Author: Mia Goulart

KBS & Transwestern sign 38,000 square feet with two regional firms at Class A office in Dallas

Posted on by Mia Goulart

KBS, one of the largest owners and operators of premier commercial real estate buildings in the nation, and Transwestern Real Estate Services (TRS), announced that they have signed 38,501 square feet in lease agreements with two regional firms at Providence Towers, a 524,143-square-foot, LEED Gold-certified Class A office building in Dallas, Texas.

The transactions include a lease expansion with Tower Street Insurance, a Texas-based independent insurance agency—the company is expanding from 5,000 square feet to 24,399 square feet—and a new 14,102-square-foot lease with Fieldwork, a market research services company that is relocating to Providence Towers from another Dallas office building.

The leasing activity demonstrates the ongoing viability of premier office properties in key U.S. markets.

Providence Towers is located at a prestigious business address along the Tollway and has been the chosen place of business for some of the country’s most prominent companies. The 12-story property has been extensively upgraded under KBS ownership, including a complete redesign of the grand east and west tower lobbies, creating luxury entrances.

KBS is currently completing a multi-million-dollar renovation of the property that includes various indoor amenity upgrades. In 2021, the firm completed a completely reimagined tenant lounge and café and is currently underway on renovations for an upgraded fitness center, expanded conferencing facility and elevated common areas. The renovated tenant lounge includes hospitality-inspired amenities such as lounge with a fireplace, collaborative working space, pool tables, shuffleboard and a private dining room. Additional Class A amenities at the property include a wine bar and putting green.

Transwestern’s Kim Brooks, Justin Miller, Scott Walker and Laney Delin represented KBS in the lease negotiations.

Tower Street Insurance’s new lease agreement at the property essentially quintuples its space at Providence Towers.

KBS owns and operates several other Class A office properties in the Dallas market, including 3811 Turtle Creek, Highland Park Place, Legacy Town Center, Preston Commons, Tollway North Office Park, and Sterling Plaza.

Providence Towers is located at 5001 Spring Valley Road in Dallas, Texas.

SPI Advisory enters New Braunfels submarket with 164-unit acquisition

Posted on by Mia Goulart

SPI Advisory (SPI) and its partners finalized the acquisition of Riverbend Apartments (formerly known as Hawthorne Riverside), a 164-unit, Class A- institutional-quality apartment community built in 1995. The property is conveniently located between the San Antonio and Austin metros along the I-35 Corridor in the heart of New Braunfels, a booming submarket at the edge of the hill country showcasing two idyllic rivers, the Comal and the Guadalupe, which attract over three million tourists each year. 

Riverbend Apartments boasts direct access to the Guadalupe River via a private 3.5-acre riverfront park for residents. The property has strong area demographics with an average household income of $107,000 within a five-mile radius and benefits from quick access to a diverse economy of industries including tourism, distribution, manufacturing, data centers, healthcare, and aviation. Riverbend offers its residents the luxury of modern unit interiors complemented with exclusive access to its private park with walking and biking trails, a fire pit, BBQ/picnic areas, a volleyball court, kayaking, paddle boarding, and more. 

This acquisition comes exactly one month after SPI’s acquisition of Parkview Terraces (formerly known as Cortland Southpark Terraces), a Class A, 244-unit apartment community located in South Austin. SPI now owns and operates nine institutional-quality properties within the proximal submarkets of Austin, Kyle, and Buda, as well as 1,160 units in nearby San Antonio.

Prior ownership partially upgraded approximately 25% of units and their ROI on those renovations proved there is strong demand for more contemporary finishes. Over the next two years, SPI will execute its own renovation plan to maximize the desirability of the asset and highlight its prime riverfront location. SPI intends to update the community’s common areas, gym, and landscaping, as well as install washers/dryers in every unit, add private backyards in select units, and upgrade 75% of unit interiors to a premium finish out.

Dallas industrial market: A closer look at submarkets and future trends

Posted on by Mia Goulart

The industrial real estate sector in Dallas, Texas, has witnessed remarkable growth and achieved significant milestones in recent years. With the market surpassing the one-billion-square-footage mark, second only to Chicago, it has become a key player in the industrial sector.

According to Q1 2023 data from Colliers, the Dallas-Fort Worth (DFW) industrial market continues to thrive. Construction levels remain elevated, with 62 million square feet under development. However, for the first time in eight quarters, the quarter-over-quarter construction growth rate has slowed. The delivery of a record 19 million square feet of speculative development has affected vacancy levels, resulting in a slight increase to 6.3%.

Rental rates in the warehouse sector have surged to all-time highs, with big-box rates reaching $5.72 NNN and non-big-box warehouse rates peaking at $8.39 NNN. These escalating rental rates indicate the robust demand and competitive nature of the Dallas industrial market.

To truly understand the Dallas industrial market, it is crucial to examine submarkets within the region. Transwestern Development Company Regional Partner Denton Walker emphasized the variations across different submarkets.

“The best submarkets in North Texas, such as north Fort Worth and north Dallas, have positive lease activity where there is better labor supply available,” said Walker. “The southern sector of the Dallas-Fort Worth area will experience slower lease activity for ample bulk distribution warehouse space due to the large supply available and less labor available.”

By focusing on submarkets, real estate professionals and investors can identify specific areas with unique characteristics, labor availability and infrastructure that align with their requirements.

In addition to submarkets, another delineation that’s important is the size of the project. Allen Gump, EVP at Colliers, splits the market between projects larger than 250,000 square feet and those that are smaller.

“In some places in the Metroplex, it’s very hard to find 150,000- or 200,000-square-foot space. In Dallas, for example, you really do have trouble finding spaces under 250,000 feet that fit the criteria that you’ve got,” Gump said. “The dynamics are very different.”

He explains that industrial development in the Dallas market has reached a turning point. While there are still numerous buildings under construction, the feverish pace of development has eased. Developers are now adopting a more cautious approach, with fewer new projects being initiated without significant leasing activity.

“It wasn’t that long ago that there were something like 17 million-square-foot buildings under construction around the Metroplex. That’s a lot of million-square-foot buildings,” said Gump. “It costs a lot to carry a million-square-foot building for several months or even longer.”

With factors such as rising interest rates and reduced liquidity, developers are now seeking greater stability and demand before commencing construction. This shift signifies a return to a more sustainable pace of development.

Newmark Managing Director Zach Riebe shed light on the capital markets for industrial properties in Dallas. Smaller, bite-sized deals are currently in focus due to challenges in financing larger projects. This shift aligns with the cautious approach taken by both equity and debt providers.

“There’s a theme we continue see is that buyers, developers, and equity/debt providers continue to prefer smaller, more infill projects in today’s environment, whether that be pursuing acquisitions or speculative development,” Riebe said. “However, we anticipate that there will be some larger portfolio trades and capitalizations in 2023 as larger institutional investors creep back into the market and feel the pressure to deploy capital .”

While the cost of capital has increased, the broader macroeconomic tailwinds in Texas, including favorable borrowing costs and availability of capital, continue to support the demand for industrial real estate. Despite the evolving financial landscape, the Dallas market remains a strong performer compared to other tier-one markets across the country.

Newmark President and Global Head of Industrial and Logistics Jack Fraker underscored the strength and resilience of the Dallas industrial market.

“The market’s fundamentals, including leasing activity, absorption, and rental rate growth, are at record levels,” he said. “The presence of a vast inventory of smaller buildings offers reliable and predictable returns, particularly in infill submarkets closer to population centers.”

Looking ahead, the Dallas industrial sector is expected to maintain its strength due to a variety of factors. These include the exceptional labor force, excellent transportation infrastructure, central location, access to major airports and availability of economic incentives for industrial development. The growth of educational institutions in the area, such as Southern Methodist University and the University of Texas, further contributes to a talented workforce.

With a diverse range of submarkets, a slowdown in big-space development, and a cautious approach in the capital markets, the Dallas industrial sector is adapting to changing conditions. Despite challenges, the market’s fundamentals remain strong, attracting investors and tenants alike. As the sector moves forward, careful analysis of submarkets and an understanding of future trends will be essential to unlocking the full potential of the Dallas industrial market.

CBRE National Partners arrange sale of Class A+, 114,000-square-foot industrial property in Plano

Posted on by Mia Goulart

CBRE National Partners announced the sale of 780 Shiloh Road, a Class A+ industrial building located in the NE Dallas submarket. A private Californian investor purchased the property from Founders Properties for an undisclosed price.

Randy Baird, Jonathan Bryan, Ryan Thornton, Nathan Wynne and Eliza Bachhuber with CBRE National Partners arranged the transaction on behalf of the seller. 

Ideally located in Plano’s Research/Technology district and minutes from US-75, 780 Shiloh Road has direct access to President George Bush Turnpike which connects I-35E, I-30 and the Dallas North Tollway. Built in 2001 and renovated in 2007, the property is leased to a single tenant through 2030.

Stream promotes development expert to lead its central region industrial development team

Posted on by Mia Goulart

Bates Arnot will lead Stream Realty Partners’ central region industrial development services division in his elevated role as managing director.

In his new role, Arnot will continue sourcing development opportunities throughout Texas and Colorado and other markets in the region. Arnot will manage the Industrial Development Services platform’s largest team, continue to source new development talent, and contribute to Stream’s national IDS platform’s leadership and overall growth strategy.

Arnot originally came to Stream, a national commercial real estate firm offering an integrated platform of services, as a young industrial leasing broker in Dallas in 2009. Green, a fellow leasing broker at the time, took the initiative as Arnot’s professional mentor and business partner. The duo saw great success together. 

In 2013, Arnot left Stream to learn more about industrial development at Hillwood (a Perot Company), a multinational industrial, commercial, and residential real estate development company based in Dallas. While there, Arnot was responsible for leasing, land acquisitions, development, and property acquisitions in multiple markets, including DFW, Denver, Houston, Austin, and Memphis. He was involved with over 28 million square feet of leasing and 1,170 acres of land acquisitions, representing 14.5 million square feet of industrial development.

Armed with seven years of development experience at Hillwood, Arnot rejoined Stream in 2020 to help build its new Industrial Development Services platform. Since his return, the team has accumulated 10 current projects in the central region with a total cost basis of $1.1 billion. His most recent success was a start-to-finish development and forward-sale of a 300,000-square-foot industrial building to Westcore Properties executed earlier this year.

CBRE arranges sale of Cooper Street Plaza in Arlington

Posted on by Mia Goulart

CBRE announces the sale of Cooper Street Plaza, a 91,856-square-foot shopping center located at 4619-4623 Cooper Street in Arlington, Texas. Vista Property Company purchased the property from a Texas based real estate investment trust.

Jared Aubrey and Michael Austry represented the seller in the marketing and sale of the property.

Located along I-20 in the middle of a dominant retail corridor in Arlington, the shopping center was 97.5% occupied at the time of sale. The center garnered significant investor interest due to its high-visibility, long-term triple net leases and below market rents. The center is anchored by K&G Mens Company and Office Max and features other prominent tenants including Black Rifle Coffee Company, UPS, State Farm Insurance and Ninja Sushi.