Newmark represents DrinkPAK in two new industrial leases in Fort Worth, totaling 2.9 million square feet

Newmark announces that DrinkPAK, a canned beverage manufacturer headquartered in California has closed on two industrial leases totaling 2.9 million square feet in its expansion to Fort Worth, nearly tripling the company’s real estate footprint. These leases represent the largest new industrial occupier leasing commitment completed in a single market across the U.S. this year and are projected to create 1,000 full-time jobs in the area by 2026. Additionally, the city has approved a 10-year tax abatement valued at $21 million for DrinkPAK’s expansion in support of the area’s long-term development.

Newmark Executive Managing Director Patrick DuRoss, SIOR, Vice Chairman John DeGrinis, SIOR, Senior Managing Director Jeff Abraham, SIOR, and Associate Director Javier Galvan, in cooperation with Vice Chairmen Adam Faulk and James Cooksey, Director Garrison Efird and Associate Adam Faulk Jr. represented the tenant in the transaction. Newmark has played a pivotal role in aiding DrinkPAK’s expansion since 2020, securing multiple leases totaling over 1.5 million square feet in the North Los Angeles region.

As part of DrinkPAK’s $452 million investment plan to develop the advanced manufacturing assets for the production, warehousing and distribution of various alcoholic and non-alcoholic beverages, the project is expected to bring significant investment to the local community and reaffirm Fort Worth’s ongoing dedication to fostering the growth of industrial-using jobs. Encompassing approximately 1.5 million and 1.4 million square feet, the sites are located, respectively, at Trammell Crow’s development at 25001 Eagle Parkway and at Carter Park East, which is owned by Crow Holdings Capital, Rob Riner Companies and Clarion Partners.

Founded in 2020, DrinkPAK is the most technologically advanced manufacturer of canned beverages in the world, providing full-service support for procurement, batching, processing, filling, packaging, warehousing and distribution for both large, complex organizations and high-growth emerging brands.

Newmark arranges sale and financing of value-add multifamily asset near Downtown Austin

Newmark has arranged the sale and financing of South Congress Commons, a 68-unit value-add multifamily asset located minutes from Downtown Austin, Texas. The asset was acquired by an affiliate of Narrow Road Group, an Austin-based investor, operator and developer of local residential real estate.

Newmark Director Chase Easley was retained by seller Firm Capital to market the sale, which resulted in Newmark’s second successful closing of this asset. Vice Chairman Anthony Tarter of Newmark’s Debt, Equity & Structured Finance group helped arrange the financing on behalf of the buyer.

Located at 126 W. Alpine Road, South Congress Commons is a garden-style property offering an array of amenities to its residents, including a fully fenced dog park, a courtyard space, an outdoor grilling and picnic area, laundry facilities and spacious studio and one-bedroom floor plans. New ownership of the property has the opportunity to revamp both unit interiors and community amenities, positioning it to compete effectively with newer properties in the market.

Situated on 1.98 acres, South Congress Commons is conveniently located just over two miles from Austin’s CBD and enjoys proximity to the city’s South Congress (SoCo) district, one of the county’s most famous corridors lined with vibrant nightlife, retail boutiques and live music venues. The property also benefits from a strong local economic landscape, with an average household income exceeding $111,800 and an average home value of $523,704 within a three-mile radius, according to the U.S. Census Bureau in 2023.

Newmark facilitates sale of 2.2 million-square-foot mixed-use corporate campus in Dallas-Fort Worth

Newmark announced the sale of CityLine, a 2.2 million-square-foot mixed-use property comprised of four purpose-built office buildings, occupied by State Farm, 120,000 square feet of retail space and a 42,000-square-foot medical office building in Richardson, Texas.

Newmark Vice Chairmen Chris Murphy, Robert Hill and Gary Carr, in cooperation with Co-Head, U.S. Capital Markets Kevin Shannon, Vice Chairman Ken White and Divisional Head of International Capital Markets Alex Foshay represented the seller, Mirae Asset Global Investments. Newmark Vice Chairman David Milestone and Directors Josh Francis and Henry Cassiday provided debt capital markets advisory in executing the sale.

The property, located at 1150, 1201, 1250, 1251 and 1415 State Street and 3661 N. Plano Road, in the City of Richardson, at the intersection of US-75 and President George Bush Turnpike, was thoughtfully developed to embody a live-work-play environment. The four office buildings, constructed in 2016, are the focal point of the master-planned, 186-acre suburban development located at the connection of two major Dart Rail Lines. Consisting of eight luxury apartment complexes, 30 restaurants and bars, a 148-key Aloft hotel and 21 acres of green space and walking trails, the project is the pinnacle of contemporary walkability and desirable amenities.

Dallas-Fort Worth office-using employment continues to remain near historical high at the end of August 2023. The metroplex reported 1.28 million office workers, an increase of 67.6% compared to 2010, and an increase of 21.5% compared to 2019 employment levels, according to Newmark Research. The continued strength and growth in the market’s office employment reflect an enduring appetite for office assets. The Dallas-Fort Worth office market’s long-term outlook remains positive and competitive given the market’s strong economic fundamentals, such as a diversified labor pool and continued office-using jobs growth.

Newmark completes sale of three-building, newly constructed industrial park in Mansfield

Newmark has completed the sale of Mansfield Urban Industrial Park, a three-building industrial property totaling 267,622 square feet in Mansfield, Texas.

Newmark Capital Markets Vice Chairmen Dustin Volz and Stephen Bailey, Senior Managing Director Dom Espinosa and Managing Director Zach Riebe represented the seller, Longbow Interests, a Dallas-based commercial real estate firm that specializes in developing shallow bay industrial buildings. The buyer was High Street Logistics Properties.

Located at 1960-1962 Heritage Road, Mansfield Urban was 89% leased at the time of sale with a 4.6-year weighted average lease term (WALT). Delivered in summer 2022, the property features Class A amenities, including front/rear-load design, 18- to 28-foot clear heights, modern truck courts, ESFR sprinkler systems, speculative office space and steel deck roofing.

Mansfield Urban is centrally located within the DFW Metroplex and offers convenient access to I-20, US-287 and TX-360. The property benefits from DFW’s ongoing population growth and robust employment growth, particularly among industrial-using jobs.

According to Newmark Research, the Dallas industrial market realized 5.4 million square feet of positive absorption in the second quarter of 2023, bringing year-to-date totals to 15.1 million square feet. Following a yearly supply outpacing demand for the second consecutive quarter, as of the end of the second quarter of 2023, vacancy increased by 160 basis points year over year to 7.3%.

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

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.

Newmark secures joint venture equity placement for 173,680-square-foot industrial project in Irving

Newmark has secured the joint venture equity placement for the development of TriStar Business Park, a two-building, 173,680-square-foot industrial project located in Irving, Texas. The project is expected to deliver in Q4 2024.

Newmark Capital Markets Vice Chairmen Dustin Volz and Stephen Bailey, Senior Managing Director Dom Espinosa and Managing Director Zach Riebe arranged the joint venture between the investor, MBK Industrial Properties, and the sponsor, Hopewell Development.

Building 1, located at 7815 Jetstar Drive, will comprise 69,160 square feet; Building 2, located at 7810 Jetstar Drive, will total 104,520 square feet, divisible down to 52,000 square feet. The buildings will feature 32-foot clear heights, ESFR sprinkler systems, 100+ parking stalls, eight dock-high doors, grade-level doors with ramps and 130- to 140.5-foot truck courts.

Situated at the corner of HWY 114 and Jetstar Drive, the project is within close proximity of the Dallas/Fort Worth International Airport and the Dallas Central Business District. Neighboring warehouse tenants include Honda, Subaru, Coca-Cola, Samsung, Canon and Boeing, among many others.