co. to take over leasing.

"Right now the building is around 65 percent occupied," Mr. Hamilton said. Built in 1983 at Pacific Avenue and Harwood Street, the red granite tower contains about 1.34 million square feet of office space.

The skyscraper was sold by a partnership organized by an affiliate of Cousins Properties.

"When these buildings change hands, it's always a good sign," said Joel Pustmueller of Peloton Real Estate Partners, a real estate brokerage firm downtown.

BETSY BOCK/Staff Artist "The new owner is coming in and making a commitment to this market, and it usually causes an increase in leasing activity in the building."

Mr. Hamilton said his family has invested in real estate all over the country for 50 years.

In the 1990s, Berkely developed a North Dallas apartment community – the St. Moritz on Arapaho Road – which it still owns.

"We have a very long-term investment perspective," he said. "We are not much for selling our properties."

With all the redevelopment under way downtown, Mr. Hamilton said it was a good time to make a buy.

"Other downtowns all across the country are becoming very hot," he said. "Dallas has not yet caught up."