Monday, September 13, 2010
Davis Building Downtown Up for Sale
(Source: The Dallas Morning News)By Steve Brown, The Dallas Morning News
Downtown Dallas' historic Davis Building is up for sale.
Lenders who financed the loft apartment building have decided to seek new owners for the high-rise.
The Davis Building at 1309 Main St. was financed with $32.6 million in commercial mortgage-backed securities debt that has been turned over to a special servicer.
While the building is still owned by a partnership set up by developer Hamilton Properties, a receiver has been appointed to sell the property.
"It's the kind of quality asset that only comes to market once every decade or so," said Tom Huth of Omnium Management Co., who's been hired to oversee the Davis Building disposition. "The building is close to 90 percent leased and is doing very well."
The owners have been unable to restructure or replace the financing on the property, which was due earlier this year.
Hamilton Properties officials say they are optimistic about the pending sale.
"We think that there is a great deal of capital that has been sitting on the sidelines, and there is currently pent-up demand to purchase quality real estate assets," said partner Ted Hamilton.
"We feel that the Davis Building is a quality asset and hope and expect to receive multiple offers on the property."
Marcus & Millichap Real Estate Investment Services has been hired to market the Davis Building for sale.
"We plan to widely market this property," said Will Balthrope, vice president of investments in the brokerage firm's Dallas office.
"It's a great property in a good location."
The Davis Building opened its doors to apartment residents in 2003.
Built in 1926 as the Republic National Bank building, the 20-story landmark had been vacant for almost 20 years.
Hamilton Properties spent about $35 million converting the former office building into 158 loft apartments and retail space. It's served by the Metropolitan Parking Garage on Elm Street, which is also up for sale.
The Davis Building is the second large downtown loft apartment project to hit the market recently.
Last month, lender Prudential Insurance sold the 440-unit Mosaic project at Akard and Bryan streets after the property was foreclosed.
Mosaic was bought by a partnership headed by Chicago's Levin Realty Advisors.
The Davis Building is one of more than 160 Dallas-Fort Worth area commercial properties listed as being in loan default, in foreclosure or facing mortgage failure, according to the latest estimate from Trepp LLC.
The New York-based commercial real estate research group estimates that these properties have debt totaling more than $1.6 billion.
That's up from about $1.3 billion in bad debt deals here early in 2010.