Tuesday, June 28, 2005

Downtown Dallas & Uptown Real Estate News

Downtown Dallas & Uptown Real Estate News

Designer Starck plans Victory condos

DALLAS (DallasNews.com) - The last time Philippe Starck made a splash in Dallas, he opened a nightclub during the go-go 1980s real estate boom.

London developer John Hitchcox and Philippe Starck plan to collaborate with a Boston architecture firm on a 26-story residential building at Victory called the House. So it's only fitting that the French designer is back to play a part in Dallas' current craze – high-rise condos.

On Monday, Mr. Starck talked about his plans for the House, a 26-story, 150-unit residential tower in Uptown's Victory project.

Mr. Starck promises the $80 million project won't be a beige box.

"I can bring something unique from around the world," said Mr. Starck, 56, who is also doing residential buildings in Boston, New York and Miami with his partner, 43-year-old London developer John Hitchcox.

"The people in the U.S. have a small view of the global market. I am the global view."

That view will come with an average price tag of more than $500,000.

The developers have already begun taking reservations at $5,000 a pop.

Mr. Starck's condo tower will be built in partnership with developer Hillwood on Lamar Street at the south end of the Victory project.

BETSY BOCK/Staff Artist It's the latest in a string of recent announcements in the 75-acre project, owned by Hillwood and Hicks Holdings Inc.

Hillwood wanted Yoo Ltd., Mr. Starck and Mr. Hitchcox's design firm, to give buyers something unique, said Jonas Woods, president of Hillwood Capital.

"We will have a very different offering in each residential building," Mr. Woods said. "The design of the House and character of it will be very different from anything Dallas has ever seen."

But we'll have to wait a few months for a detailed look.

Boston architecture firm Elkus Manfredi is designing the exterior, and Mr. Starck will collaborate with architect Howard Elkus on the plans, according to Hillwood. Yoo will design the interiors.

"We plan to break ground in the first quarter," Mr. Woods said.

The Dallas condos will range from 1,000 to about 3,500 square feet.

Amenities planned for the building include a swimming pool, lounge, business center, guest apartments and 24-hour concierge.

All of Yoo's projects come with a big slice of Mr. Starck's eye-popping style – whether in the building lobbies or – if the buyers choose – complete residential interiors.

"Other people at the same price give concrete and steel," Mr. Starck said. "For us, we give dreams.

"People who chose to have an apartment made by me expect something special."

Who's Yoo

Mr. Hitchcox said he met Mr. Starck about seven years ago while working on a residential project in Paris. "I had been building lofts in London and we had been doing a lot of design-oriented development, and I knocked on his door."

They struck up a friendship and eventually started designing projects ranging from small historic renovations in Boston to 40-story towers in Tel Aviv.

Yoo has built residential projects in cities including Melbourne, Boston, Moscow, Tel Aviv, Miami, Buenos Aries, Hong Kong, Seoul, New York, Madrid and Vienna. Most of its projects are done in partnership with other developers or investors.

"What's interesting in America is how quickly this business has taken off and the appetite for good design," Mr. Hitchcox said.

The prices and sizes of Yoo's projects are just as diverse.

"We have apartments in Melbourne that are $80,000 each," Mr. Hitchcox said. "Our apartments in New York sold for $8 million.

"You can put three of our apartments in Hong Kong into one of our apartments in Miami."

Back to the Wild West

Mr. Starck has a special relationship with Dallas that goes back more than 20 years.

When he opened his West End nightclub in 1984, Dallas got a disco that attracted worldwide attention. Just getting in the door of the Starck Club was a challenge – because of both the crowds and door screeners who made sure only the right folks gained admittance.

"I was known because of my success in Texas," said Mr. Starck, who lived in Dallas for almost a year. "It was a big adventure.

"It was the Wild West here, and I was not disappointed – it was wild."

More 'charming'

Today, he says, Dallas is more "charming and polite" than it was in the disco days.

The condo market here is also different than it is on the two coasts, he says.

"Dallas is the center of America," Mr. Starck said. "To work in the center of America is interesting."

The demand for Mr. Starck's work in the U.S. is growing, according to his development partner.

"At the moment, there seems to be a huge appetite for what we are doing on a scale that surprises us," Mr. Hitchcox said.

"This building is going to be full of people who were 20-somethings 20 years ago when Philippe had his nightclub here."


What: The House is a 26-story, 150-unit luxury condo tower planned for Uptown's Victory project.

Where: At the south end of Victory at Lamar and Houston streets.

When: Buyers can reserve units in the building for $5,000. The House is scheduled to be designed by the fall, and construction will start in first-quarter 2006.

Who: A project of French designer Philippe Starck and Yoo Ltd., the London development company headed by John Hitchcox. Victory developer Hillwood is the majority partner in the Dallas condo tower.

For more information: www.thehousebystarck.com and www.yooarehere.com

SOURCES: Hillwood; Yoo


Philippe Starck was born in Paris in 1949, the son of an aircraft designer.

Since the 1980s, he has been one of the world's most popular contemporary designers of everything from furniture to appliances and interiors.

His interior design projects range from apartments and cafés in Paris to hotels in New York and Miami and offices in Japan.

In 1984, he designed the Starck Club disco in the West End. The original Starck Club was open for about five years.

Mr. Starck's Web site is www.philippe-starck.com.

SOURCE: Dallas Morning News research

Wednesday, June 22, 2005

Downtown Dallas & Uptown Real Estate News

Downtown Dallas Real Estate News

NAIOP Speakers Address Issues Confronting Global Economy

DALLAS (DallasNews.com) - Looking to get their arms around every aspect of the industrial arena, about 200 professionals are wrapping up a third day of seminars focused on the global perspective of doing business in today's world.
"The outlook for your business is good," Jeff Thredgold of Salt Lake City-based Thredgold Economics told yesterday's crowd attending NAIOP's I.con at the Adolphus Hotel in Downtown Dallas. "The economy's going to continue to perform well."

Thredgold crisscrossed the world's markets for conference goers, tossing out cautionary commentary about Japan and economically flattering stats about China and India. As for the US, he said time will prove it wasn't a jobless recovery after all, but rather a breeding period for startup businesses to seed the employment sectors of the future.

Thredgold predicted the future's seven most critical industries will be technology, transportation, telecommunications, financial services, energy, entertainment and biomedicine. "In terms of technology, we ain't seen nothing yet," he quipped.

At the end of the day, the most commonly used word was "competition," regardless of the session. A powerhouse panel, comparing a development model in SoCal, Dallas and Central Jersey, discussed the changing dynamics from market to market and universal pro forma changes arising from increased construction costs and higher land prices as residential developers go head to head with the commercial sector.

"The last cycle, nobody wanted to touch land. This cycle, it's doubled. Costs are up, rents will have to go up," said John Stirek with Dallas-based Trammell Crow Co. "Otherwise, it's going to be a pretty cold cycle." The climate has developers taking down their land banks for spec development and buying acreage when they can. "I do think this cycle's going to be shorter," he predicted.

Buoyed by its prospects in the industrial arena, Mexico is advancing a plan to build a logistics network to go hand in hand with its maquiladora manufacturing trade, which has rebounded from the downturn. Meanwhile, the hot talk of the day is the introduction of REITs, possibly in the next nine months, to get more investors across its border, said Luis Gutierrez with G. Accion, part of a panel dedicated to joint venture opportunities in Mexico.

Transportation expert, Dr. Leigh B. Boske from the LBJ School of Public Affairs at the University of Texas at Austin, discussed trends and regulations for the trucking, rail and shipping industries. Boske, who's in Washington, DC today to present his latest federally commissioned report, is optimistic the long-awaited transportation funding bill will be ready for a vote by June 30. Besides the highway dollars that are at stake so are regulations for truckers' road hours.

These days, transportation experts are attuned to the ports, zeroing in on alternatives to battle long waits for offloading, loading and processing. Among the options is an inland port, just like the one that's proposed for South Dallas. "No one, but no one anticipated the amount of trade coming from China," Boske said.

Downtown Dallas & Uptown Real Estate News

Downtown Dallas & Uptown Real Estate News

Galleria builder joins Hillwood to construct first work spaces

DALLAS (Dallasnews.com) - Houston developer Hines is teaming up with Ross Perot Jr.'s Hillwood development firm to build two office towers at Uptown's Victory project.

The 33-story W Dallas Victory Hotel & Residences with 144 condominiums, 251 hotel rooms and 42,500 square feet of retail space. To open in May.

The Terrace, a seven-story, 95-unit condominium building with 24,000 square feet of retail space. To open in May.

The Vista, a 125-unit apartment building with 25,000 square feet of retail space. To open in May.
The buildings will be constructed near Continental Avenue and Stemmons Freeway, at the south end of the 75-acre Victory complex between the West End entertainment district and American Airlines Center.

"We have signed a joint venture with Hines to build an 800,000-square-foot office complex," Jonas Woods, Hillwood Capital president, said Tuesday. "They have the kind of experience and have demonstrated the quality we want.

"It made sense for us to team up with them on the first office space in Victory," he said.

Hines built the Galleria Dallas mall and office high-rises all over the globe.

Construction so far in Victory has concentrated on hotel, residential and retail. But the project's master plan called for millions of square feet of office space.

BETSY BOCK/Staff Artist With Hines' addition to the development, construction of speculative office space will take a higher profile.

"We hope it's no more than six months away from a groundbreaking," said Mr. Woods. "The first building will be 18 stories with retail on the ground floor."

He said the office project is "subject to pre-leasing, but we are making very good strides." He said rental rates are projected to be in the "high $20s" per square foot annually.

That's more than most new suburban office buildings charge but still less than the luxury space at the nearby Crescent.

The complex will be Hines' first Dallas office project in several years. Clayton Elliott, a Hines senior vice president, said Victory's quality and location helped make the decision easy.

"It is seeing firsthand the new development going on down there," Mr. Elliott said. "There are eight additional buildings coming on line in the next few years.

"It's really getting to be a great urban environment for tenants to have another choice for their office," he said.

Dallas architect BOKA Powell is designing the two-phase project. BOKA Powell has worked on other buildings proposed for Victory, including a 45-story office and condo tower to be built across the street from American Airlines Center.

Almost $450 million in development is under way at Victory, including the W Dallas Victory Hotel & Residences set to open in May; two smaller residential buildings to be finished next summer; and two retail and commercial buildings to open in May on the south side of American Airlines Center. Already, several restaurants have signed on to be Victory tenants.Next week, Victory's developers are scheduled to announce plans for yet another residential tower – "The House" designed by Philippe Starck. The project will be done with London and New York-based Yoo Ltd.

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

LA Investor Closes On 1700 Pacific Purchase

CSFB and Faison Exit Dallas Market Following Near-$100 Million Sale

DALLAS (CoStar Group.com) - After a false start last year, a partnership between Credit Suisse First Boston (CSFB) of New York, and Charlotte, NC-based Faison Capital Advisors successfully sold the 49-story downtown Dallas landmark 1700 Pacific. The buyer, a private investment firm based in Los Angeles called Berkeley Investments, agreed to pay a price of "near $100 million" for the 1.34 million-square-foot office tower.

John Alvarado and Josh McArtor with Trammell Crow Company's Capital Markets group brokered the sale on behalf of the CSFB/Faison partnership, which had owned the property since 1986. With the sale, both companies have fully divested their holdings in the Dallas market.

Last year, another buyer put the building under contract, but the sale fell through and the sellers pulled the building off the market. "The transaction went as smoothly as could be expected after re-positioning the asset in early 2005," Alvarado said in a statement announcing the sale.

After the earlier sale was called off, observers speculated the prospective buyer may have had difficulty arranging financing for an older office building in downtown Dallas, despite a price reorted to be less than replacement cost. Alvarado credited Stephen Pearlman, a colleague in Trammell Crow's New York office, with identifying debt sources and helping arrange competitive financing to secure the building for Berkeley Investments.

Jon Hamilton, a Berkeley Investments principal, said his company will open an office in the building and is planning an "aggressive lease-up plan" for the 382,000 square feet of contiguous space that remains available in the building.

Trammell Crow's Jim Yoder, Jeff Eckert and James Esquivel will continue to market available space in the building for Berkeley, while property management duties will be handled by Lincoln Property Company.

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

GlobeSt.com EXCLUSIVE: MetLife Buys Turtle Creek Centre

DALLAS - CB Richard Ellis Investors Inc., representing the Utah State Retirement Fund, has released the 295,809-sf Turtle Creek Centre to MetLife Real Estate Investments Inc. Market sources say the Uptown office deed has brought in the high $170s per sf for its 11-year owner.

As the deed changed hands so did the property management and leasing assignments for the class A building at 3811 Turtle Creek Blvd., assessed at $33.9 million by Dallas Central Appraisal District. None of the deal's brokers was available prior to publication time for comment on the transaction.

When the deal closed, the new owner put Trammell Crow Co. in charge of the asset after a face-off with Houston-based PM Realty Group. TCC principal Jim Yoder tells GlobeSt.com that the same team assigned to the New York City-based MetLife's 2100 McKinney high rise has been handed the reins to Turtle Creek Centre--Matt Craft and Worthey Wiles for leasing and Kari Whitley as property manager. "The common ownership gives you flexible, creative things to do with leasing," Yoder says.

The TCC team is stepping into an 85%-leased asset with "not a lot of immediate roll," Yoder says. The 21-story building has about 40 tenants, with its leads as CSC Consulting Inc., 25,000 sf; Centex Construction Co., 29,000 sf; and Wilson & Associates Inc., about 15,000 sf.

Turtle Creek Centre's quoted rate has been $23 per sf plus electric. "We're going to try to push it to $25 per sf plus electric," Yoder says. The rent hike will be married to a renovation of landscaping and common areas aimed at nudging the class A into the class AA playing field, he adds.

The Utah pension fund bought the 21-year-old building, positioned on two acres in the city's most valued office submarket, in October 1994. CB Richard Ellis Inc.'s Gary Carr and Russell Ingrum steered the sale for CB Richard Ellis Investors, which had Michael Everly in Los Angeles and James Bell in Newport Beach, CA in the drivers' seats.

Tuesday, June 21, 2005

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

State of the Union Tower
Complex's empty offices are about to become homes, shops

DALLAS (DallasNews.com) - It's been empty as long as the Mercantile National Bank building and has about as much office space. But for years, the huge Union Tower Complex on Thanks-Giving Square has been pretty much ignored.

That won't be the case for long. Starting this summer, the derelict skyscraper is getting a $106 million residential makeover.

"We're going to create a big neighborhood over here," said developer Ted Hamilton, who also converted downtown Dallas' Davis Building and the Dallas Power & Light complex into housing. "This is a humongous building. It has more than a million square feet of space."

Father and son Larry (right) and Ted Hamilton plan to convert the complex into apartments, stores and parking. The former office building will house 432 apartments, 19,000 square feet of ground-floor retail and 737 parking spaces.

But first, the developers have to clear out acres of abandoned furniture and office equipment and demolish the interior of the 32-story tower at Akard and Bryan streets.

"We think the whole project will take around 18 months," Mr. Hamilton said.

The building will be called the Mosaic, a reference to the millions of blue green ceramic tiles on the exterior.

"We went through a lot of names," Mr. Hamilton said. "This building didn't have a strong identity like the Davis Building or DP&L."

Once it did.

From offices to empty

When the 32-story Mayflower Building opened in 1960, it was one of the tallest buildings in Dallas. Built in a partnership with Fidelity Union Life Insurance Co., the brick glass and tile tower joined the 21-story Fidelity Union building that went up in 1952. Both structures were designed by Dallas architect Hedrick C. Wyatt.

Dallas went through an office building boom between 1950 and 1960. More than 60 office buildings went up, and only New York added more office space during that time.

But by the early 1990s, Dallas' midcentury buildings were mostly out of fashion.

The Union Tower Complex has been mostly empty since 1992, when Fidelity Union Life Insurance was acquired by a Minneapolis firm. Weak demand for downtown office space and environmental problems with the building contributed to the lack of interest.

New demand for living space in Dallas' core is driving the building's renaissance, and Hamilton Properties bought the complex last year.

Meriman Associates is the architect on the redevelopment, and Andres Construction has been hired as general contractor.

Mr. Hamilton estimates that the apartments will average more than 1,100 square feet and start at around $900 a month.


Other features planned for the building include a pool and recreation area on top of the north side parking garage and a dog park on the 21st floor.

The developers plan to preserve some of the historic lobby areas of the building as well as an executive apartment that's still furnished in 1960s swank.

"We call it the Ricky Ricardo apartment," Mr. Hamilton said.

Unlike the historic Davis Building, which opened 2003 – and the DP&L buildings, which opened Thursday – the Union Tower Complex will get a more modern style makeover. The developers have also gotten tentative approval to cut new windows in one side of the building that faces Thanks-Giving Square.

"Reportedly this was the biggest office building in Texas when it was completed," said Larry Hamilton, Ted Hamilton's father, who founded Hamilton Properties in Denver. "The project is a good link between the historic districts downtown and the Arts District."

Hamilton Properties is receiving about $9 million in public incentives for the project.

'New frontier'

Most of the downtown apartments built recently have been in the area from Elm Street south. That's starting to change.

Redevelopment is also scheduled to begin this summer on the Republic Bank Building, another building that faces Thanks-Giving Square. Gables Residential Trust is doing the Republic project.

"We have focused our attention on the revival of Main Street while other areas of downtown are equally important," said Dallas City Council member Veletta Forsythe Lill. "We are thrilled the Hamilton family has decide to seek this new frontier.

"That area has good pedestrian access and mass transit," she said.

The Dallas Area Rapid Transit light rail line runs right in front of the Union Tower Complex.

More than 2,500 additional apartments are under construction or planned in the central business district.

The downtown rental projects have been attracting a broader base of tenants, said industry analyst Mike Puls, who said he isn't worried yet about an oversupply.

"There are a substantial number of people leaving the suburbs looking for more fun" in terms of where they rent, Mr. Puls said.

"The downtown market still has potential, and there are fewer new apartment deals that can go to Uptown because the land prices are so high."

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."

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

DALLAS (DallasNews.com) - Starting next week, potential buyers will get a peek at downtown Dallas' latest condominium project.

The 32-year-old 1200 Main office skyscraper will be redeveloped into the Metropolitan, with 283 condominiums.

"It's a little bit of a jigsaw puzzle," said Christine Lutz of Garrison Partners Consulting, a Chicago firm that's overseeing the marketing of the Main Street project.

"We are working within a framework we cannot change. At the same time, what we are doing to the building will make it totally different," she said.

Work crews are building model apartments in the empty office building and construction is complete on the ground-floor marketing center, which will open later this month. A preview Tuesday will show off the project to a list of potential buyers.

The condo prices will range from about $120,000 for the smallest one-bedroom floor plan to more than $560,000 for the largest two-bedroom unit.

Instead of industrial-style urban apartments, condos at the Metropolitan will be highly finished homes.

"We're offering an alternative to lofts, which is great," said Ms. Lutz, whose firm is also marketing a high-rise residential tower in downtown Fort Worth.

Outside, most of the thousands of brown-tinted glass panels are staying put.

"The cost to replace the façade would add millions of dollars" to the redevelopment budget, which could run as high as $50 million, said Keith Walker, senior vice president of Rockwood Realty Associates, the New York-based developer of the project.

"The property has that kind of modern Mies van der Rohe look. We wanted to give it a residential feel by putting in the balconies," Mr. Walker said.

Inside, the condos will have sleek European-style kitchens and baths and oversized closets.

The Dallas makeover is part of a nationwide craze, said Garrison's Garry Benson.

"We started with the older buildings in loft style and have moved on to the '50s and '60s office buildings," he said. "We are always looking for higher and best uses of real estate assets."


What: The Metropolitan condos are being developed in a former office tower that was built in 1972 at Main and Murphy streets.

Who: Rockwood Realty Associates of New York is the developer. Corgan & Associates architects of Dallas designed the reconstruction of the brown glass tower that includes cutting more than 160 balconies into the building's exterior.

Amenities: A seven-level parking garage to be built on the tower's east side, retail space on the ground floor, and a swimming pool and a garden on the top floor.

When: Construction will begin in August and take 14 to 18 months.

Prices: There are 14 floor plans, ranging from about 660 square feet to more than 2,000 square feet. Costs will range from $120,000 to more than $500,000.

Count the ways: When the floors are numbered, 13 is skipped, so there's a 26th floor in a 25-story building.

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

DALLAS (DallasNews.com) - Developer Billingsley Co. is giving a first look at 7-Eleven Inc.'s new headquarters in downtown Dallas.

The modern-style concrete and glass high-rise was designed by local architects and will house the first office space built in the Arts District since the 1980s.

Billingsley Co.
The One Arts Plaza tower will be built of unembellished concrete, steel and glass. Its 'front door' will be Flora Street. "We are working on construction details right now and plan to break ground in July," said Lucy Billingsley, whose firm is building the $100 million project at Flora and Routh streets.

7-Eleven announced in April that it would relocate its 1,000-person headquarters from Cityplace on North Central Expressway in early 2007.

Along with the convenience store chain's offices, the 24-story One Arts Plaza tower will contain an additional 180,000 square feet of multitenant office space, plus 71 luxury condominiums on top.

"Most people will be looking at our building down Flora Street, which is our front door," said architect Lionel Morrison with Morrison Seifert Murphy.

BETSY BOCK/Staff Artist Mr. Morrison's firm and architects at Corgan Associates who worked on the project also had to acknowledge their competition in the Arts District – high-profile designers of the cultural landmarks including the Morton H. Meyerson Symphony Center and Nasher Sculpture Center.

"We are surrounded by these buildings done by world-class architects on essentially unlimited budgets," he said.

Instead of expensive stone or elaborate metal panels, the One Arts Plaza exteriors will be constructed of unembellished concrete, steel and glass.

"We don't have the budget to make this a limestone building," Mr. Morrison said. "But we need to hold our own in this company."

The building's upper levels are accented by a large section of glass wall and balconies for the condominiums.

On the ground floor, two glass and steel wings facing a plaza will have retail space and help mask the parking garage.

Wednesday, June 08, 2005

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News


DALLAS (DallasNews.com) – Two more multifamily rental properties in Dallas’ Uptown are under the wing of Gables Residential. The 22-story, 196-unit Uptown Tower at McKinney Ave. and Hall St. and the 158-unit Gables Katy Trail complex at 2821 Carlisle St. were purchased by the company and are slated for remodeling. Gables will spend about $4 million remodeling the two assets it purchased from Fath Properties.

Together, the two developments are valued at about $22.5 million on the tax rolls. Counting projects under construction, Gables has more than a dozen rental properties between Highland Park and downtown Dallas.

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

DALLAS (Marcus & Millichap) – "High levels of net inmigration and residential expansion will bolster retail sales and attract retailers to the Metroplex," comments Tim A. Speck, regional manager of Marcus & Millichap Real Estate Investment Brokerage Company’s Dallas office. "A slowdown in construction activity coupled with improving economic conditions will continue to fuel investor interest for Dallas-Fort Worth retail assets throughout the year."

The company’s Retail Research Report for Dallas-Fort Worth report indicates:

Employers are expected to add more than 76,000 employees, an increase of 2.8 percent and population will continue to grow, resulting in sales growth of 4.7 percent this year.

After rising during each of the past two years, construction will fall 24 percent this year to 4.1 million square feet.

The overall vacancy rate is forecast to ease 30 basis points, and asking rent growth of 2.6 percent can be expected as occupancy continues to firm. Vacancy is expected to decline to 11.1 percent.

The single-tenant net-lease sector continues to attract significant investor attention.

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News


DALLAS (DallasNews.com) – Blighted skyscrapers will become new residences and retail in downtown Dallas if a deal negotiated by Dallas officials and Forest City Enterprises on Wednesday is approved by the City Council. Just last week, Forest City had announced that it was dropping its plans, which would have brought new life to downtown, because of a falling out with the city about incentives.

Forest City will transform the Mercantile Bank tower into 225 apartments, demolish other sections of the complex and replace with 150 more apartments and build 150 condos in the Continental building. It will also create 265 apartments in the four-building former TXU Gas Co. complex that is currently owned by the city.

In return, the city will give Forest City between $58 million and $60.5 million worth of tax incentives toward the Mercantile complex and $5 million toward the Continental building, according to terms of the tentative deal.

After the meeting, Mayor Laura Miller said, “We’re married. There’s no time for a honeymoon, but the City of Dallas and Forest City are definitely hitched.”

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News


DALLAS (DallasNews.com) – A group of European investors represented by Real Estate Capital Partners has purchased Mockingbird Station, a mixed-use development built around the Mockingbird light rail station on North Central Expressway east of Southern Methodist University. The sellers were Simpson Property Group (one of the original developers) and a Michigan pension fund.

The development includes 211 loft apartments, an eight-screen Angelika cinema, a Virgin Entertainment superstore, shops, restaurants and about 140,000 square feet of office space. The retail is more than 85 percent leased and the office building is 68 percent leased.

Mockingbird Station’s original developer Ken Hughes said, “Europeans tend to better understand mixed-use developments. Clearly they understand much better than American investors the value of being on a transit station.”

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

BOCA RATON, Fla. (PRNewswire-FirstCall) – A partnership managed by ING Clarion has entered into a definitive agreement to acquire Gables Residential Trust, a company specializing in luxury multifamily properties. The transaction represents the largest public-to-private REIT transaction in the multifamily sector.

Under the terms of the agreement, the ING Clarion partnership will acquire all of Gables' common stock for $43.50 per share in cash. Completion of the transaction, which is expected to occur by the end of third quarter 2005, is subject to approval by the Gables' common shareholders and certain other customary closing conditions. The transaction has been unanimously approved by Gables’ board of trustees, which will recommend that the common shareholders approve the transaction.

The transaction is being financed by $400 million of equity provided by ING with the balance of the debt and equity capital arranged by Lehman Brothers Inc. and its affiliates.

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

DALLAS (GlobeSt.com) – For its first North Texas buy, Centaurus Investments has purchased the 80 percent leased, 136-unit Savannah Heights at 2600 Arroyo Ave. for $3.75 million from Oakway Ltd. Centaurus officials said the firm plans to convert the Oak Lawn complex into condos. Centaurus plans to do minor renovations, but no other changes are planned.

Units in Savannah Heights average 825 square feet with rents averaging $655 per month. The purchase is part of an acquisition goal of 500 to 1,000 units in Dallas-Fort Worth in the coming year, according to Centaurus officials.

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News


DALLAS (Perry Guest Co.) – Gables Residential has purchased the Carlisle on the Creek Apartments at 3104 and 3230 N. Hall St. in Uptown Dallas.

According to Hank Glasgow Jr. of Perry Guest Co., Gables’ strategy is to purchase and develop in Uptown and Highland Park. In the past, the company focused on newer properties, but now it is looking to buy apartment buildings in prime neighborhoods, such as Park City, Highland Park, University Park and Uptown, regardless of age. Carlisle on the Creek Apartments was built in 1967 and contains 176 units. Gables will keep the building with the possibility of redeveloping in the future, Glasgow says.

The sellers were SMI Realty of Newark, New Jersey, which purchased the property in 1994. Perry Guest Co. represented the buyer and the seller in this off-market deal

Monday, June 06, 2005

Downtown Dallas Real Estate News

Downtown Dallas Real Estate News

Harwood Center

GlobeSt.com EXCLUSIVE: Lehman Chooses Team for Dallas Sale
By Connie Gore
Last updated: June 3, 2005 07:27am

DALLAS-Ending a face-off among all the top brokerage firms, Lehman Brothers yesterday gave the nod to Holliday Fenoglio Fowler to sell the largest block of CBD space to hit the market in quite awhile. Saint Paul Place and Harwood Center, with a combined 993,809 sf, join a growing roster of soon-to-be-marketed class A and class B-plus buildings in the metroplex.

GlobeSt.com has confirmed the HFF win over CB Richard Ellis Inc., Cushman & Wakefield of Texas Inc., Jones Lang LaSalle Inc., Rockwood Realty Associates Inc. and Trammell Crow Co. Word on the street is the New York City-based lender has taken back the CBD high rises in a gentlemen's agreement with the Witkoff Group, which bought the buildings in the mid-1990s. Assessed at close to $70.9 million, the 273,080-sf St. Paul Place at 750 N. St. Paul St. and the 720,729-sf Harwood Center at 1999 Bryan St. are just the tip of the proverbial iceberg of all that's coming up for sale in Dallas/Fort Worth.

The piece de resistance now being groomed for a sale is JPMorgan International Towers I, II and III, 1.1 million sf of premier space along the Dallas North Tollway. An HFF team also snared that win at the interview table with its owner, Ohio Teachers Retirement System. Given market conditions and the asset's quality, the prediction is it will take close to $200 per sf to win the deed. The trio's assessment hovers $152.8 million.

Meanwhile, sources say HFF and C&W made the short list for the assignment to sell the 835,044-sf Millennium Center at 222 W. Las Colinas Blvd. The New York City-based TIAA-CREF is looking to close the books on a seven-year hold of a 22-year-old asset with a $63.6-million assessment in the Las Colinas Urban Center.

And then there's Colonnade Properties LLC, taking the lead of Equity Office Properties to set up a market exit with a 1.1-million-sf, four-building portfolio sale. A Jones Lang LaSalle team will be marketing the play for the New York City owner, who picked up the Downtown Dallas and Las Colinas buildings in 1997 and 1998. The portfolio's assessment nudges $46.8 million.

Add what's coming up to what has already debuted and it sets up one of the largest shopping sprees in the region's history. "It will really test the depth of all this capital that we continue to talk about," Jack Eimer, president of the Central Region for Houston-based for Transwestern Commercial Services Inc., tells GlobeSt.com. "The story here is there are going to be some assets brought to market that a year or two ago would not have qualified as core, but today they'll definitely be pursued by core buyers."

In days gone by, a core buy meant high occupancy within the class A walls. "Because there's so much capital currently in the market looking for class A product, they're not being scared away by vacancy," Eimer says.

The JPMorgan complex is about 75% occupied. St. Paul Place, a class B with a CBD address, is 50% leased. Harwood Center is 70% leased. Millennium Center was hanging at roughly 50% until a recent leasing flurry pushed it closer to 80%. The Colonnade package has 651,058 sf of vacant space--playing out as half full or half empty, depending on the perspective.

Not only is there an abundance of class A and B-plus product for sale, but there's also no shortage of buyers, says Jason Mattox, senior vice president with Dallas-based Behringer Harvard Funds. Buyers of "all shapes and sizes" are shopping the streets of Dallas and select suburbs like Las Colinas. "The competition is very fierce," he says. "They'll have plenty of buyers for those assets."

How hungry is the investment market for Dallas-area space? That answer probably will come when the CB Richard Ellis team starts generating buyers from a quiet marketing of the empty 220,471-sf Waterway Tower at 433 E. Las Colinas Blvd., bought in January 2004 by Dallas-based Bandera Ventures Ltd. at a bargain-basement rate. Sources say the empty building is expected to turn a tidy profit even though it's been mothballed since it was bought.