Friday, July 13, 2007

Uptown Condo Tower Development

DALLAS-With a $250-million pipeline at work, SNK Realty Group is eyeing a year-end groundbreaking on a 24-story condo tower in the heart of Uptown. The Phoenix-based developer has jump-started talks with potential joint venture partners to meet the groundbreaking target.
SNK plans to lock in its joint venture partner before vertical work begins on the 2500 McKinney Ave. block, bounded by Fairmount, State and Routh streets. "There are just a handful of candidates that we're negotiating with right now," SNK's founder and CEO Hal Watson tells GlobeSt.com. He confirms that the buy-in opportunity went on the desks of a select few rather than wage a full-blown search for an equity partner.
In the interim, SNK Realty has just broken ground on the first phase of its third development in the metro, the 272-unit Allegro Addison at 15750 Spectrum Dr. in North Dallas. Its second phase, bringing as many as 72 additional units, will break ground in second quarter 2008. Meanwhile, SNK is readying its first two deliveries for their first residents. The 236-unit Arioso Apartment Homes at 3030 Claremont Dr. in Grand Prairie is opening this month and its 52-unit neighbor, Toccata Casitas, will open in August.
Now that it's gained its footing, Watson is ready to discuss the 2500 McKinney plan, just a temporary name while the SNK team polishes the branding. Site work will get under way before summer ends. Two office buildings will be scraped, driving the relocation of SNK's Dallas office.
Watson says the condo tower construction is slated to get under way at year's end, but it could bump into early 2008. The developer has penciled a 27-month construction schedule. Three general contractors are in the running for the contract.
Watson says the basic plan has seven two-story penthouses on floors 23 and 24, 30 sub-penthouses on floors 20 to 22 and 252 condos on floors three through 19. There's also a small street-level retail component. But, that's just the tower's skeleton.
SNK's Dallas-based architect, Gromatzky Dupree & Associates, has designed a condo tower befitting its 2.7-acre Uptown site. The project will have two brandings and two entrances to delineate the 37-unit penthouse component from the other condos.
The penthouses will have private elevators to an underground parking garage, with the seven two-story penthouses having optional individual elevators. The penthouses will have a separate lobby plus an SNK-branded private spa and fitness center and "for sale" poolside cabanas. The two-story units will average 3,882 sf; the 30 sub-penthouses, 1,878 sf. The remaining condos will average 1,250 sf. As for the price points, that's still being fine-tuned.
Once the tower's done, SNK will deed a 1.2-acre park to the city at the corner of Routh and State streets. To assemble the development site, SNK bought one alley from Dallas, agreeing to deed back the park after the project wraps up.
SNK began its Dallas push in September 2005. Its Allegro Addison is a 6.55-acre mixed-use project in the award-winning Addison Circle. The two-phased development will have 4,908 sf of street-level retail at completion.
SNK's partner for Allegro Addison is Ameriton Properties Inc., a division of Englewood, CO-based Archstone-Smith Trust. Guaranty Bank provided construction financing. The first phase will take roughly 15 months to deliver so rents have yet to be set.
SNK's partner for the Grand Prairie project is ING Real Estate Development, a division of New York City-based ING Clarion Partners. The Arioso Apartments, positioned on 9.83 acres, are one- and two-bedroom units ranging from 632 sf to 998 sf in a country-home design with balconies and upscale interior components. The 3.74-acre Toccata Casitas are two- and three-bedroom apartments ranging from 1,514 sf to 1,622 sf. Each one has a private drive, two-vehicle direct access garage and upscale interiors and appliance plus vaulted ceilings.
SNK typically is a merchant builder. Watson says the MO is to wait until leasing hits 50% before marketing begins. And, he says, the projects aren't a conduit to deliver product to its equity partners. In fact, he says there are no presales agreements in place for its present pipeline. "They're welcome to bid high," he says.
Watson says he's just returned from Austin, which he's eyeing as his next stop on the Texas drive. Houston and San Antonio, in that order, also are on the itinerary. And, of course, he's far from being done in Dallas/Fort Worth, where he's put in the groundwork for a full-service shop from property management to condo sales to retail leasing. "We're planning on continuing to look for new opportunities and we are building an organization that will be here long term," Watson says.


By: Connie Gore