The Deal Sheet
Supply and demand isn't everything. Despite strong need for industrial nationwide, Dallas is one of only a handful of metros where rents support industrial development. (What other fundamental economic concepts can we topple? Did you know inflation is caused by the moon's gravitational pull?)
ProLogis CEO Hamid Moghadam (speaking at NAREIT’s REITWeek in NYC this week) says US industrial deliveries have grown from 20M SF in 2011 to 65M SF in 2013 and still fell dramatically short of last year’s demand for 225M SF. Next year, he expects 110M SF of new inventory will be built, but that’ll be half the anticipated demand. Rents in the Inland Empire, Dallas, and Houston are high enough to justify construction that’s happening there, Hamid says. Prologis aims for $2.5B worth of development per year but is on pace for $2B now, owing to a slower than anticipated recovery in Europe (that royal baby really distracted people, huh?) and more sluggish than expected market in Mexico.
W.P. Carey’s unique-to-REITs model of owning an investment manager has its advantages, says CEO Trevor Bond (give the new guy some leeway; the company has been a REIT for just two years). The company derives 10% of its revenue from that arm, and Trevor says it’s a good way to grow revenue without issuing equity that dilutes value. While the equity-raising climate is robust now, the net lease investor used this method to raise $500M during the downturn, when acquisition opps looked good. He says the funds help buffer against cash-flow bumps and smooth out earnings. This year, it’s raised $800M, and the REIT also uses its own balance sheet for acquisitions, especially for deals in which the cost of capital would be too high for a fund.
SALES
Disney Investment Group closed on the sale of Westside Market, a new Tom Thumb anchored shopping center at the southeast corner of FM 423 and Lebanon Road in Frisco. Inland Real Estate Acquisitions purchased the 2013-era 94k SF shopping center from an undisclosed seller. DIG’s David Disney represented the seller and also procured the buyer. Inland’s Matthew Tice repped the buyer.
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A partnership purchased the 60-unit Amberwood Apartments at 800 Hamsted St in Fort Worth from a private investor. Marcus & Millichap’s Mark Allen and John Barker repped the seller. Marcus & Millichap’s Mason Green repped the buyer. The listing received multiple offers and closed as an all-cash, “as-is” transaction. The buyer will seek to add value through addressing deferred maintenance, and improving property management.
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HFF closed the sale of the 300-room DoubleTree Dallas-Campbell Centre full-service hotel in Dallas. HFF represented the seller, a JV between GTIS Partners and Aimbridge Hospitality, in the sale of the property to Black Forest Ventures.
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A partnership between Poynter Scifres and an affiliate of Realty Capital Partners sold the 50k SF Automotive Resources International Building at 2550 SW Grapevine Pkwy in Grapevine to a 1031 exchange buyer. Marcus & Millichap’s Ron Hebert and Michael Lawrence repped the seller.
LEASES
The 120k SF second phase of industrial and office product at Cascades at The Colony inked its first lease with Zackat for 12k SF in building 9. CBRE’s Burson Holman and Adam Hammack represented the owners. Project developer, Jackson-Shaw, hoped to drive more interest in the project from tenant reps for Cascades West by hosting 16 players at Old American Golf Course in The Colony with a special feature: the City of The Colony donated a TaylorMade SLOR 460 driver golf club to each player.
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PIRCH leased 30k SF at 4521 Simonton Rd in Farmers Branch from the Realty Associates Fund. Cassidy Turley’s Blake Anderson, David Eseke, and Tom Van Betten repped the tenant. The landlord was repped by Lincoln Property Co’s Peter Yates.
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Hickory Springs leased 64k SF at 605 109th St in Arlington. Cassidy Turley’s Frank McCafferty, Blake Anderson, and David Eseke repped the tenant.
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Manara Academy leased a 25k SF at 6101 S Collins St in Arlington from Dockside Threading. Hudson Peters Commercial’s Michelle Hudson repped the tenant. Real Space’s Jason Morahan repped the landlord.
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BMC Software signed a 14k SF renewal at Legacy Town Center for landlord, KBS REIT III. CBRE’s Celeste Fowden, Dennis Barnes, Burson Holman, and Seth Thatcher represented the landlord. Cushman & Wakefield’s Scott Weggman repped the tenant.
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Vend Catering Supply has leased 30k SF at 4770 Mercantile in Fort Worth. NAI Robert Lynn’s Todd Hubbard represented the tenant. Mercantile’s Brian Randolph and Andrew Ward represented the landlord. Todd also repped Clampitt Properties in a 27k SF lease at 7500 Baker Blvd in Richland Hills. Conti Warehouses’ Ryan Wood represented the landlord.
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Custom Credit Systems expanded its lease to 15k SF at 801 E Campbell Rd in Richardson. NAI Robert Lynn’s Kent Smith repped the tenant. Beltway’s Deborah Borum repped the landlord.
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Matt Malouf Interests leased a 40k SF pad site in Custer Market Place Shopping Center at the southwest corner of Custer Road and Virginia Parkway in McKinney. This site will be developed for a new 7-Eleven convenience store and gas station. UCR’s Thurston Witt handled the transaction.
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The Holiday Warehouse leased 15k SF at 2819 W 15th St in Plano. Structure Commercial’s Jeremy Cummings and Eric Deuillet negotiated the lease.
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Atlas Resource Partners added another 13k SF on the second floor of The Westbrook bringing its total to 40k SF.
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YMCA signed a 15k SF lease in The Corner at Preston Center at Luther Lane and Westchester Drive from Rosebriar. The site will be an interim YMCA facility during its construction of its planned new facility at the existing Park Cities YMCA location on Preston Road. Rosebriar managing director Ryan Stewart represented the landlord, along with Bill Hanks. The YMCA was represented by Venture Commercial’s Elizabeth Ellenwood and Ken Reimer.
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The City of Grapevine inked a 20k SF lease at 1250 William D Tate in Grapevine from KKM Grapevine. Edge’s Michael Stern repped the tenant. CBRE’s Amy Nott repped the landlord.
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Bradford’s Nick Talley worked three leases including:
•StoneTex DFW renewed 14k SF at 11455 Newkirk St in Dallas. Nick repped the landlord, ML Capital, in the direct deal.
•Jones-Blair Co leased 10k SF at 500 Railhead Blvd in Fort Worth fromSun Life Assurance Co. Nick repped the landlord. Legacy Realty Group’s Bob Lazenby repped the tenant.
•Fastenal Co renewed 10k SF at 500 Railhead Blvd in Fort Worth. Nick repped the landlord, Sun Life Assurance Co. Mercer Co’s CorbyHodgkiss repped the tenant.
