Dallas-Fort Worth Real Estate Review - Winter 2014

DFWREALESTATEREVIEW.COM 20 WINTER

14

T HE CR A NE REPORT: ING WHO’S BUILD WHAT, WHERE

CAPITAL MARKETSBLE: ROUNDTA

+ N W O T P U TS R A E H T T C I R T DIS

OU T L O OK F OR

2015

IN JECTS ARKET O R P W M E COOL N HOTTEST SUB ’ D A L L AS

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WINTER 2014

CONTENTS

28 ROUNDTABLE

Welcome Letter . . . . . . . . . . . . . . . . . . . . . . . . . .8 Publisher’s Note . . . . . . . . . . . . . . . . . . . . . . . 10

FOUNDATIONS DFW market statistics, economic indicators, and commercial real estate news . . . . . . .12-17

BLUEPRINT FOR PROSPERITY Where the talent lives . . . . . . . . . . . . . . . . . 19

THE CRANE REPORT

23 THE CRANE REPORT

Who’s building what, where. . . . . . . . . . . 23

SCORECARD DFW’s top office, industrial, and retail leases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

ROUNDTABLE An insider’s view on the region’s real estate investment . . . . . . . . . . . . . . . . . . . . . 38

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W I N T E R 2014

MARKET LEADERSHIP REDEFINED Serving as trusted advisors to Dallas’ most notable companies is a role we take seriously.

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For more information on how CBRE can partner with you on your real estate needs, please contact: Michael Caffey +1 214 979 6100

cbre.com/dfw

W I N T E R 2014

D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W / 5

Jim Lake Companies

CELEBRATING

50 YEARS OF ADAPTIVE URBAN REDEVELOPMENT

AND COMMERCIAL REAL ESTATE

1964 Beginning

Jim Lake Sr. built first building

1977 Trinity Market Center & Plano Jim Lake, Sr. and Mike Morgan develop projects in Plano and what was then called the Trinity Industrial District

1985 Bishop Arts District

Jim Lake, Sr. and Mike Morgan, with broker Jim Lake, Jr., purchase boarded up buildings and develop them into what is now known as Bishop Arts District

1986-1992 Pioneer Plaza

Jim Lake, Sr. partners with Trammell Crow, Sr. to fund and construct Downtown Dallas’ Pioneer Plaza

1990 Dallas Design District

Jim Lake, Jr. begins acquiring office & warehouses in what will later become the Dallas Design District

2005 Trinity Loft

Redevelopment of three story office building into the Design District‘s first residential property

2006 International at Turtle Creek Jim Lake, Jr. redevelops a 200,000 SF warehouse into a Design Center

2013-2014 Jefferson Tower

Jim Lake, Jr. acquires and redevelops Jefferson Boulevard’s historic block into a mixed-use property

2013-2014 Waxahachie & Ennis

Jim Lake, Jr. and Amanda Moreno-Lake purchase and begin redevelopment of historic buildings in Waxahachie‘s and Ennis’ town squares

Jim Lake, Sr., 1976, (city council candidate) pictured in front of the construction of Woodall Rodgers Freeway, looking towards the Trinity River 6 / D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W

214-741-5018 JimLakeCo.com W I N T E R 2014

E XC L USI V E LY P UB L ISHE D B Y D CUSTOM, A DIVISION OF D MAGAZINE PARTNERS

WWW.DFWREALESTATEREVIEW.COM PUBLISHER Quincy Curé Preston 214.523.5215 quincy.preston@dcustom.com

52 ANATOMY OF A DEAL SPECIAL REPORT: ANATOMY OF A DEAL — UPTOWN / ARTS DISTRICT Overview How a sleepy residential neighborhood evolved into one of the hottest commercial submarkets in the country. . . . . . . . . 50

Lay of the land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Multifamily. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 Parks and green spaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 Arts and culture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 Getting around. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 Retail and restaurants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70

TOOLBOX Leveraging the power of information Helping companies make site-selection decisions has become a science . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74

SPECIAL ADVERTISING SECTION: CITY PROFILE DIRECTORY . . . . . . . . . . . . . . . . . . 76

ART / PRODUCTION MANAGER Michael Samples PROJECT EDITOR Karen Nielsen COPY EDITOR Kathy Lawrence CONTRIBUTING WRITERS Jeff Bounds Jenny Fuentes Hilary Lau Connor Yearsley DIRECTOR OF SALES Kyle Moss 214.523.5247 kyle.moss@dcustom.com INTERNS Crystal Hough Haley Rogers

B E T T E R C O N T E N T. B E T T E R M A R K E T I N G .

PRESIDENT Paul Buckley GENERAL MANAGER Jas Robertson CREATIVE DIRECTOR Kyle Phelps EDITORIAL DIRECTOR Amy Robinson MANAGING EDITORS Casey Casteel

COMMUNITY Calendar of Real Estate Events. . . . . . . . . . . . . . . 86

The Real Estate Council, Impact Investors . . . . . . . . . . . . . . . . 82

Dallas Regional Chamber, Leadership Dallas . . . . . . . . . . . . . . . 86

The Real Estate Council, 2014 Giving Gala . . . . . . . . . . . . . . . . 84

Dallas Regional Chamber, Top-Level Members . . . . . . . . . . . . . 80

The Real Estate Council, Associate Leadership Council . . . . 85

W I N T E R 2014

EDITOR-IN-CHIEF Christine Perez

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DIRECTOR OF PRODUCTION Diane Testa PRODUCTION MANAGER Pedro Armstrong GRAPHIC DESIGNER Emily Slack MARKETING MANAGER Jessica Fritsche Dallas-Fort Worth Real Estate Review® is published for The Dallas Regional Chamber and The Real Estate Council by D Custom, a division of D Magazine Partners, 750 N. St. Paul St., Ste. 2100, Dallas, TX 75201; www.dcustom.com, 214.523.0300. ©2014 All rights reserved. No part of ths publication may be reproduced or reprinted without written permission. Neither the Dallas Regional Chamber nor The Real Estate Council nor D Custom is a sponsor of, or committed to, the views expressed in these articles. The publisher is not responsible for unsolicited contributions.

WELCOME

A letter from the Dallas Regional Chamber and The Real Estate Council

2014 CHAIRMAN OF THE BOARD Stephen L. Mansfield, Ph. D, FACHE President & CEO, Methodist Health System PRESIDENT & CEO

The Emerging Southern Dallas

Dalehas Petroskey Nearly 900,000 SQUARE FEET OF OFFICE SPACE been built or is under construction at Cypress Waters.

CHIEF OPERATING OFFICER & CHIEF FINANCIAL OFFICER

DALE PETROSKEY President and Chief Executive Officer Dallas Regional Chamber

Southern Dallas is an opportunity—and one that holds a lot of excitement. The foundation we are building today in Southern Dallas supports the promise of our region’s future. The Dallas Regional Chamber and The Real Estate Council are supporters of Dallas Mayor Mike Rawlings’ Southern Dallas Economic Development Plan known as GrowSouth. We’re also a part of the force working to re-educate the public about the promise of Southern Dallas.

LINDA McMAHON President and Chief The economic potential for Southern Dallas Executive Officer has never been more promising. From the great The Real Estate Council anticipation of the Small Brewpub on the street level of the historic Jefferson Tower, to talk of high-rise apartments in Fair Park, to the annual $600 million Texas-sized economic boost of the State Fair of Texas, to $13.9 million in Sports Arena Tax Increment Financing District dollars approved for phase two of Trinity Groves at the foot of the Margaret Hunt Hill Bridge—eyes are focused south to all that’s happening there.

Southern Dallas is home to 45 percent of the population yet provides only 15 percent of our property tax base. Commercial real estate developers with an eye for the long-hold salivate at the potential of that. It represents possible new sales tax revenue from business and development that will strengthen our total tax base and help fund growth of our entire city.

Encompassing 185 square miles, roughly 55 percent of the city’s area, Southern Dallas could hold the cities of Boston, Miami, Pittsburgh, and San Francisco combined. Southern Dallas has the land, the workforce, and the will. But it’s missing one major component: investment capital.

Through the Dallas Regional Chamber’s economic development work and the Southern Dallas Committee, the chamber is actively marketing all of Southern Dallas County for business relocations and expansion.

The Real Estate Council has been instrumental in the creation of Impact Dallas Capital, a new not-for-profit organization whose mission is to drive investment into Southern Dallas. Impact Dallas Capital is the platform for the creation of a family of double-bottom-line investment funds to fill gaps in the capital needs of Southern Dallas. The first bottom line is a market rate of return to investors, and the second is the improved quality of life for Southern Dallas residents. The first of these funds will focus on real estate development. This is a long-term solution with a goal of jump-starting economic development.

In the meantime, we can all work to debunk the Southern Dallas myths by focusing on what’s happening there. You can read more about this on page 15.

8 / D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W

Pat Priest

KEY PLAYERS

COMMUNICATIONS, VICE PRESIDENT Amy Ramos

BUSINESS INFORMATION & RESEARCH, VICE PRESIDENT Duane Dankesreiter DIRECTOR, BUSINESS INFORMATION & RESEARCH Eric Griffin DIRECTOR OF COMMUNICATIONS Meredith Turner

2014 CHAIRMAN OF THE BOARD Paul Rowsey Compatriot Capital VICE CHAIRMAN Sue Ansel Gables Residential PRESIDENT & CEO Linda McMahon VICE PRESIDENT MARKETING & EVENTS Debby Hanson VICE PRESIDENT FOUNDATION Robin Minick DIRECTOR OF FINANCE Susan Sellers

W I N T E R 2014

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W I N T E R 2014

D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W / 9

UPFRONT QUINCY CURÉ PRESTON Publisher Dallas-Fort Worth Real Estate Review

A letter from the Publisher

Welcome to the third edition of the all-new Dallas-Fort Worth Real Estate Review, produced in collaboration with the Dallas Regional Chamber and The Real Estate Council. The momentum continues to build, as the need for detailed info on the red-hot North Texas commercial real estate market becomes even more critical.

In this issue, we’re taking a geographical approach to our signature “Anatomy of a Deal” package. After exploring CityLine and Cypress Waters in our first two editions, this time we’ve turned our focus to Uptown and The Arts District. A commercial market that didn’t even exist 30 years ago, Uptown is on fire, especially on the office, multifamily, and retail fronts. It seems as though every square foot of available land has been snapped up by developers—some of whom are paying record prices. At the same time, people are flocking to the urban market for its unique live-work-play environment.

Our package includes the bustling Arts District, which is not only the largest contiguous cultural district in the country, but the glue that binds downtown Dallas and Uptown.

For our roundtable discussion, we gathered some of the top capital markets experts in North Texas. They tell us why DFW has found favor with local, national, and global investors, and where the greatest opportunities lie for various sectors in 2015.

Our signature Crane Report on page 23 offers a marketwide look at office, industrial, and multifamily developments underway and those planned across the region. You won’t find this information available anywhere else, and encourage you to visit www.dfw.realestatereview.com for an interactive version.

Speaking of intel, don’t miss our special Toolbox feature on page 74, which explores ways tenant representatives are leveraging technology to help companies make educated site-selection decisions. The data tools available today make it possible to drill down on things such as per capita income in particular regions of the city, and locate how many engineers are concentrated around prospective office sites.

We’re already begun work on our spring issue, which will come out in March, and look forward to bringing you four quarterly publications in 2015. With North Texas enjoying dynamic job and population growth, ongoing corporate relocations, and record occupancy and lease rates, there will be plenty to talk about.

Quincy Curé Preston Publisher

A PARTNER YOU CAN BUILD WITH, FROM CONCEPT THROUGH COMPLETION. General Contracting | Preconstruction Construction Management | Design/Build

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EVEN MORE TO THE STORY

ADDITIONAL CONTENT ONLINE AT DFWREALESTATEREVIEW.COM

mccarthy.com | 972.991.5500

1 0 / D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W

W I N T E R 2014

Nowhere Is So Much, So Near.

NORTH

EAST

SOUTH

WEST WAXAHACHIE is located at the Crossroads of I-35E and Hwy. 287 linking a total of more than 3,300 miles of northsouth highways from Mexico and the Gulf to the archways of Canada. Our city is just 15 minutes from major east-west super highways I-20 and I-30. It is 30 minutes from the city limits of both Dallas and Fort Worth and the dynamic Metroplex. To the south is the portal to the Texas Hill Country and to the east is the gateway to the piney woods.

Waxahachie offers national railroad connections, a new airport with an impressive 6,500 foot runway and the buildings, land and people to make things happen for your business. Nowhere in Texas can you be so close to so much for so little. Geographically, you could not find a better location for your business. But Waxahachie is more than the interstate crossroads of our state… it is also the very heart, soul and spirit of Texas.

WAXAHACHIE

The Crossroads of Texas City of Waxahachie Economic Development · Doug Barnes, Director · 214-762-5022 · www.crossroadsoftx.com W I N T E R 2014

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FOUNDATIONS

NORTH TEXAS INDUSTRIAL MARKET SEEING GROWTH IN BIG-BOX CONSTRUCTION

DFW LAW FIRMS FACE LACK OF OFFICE SUPPLY, RISING RENTS Law firms face more supply constraints than companies in nearly any other industry, JLL reports. That’s because law firms typically want offices in premium, Class A space in central locations—the tightest segment of most office markets.

This holds true in Dallas, where a substantial number of firms have made decisions to either relocate or renew in the past year. Staying put are Norton Rose Fulbright, which leased 117,500 square feet in Chase Tower, and Locke Lord LLP, which renewed for more than 144,000 square feet in the same Arts District building. Moving to new space are Gardere Wynne Sewell and Sidley Austin, which are taking 109,000 square feet and 75,000 square feet, respectively, in Crescent’s McKinney & Olive in Uptown, and Polsinelli, which has leased 77,000 square feet in Harwood’s Frost Tower, also in Uptown.

LAW FIRM PERSPECTIVES: DALLAS

DFW developers of industrial space are jumping back into the speculative game—in a big way. Betting on continuing demand for big-box space, the average size of new spec projects is 842,000 square feet, according to third-quarter data from CBRE. The firm reports that construction of industrial facilities at least 500,000 square feet in size is 4.5 times greater than last year.

SPECULATIVE CONSTRUCTION BUILDINGS 500,000 SQ. FT. OR LARGER

Q3 2014

SOURCE: CBRE Research

9.3

MILLION SQ. FT.

Q3 2013

1.7

MILLION

2014 was a tremendous year for apartment operators in Dallas-Fort Worth, according to statistics from Axiometrics Inc. “It really comes down to lack of vacant residential supply and very strong job growth,” says Jay Denton, senior vice president of analytics and research.

The demand-supply imbalance resulted in rent growth of 4 percent to 7 percent in most submarkets. The lone exception is Uptown and downtown Dallas. “That submarket has delivered the most units in [North Texas] the last couple

(per s.f.)

$30

AVERAGE RENT PREMIUM FOR TROPHY SPACE

30%

years, which has presented more of a challenge for existing apartments in that part of town,” Denton says.

For 2105, rent growth likely will remain above historical levels. “Job growth is expected to remain strong, and there is very little vacant supply in either multifamily or single-family product,” Denton says.

“While the new supply numbers might look big relative to other metros, new construction is needed to simply keep pace with demand.”

DALLAS

ANNUAL EFFECTIVE RENT GROWTH

LAW FIRMS OCCUPYING MORE THAN 50,000 s.f.

OCCUPANCY RATE

31

JOB GAIN JOB GROWTH SOURCE: JLL

13.7%

4.5X

SQ. FT.

LOOKING AHEAD: MULTIFAMILY FORECAST FOR 2015

AVERAGE CLASS A ASKING RENT

PERCENT OF MARKET OCCUPIED BY LAW FIRMS

A baseline for the region’s future

NEW SUPPLY (UNITS)

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FORT WORTH

2014

2015

2014

2015

4.4%

3.2%

5.2%

3.5%

94.7%

94.0%

94.7%

94.2%

79,200

75,800

23,900

30,000

3.6%

3.3%

2.6%

3.1%

10,509

14,757

1,915

1,721 SOURCE: Axiometrics Inc.

W I N T E R 2014

F FOUNDATIONS

BREAKING DOWN FRISCO’S $5 BILLION MILE The Star, a new 91-acre complex anchored by a training facility and headquarters for the Dallas Cowboys, isn’t the only big development underway in Frisco. According to the city’s mayor, Maher Maso, three other nearby projects have created a “$5 Billion Mile” along the Dallas North Tollway from Warren Parkway north to Lebanon Road.

“That’s how much development is taking place in that mile, and it was all instigated by the

announcement of (the Cowboys) project,” Maso said at a press conference at AT&T Stadium in November. “They created that synergy, to where there are multiple things going on.”

The new Cowboys complex already has gotten worldwide exposure, the mayor said, and is helping the city attract investors from around the globe.

“This last week alone, we’ve had visitors from Korea, China, Germany, and Dubai, and we

> FRISCO STATION ($1.7 BILLION): 242-acre mixed-use project, a collaboration between landowner The Rudman Partnership, VanTrust Real Estate, which will oversee office development, and Hillwood, which will serve as the master developer and develop all non-office space. Plans call for 4 million square feet of office space, 2,400 multifamily residences, restaurant, and entertainment venues, medical and wellness facilities, and open spaces and parks.

> THE GATE ($700 MILLION): Developed by Invest Group Overseas, the project could ultimately include 4 million square feet of office space, 250 hotel rooms, 2,400 multifamily units, 73 single-family homes, nearly 200,000 square feet of retail and restaurant space, plus 415,000 square feet of medical office space.

> WADE PARK ($1.6 BILLION): 175-acre mixed-use project from Thomas Land Development. Slated to include 600,000 square feet of retail space, up to 6 million square feet of office space, more than 500 hotel rooms, 1,300 residential units. Groundbreaking for the project took place in August. Whole Foods, iPic Theatre, and Pinstripes have already signed on as tenants.

> THE STAR ($1 BILLION): 91 acres, Dallas Cowboys world headquarters, 12,000-seat events center and training facility. Size: 1.7 million square feet, plus two hotels totaling 480 rooms. Potential job creation at buildout: 4,500.

A version of this story originally appeared at drealestatedaily.com.

OFFICE SALES: HOW DALLAS STACKS UP

The coastal markets continue to lead the way in office sales, as it relates to price, volume, and number of transactions. But Dallas is finding favor, too. According to Transwestern, the market ranked No. 4 of all U.S. cities in terms of transactions, and No. 7 in total sales volume, through the first seven months of the year (the most recent period for which statistics are available).

The only Texas city to crack the top 10 in pricing was Austin, which came in at No. 7 with an average per-square-foot rate of $269. Manhattan was No. 1 at a whopping $770 per square foot, followed by Washington, D.C., at $548, San Francisco at $464, and San Jose at $412.

TOP 10 U.S. CITIES BY TRANSACTIONS

TOP 10 U.S. CITIES BY VOLUME

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

LOS ANGELES MANHATTAN BOSTON DALLAS CHICAGO SAN FRANCISCO MIAMI NORTHERN N.J. HOUSTON ORANGE COUNTY, CALIF.

W I N T E R 2014

172 107 95 87 73 71 68 64 63 32

visited with Peru and Honduras just last night,” he said. “They’re all aware of the project. … [The Cowboys are] a quality organization, and it’s a worldwide brand that’s known for doing things right. Brokers and investors know that if they are near this, they will be successful, because of the success of The Star.”

Here’s a look at projects in Frisco’s “$5 Billion Mile:”

MANHATTAN LOS ANGELES SAN FRANCISCO BOSTON CHICAGO WASHINGTON, D.C. DALLAS HOUSTON SAN JOSE PHILADELPHIA

$11.2 billion $5.1 billion $5.0 billion $4.1 billion $2.9 billion $2,1 billion $1.7 billion $1.6 billion $1.6 billion $1.4 billion

BIG JUMP IN SALES OF DFW RETAIL PROPERTIES The velocity of sales of multitenant retail properties accelerated at a double-digit pace during the past 12 months, led by an uptick in activity in the Far North Dallas, Central Fort Worth and Mid-Cities submarkets.

According to Marcus & Millichap, Sales prices averaged $215 per square foot over the past year, which reflects a 7 percent increase from 12 months earlier. Over the same time period, cap rates declined 30 basis points to 7.6 percent.

The sale of single-tenant transactions also increased significantly, as more out-of-state capital flowed into Dallas-Fort Worth. Aside from general freestanding properties and restaurants, fast-food assets and convenience stores accounted for the most sales.

Despite improving conditions, the average asking rent in remains below the pre-recession peak. This may continue to impact values for shopping centers with multiple leases signed from 2005 to 2007.

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The appeal of walkable places can be measured in feet.

People today, more than any time in the past century, are seeking an alternative to car-dependent living. They want options. To meet certain daily needs on foot and, in the process, experience the fullness of neighborhood life. So much so that the supply of such places is running thin.

Curious how this emerging demand will be met in the coming decades? Then join us at the Congress for the New Urbanism, this April in Dallas / Fort Worth, and plug in.

Walk the talk. Register today. #thisisCNU

CNU 23 MEETING THE DEMAND FOR WALKABLE PLACES APRIL 29 - MAY 2, 2015 | DALLAS / FORT WORTH EARLY REGISTRATION ENDS MARCH 27 | CNU23.ORG

F FOUNDATIONS

SOUTHERN DALLAS COUNTY

THE NEXT BIG THING

BY CHRISTINE PEREZ

Investors, developers, and companies looking to relocate or grow now have a new data tool available for getting the latest information on opportunities in Southern Dallas County. The new website—available at www.dallaschamber.org/southerndallas—provides everything from land use details to wage and salary profiles and info on significant employers in the region. The real star of the site, though, is an interactive development platform that marries the chamber’s mapping expertise with data with the latest news stories by local business journalists.

“The purpose of the map is to showcase all the development that is actually already occurring in Southern Dallas County,” says Duane Dankesreiter, vice president of business information and research for the Dallas Regional Chamber. “This is part of dispelling the myths the Chamber’s Southern Dallas Committee has often discussed.”

Although the Chamber has long been active in Southern Dallas County, the committee was formed about 18 months ago with the goal of taking a more proactive approach. The group’s activities complement Mayor Rawlings’ Growth South initiative for the City of Dallas, but also extends its reach to other regions and cities of Southern Dallas County. The committee, which has about CONTINUED ON PAGE 17

WELCOME TO THE NEIGHBORHOOD

SOUTHERN DALLAS TRANSPORTATION INFRASTRUCTURE > MULTIPLE INTERSTATE HIGHWAYS (Interstates 35, 45, 20, and the future Loop 9) > FOUR GENERAL-AVIATION CORPORATE AIRPORTS: Dallas Executive, Lancaster, Mesquite Metro, and Grand Prairie Municipal > RAIL: Two Class I railroads serve Southern Dallas County > INTERMODAL: Union Pacific’s Dallas Intermodal Terminal and future BNSF Intermodal facility

OAK CLIFF

Southern Dallas County is home to many different districts and communities. The Dallas Regional Chamber’s new Southern Dallas website provides background information on these different neighborhoods and what makes them unique: Oak Cliff West Dallas Pinnacle Park The Cedars Education Corridor DART Greenline Corridor Lancaster Corridor Mountain Creek/Redbird

PHOTO: DALLAS CVB

The Inland Port Grand Prairie Southwest Dallas County Southeast Dallas County

W I N T E R 2014

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Frisco, Texas is one of the few places where the grass is actually greener.

■

16,000+ acres available for development

■

Skilled, highly-educated workforce of 68,000

■

25 minutes from DFW International Airport

■

Innovative city leadership

■

Competitive incentives for qualified projects

Get here as fast as you can and bring your dreams.

Frisco Economic Development Corporation | 6801 Gaylord Pkwy., Ste. 400 | Frisco, TX 75034 | 972.292.5150 | FriscoEDC.com

F FOUNDATIONS

THE INTERACTIVE DEVELOPMENT MAP AT WWW.DALLASCHAMBER.ORG/SOUTHERNDALLAS

30 members, is led by Chairman Randy Bowman, president of MW Logistics LLC, and Vice Chairman Kelvin Walker, managing partner of 21st Century Group LLC. Committee members quickly realized that the first order of business was marketing— creating awareness of Southern Dallas County and all it has to offer, from its low taxes and cost of doing business to land opportunities, transportation infrastructure, and neighborhoods. The site breaks the story down into five main components: > WHY SOUTHERN DALLAS. This “elevator pitch” page provides quick snapshots on everything from typical lease rates for commercial space to population statistics. > SIGNIFICANT EMPLOYERS. A diverse group of household names such as L’Oréal, Walmart, Lockheed Martin, Kohl’s, AT&T and Whirlpool have established operations in Southern Dallas County. This detailed map provides a broad look at where the region’s major employers are based. > LAND USE MAP. Southern Dallas County has more than 125,000 acres of undeveloped land, providing a wealth of choices for commercial investment across all sectors.

This map provides land-use specifics and current status, as well as proximity to infrastructure and amenities. > LOGISTICS MAP. The DFW region is known as one of the top distribution markets in the United States, and Southern Dallas is a big reason why. This map shows the location of major industrial parks in the region, as well as major roadways and the Dallas County Inland Port. A sidebar provides information on logistics certificates and degrees offered by area colleges. > WAGES AND SALARY PROFILES. Median wages and salaries in the Dallas–Fort Worth region generally track below national levels, thanks to Texas’ pro-business labor environment and low taxes. This page provides salary, labor pool, insurance, and other employment statistics for a variety of occupations. > INTERACTIVE DEVELOPMENT MAP. Details on office, industrial, and multifamily projects under construction or planned in Southern Dallas County. Many of the projects include links to news reports that provide more details. The links are updated as new stories appear in local newspapers or news sites.

Now that the marketing need has been addressed, Dankesreiter says the committee will shift its focus to recruitment. “We’re looking at companies that might be a good fit for Southern Dallas County, the supply chains of companies that are here and how they connect to suppliers from outside the region,” he says. “We have a great case to make, and a great committee to help us do so.”

Be sure to visit dfwrealestatereview.com for extended Capital Markets content on opportunities in Southern Dallas. Also, be watching for a story on The Real Estate Council’s Impact Dallas Capital initiative in the spring edition of the DFW Real Estate Review.

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EXPLORE THE OPPORTUNITIES IN BENBROOK An ideal location adjacent to Fort Worth and centrally located in North Texas, Benbrook is part of one of the nation’s fastest growing regions. Benbrook offers great sites and sound infrastructure essential to growth and success and is easily accessible by IH–20 and US 377. Benbrook is open for business, and looking to help you develop commercial, residential and industrial properties.

Economic growth and opportunity awaits you in Benbrook.

FORT WORTH

Contact: Ron Rainey Benbrook EDC 817.249.6990

Committed to

EXCELLENCE

B BLUEPRINT FOR PROSPERITY

WHERE THE TALENT LIVES Access to a deep labor force has emerged as the No. 1 factor in relocation decisions.

BY MIKE ROSA

I’ve been involved with corporate recruitment and expansion projects in the DallasFort Worth area since 1988. Some companies decided to locate here; some chose to go elsewhere, based on a wide variety of reasons. I have not, in the last 26 years, seen a location factor as consistently deep-dived and scrutinized by companies and consultants as labor is today.

No doubt, the positioning and search for talent is on. In a recent nationwide survey of corporate executives, skilled labor availability was deemed “very important” in 95 percent of site location decisions. In another survey, it ranked as the most critical from among more than two dozen factors that typically go into a location choice.

When companies consider a move, laborforce facts and figures are widely and easily available, allowing a company to make apples-to-apples comparisons when weighing different regions against one another. Organizations like the Dallas Regional Chamber (DRC), with its deep research and presentation capacity, add value to the process by visualizing and presenting our region’s labor force information in a way that combines it with other harder-to-obtain local factors, such as university degrees awarded, commuting patterns, and new housing developments. All of this work is usually done and reviewed before a company team flies in to kick our tires. But having and presenting all the data possible is no longer enough to assure a company that it’s making the right choice.

When visiting Dallas, corporate executives are concentrating on proving up all the “people” issues in real time, from peers and in conversations with Chamber staff and local labor force experts. The DRC’s economic

W I N T E R 2014

development team helps the company’s executives and consultants do just that.

These days, the human resources leader drives most visit agendas, and our team dedicates much of its time on this critical issue. We’re often setting up peer-to-peer interviews with executives at other companies that already operate here, showcasing residential areas for relocating employees, or connecting the company to school, college, and university leaders who convey the talent pipeline in the Dallas area.

The education to employment pipeline is so critical to the success of our region that the DRC works directly with PreK, public education, community college, higher education, nonprofits and area workforce boards to improve outcomes for students and to create a more talented pool of job candidates for employers. This work requires collaboration and coordination across a variety of stakeholders to make sure that everyone in the continuum is aware of the job trends, opportunities, and employer requirements, including those of newly relocated or expanded companies.

The DRC also works to connect these companies with great educational choices both for their current employees’ children and their future workforce.

Companies looking here see what existing businesses also see: a more competitive labor market for specific skills, brought on by other companies either growing or moving here. So, relocation candidates are sharpening pencils and carefully studying our market and our trends, including our strengths, like our tremendous population growth, colleges and universities, the ability to relocate or recruit CONTINUED ON PAGE 20

D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W / 1 9

B BLUEPRINT FOR PROSPERITY employees from elsewhere to Dallas, the affordability of living here, fairer taxes and rules and regulations, and a host of other strong counterpoints to any labor force concerns.

TALENT AND LABOR: WHERE DFW STANDS

So what case do we make when companies question our regional labor issues?

Fortunately, our workforce, our talent base, and our wages and salaries and employment rules and regulations are very much in our favor.

When it comes to wages, the Dallas area has the benefit of consistently attracting a growing pool of well-educated and productive workers drawn by its overall prosperity and future opportunities. And although our economic success has led to some wage increases, the area remains highly favorable. Overall, wage rates in

LABOR LAWS - TEXAS vs. CALIFORNIA TEXAS

CALIFORNIA

> Non-compete agreements are enforceable against former employees

> Non-compete agreements are illegal; attempts to enforce them can lead to penalties against employers

> Employers are not required to reimburse personal cell phone usage

> Possible class action exposure if employers do not reimburse work-related cell phone usage on employees’ personal phones

> Employers are not required to indemnify employees sued by third parties

> Employers must indemnify employees sued by third parties regarding employees’ conduct within the course and scope of their employment

> Employers can opt-out of workers’ compensation program

> Employers cannot opt-out of workers’ compensation program

> Few cities enact employment laws, and the few that do have very limited laws

> Cities enact onerous local employment laws

> Minimal statutory and regulatory requirements

> Class action “seating” litigation, a vague test for employers to determine whether seating is necessary for employees who normally stand at work

> Breaks aren’t required

> Meal and rest breaks are required

Texas Workforce Commission: “Although some states require breaks, Texas and most other states do not.”

California Chamber of Commerce: “Meal and rest break compliance continues to be the source of a great deal of litigation for California employers.”

Dallas are comparable to those in other major markets in the South (such as Houston, Austin, and Atlanta) and are well below those in other technology centers. (Boston wages are about 25 percent higher than DFW’s, and those in San Francisco are more than 30 percent higher.)

And it’s just easier in Texas when it comes to hiring and retaining talent. There are two books with nearly identical covers among the stack of books and magazines on my office desk. Both are reference guides for employers. One is a California guide to employment laws and regulations. The other is a Texas guide to the same, both published by Littler Mendelson, a Chamber-member legal firm specializing in employment law. The similarity ends, however, when both books are viewed side by side.

The California book contains 564 pages; the Texas book has 280 pages. California’s book is, literally, twice as thick. Stacked together, they make a compelling slide when we present to California corporate executives considering a move here.

I wonder why business leaders would deal with all that and choose places much less friendly and more costly in terms of operations. For our region to continue its long run of success with respect to corporate moves, job creation, and its expanding economy, it must continue to be a place that grows, attracts, and retains talented people—especially young people. Companies now, and even more so in the future, will migrate where the talent lives.

WANT TO LEARN MORE ABOUT HOW TO GET INVOLVED IN BLUEPRINT FOR PROSPERITY? Contact Mike Rosa, Senior Vice President, Economic Development, Dallas Regional Chamber 214.746.6735 | mrosa@ dallaschamber.org

SOURCE: Littler Mendelson

BLUEPRINT FOR P R O S P E R I T Y,

BLUEPRINT FOR PROSPERITY

OUR NEXT STEPS FORWARD

region’s success. This additional investment made by more than 130 organizations in addition to annual

The Dallas Regional Chamber’s economic development program, Blueprint for Prosperity, provides organizations in Dallas-Fort Worth with an accelerated investment opportunity that helps advance our chamber membership dues allows organizations to increase their support of our efforts to further economic prosperity throughout the region. This initiative funds efforts related to direct contact with corporations and location consultants examining the DFW Region.

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THE STAR — DALLAS COWBOYS HEADQUARTERS CAMPUS IN FRISCO

THE CRANE REPORT

Winter 2014

Everywhere you look, cranes are flying in North Texas, as developers break ground on new projects throughout the region. Dallas-Fort Worth Real Estate Review’s exclusive Crane Report provides a detailed look at who’s building what, where. Data for the office and industrial sectors is provided by Xceligent Inc. Axiometrics provides data for the multifamily sector.

BY CHRISTINE PEREZ

ON-THE-GRO U N D I N S I G H TS

OFFICE

BEN APPLEBY

Partner, Paladin Partners

“High lease rates for new product in traditional spec markets (Legacy, Las Colinas, Uptown) has created an opportunity for nontraditional spec markets to off er a competitive product at a more aff ordable price point.”

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INDUSTRIAL

MULTIFAMILY

SUSAN ARLEDGE

RYAN KEISER

BRIAN O’BOYLE

“The greatest impact on our real estate industry, for both development and leasing, is the growth of the millennial population. Employers will have to focus on locating their companies in places where employees want to live and work.”

“Lower oil prices will have a two-fold eff ect on demand: sustained consumer spending, which will drive expansion among existing industrial users, and lower fuel prices, which will continue to support DFW as a top destination for regional distribution centers.”

“Although there is a considerable amount of product scheduled for delivery, our solid market fundamentals and long-term job growth projections should keep absorption in check and allow for respectable rental increases across the board.”

Managing partner, Cresa Dallas

Senior vice president, CBRE

Founder and managing broker, ARA Dallas

D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W / 2 3

RAYZOR RANCH MEDICAL PARK BLDGS 1, 2, 3 & 4 CARROLL PARK PLACE PHASE II

THE CRANE REPORT:

OFFICE

For North Texas office developments at least 10,000 s.f. in size, Xceligent Inc. shows that 42 projects totaling 7 million s.f. are under construction; another 115 projects totaling 17.4 million s.f. are planned or proposed.

ANNOUNCED + UNDER CONSTRUCTION

85 HIGHW

CENTRE PLACE PROFESSIONAL BUILDING

TOWN CENTER OFFICE PARK 142 OLD TOWN BLVD N BARTONVILLE TOWN CENTER

4431 LONG PRAIRIE RD MEADOWLANDS ADDITION BLDG I

PROSPER OFFICE

CARILLON OFFICE

SE OF HWY 377 AND MARSHALL RIDGE

10740 OLD DENTON RD

SIZE: 275,000 s.f.

DEVELOPER: Matthews Paradise DETAILS: Designed by BOKA Powell, the project is part of a new 187-development at the Dallas North Tollway and State Highway 380 in Prosper.

2

THE P CONDOM

NE OF MORNINGSIDE ST AND S OAK ST 2310 AVONDALE HASLET RD

1

MONTEREY OFFICE PARK BLDGS 1 & 2

THE VILLAGE CENTRE PHASE I

ANNOUNCED DEVELOPMENTS

584 KIMBALL AVE

BEAR CREEK OFFICE PARK HERITAGE TRACE CENTER

ALLIANCE MEDICAL OFFICE BUILDING

2631 IRA E WOODS AVE

HERITAGE OFFICE PARK PHASE I HERITAGE OFFICE PARK PHASE II

THE PONDS 8329 WHITLEY RD

7105 GOLF CLUB DR PAD SITE THE SHOPS AT FOSSIL CREEKPAD SITE 2

801 ENTERPRISE DR

5

RIVER OAKS

420 JOHNSON RD UNIT 202

FAA CORPORATE CAMPUS

LYNN S

NORTHWEST PLAZA

7114 MID CITIES BLVD

FREEPOR COMMON

755 MID CITIES BLVD

ALLEN CENTRAL PARK 1

THE OFFICE @ HAMPDEN WOODS

SIZE: 150,000 s.f.

DEVELOPERS: Peloton Commercial Real Estate, Allen EDC LEASING AGENT: Dale Ray with Peloton DETAILS: The first of six buildings planned for the northwest corner of Bethany Drive and North Central Expressway in Allen. A hotel also is planned for the site.

111 BOLAND ST 3736 CAMP BOWIE BLVD

EXPEDITION PLAZA

1200 6TH AVE WESTBEND

CLEARFORK OFFICE

COOPER LANDING

TEXAS SHALE TOWER

SB

WATERSIDE BLDG L 320 MERCEDES ST 7000 BRYANT IRVIN RD

4015 IH 20 W

TEXAS HEALTH SOUTHWEST MOB 5900 DIRKS RD

MATLOCK PROFESSIONAL OFFICE PARK BLDG 3 THE ENCLAVE #27 THE VALMONT BLDG 2

HULEN VILLAGE OFFICE BLDG I, II, IV

CANNON PROFESSIONAL PLAZA BLDG 5

THE ATRIUM

HIGHPOINT COMMONS GRAND REGENCY PROFESSIONAL BUILDING

OFFICE UNDER CONSTRUCTION 3

CROWN CENTRE AT CASTLE HILLS

SIZE: 200,000 s.f.

DEVELOPER: Bright Realty

WE ARE STARTING ON THE FIRST PHASE ... WITH THE IDEA WE CAN DELIVER 3 MILLION SQUARE FEET OF OFFICE SPACE AND A HOTEL. — CHRIS BRIGHT 2 4 / D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W

L

4

7-ELEVEN HQ

SIZE: 300,000 s.f.

DEVELOPER: Billingsley Co. DETAILS: Designed by Corgan, the convenience store’s new headquarters will sit on the north side of Interstate 635 just east of Belt Line Road in Irving, within Billingsley’s Cypress Waters development.

5

LEGACY CENTER

SIZE: 169,000 s.f.

DEVELOPER: Cawley Partners LEASING AGENTS: Randy Shipman and Addie Ludwig with Cawley Partners DETAILS: Located on 12 acres at the northwest corner of Legacy Drive and Hedgcoxe Road in Plano, this project will feature a rooftop terrace.

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PROSPER TRAIL OFFICE PARK

1

500 E WAY 380

NE OF ELDORADO PKWY AND TEEL PKWY LOT 4 ELDORADO MEDICAL PLAZA LEGACY WYNDHAM OFFICE PARK

R PHASE I & II

WILSON CREEK MEDICAL PARK

STONEBRIDGE MEDICAL OFC CONDOS

THE FORUM AT PROSPER WEST

6579 VIRGINIA PKWY METHODIST McKINNEY OFC CONDO ALMA OFFICE CONDOS IN CRAIG RANCH

MCKINNEY MEDICAL OFFICE PARK BLDG 5 ONE FOUNTAIN COURT

NW OF WARREN PKWY & LEGACY DR BLDG 7

CORPORATE CENTER THE BLUFF ON MCDERMOTT ALLEN PLACE TWIN CREEKS ALLEN CENTRAL PARK OFFICE PARK ANGEL FIELD CENTER PRESTON LEGACY OFFICE PORTFOLIO SALE

9 FRISCO BRIDGES PLACE 65

TOYOTA HEADQUARTERS

7

CENTRE AT THE COLONY PHASE II

PLATINUM PARK

SIZE: 166,104 s.f.

DEVELOPER: Stream Realty Partners LEASING AGENTS: Matt Wieser and Ryan Evanich with Stream Realty Partners DETAILS: Designed by Corgan, with Hill & Wilkinson as the general contractor, this spec building in Plano is scheduled for completion in January 2016.

SUMMIT PARK II

1256 W EXCHANGE PKWY

SQUARE

2

SPRING CREEK COMMONS

PARKER 3 PROFESSIONAL

NW OF CHAPEL HILL BLVD & DALLAS NORTH TOLLWAY 4101 HIGHWAY DEXTER 121 BYPASS BLVD PROFESSIONAL 4120 MIDWAY RD CENTRE 121 PARK PLAZA

CITYLINE STATE FARM

MURPHY MEDICAL OFFICES BUILDING A, C, D, E, F NW OF FM 544 AND WESTGATE WAY

CITYLINE RAYTHEON

PLAZA OFFICE MINIUMS BLDG 3

CAMPBELL CROSSING OFFICE PARK

2900 LAKE VISTA DR

RICHARDSON MEDICAL OFFICE PARK BUILDINGS 4 & 5

587 HOUSTON ST

RT NS

7

1831 HARROUN AVE VIRGINIA PARKWAY MEDICAL PLAZA

SW OF QUORUM DR & DALLAS NORTH TOLLWAY

7 ELEVEN CORPORATE

4 HEADQUARTERS

WILCOX PLAZA AT LAS COLINAS

TOLLWAY CENTER CENTENNIAL PROFESSIONAL CENTER

FOUR GALLERIA TOWER

THREE HICKORY CENTRE

VICTORY AT RIVERSIDE BUILDING 4

DECKER COMMONS BLDG 600 2232 E GRAUWYLER RD

8

8020 PARK LN PARK CITIES PLAZA 8111 WESTCHESTER AVE

SE OF OAKDALE RD AND MACARTHUR BLVD

FROST TOWER VICTORY CENTER

2850 SHORELINE TRL 3140 HORIZON RD

MEADOW GREEN MEDICAL CENTER 8100 PARK LN UNIT G

RICHARDS GROUP TOWER 1212 N LOOP 12

SHOAL CREEK BLDG 1

8 3405 N BELT LINE RD

RAYTHEON CAMPUS

SIZE: 500,000 s.f.

DEVELOPER: KDC DETAILS: Raytheon joins State Farm as a second anchor at CityLine, KDC’s massive development along North Central Expressway near State Highway 190 in Richardson. Raytheon’s three-building campus was designed by HKS Inc.

SHALEM PARK

TWO ARTS PLAZA

TWO VICTORY PARK 276, 278, & 280 S COLLINS RD DAVIS STREET MARKET

DEVELOPMENT BARBELL

2337 BELT LINE RD

3920 W WHEATLAND RD 407 E DANIELDALE RD

The biggest hot spots for new office construction in North Texas are in Uptown (see Anatomy of a Deal beginning on page 50) and the Legacy area of Plano and Frisco. (See page 13 for a list of projects underway along Frisco’s “$5 billion mile.”) This has created a “development barbell,” say local market experts. The pattern is being driven by the quest for talent, says Michael Ablon, founding principal of PegasusAblon. “For the last 30 to 40 years, people moved to chase the jobs,” he says. “We now clearly have the jobs moving to where the people are—the creative teams, the talent teams, the technology teams, the more educated progressive work force. It’s a radical paradigm shift in the pattern language of this country, and that bodes well for Dallas.”

DATA SOURCE: XCELIGENT INC., A COMMERCIAL REAL ESTATE RESEARCH FIRM IN PARTNERSHIP WITH NTCAR

6

FEDEX OFFICE

SIZE: 265,000 s.f.

DEVELOPER: KDC DETAILS: This large new regional office for FedEx is helping to kick off Legacy West, which also will be home to Toyota’s new North American headquarters. It’s located on the western quadrant of State Highway 121 and the Dallas North Tollway.

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9

FRISCO BRIDGES PLACE

SIZE: 170,000 s.f.

DEVELOPER: Heady Investments DETAILS: This six-story office building is being built on the southeast corner of the Dallas North Tollway and Gaylord Parkway.

D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W / 2 5

MARKET STREET INDUSTRIAL PARK BLDG 5

NORTH FORT WORTH POWERHOUSE Twenty-five years ago, Ross Perot Jr. and his team at Hillwood kicked off development of the world’s first industrial airport, Fort Worth Alliance.

Anchored by a robust industrial base, it has since evolved into AllianceTexas, an 18,000-acre mixed-use development that sprawls from North Fort Worth into Haslet, Roanoke, and Westlake. Through 2013, AllianceTexas has generated a local economic impact of $50.6 billion. In the last 18 months alone, Hillwood has secured more than 6 million square feet of industrial leases to LG Electronics, Amazon, Flextronics, Carolina Beverage, Heritage Bag Co., Saddle Creek Logistics, Walmart.com, and other tenants.

THE CRANE REPORT:

INDUSTRIAL ANNOUNCED + UNDER CONSTRUCTION

4

LKQ

HERITAGE BAG HEADQUARTERS SE OF EAGLE PKWY & OLD DENTON RD

ANNOUNCED DEVELOPMENTS 1

NORTHPORT 35 BUSINESS CENTER

Xceligent reports that 45 DFW industrial projects totaling 12.4 million s.f. are underway; another 146 projects totaling 53 million s.f. are planned or proposed.

PARK 161

SIZE: 345,150 s.f.

DEVELOPER: Avera DETAILS: Located at the northwest corner of State Highway 161 and January Lane in Grand Prairie. The building was designed by Powers Brown Architecture, will civil engineering by Pacheco Koch.

Avera Construction will act as the general contractor.

ALLIANCE GATEWAY 25

WAL-MART

PROLOGIS PARK 121

330 S ROYAL LN

FREEPORT 1 NORTH

SW OF WALL ST & IH 635

POINT WES INDUSTRIA

3710 ROYAL LN

STADIUM SOUTHWEST

PARC 114 BLDG 9

CRAWFORD ELECTRIC SU RAILHEAD INDUSTRIAL PARK BLDG 9 RAILHEAD INDUSTRIAL PARK BLDG 3

COUNTY LINE RD 5481 FRYE RD

MEACHAM CROSSING

240 GILBERT

RIVERPARK 1000

3000 ROY ORR BLVD - BLDG B

1460 AVENUE S

101 JIM WRIGHT FWY

1 LOGISTICS CROSSING 2

MEDSTAR MOBILE HEALTHCARE

SOUTH CENTRAL DISTRIBUTION CENTER II

ULTA, IN

2

CARTER DISTRIBUTION CENTER BLDG C

JJ LEMMON DISTRIBUTION CENTER

1102 ENTERPRISE PL

SIZE: 700,000 s.f.

DEVELOPERS: Trammell Crow Co., Clarion Partners, Rosewood Property Co. LEASING AGENTS: Kacy Jones and John Hendricks with CBRE

CLASS A INDUSTRIAL SPACE IN THE SOUTHERN DALLAS MARKET IS SCARCE, AND DEMAND REMAINS STRONG DUE TO THE EFFICIENT NETWORK OF HIGHWAYS. —SCOTT KRIKORIAN, TRAMMELL CROW CO.

3

LAKESIDE RANCH I

SIZE: 658,600 s.f.

DEVELOPER: LNR Corp.

LEASING AGENTS: Dave Anderson with CBRE. DETAILS: Located near the intersection of Interstates 20 and 35E in DeSoto.

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● ANNOUNCED ● UNDER CONSTRUCTION

ONLINE EXTRA

619 S WISTERIA ST

THE CRANE REPORT: INTERACTIVE VERSION

online at dfwrealestatereview.com

UNDER CONSTRUCTION 4

NORTHPORT 35 BUSINESS CENTER

SIZE: 945,000 s.f.

DEVELOPER: Stream Realty Partners LEASING AGENT: Bob Hagewood with Stream Realty Partners DETAILS: The three-building complex is slated for completion in December 2015.

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2421 E UNIVERSITY DR

FRISCO COMMERCE CENTER BLDG D

ALLEN PLACE BLDG 1

NEBRASKA FURNITURE MART WAREHOUSE

DOZIER PLACE 501 W FM 544 2910 GUILDER DR

FRANKFORD TRADE CENTER BLDG 8B

1644 W CROSBY RD THREE VALWOOD DIPLOMAT I

ST AL VIII

SW OF MARQUIS AND NICHOLSON BLDG 2

6

4

UPPLY

MERCER PARK MONITRONICS 11070-11090 N STEMMONS FWY

*

JUPITER TRADE CENTER

9726 BROCKBANK DR

*195,000 SF Industrial Space Coming Soon*

T CIR

20 Acres Retail on

I-30 BUSINESS CENTER BLDG 3 PINNACLE 5 FIRST PARK BLDG B

MUSTANG CREEK BUSINESS PARK NORTH

55 Acres of Multi Family Sites 440 Acres Mixed Use Land

SOUTHWEST DISTRIBUTION CENTER MOUNTAIN CREEK BLDG 1

NW OF IH 20 & JJ LEMMON RD INTERSTATE COMMERCE CENTER COMMERCE 20 BLDG 2

2

NC

3 SOUTHFIELD PARK 35 BLDG 4

RIDGE LOGISTICS CENTER BLDG 2

SOUTHPORT LOGISTICS PARK BLDG 9 SE OF PLEASANT RUN RD & SUNRIDGE BLVD DALPORT TRADE CENTER BLDG 2 DALPORT TRADE CENTER BLDG 3

I 35 INTERCHANGE I 2700 S MILLERS FERRY RD

DATA SOURCE: XCELIGENT INC., A COMMERCIAL REAL ESTATE RESEARCH FIRM IN PARTNERSHIP WITH NTCAR

5

FIRST PINNACLE

SIZE: 233,176 s.f. and 394,680 s.f.

DEVELOPER: First Industrial Realty Trust LEASING AGENTS: Terry Darrow and Michael Swaldi with JLL DETAILS: This two-building project is located on Cockrell Hill Road just south of Interstate 30.

6

MERCER BUSINESS PARK II

SIZE: 260,000 s.f.

DEVELOPER: Billingsley Co. LEASING AGENT: George Billingsley at Billingsley Co. DETAILS: Mercer Business Park is located at the northwest corner of Interstates 35E and 635. The first 75,000 s.f. of this project has been leased by ViaTech.

110 Acre Master Planned Industrial Development Frontage on

--202,280 SF Industrial Space Coming Soon---

214-370-6100 W I N T E R 2014

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WOODLANDS APARTMENTS

THE CRANE REPORT:

MULTIFAMILY

URBAN SQUARE AT UNICORN LAKE II

ANNOUNCED + UNDER CONSTRUCTION

DISTRICT OF HIGHLAND VILLA

ANNOUNCED DEVELOPMENTS 1

DRY CREEK RANCH II

KEEPING UP WITH DEMAND

ELAN LAKES

Axiometrics reports that 71 multifamily projects totaling 20,677 units are under construction across the North Texas region; another 152 projects totaling 41,908 units are planned or proposed.

PRESTON HOLLOW VILLAGE

UNITS: 512 DEVELOPER: Provident Realty Advisors and Koenke Holdings DETAILS: This development at the northwest corner of Walnut Hill and Central Expressway represents phase II of Preston Hollow Village, which also has retail and office components. Ziegler Cooper Architects of Houston designed the structures, each of which features unique architecture. Construction will get underway in 2015.

OVERLOOK RANCH MANSIONS AT TIMBERLAND

WATERFORD GLEN

SAGESTONE VILLAGE PH II

THE SOVEREIGN DOLCE LIVING HOME TOWN PH 1

RIVERWAL APARTMEN BROADSTONE AVION II

STONE VILLAS AT LAKE WORTH II

ELAN WEST 7TH

HULEN PLACE DEV CENTER PLACE APARTMENTS PH II

RESIDENCES AT EDWARDS RANCH CLEARFORK

● ANNOUNCED ● UNDER CONSTRUCTION

ONLINE EXTRA

2

THE CRANE REPORT: INTERACTIVE VERSION

TRINITY GROVES APARTMENTS

UNITS: 1,000 DEVELOPER: Columbus Realty Partners DETAILS: Former Dallas Cowboys players Robert Shaw and Roger Staubach are teaming up with the developers of Trinity Groves on this project. Construction will kick off in March 2015, with the first units ready for occupancy in early 2016.

2 8 / D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W

REGA MANS

online at dfwrealestatereview.com

3

KNOX HEIGHTS

UNITS: 182 DEVELOPERS: Trammell Crow Co.’s Street Light Residential and Northwestern Mutual Real Estate DETAILS: The development will replace five aging buildings along McKinney north of Knox Street.

4

UPTOWN PLAZA

UNITS: 212 DEVELOPER: Street Lights Residential DETAILS: This 23-story development, built near Hotel ZaZa in Uptown, will have 212 apartment homes and over 7,000 square feet of high-end amenity space.

Construction began in June 2014, with the first units slated for occupancy in July 2016.

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ST. PAUL SQUARE THE TOWERS

BY THE PARK VILLAS AT CHAPEL CREEK II CHAMPION HOMES AT LAKE DALLAS

VILLAS AT CHAPEL CREEK I

TWIN CREEKS CROSSING

SORREL PHILLIPS CREEK RANCH

AGE

CREEKSIDE SOUTH

AMLI WEST PLANO VILLAGE THE AVENUES AT CARROLLTON

Just North of Dallas.

Far from Ordinary.

Close to Perfect.

JUNCTION 15 GATEWAY PLANO II

SIDE

MANSIONS AT WOODBRIDGE

KELLER SPRINGS APARTMENTS

GREENVUE APARTMENTS VV&M

THE NEIGHBORHOODS OF CYPRESS WATERS

MUSTANG STATION

6

CREST AT PARK CENTRAL I

JEFFERSON LAS COLINAS

1

AMLI CAMPION TRAIL

WHITE ROCK TRAILS APARTMENTS

LK NT

3 4 2 5

UPTOWN/DOWNTOWN GLENCOE APARTMENTS LOCALE ALTA MAPLE STATION 2727 KINGS ROAD

JLB LINCOLN CEDAR KNOX SPRINGS

MAPLE DISTRICT

ECHO

CANTABRIA AT TURTLECREEK ROUTH STREET FLATS ALEXAN SKYLINE

AVENUE H

3700M

ONE UPTOWN

STILLWATER PEAK TOWNHOMES AND FLATS ALEXAN ARTS

UPTOWN PLAZA ELAN CITY LIGHTS ONE DALLAS CENTER 1600 PACIFIC TOWER ALTA FARMERS FAIRFIELD THE MARKET AT ROSS OLYMPIC

CAMDEN VICTORY PARK 1900 CEDAR SPRINGS

MIDTOWN CEDAR HILL

ALTA WEST COMMERCE

ALIA AT SFIELD

LOFTS AT SYLVAN THIRTY

DATA SOURCE: AXIOMETRICS INC.

UNDER CONSTRUCTION 5

LOFTS AT SYLVAN | THIRTY

UNITS: 201 DEVELOPERS: Oaxaca Interests and Wood Partners DETAILS: Designed by Lake Flato and Paul Duesing, this three-phase multifamily project is at the crossroads of Oak Cliff and West Dallas.

SOUTHSIDE FLATS BY JEFFERSON

6

JEFFERSON AT LAS COLINAS

UNITS: 386 DEVELOPER: TDI Real Estate DETAILS: This transit-oriented development is within walking distance to the Irving Convention Center and DART Rail’s Orange Line.

McKINNEY ECONOMIC DEVELOPMENT CORPORATION

McKinneyEDC.com W I N T E R 2014

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$1 BILLION in Stream Texas Developments NOW UNDER WAY Stream is a national, full-service firm covering the broad spectrum of leasing, management, development, construction, and investment sales services across the commercial and multifamily industry. In addition, Stream specializes in sourcing acquisition and development opportunities for the firm and its clients. Stream currently has more than 120 million square feet of assignments across the nation; completes over $1.6 billion in real estate transactions annually; and is considered one of the most active investors and developers in the real estate industry.

PLATINUM PARK I OFFICE 166,100 SF I Legacy

CONNECTION PARK I OFFICE 304,000 SF I Freeport

RIVERPOINT COMMERCE CENTER I INDUSTRIAL 603,000 SF I Great Southwest

NORTHPORT 35 BUSINESS CENTER I INDUSTRIAL 945,035 SF I Alliance

MOTOR CIRCLE I INDUSTRIAL + OFFICE 89,939 SF I Design District

ATLANTA I AUSTIN I CHARLOTTE I DALLAS / FORT WORTH I DENVER I HOUSTON I SOUTHERN CALIFORNIA I SAN ANTONIO I WASHINGTON, DC WWW.STREAMREALTY.COM

S SCORECARD

ONE ARTS PLAZA

SCORECARD

PHOTO: BILLINGSLEY COMPANY

Winter 2014

This past year has proven to be strong across all commercial real estate sectors. What’s encouraging both brokers and investors is the diversity of demand and the strong market fundamentals, with the region’s surging job and population growth. Although landlords currently have the upper hand in several submarkets, development that’s underway will help balance things out. Here we look at the top five office, industrial, and retail leases of the past three months, with data provided by Xceligent Inc.

BY CHRISTINE PEREZ

ON-THE-GRO U N D I N S I G H TS

OFFICE

INDUSTRIAL

RETAIL

MIKE WYATT

RIIS CHRISTENSEN

RICK MEDINIS

MIKE GEISLER

“The outlook for 2015 is bright and very promising.

With continued population migration to Texas, robust job growth, more corporate relocations, strong organic growth, and fresh capital crossing the Red River, I am very optimistic about another banner year here in North Texas.”

“Many tenants are dumping up to 50 percent of their space and paying double rents to be in buildings with walkable amenities and housing. Landlords are scrambling to off er six to eight parking spaces per 1,000 square feet—what would have been considered call-center densities fi ve years ago.”

“Industrial lease rates are sitting at historical highs.

These should remain stable throughout the lease-up period of newly delivered space. If more new starts aren’t introduced into the pipeline during the next two quarters, we may see another shortage of supply in the under-500,000 square feet category.”

“The fundamentals for retail have never been better. There’s stronger retail and restaurant sales volumes, rising rents, and limited vacancy. Add in favorable lending dynamics that’s fueling the investment side of the business. Our greatest obstacle is rising construction costs.”

Executive vice president, Cushman & Wakefield of Texas Inc.

W I N T E R 2014

Senior vice president, Transwestern

Executive vice president and principal, NAI Robert Lynn

Managing partner, Venture Commercial

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S SCORE CARD

OFFICE LEASES

5

3

4 21

2,000 7,378 SF 7,379 18,794 SF 18,795 46,309 SF 46,310 109,548 SF 109,549 325,000 SF

DATA SOURCE: XCELIGENT INC., A COMMERCIAL REAL ESTATE RESEARCH FIRM IN PARTNERSHIP WITH NTCAR

LARGEST OFFICE LEASES ENLINK MIDSTREAM PARTNERS AND ENLINK MIDSTREAM LLC SIZE: 157,568 s.f. in One Arts Plaza at 1722 Routh St. in Dallas TENANT REPS: Steve Thelen, Jeff Staubach, and Torrey Littlejohn with JLL LANDLORD: Billingsley Co., represented in-house by Lucy Burns and Marijke Lantz DETAILS: 7-Eleven Inc.’s decision to move its headquarters to Irving opened up a chunk of space in this Arts District property. Much of it was leased

by EnLink, which will relocate from Uptown in mid-2016. The deal includes an option to expand into more space during the term of the lease.

ONE ARTS PLAZA

LOCKE LORD

LEGACY TEXAS BANK

SIZE: 145,000 s.f. in Chase Tower at 2200 Ross Ave. TENANT REPS: Steve McCoy and Alan Harrington of Transwestern LANDLORD: Hines, represented in house by Tyler Baker, as well as Blaine Hall of Colvill Office Properties DETAILS: After scouring other options in the market, the law firm decided to stay in the Arts District tower, but will move to new space within the building, occupying about six floors.

SIZE: 78,705 s.f. in Plano Tower at 5851 Legacy Circle in Plano TENANT REP: Ben Sumner of Centurion Real Estate Partners LANDLORD: American Realty Capital Partners LEASING AGENTS: Greg Biggs, Doug Carignan, Torrey Littlejohn and Marc Feldman represented the sublessor, Encana.

DETAILS: LegacyTexas Bank will move its commercial banking corporate headquarters to the top three floors of Encana Oil & Gas USA Inc.’s former regional headquarters within Legacy Town Center. Eight 26,550-s.f. floors within the building remain available.

CHASE TOWER

SOFTLAYER TECHNOLOGIES INC.

HERITAGE AUCTIONS

SIZE: 125,000 s.f. in Stanford Corporate Center at 4849 Alpha Road in Dallas TENANT REPS: Clay Vaughn, Steve Rigby, and Mike Cleary of CBRE LANDLORD: TCI Stanford LLC, represented by Henry S. Miller Cos.’ Jerry Averyt and Greg Trout, formerly of HSM DETAILS: The fast-growing tech firm, which was acquired by IBM in 2013, needed space to house its corporate headquarters. The new office can accommodate up to 700 employees.

SIZE: 89,518 s.f. at 3500 Maple in Dallas.

LANDLORD: Champion Partners, represented by Johnny Johnson, Layne Mayfield, and Trey Smith of Cassidy Turley.

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PLANO TOWER

JOHNNY JOHNSON

W I N T E R 2014

INDUSTRIAL

STRENGTH

KTR IS A DYNAMIC INDUSTRIAL INVESTMENT, DEVELOPMENT AND OPERATING PLATFORM WITH OVER 5 MILLION SQUARE FEET OF ASSETS IN THE DALLAS MARKET. KTR is focused exclusively on the industrial property sector in North America. KTR is a recognized industry leader and dependable partner providing solutions in every major population center and logistic hub in the United States. Since 1997, the KTR team has completed nearly $7 billion of acquisitions and development.

KTR’s 89 employees in 8 offices across the country are led by a management team that averages 25 years of industrial real estate experience. Our unique depth and breadth combines the investment acumen and financial sophistication of an institutional asset manager with the real estate knowledge and entrepreneurial spirit of a local operator.

KTR currently owns and operates a portfolio of approximately 65 million square feet in 25 markets, highly concentrated in California, New Jersey, Chicago, South Florida and Texas.

IF YOU WOULD LIKE TO HEAR MORE A B O U T H OW K T R C A N H E L P YO U, EMAIL US AT: INFO@KTRCAPITAL.COM.

F E AT U R E D P R O P E R T I E S

W W W. K T R C A P I TA L . C O M N E W YO R K C I T Y | C H I C AG O | DA L L AS LAS VEGAS

|

LOS ANGELES

P H I L A D E L P H I A | S E AT T L E

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MIAMI

Interchange Distribution Center, DeSoto, Texas Up to 1.5 Million SF Build-to-Suit

Meacham Crossing, Fort Worth, Texas 502,323 SF – Newly Delivered

ARCHITECTURE PLANNING INTERIORS

www.obrienarch.com

W I N T E R 2014

THE STAR

HOME OF THE DALLAS COWBOYS

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S SCORE CARD

INDUSTRIAL LEASES

4 5 2

3

2,000 35,405 SF

1

35,406 125,103 SF 125,104 318,225 SF 318,226 821,502 SF 821,503 1,564,800 SF

DATA SOURCE: XCELIGENT INC., A COMMERCIAL REAL ESTATE RESEARCH FIRM IN PARTNERSHIP WITH NTCAR

LARGEST INDUSTRIAL LEASES

1

NAVISTAR INC.

3

FRUIT OF THE EARTH

DEAL: 360,000 s.f. in Pinnacle Park at 4038 Rock Quarry Road in Dallas.

LEASING AGENTS: John Gorman of Holt Lunsford Commercial represented the landlord, TA Associates TENANT REP: Nathan Orbin of JLL represented Navistar, a manufacturer of trucks and buses.

2

KGP TELECOMMUNICATIONS

SIZE: 260,700 s.f. renewal at 9400 N. Royal Lane in Irving LANDLORD: Prologis, represented in-house

by Mitch Pruitt TENANT REPS: Tom Walrich and Reed Parker of Lee & Associates represented KGP Telecommunications, which provides supply chain management and logistics solutions.

4

KONE

SIZE: 130,000 s.f. at AllenPlace DEVELOPERS: Sentinel Capital LLC, Centra Partners, and Triad Real Estate LEASING AGENT: Ben Appleby with Paladin Partners TENANT REP: Jeff Patman with Site Selection Group DEALS: KONE, which makes elevators and escalators, announced in May that it would be the lead office tenant at AllenPlace, a $26 million, five-building office park under construction off North Central Expressway near West Bethany Drive. Four months later, it announced it would add an on-site manufacturing facility, creating 80 new jobs.

SIZE: 145,579 s.f. Riverpark 1000 in Grand Prairie DEVELOPERS: Amstar, Huntington Industrial Partners, Seefriend Industrial Properties LEASING AGENTS: Kacy Jones and Steve Koldyke of CBRE TENANT REPS: Tom Walrich and Reed Parker of Lee & Associates DETAILS: It began as a speculative project, but Riverpark 1000 has been fully leased to Fruit of the Earth, which will take occupancy when the building is complete in the second quarter of 2015.

ALLENPLACE

5

RIVERPARK 1000

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SWS RE-DISTRIBUTION CO. INC.

SIZE: 127,506 s.f. at 1440 Lemay Drive in Carrollton.

LANDLORD: Lightning Propco I LLC LEASING AGENTS: Adam Graham, Mark Graybill, Nathan Denton, and Scott Giordano of Lee & Associates.

W I N T E R 2014

W I N T E R 2014

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S SCORE CARD

RETAIL LEASES

2

1

4 5 2,000 6,332 SF 6,333 17,023 SF

3

17,024 35,417 SF 35,418 60,858 SF 60,859 132,000 SF

LARGEST RETAIL LEASES

1

DICK’S SPORTING GOODS

SIZE: 50,018 s.f. at Glade Parks in Euless DEVELOPERS: North Rock Real Estate and Iron Point Partners LEASING AGENTS: EDGE Realty Partners DETAILS: Glade Parks is a new development being built along State Highway 121 in Euless. More than 400 apartments have been constructed; 800,000 square feet of retail space is planned.

GLADE PARKS

DATA SOURCE: XCELIGENT INC., A COMMERCIAL REAL ESTATE RESEARCH FIRM IN PARTNERSHIP WITH NTCAR

2

TEXAS FAMILY FITNESS

3

WHOLE FOODS

SIZE: 45,000 s.f. in Plano Towne Square at 920 W. Parker Blvd. in Plano.

TENANT REP: Dan Avnery of NAI Robert Lynn DETAILS: With more than 11,000 members it was time for Texas Family Fitness to open a second location. After a $500,000 remodel, the club will move into its new space. The company has secured funding to open three new locations in 2015.

SIZE: 45,000 s.f. in Waterside, Bryant Irvin Road and Arborlawn Drive in Fort Worth DEVELOPERS: Trademark Property Co. and Sarofim Realty Advisors DETAILS: Whole Foods is the first anchor tenant to sign on for space in this new 63-acre mixed-use development along the Trinity River. Ultimately, the project will include 200,000 square feet of retail space, riverside restaurants, 200,000 square feet of office space, and more. The first phase will open in the spring of 2016.

WATERSIDE

3 6 / D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W

4

TRADER JOE’S

5

DEL FRISCO’S DOUBLE EAGLE STEAK HOUSE

SIZE: 14,000 s.f. in Preston Hollow Village at Walnut Hill Lane and North Central Expressway DEVELOPERS: Provident Realty Advisors and Kroenke Holdings LEASING AGENTS: Aaron Stephenson and Zachary Porter of Retail Street Advisors DETAILS: Trader Joe’s will anchor this 42-acre development, and will open in February 2015. The first phase totals 75,000 square feet of retail space and 60,000 square feet of office space. More than 500 apartments will be built as a second phase of the project.

SIZE: 13,000 s.f. at McKinney & Olive in Uptown DEVELOPER: Crescent Real Estate TENANT REP: Kevin McIntosh of KMAC Group Inc. LEASING AGENTS: Jack Gosnell and Jack Breard of UCR Urban DETAILS: Del Frisco’s will close its longtime North Dallas venue when it moves to new two-story space in Crescent’s McKinney & Olive tower in 2016.

MCKINNEY & OLIVE

W I N T E R 2014

OUTSIDE. IN THE CITY. In Line With The Future. A new mixed-use development at George Bush Turnpike and Central Expressway. Coming summer 2015. Office, restaurant and retail spaces available now.

CITYLINE DFW.com W I N T E R 2014

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R ROUNDTABLE

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W I N T E R 2014

A MAGNET FOR MONEY With its strong fundamentals and surging population, Dallas-Fort Worth now ranks among the country’s top real estate investment markets, across all sectors.

In a roundtable discussion, our panel of experts share their insights on the current climate—and the prospects for 2015.

BY CHRI ST I NE PEREZ PHOTOG R APHY BY M I C HAEL SA M P L E S

W I N T E R 2014

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R ROUNDTABLE

The construction cranes are flying high across North Texas, a clear sign of the capital infusions spurring growth in office, multifamily, industrial, and other sectors. Our diverse region also is experiencing dynamic job growth, attracting numerous corporate relocations, and enjoying record occupancy rates—all of which just adds to the appeal.

What sectors will surprise us in 2015? Will higher rents push development to new submarkets? What product types will offer investors the most value? We asked six industry experts to share their big-picture view about the changing landscape in Dallas-Fort Worth. Here’s what they had to say.

MEET THE EXPERTS TIM JORDAN

BETH LAMBERT

BOB AISNER

A managing director of JLL’s capital markets group in Dallas, Tim Jordan’s primary areas of responsibility include the financing of commercial real estate properties and developments, including office, hotel, retail, mixed-use and multifamily product types.

Executive Managing Director Beth Lambert oversees Cassidy Turley’s capital markets platform in Texas. Her extensive experience in the industry includes co-founding Vision Capital Real Estate and serving as a director at Archon Group LP, a Goldman Sachs company.

Bob Aisner brings more than 30 years of commercial real estate leadership to his role as president and CEO of Behringer.

Investments sponsored and managed by the Behringer group of companies have invested more than $11 billion in assets.

4 0 / D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W

W I N T E R 2014

DFW REAL ESTATE REVIEW: Let’s start by getting a recap of real estate investment activity across the region in 2014. Were things better, worse, or about what you expected —and why?

JACK FRAKER: It’s better than we thought it would be this time last year, but each year since the dark days of 2009 have been better and better. In 2009, the volume for capital markets activity was down 90 percent from what it was in 2007. Those were the really bad days that I have tried to repress in my memory. But each year it’s gotten better and better. There’s a significant amount of capital in the U.S. that wants to be in real estate as an asset class. And it’s not just U.S. capital. It’s coming from all over the world. Real estate is one of the better asset classes for the retiring baby boomers coming up in the next few years. Eighty million baby boomers are going to start to retire, and they’re looking for income-producing assets. Volume is better than I had expected, and I think it’s going to be even better next year.

TIM JORDAN: We benefit from just the dynamic job growth that we have here in North Texas, and plentiful inexpensive debt also helps drive that. It’s been fantastic.

BETH LAMBERT: When I think about investment activity, there’s two pieces: Acquisition and development. Acquisition in the sales volume has been on par with 2013, but development is pretty impressive when you see what’s going on around the city. When you look at the 5.5 million square feet of office, 18.5 million of industrial, and 28,000 units in the multifamily space, which has really been surprising, Dallas is leading the nation in multifamily development. But when you’ve got 5 percent vacancy, the economics still work.

ANDREW LEVY: If we look in on a macro level, we’re having a very, very strong year.

It’s obviously a primer of the entire market. I don’t think we’re surprised because we saw our pipeline building up at the beginning of the year — or really at the end of last year, so we felt like it was going to be at least as good as last year and

hopefully a little better. But the difference is we’ve been talking for many years about capital leaving the coast and leaving the primary markets and coming into secondary markets, and we finally got to be right. There’s a lot of capital that’s now coming in and looking at apartments, office, industrial, and that’s obviously a very good sign.

BOB AISNER: The amount of money looking to come into Dallas and the region is just astronomical.

SCOT FARBER: For the office side, we’re on pace for $3 billion worth of volume right now, year to date. Some of the sellers are saying, ‘If I sell, where am I going to put my money?’ I don’t know how that’s going to actually translate into sales down the road because people are looking at alternatives once they sell the property, if they can find a replacement property.

The same thing is happening on the residential side, too.

FRAKER: Where these yields and cap rates are so low, so many institutional investors are now trying to go on the development side. They can get a slightly higher return that way, through

JACK FRAKER

SCOT FARBER

ANDREW LEVY

Jack Fraker is a vice chairman at CBRE and managing director of the firm’s capital markets group. He specializes in the sale of investment properties for institutional clients, as well as tenant representation (office and industrial) for corporate clients.

As executive director of the capital markets group for Cushman & Wakefield of Texas Inc., Scot Farber is in charge of the disposition of investment sales properties for financial institutions, banks, special servicers, pension funds, REITs, corporate users, and private investors.

As senior managing director for HFF, Andrew Levy’s primary focus is on office investment sales, as well as overseeing day-to-day operations of the company’s Dallas office. He has worked on some of the largest office and mixed-use sales transactions in the Southwest.

W I N T E R 2014

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R ROUNDTABLE

SCOT FARBER

IT’S A CHOICE THAT AN EMPLOYER IS GOING TO HAVE TO MAKE ABOUT HOW FAR OUT THEY WANT TO GO. IF THEY WANT TO BE WITHIN THE LOOP, OR INNER LOOP, THERE’S NOT THAT MANY OFFICE SITES THAT ARE READY TO BUILD AND READY TO GO. —SCOT FARBER 4 2 / D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W

development, and get a higher yield on cost versus buying a stabilized property at a low cap.

Where are we in the cycle compared to 2007?

LAMBERT: People start to think we’re getting near the bubble because of where cap rates are and peak pricing and all that. But, fundamentally, when you compare back to 2007, if you were looking at a 6.5 cap, your interest rates were taking up 500 basis points of that, and so the spreads for lenders and spreads for equity were really small.

So they split that 150 basis points. Today, with central banks intervening and keeping the training wheels on, interest rates are making up about half of that, so at 2.5 percent.

We’re still pretty early in the cycle. We’ve still got a lot more volume left in that regard.

LEVY: The fundamentals here are just so exponentially better than they were, and the lenders are keeping the construction in check.

FARBER: In some of the major submarkets, leasing rates are pushing past historical highs, and there’s still a lot of room left to go before real construction takes place. I’m talking about real high rise, multitenant office buildings, not the one- and two-story buildings and three stories they’ve been building. So there’s a lot of room left in the submarkets out there for that rental rate growth.

LAMBERT: When you see buyers paying these crazy 5 caps that Andrew loves to get, they can see where rent is going, because you’ve got job growth, consumer spending is up, and lots of things that are driving a very healthy overall market. They can see how that translates to rent growth. While they may be underrating a 5 going in, we can convince them that there’s a 7.5 or an 8 waiting pretty quickly on the horizon because there’s a vacancy play or rollover in the rent role.

AISNER: It’s different than ’07 because everybody came out of ’07 saying, ‘I’m never going to leverage high again.’ We’ve been able to cross all sectors and it’s really a much lower-leveraged environment. We’re not down to 40 percent leverage, but we’re on the other side of it. The one thing that’s starting to happen that reminds me of ’07 is people buying vacancy. Let’s buy vacancy because nothing will ever change.

W I N T E R 2014

JACK FRAKER

ANDREW LEVY

LEVY: I don’t disagree at all. If you’re looking for a red flag, it’s people. I know I speak for all the brokers in the room, you may not want to do that lease. A space that’s worth more vacant than leased is certainly a red flag. But the difference is we have been doing that now for about two years, and they’re being rewarded for it. If you look at a typical Uptown building, the rates have probably moved on the office side $10 in two years.

FRAKER: On the industrial sector, we are exceeding 2007 in terms of volume, of national capital markets activity, and there are also many cases where cap rates now are as low, or lower, than they were back then. The per-square-foot metric is also higher in some cases than it was in 2007, but it is being driven by the rental rate growth that Beth alluded to, because it’s tangible evidence of rental rate growth.

LAMBERT: We’re not seeing people do crazy underwriting things, like double-digit rent growth for five years in a row like we saw in 2007, to get deals to make. It’s much more moderate growth that you can understand. It’s believable.

Even the brokers have been surprised by the rent increases, especially in Uptown, with office and multifamily, and all of the unprecedented industrial development that’s going on in Southern Dallas. Are lenders and investors worried about the market becoming overbuilt, or is there enough demand?

FARBER: There’s about 5.8 million square feet of new office construction that’s going on right now, and if you back out 1.5 million square feet of the State Farm space, you’re down to about 4.3 million square feet. Let’s assume that across the board it was 30 percent pre-leased, so we’re only talking about 2 million square feet of space.

The biggest difference is that the building sizes are actually getting smaller. The real high rises aren’t there, and that’s because the rents aren’t there to support it yet.

JORDAN: The dynamic job growth is what’s backfilling the buildings both in multifamily and office. We’re keeping up with the job-growth-generated demand in both those sectors. The multifamily occupancy’s just under 95 percent. That’s the highest it’s been in 30 years. If you add one new apartment unit for every five jobs

W I N T E R 2014

BETH LAMBERT

created—that’s about what the math is in North Texas—we’re at 25,000 units. We’re keeping up with that job-growth-generated demand, and that’s why occupancies are so strong and we’re getting good rent growth throughout DFW. LEVY: The lenders are doing their jobs. We’ve raised the equity and the debt on a lot of the new towers that are going up, in Uptown and Legacy. The 5 million square feet is all in two sale markets. I’m exaggerating a little bit, but not much. The lenders are absolutely tapping the brakes and I can’t tell you how difficult it is to raise debt and equity on any spec office building. If you get a 30- or 40-percent lease, you get it at McKinney and Olive, which is a fantastic kind of trend-setting-type building, you can get it done. But even that building was 30 percent pre-leased before we could get it going.

FRAKER: It’s a lot different today than it was in 2004 or ’94 or ’84. There’s more and more institutional governance on these development deals, speculative or even some build-to-suit deals, and it’s not the wild, Wild West days of the ’80s, when every developer and his brother could go out and get a loan and build something on the same day. Now there’s so much information available about market demand, market statistics, absorption, and the lenders and the equity have their finger on the pulse of that and don’t do anything risky without really

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R ROUNDTABLE understanding the drivers.

LEVY: There was a great piece that was put together about three years ago that debunked the supply constraint market myth because that was always the knock on Dallas versus Boston or New York or even in Austin. There’s so much land and you can build indefinitely, and the reality is that lenders have bid on various entry because they did get burned so badly in two or three different cycles that it’s just not that easy to get stuff built. That’s our barrier at entry.

FARBER: There’s not a lot of office sites out there that are close in anymore so it’s a choice that an employer is going to have to make about how far out they want to go. If they want to be within the loop, or inner loop, there’s not that many office sites that are ready to build and ready to go.

AISNER: We’ve absorbed essentially everything with the job growth. Two factors will help continue to keep this in balance. Land is getting expensive. To build a multifamily property, it’s expensive to buy the land. Then, you’ve got to get big rents. The question everybody asks is, ‘How much more can kids pay on any of these properties?’ That’s the natural ceiling that constrains supply because you just can’t continue to push rents. Through the bottom of the recession, the unemployment rate for kids with a college education never went above 5 percent. Dallas rents are relatively cheap compared to San Francisco or Boston or some of these other markets, but you have to make a decent living to pay. The natural tension on the multifamily side, unlike the office side, is how high can you raise rents before people start to say, ‘I’m going to go somewhere else.’ We’re starting to see that in the Bishop Arts and Trinity Groves areas. They’re starting to move out a little bit where they can get less expensive rents, but get into downtown a little easier.

LAMBERT: Even those are escalating pretty quickly. We’ve done a few projects in South Dallas, and they were performing $1.40 rents, and now we’re bringing them online at $1.60, $1.80. So even down there, it’s starting to price people out.

AISNER: We just bought a property down in Lakewood, near the lake, in an area we think is going to continue to come up on that theory.

FRAKER: The demographics are changing, too, so it’s not just the young people. It could be retiring baby boomers who want to get rid of a house and live in a cool area like Uptown.

FARBER: Or downtown.

FRAKER: So they can pay those rents.

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THE NATURAL TENSION ON THE MULTIFAMILY SIDE, UNLIKE THE OFFICE SIDE, IS HOW HIGH CAN YOU RAISE RENTS BEFORE PEOPLE START TO SAY, ‘I’M GOING TO GO SOMEWHERE ELSE.’ WE’RE STARTING TO SEE THAT IN THE BISHOP ARTS AND TRINITY GROVES AREAS. —BOB AISNER JORDAN: Downtown is a surprisingly good market. It’s been full, seeing good rent growth in the downtown market. You’ve got approximately 6,000 residents downtown now, which is a big change from what it was 15 or 20 years ago.

How would you characterize the makeup of investors who are betting on North Texas today?

JORDAN: It’s very mixed. You’ve got the institutional investors, which are strong and real active in this market. With the available inexpensive debt, you’ve got a lot of the local, regional, private investors that can play in the market.

FARBER: On the office side, I would call it North American capital. We do get some foreign money here, but what we’ve seen is a bigger influx of Canadian and Mexican money as well as other cities from around the country that haven’t been here before.

LEVY: To Scot’s point, it’s Canadian, it’s Mexican, it’s Israeli, and German. We’ve never seen those types of buyers coming in. The statistics would tell you that 12 percent of the core trades in the United States on the office side are now foreign capital, and 90 percent of that is in the gateway market so that’s pushing a lot of capital out because we’re not getting deals done in those markets because foreign capital is beating them. We don’t like to think Dallas is a secondary market. Probably the better term is non-gateway. It’s not New York, D.C., L.A., or San Francisco, or Boston.

LEVY: From a transactional volume standpoint, across all property types, in 2013 Dallas was No. 6 in the country, behind cities like New York, L.A., Washington, and Chicago. That’s got to be filled by a lot of different buckets.

LAMBERT: We think there’s a ton of foreign capital here, but in reality it’s less than 10 percent that actually invests in Dallas. It’s the same thing in Houston.

FRAKER: A lot of the foreign capital is sort of hidden from the public view because it ends up in commingled funds. All of these famous funds we hear about, whatever asset class it is, they may have a wide variety of foreign investors that are limited investors in a fund.

LEVY: Or even operating partners. We did one on the tollway last year where 90 percent of the equity was Israeli, but you would never see it. I can’t imagine any of the national statistics would reflect that because you wouldn’t know it.

AISNER: We raised $500 million from an overseas pension fund to do domestically controlled REIT joint ventures with us in our multifamily, and so nobody would know that they own 45 percent of a lot of stuff here in Dallas just because they’re not on the masthead or the letterhead. But that’s foreign capital that’s willing to invest here in Dallas.

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TIM JORDAN

BOB AISNER

FRAKER: I was on a property tour a couple weeks ago with people from the Middle East buying an industrial portfolio. We also had people from Canada looking around, too. So they’re starting to do direct deals, but mostly, it’s hidden funds.

JORDAN: You think about Invesco. They’ve invested almost $1 billion in the Legacy market, and then this is a trade of 1,600 units total up there. You look at that and that’s a huge buy for somebody and it’s a huge stake, but it’s a testament to their commitment to that market and how they view the growth up in Legacy long-term.

FRAKER: I think 2017 is the peak year for retiring baby boomers. So if you’re the CEO of a corporate pension plan, you really don’t want to have your money in derivatives or hedge funds or something exotic like that, or even the stock market, because you’d rather have reliable income, even if it’s lower yields.

FARBER: The S&P just created an 11th grouping for REITs, which is a big change.

The investors asked S&P to do that.

What’s the sweet spot in terms of the different product and property types and submarkets? What are investors currently targeting?

LAMBERT: I’ll pick on value-add a little bit, and I do all product types. When I think of buyers, there are value-add guys, which sometimes look a little opportunistic today, and there’s core buyers, who have a core or core plus or build-a-core kind of program. I see the value-add guys looking at Las Colinas a good bit, because that market has been an island, but has started to have some great connectivity with Dallas and Fort Worth. The amenities are coming in and there’s an infrastructure that’s happening there. People see an opportunity there. A few groups are getting a little bit ahead on the value-add side, along the LBJ corridor, thinking that when it’s finished there’s going to be surreal opportunity there. On the core side is Uptown, Preston Center, and Legacy.

LEVY: The only thing I’d add is 90 percent of the capital that’s been raised in the last three years in the U.S. is targeted at whole periods of less than seven years, and a huge part of that is three to five years. So it’s all value-add money or core-plus money, and the yields are being chased down because they’re not finding a whole lot of value-add in the market that’s creating so many jobs and filling up so many apartment units, and retail centers, office buildings, and industrial buildings.

Their yield requirements are dropping and in order to replace this capital they

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show up and they want to talk about Uptown and Legacy or Preston Center. They find very quickly they’re nowhere near where the yields need to be so they’re going to Richardson, Las Colinas, LBJ. I think the next market that’s got to pop, from an investment and leasing standpoint, is going to be North Central Expressway, because with Uptown and Preston Center as tight as it is there are a lot of tenants who just flat out will not be able to pay $25 net, when they were paying $25 gross when they signed their lease five or seven years ago.

FARBER: LBJ is a sleeper market. For my entire career, we’ve heard nothing but negative things about LBJ, but for the first time, with the completion in 2015, people are picking up on it. I think we’ve sold over 20 buildings over there.

People are trying to get ahead of the curve about what’s coming.

LEVY: Value-add capital’s got to chase vacancy, and North Central and LBJ are where it’s at.

JORDAN: You’ve already seen rents pop pretty well in the nicer buildings along Central Expressway. You’re getting rewarded for making that bed early, when Piedmont bought Lincoln Park.

FRAKER: The sweet spot for industrial is the light industrial sector in buildings that are 200,000 square feet or smaller, which are primarily infill locations. Out of all the speculative development that’s taking place in Dallas, very little of it is in that sector.

The vast majority, something like 65 percent or 70 percent of all industrial, is light industrial. So if it’s not being built speculatively, and tenant demand has come back, a lot of those tenants are tied to the single-family housing industry or tied to the automotive industries and those industries were wiped out in 2009. But now they’re coming back and they’re leasing up light industrials.

What trends are we seeing with regard to pricing, and what factors are driving the trends? Also, do you expect the end of quantitative easing to have an impact?

AISNER: On the multifamily side, there’s been no increase in cap rates. We’ve seen no continued pressure on pricing. We moved our strategy from a buyer to a developer a couple of years ago because we waited and waited and thought, well, this is not just in Dallas. So we’ve given up guessing on that. But it’s been really a very tough market to buy in. People feel really good about buying into long income streams of apartments. You know, at some price, they always rent. I don’t think they’re going to move

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BETH LAMBERT

for a while. In the multifamily business, people are trying to decide how far out of the core do they have to go to get a decent yield. And then, do people really want to go out there? It’s going to be easy at the State Farm property, or up at Toyota, where you’ve got a real suburban-urban kind of place, where they’re not going to have to get in their car and drive everywhere. I don’t see a movement up in cap rates, at least for a while, on the multifamily side. I think it’s going to stay very tight.

LAMBERT: In mid-2013 we had a market check, what they called a taper tantrum, when the interest rates spiked. For that period that they were spiked, nothing happened in cap rates.

That goes back to those appropriate risk adjusted yields that lenders are getting and equity’s getting back compared to 2007. So there’s some running room there. Interest rates have got to move significantly, but moderate inflation is going to be a good thing for real estate pricing.

If we’re having normal inflation, we’ve got job growth and wage growth, and consumer spending, and all the fundamentals that are going to drive demand for real estate. You’re going to see the rent growth and the occupancy growth and that demand happen. I like taking the training wheels off and trying to stand on our own and really one with the market forces, as opposed to this intervention by the central bank. We can do

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that and not see cap rates being adjusted for a while.

JORDAN: We are seeing real rent growth today with the low interest rates, and it’s real, sustainable, and it’s expanding. That piece of it feels better than any time in my career where the fundamentals are really in check with good job growth and very inexpensive capital.

LEVY: The party line at our firm is that the transactional volume is driven by the availability of capital, not by the pricing of capital. If you look back in 2007, the national U.S. investment activity was $575 billion, and the average interest rates were 4.6 percent. So the interest rates were 200 basis points above where they are right now, and it was the highest volume in the history of the business. Even going from 13 to 14, interest rates have run up 100 basis points, and yet transactional volume is still spiking.

FRAKER: So there’s no direct correlation. It’s not a basis point for basis point correlation.

LAMBERT: Not at all. It’s a lot more complex than that.

FARBER: The transaction volume is still way down. The only statistic I follow is CMBS (commercial mortgage-backed securities) lending, but CMBS lending in ’07, I think, was $250 billion. This year it’s $100 billion or something. It was $80 billion last year. So you talk about this huge spike of transactions, but there is not as much as there was leading up to the recession, which I think is a good thing.

LEVY: The difference is there’s much more equity going into these deals.

JORDAN: In ’07, you had a lot of the public-to-private trades, which were in that number. The volume was driven a lot by those massive public-to-private trades that occurred. If you take just what I’ll call “flow CMBS,” we’re not at the peak, but it’s pretty healthy.

LAMBERT: Closer.

JORDAN: Yeah, you have to take out the big events.

FRAKER: There’s a lot of debt that’s LIBOR-based. There’s big, smart, sophisticated institutional investors that are doing LIBOR-based financing with interest rates of 1.25 percent. We’ve seen some sovereigns or really large groups that are capable

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R ROUNDTABLE

TIM JORDAN

of 100 basis point spread over LIBOR (which stands for London InterBank Offered Rate). You can really do some good gearing, as they call it overseas, with those kind of low interest rates.

FARBER: If you’re a value-add or opportunistic investor, you’re not talking to the CMBS market anyway because it’s a shorter-term value-add, three- to five-year hold.

So that’s a little bit different.

AISNER: If you look at the public markets, their ability to access capital at very low rates is incredible right now. It’s really cheap money right now for the publics, and in all office and multifamily, whatever, enormous availability of capital.

JORDAN: But there’s good liquidity. You look at the bank market, life insurance company market, and the CMBS market, everybody’s healthy on the capital provider side.

LAMBERT: Look at the additional debt funds that you throw into that mix. It tells you how much debt capital is out there. When you look at some of the big firms, like Mesa West, LoanCore, or Latitude, they’ve been used to lending at 5 and 6 percent.

You talk to the guys that run those companies, they’re telling you high 3s, low 4s now, and I say, ‘Is that just because you’re making a run for end of the year?’ There’s just a tremendous amount of debt capital out there.

Some have projected that the current cycle is going to turn in 2018. Are there any indications of that happening?

FRAKER: Nobody can really predict it. You can look at industrial real estate. The average amount of new construction for a 20-year period, from 1987 to 2007, was about 225 million square feet per year, and so now we’re way below that average nationally—we’re close to 100 million square feet. But, gradually, it will get back to the same number or more and some people have predicted that it will be 2018. If you look at cycles and recessions and how the recovery lasts after a recession, we’re just now getting started in that cycle. Some people say that will be five or seven years, so that would take you past 2018.

LAMBERT: This is a different recovery. It’s already been elongated, when you look

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THE PARTY LINE AT OUR FIRM IS THAT THE TRANSACTIONAL VOLUME IS DRIVEN BY THE AVAILABILITY OF CAPITAL, NOT BY THE PRICING OF CAPITAL. —ANDREW LEVY D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W / 4 7

JACK FRAKER

R ROUNDTABLE

ANDREW LEVY

back. So history is not helping us predict much.

With the strong fundamentals we’re seeing in Texas, we might have a longer tail than the rest of the country.

FARBER: For the office developers doing larger projects, they’re going to need more than $40 a square foot to even kick those deals off. We’re a far way away in most submarkets, so there’s a lot of room to grow. I don’t know how that coincides to 2018, but the rental rates are going to move quite a bit before we can really get to those rental rates and have a lot of meaningful construction out there.

JORDAN: Look at Toyota’s decision to come to North Texas, and that’s a generational decision.

They’re moving their corporation here and making a long-term bet on North Texas. You look at what’s going on with DFW, and it’s hard to be more bullish than we feel today because we’ve got everything going for us in North Texas, and in Texas in general.

AISNER: For multifamily, by 2018 we will see there’s no slowing, and we just can’t keep raising rents the way we’re raising them. We’re going to come back down a bit. This is just too good right now. Office obviously comes out of the cycle later than multifamily. There’s no doubt the office sector will have a longer tail on it and really strengthen. We came out much, much sooner and much quicker than the other sectors, and

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I think that will affect what it looks like in ‘18; whereas, the office could look much better.

JORDAN: For multifamily, it seems that the rent growth may slow down, but it doesn’t seem like we’re going to have issues relative to occupancy.

AISNER: No, no. Dallas came through the recovery OK in the multifamily sector because we didn’t have the overheated housing market here that blew up the rest of the country.

What is it going to take for capital to be driven to Southern Dallas?

LAMBERT: There’s a good bit of multifamily stuff happening down there. Rents are really proving up. There’s exit strategies down there and that’s where it starts, right?

You don’t start with the office. You start with the multifamily.

JORDAN: That’s because you can go down there and lease it for $1.40 per foot, not $2.00, or $2.40. You’ll have the urban pioneers go down and say, ‘For that price, I’ll make the change.’

AISNER: Transportation into the city is incredibly important, wherever you are. If they can get in here easily; it’s just amazing what the bridge to Trinity Groves has done.

LAMBERT: Bishop Arts and Trinity Groves.

South Dallas seems to be very active on the industrial front.

FRAKER: That’s right. Corporate real estate managers will talk about the Inland Empire in Los Angeles or Eastern Pennsylvania/New Jersey, and in the same breath they’ll talk about South Dallas. You have the intermodal. If you haven’t done this, pull off to the side of the road one day at that intermodal entrance and just watch the activity. Capital is already investing in the industrial sector in South Dallas. Look at what other ancillary uses could go around all of that activity.

I don’t know how many workers are down there, but they’re having to drive a long distance to get nice apartments or housing.

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What are other opportunities, challenges, and your overall predictions for the coming year?

LEVY: The biggest challenges and greatest opportunities are on the office side.

FRAKER: We all had pipelines of deals in business, and we already know that we’re going to have a good first quarter. It’s going to be at least a continuation of the type of volume we’ve had this year. Large portfolios are happening in our sector, so we expect a few more of those to happen next year. Unfortunately, I’m in the industrial real estate business, and our per-square-foot prices are half of what the office is, so we have to work twice as hard. But, anyway, we think the volume in our sector is going to be big next year.

LAMBERT: We have such great momentum with corporate relocations coming to this area. That’s still a great opportunity. Our groups together have done a great job in recruiting and bringing folks in, and that continues to bolster our economy and keeps us all in business because of the job growth and all that comes with those companies coming in, the need for space. I see that as a continued opportunity to really sell what’s great about Texas and what’s great about Dallas. Having a diverse economy is huge, and that’s why Toyota’s here and State Farm is here. When you talk to those groups, you think real estate might be driving those decisions, but the stories I hear is that there’s no real estate people coming to those meetings. It’s the HR groups that are looking for places where people want to be in these urban lifestyles.

LEVY: For the next 12 to 24 months, I’m probably most excited about downtown for all the reasons everyone’s discussing. The renters are getting priced out of Uptown.

Bob, you told me it’s 50 cents to $1 cheaper for a phenomenal Class A unit in downtown. The denominator is shrinking. The amount of activity on the street is rising with retail coming in every month. If you look out of this window at the top 10 buildings, it’s hard to find a building that something significantly positive hasn’t happened to it in the last 12 months, whether it be One Main Place or 1401 Elm.

Virtually, every building in downtown has had something significantly positive happen to it in the last 12 to 18 months.

FARBER: We’re going to see investors that haven’t been here before and add-ons. They see the headlines that are out there and we get new calls everyday.

JORDAN: The lifting of the Wright Amendment is going to have a huge impact on the in-town market, and I think downtown also benefits there. If I’m a company and I’m looking at transportation, I’ve got my people traveling all over the country. All of a sudden, now I can go from Love Field and my access from downtown is fantastic. That’s a dynamic we haven’t really seen the effects of and the spillover of that could be tremendous.

AISNER: From the multifamily side, that can obviously be good. The challenge will be finding developable land where the numbers will work.

You’re going to see development pull back, and I think the opportunities will be starting to look in these fringe areas that people still feel are kind of cool, but are a little on the edge. For owner/operators, I think 2015 will be another very good year.

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A ANATOMY OF A DEAL

MOVIN’ HOW A SLEEPY RESIDENTIAL NEIGHBORHOOD EVOLVED INTO ONE OF DALLAS’ HOTTEST COMMERCIAL SUBMARKETS

BY HILARY LAU

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Now one of the most successful commercial submarkets in the country, it’s hard to believe that just 30 years ago Uptown Dallas was predominately comprised of single-family residential properties. Back then, all of the action was downtown, where Trammell Crow and others were putting up skyscrapers during the 1980s building boom.

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ON UP

PHOTO: MICHAEL SAMPLES

A stark contrast to the shiny buildings that stand tall in Uptown today, the area originated in the late 1800s as a neighborhood inhabited by Eastern European Jewish immigrants. By the early 1930s, and as a result of displacement by the Mexican Revolution and job opportunities created by industrialization in Dallas, Mexican immigrants moved in alongside them. The flourishing area changed and evolved from Little Jerusalem into Little Mexico, and gave birth to such Dallas institutions as El Fenix and Luna Tortilla Factory.

Later, through eminent domain, the neighborhood saw a flurry of commercial redevelopment.

From the 1950s to the 1980s, the City of Dallas began changing and chopping roads in order to create better fluidity for commuters traveling into and out of the city’s core. By the ’60s, the Dallas North Tollway had created a physical divide through Little Mexico. By the ’70s, Cedar Springs and Pearl Street had been significantly widened, while Harry Hines Boulevard; McKinnon, Carlisle, and Cole streets; and Lemmon and McKinney avenues all became one-way. A connection at MapleRouth was chiseled across existing street lines, and disintegration of the grid in what

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had been Little Mexico led to disinvestment.

Uptown’s evolution into a commercial standout began in 1983 with development of The Crescent. Even in a city known for “wow” developments, this $400 million project stood out.

Built on 10 acres, the 1.1 million-square-foot office, hotel, and retail complex opened to great fanfare in 1986. Its neo-French classical design was unlike anything the market had ever seen.

“The neighborhood in 1983 when The Crescent started construction really was just bland, on the edge of downtown,” says John Zogg, managing director of Crescent Real Estate Holdings. “The Crescent was an extremely ambitious project for the time, and it really jump-started a new neighborhood.”

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HOUSTON

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SAN ANTONIO

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PHOENIX

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MID-ATL A NTIC

A ANATOMY OF A DEAL

PHOTO: CRESCENT REAL ESTATE HOLDINGS

PHOTO: MICHAEL SAMPLES

THE CRESCENT

UPTOWN TAKES SHAPE Robert Shaw pioneered multifamily development in Uptown when he broke ground on the Meridian Apartments in 1990. He would go on to build 14 projects in the neighborhood. (He and business partner Roger Staubach hope to have a similarly transformative impact on Trinity Groves, where they’re building a 1,000-unit apartment complex.)

In the early 1990s, Uptown Dallas incorporated to accommodate the Uptown Public Improvement District, with the overall goal of revitalizing the area. A small but mighty group of residents and investors drove initiatives to create momentum and fuel investment, which yielded residential development, the M-Line Trolley, and redevelopment of the Katy Trail.

“The development of the Katy Trail was a milestone, adding the appeal of recreational opportunities to the re-emerging neighborhood,” says Amy Gibson Tharp, president and executive director of Uptown Dallas Inc. “UDI has been a supporter of

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the Katy Trail since its inception, contributing to capital projects and security, and encouraging community involvement through events.”

Countless Dallas developers have kicked up dirt in Uptown over the past 30 years to create the region’s hottest submarket. Rents and property values have soared with gap-bridging architectural feats like Klyde Warren Park, completed in 2012, creating public green space that’s now flanked by restaurants, residences, and entertainment venues.

According to UDI’s Gibson Tharp, conservative estimates show Uptown has 15,000 residents within its 570 acres—more than double the number of people who lived in the district in 2000.

On the commercial side, Uptown boasts some of the highest occupancy rates and rents in the country. About $1.2 billion in construction projects have recently been completed or are about to break ground. Since the creation of the PID, Uptown’s portfolio value has grown from $500 million to $3.8 billion.

One of Uptown’s big players, Gabriel BarbierMueller’s Harwood International, helped pioneer the district. To date, Harwood has developed 22 million square feet of space in Uptown. He has several projects underway and even more planned for the future. The Swissborn real estate developer likes to incorporate his worldly passion for art collecting and the Bushido Code of the Samurai into his projects; he’s bringing an international spirit to Uptown that will, in turn, bring greater recognition to Dallas on a global scale.

“We have 18 city blocks that we call Harwood, which stretch from the Natural Museum of History to the Katy Trail,” he explains.

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A ANATOMY OF A DEAL

“THE UPTOWN COMMUNITY IS BECOMING MORE DIVERSE, AS MILLENNIALS DESIRE TO STAY LONGER AND START THEIR FAMILIES HERE.” — GIBSON THARP, UPTOWN DALLAS INC.

Projects underway include Frost Tower, a 22-story, 167,251-square-foot office tower that’s already 92-percent leased, and Blue Ciel, a 780,000-square-foot, 33-story residential tower that’s shaped like a teardrop. It’s a follow-up to Harwood’s wildly successful residential tower, Azure.

For each of these projects, Babier-Mueller has tapped a number of noted advisers, including Jean-Michel Wilmotte, an architect whose projects include Paris’ Musée d’Orsay and Mandarin Oriental Paris Hotel.

PARKS AND ART No one was sure what to expect when Klyde Warren Park opened in 2012. The hope was that it would connect Uptown with The Arts District and downtown Dallas, and it has certainly done just that. But the biggest winner may, in fact, be Uptown, where office rents—especially for projects on or near the park—have soared. Uptown has also benefited from completion of the Dallas Arts District in 2012. The largest contiguous urban arts district in the nation, it spans 68 acres and 19 contiguous blocks.

Lucy Billingsley was the first to bring office space to the district with One Arts Plaza, which opened in 2007. Craig Hall has followed with KMPG Plaza at Hall Arts, slated to open in 2015.

These one-of-a-kind amenities just strengthen the allure of the Uptown/ Arts District submarket, where only a few pockets of land remain available for development.

“It has the highest expression of every product type, and it’s such a draw as far as people coming in,” says Zogg with Crescent Real Estate. “It’s so hard to go find land and just make something happen like this in urban cities; [Uptown] was created in the last 20 years to be the best part of Dallas, by far. There’s only a limited amount of land, so there’s only so much more we can do with it, and there’s a lot of people trying to get in.”

Beyond commercial developers, Uptown is attracting a swarm of residential builders, too. As the neighborhood matures, it’s attracting a wider variety of inhabitants, says Gibson Tharp of UDI. “The Uptown community is becoming more diverse, as millennials desire to stay longer and start their families here, creating new demands on educational and recreational opportunities,” she says. “Empty-nesters and baby boomers are seeing the benefits of ditching the yard work for a walkable neighborhood and comprise nearly 20 percent of our growing demographic. Uptown is pushing through the threshold where it can sustain a variety of retail sectors beyond nightlife. … I feel lucky to be leading this organization as we focus our priorities on improving mobility through urban design.”

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UPTOWN/THE ARTS DISTRICT MILESTONES LATE 1800S: Eastern European Jews settle the area surrounding Pike Park in Uptown, dubbing it “Little Jerusalem,” “Goose Valley,” or “Frogtown.”

1910-1930: Mexicans displaced by the Mexican Revolution move to the area alongside the Jewish immigrants, finding job opportunities in Dallas’ industrialization and railroad industry.

Meanwhile, rising middle-class Jews begin moving out of the neighborhood, giving way to “Little Mexico.”

1950S: Construction is completed on Central Expressway.

1962: Construction begins on Woodall Rodgers Freeway separating Uptown from downtown Dallas.

1966: Construction begins on the Dallas North Tollway, cutting through Little Mexico.

LATE 1960S-1980S: The City of Dallas purchases swaths of land in Little Mexico through eminent domain, opening the area for investment and expanding streets.

1983: Rosewood Property Co. breaks ground on The Crescent, a mixed-use office, hotel, and retail complex that was completed in 1986. The Crescent would later be acquired by Crescent Real Estate Holdings LLC. 1984: Harwood International’s Rolex Building opens at 2651 N. Harwood St. Dallas Museum of Art opens, kicking off development of the Dallas Arts District.

1989: The McKinney Avenue Trolley begins service for the first time since streetcars stopped running in 1956.

1990: Robert Shaw breaks ground on Uptown’s first major apartment project, The Meridian, near McKinney Avenue. He would go on to build 14 projects in the submarket.

1992: Uptown Dallas becomes a public improvement district (PID).

2001: The American Airlines Center opens as an anchor tenant in Victory Park, a new mixed-use development lead by Hillwood’s Ross Perot Jr. Tenants would grow to include The W Dallas Victory Hotel and Residences, House of Blues, and the Perot Museum of Nature and Science, among others, between 2004 and 2012.

2009: AT&T Performing Arts Center opens in The Arts District.

2012: Klyde Warren Park is built atop Woodall Rodgers Freeway. Dallas City Performance Hall and The Perot Museum of Nature and Science open, completing the cultural buildout of The Arts District.

2013: Uptown celebrates its 30th birthday.

2014: Uptown has an estimated 15,000 residents within its 570 acres, and a real estate portfolio value that exceeds $3.8 billion.

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The Vision that will transform

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A ANATOMY OF A DEAL

GRIGGS PARK PHOTO: UPTOWN DALLAS INC. / JUSTIN TERVEEN

LAY OF THE LAND

KPMG PLAZA AT HALL ARTS

NEW OFFICE PROJECTS

MAJOR ARTS VENUES

1 McKinney & Olive

19 AT&T Performing Arts Center

2 Frost Tower

20 Dallas City Performance Hall

3 1920 McKinney Avenue

21 Dallas Museum of Art

4 KPMG Plaza at Hall Arts

22 Morton H. Meyerson Symphony Center

5 Old Parkland, West Campus

23 Nasher Sculpture Center

6 Akard Place

24 Perot Museum of Nature and Science

7 Victory Center

25 Trammell Crow Center and Crow Collection of Asian Art

8 Trammell Crow Uptown 9 Two Arts Plaza

NEW MULTIFAMILY PROJECTS

RESTAURANTS 26 Marie Gabrielle Restaurant and Gardens 27 Fearing’s at the Ritz-Carlton

PHOTO: MICHAEL SAMPLES

10 One Uptown

28 The Capital Grille

11 Bleu Ciel

29 Morton’s The Steakhouse

12 Camden Victory Park

30 Nick and Sam’s

13 Gables McKinney Avenue

31 Ocean Prime

14 Gables Uptown Trail

32 Savor

15 M-Line Tower 16 Moda 17 Monaco on Katy Trail 18 Routh Street Flats

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A ANATOMY OF A DEAL

PHOTO: UPTOWN DALLAS INC. / JUSTIN TERVEEN

QUENCHING TENANT DEMAND With office vacancies dropping and lease rates on the rise, developers kick off new projects in Uptown and The Arts District.

BY HILARY LAU

For an office submarket that has only been around for about three decades, Uptown certainly has grown up fast. It’s now a bustling part of urban Dallas, with 10.4 million square feet of office space (compared to downtown Dallas’ 28 million), according to calculations by Dallasbased CBRE. Add in the two Arts District towers developed by Lucy Billingsley and Craig Hall, and the number climbs to 11.3 million square feet.

Downtown and Uptown/The Arts District used to be a “musical chairs” market, with tenants moving from one building to another, says Phil Puckett, executive vice president at CBRE. “What we’re seeing now are tenants outside the

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market coming in—not only into Dallas-Fort Worth, but into Uptown.”

Initially, Uptown office properties—namely The Crescent, developed in the mid1980s—attracted finance tenants, like stock brokerages and investment management firms. Then, law firms started moving in, leaving older space in downtown Dallas. After the 2012 opening of Klyde Warren Park—the 5.2-acre park constructed on top of Woodall Rodgers Freeway—a literal gap was bridged, connecting Uptown’s residents and office tenants to The Arts District and downtown Dallas. Soon, a milelong extension of the M-Line Trolley will enhance that connectivity, and commuters will be able to more easily access the area via DART trains.

“Uptown, make no mistake, is the hottest, fastest-growing in rents [submarket], Puckett says. “It has really become the live-work-and-play area of Dallas. In 2005, the Uptown market was about 5 million square feet. Fast forward to today, about nine years later, it has roughly doubled.”

As tenants continue to flock to the area, developers are stepping in to quench demand with new office projects. Here are some notable developments underway:

W I N T E R 2014

A ANATOMY OF A DEAL

McKINNEY & OLIVE Crescent Real Estate has big dreams for its mixed-use McKinney & Olive project, a Cesar Pelli-designed tower that will stand across the street from The Ritz-Carlton Dallas and house 480,000 square feet of office space and another 50,000 square feet of retail space.

Gardere Wynn Sewell LLP has signed on to be the 109,000-square-foot lead tenant. Sidley Austin LLP has claimed 75,000 square feet in the building, which will open in 2016.

The developer is cutting no corners, setting records for lease rates and raising the bar for luxury, much as The Crescent did in the late 1980s. John Zogg is overseeing the project for Crescent and notes that, besides The Crescent itself, McKinney & Olive will be the most expensive building constructed in Dallas. He calls Pelli’s design “phenomenal,” citing its incorporation of natural light and 10-foot ceilings alongside an outdoor landscaped garden on the fifth floor as evidence. The building will have a fitness center—designed and outfitted by Canyon Ranch, a health spa company partly owned

by Crescent Real Estate—for use by tenants.

Del Frisco’s will anchor restaurant and retail space, and Zogg says additional “significant” retail tenant announcements will be made soon. All in all, McKinney & Olive is poised to change a big part of the Uptown landscape.

“Cesar’s building is really with its arms completely open to the market,” Zogg says. “If you’re walking down McKinney, you’re going to feel like you’re inside the building already.

If you’re inside the building, you’re going to feel like you’re outside.”

KEY PLAYERS DEVELOPER: Crescent Real Estate Holdings LLC ARCHITECT: Pelli Architects, Kendall/Heaton Associates INTERIOR DESIGN: Pelli Architects LANDSCAPE ARCHITECT: The Office of James Burnett GENERAL CONTRACTOR: Beck Group ENGINEERS: Brockette-Davis-Drake Inc., I.A. Naman

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A ANATOMY OF A DEAL

FROST TOWER For Harwood International founder and CEO Gabriel Barbier-Mueller, part of the goal for many of his Uptown projects has been to incorporate certain elements that he missed from European cities, like Rome—think patios, terraces, landscaped gardens, and picturesque places to both work and enjoy a glass of wine.

His latest development, the 22-story, 167,251-square-foot Frost Tower, is the seventh building in Barbier-Mueller’s Harwood District, situated on 17 city blocks nearly encased on the north and west sides by the Katy Trail in between Victory Park and The Crescent.

Frost Bank, a longtime client of Harwood’s, will occupy 57,558 square feet of office space in the building.

Kansas City-based law firm Polsinelli has signed for six floors (77,000 square feet), and will move its office from Saint Ann Court—another Harwood International property—when Frost

Tower is complete. At press time, the building was 92 percent leased.

Barbier-Mueller says about one-third of his Harwood district’s 22 phases have been completed. (They include Azure, a 31-story condo tower, and Bleu Ciel, a 33-story condo tower.) Frost Tower, which will open in 2015, has special meaning for the developer.

“The Frost Tower project was designed by our architectural firm HDF— Harwood Design Factory,” he says. “It’s the first building we designed 100 percent in-house.”

KEY PLAYERS DEVELOPER: Harwood International ARCHITECT: HDF LLC INTERIOR DESIGN: HDF LLC GENERAL CONTRACTOR: HCMS, Manhattan Construction Co. ENGINEERS: L.A. Fuess Partners Inc., TTG

1920 MCKINNEY A parcel of land along McKinney Avenue at Harwood Street will soon be home to a 12-story, 150,000-square-foot office and retail tower. KDC and Invesco Real Estate broke ground on 1920 McKinney last September, planning for six floors of office space, a six-story parking garage, and 8,500 square feet of ground-level retail space.

Construction will wrap up in early 2016, with McCarthy serving as the general contractor. Mike McWay, Texas region president, says he’s seeing developers incorporate more amenities into their projects. “The Uptown market typically provides for retail, restaurants, fitness centers, outdoor spaces, and adjacencies to outdoor venues like Klyde Warren Park, which was another project McCarthy built.”

BOKA Powell is serving the project’s architect, JLL is leasing the building’s office space, and The Retail Connection is marketing ground-floor retail. Colin Fitzgibbons, vice president at KDC, has been involved with

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the project since its inception in early 2013.

The lead office tenant has been secured but remains undisclosed. Specific amenities are still being ironed out.

“This is great, great real estate,” he says.

“It’s two minutes from Klyde Warren Park, it’s truly walkable to all the major amenities that make Uptown so great—The Crescent, The Ritz, other restaurants—it’s on the trolley, and it has great access. Especially with the Uptown office market being as hot as it is right now, it’s just really well-positioned to deliver something that doesn’t really exist today in the market, which is new construction for the midsize tenants out there—your 10,000- or 15,000-square-foot tenants.”

KEY PLAYERS DEVELOPER: KDC, Invesco ARCHITECT: BOKA Powell GENERAL CONTRACTOR: McCarthy ENGINEERS: Schmidt & Stacy

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A ANATOMY OF A DEAL

KPMG PLAZA AT HALL ARTS

By April 2015, the Dallas skyline will have another tower in KPMG Plaza at Hall Arts, the newest development from Craig Hall and Hall Financial Group. The 19-story building will bring 500,000 square feet of office space to the Arts District at 2323 Ross Avenue, as well as ground-floor retail space. Nestled beside the AT&T Performing Arts Center and across the street from the Meyerson Symphony Center, KPMG Plaza will also include a half-acre public park, a plaza named for lead tenant KPMG, and an artful outdoor Texas Sculpture Walk populated with commissioned and acquired works

by Texas artists.

Along with in-house amenities, the project’s location near the country’s largest arts district will provide tenants with a variety of nearby dining, residential, and entertainment options.

Joining lead tenant KPMG, which has leased more than 150,000 square feet, are Jackson Walker, UMB Bank, Hall Financial Group, and Stephan Pyles’ flagship restaurant. The building is now 70 percent pre-leased, with the seventh and top-two floors still available. Kim Butler, who heads up leasing for Hall Financial Group, says everyone on board is excited to see the long-term project—Craig Hall bought the property in 2005—finally come to fruition.

“The one thing that this building has that is unique and, I think, a deviation from how we did business 10, 20, and 30 years ago when we were just trying to put as much commercial space as possible on a site to maximize the income potential: This space is going to have an unusual amount of green space and livable space—what I call ‘enjoyment’ space for collaboration—to get out of the office with your laptop, and get some fresh air,” Butler says.

Once the timing was right to move forward with construction—which Hall did on a speculative basis—the project quickly gained momentum.

“It’s the newest building but has some of the most tenured tenants … KPMG will be 100 next year when they move in; Jackson Walker celebrated its 125th two years ago,; UMB Bank, out of Missouri, this is their entre into Dallas ... and they’re a 100-year-old bank,” Butler says. “Here you have this new, bright, shiny, fabulous new building, and the people that are choosing it are the real stalwarts of business. Hall’s the young kid on the block.”

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KEY PLAYERS DEVELOPER: Hall Financial Group ARCHITECT: HKS Inc. GENERAL CONTRACTOR: Turner Construction LEASING AGENT: Kim Butler of Hall Financial Group

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A ANATOMY OF A DEAL

OLD PARKLAND, WEST CAMPUS

Harlan Crow’s redevelopment of the historic hospital at Maple and Oak Lawn avenues has gained both prominence and notoriety as Dallas’ most expensive office campuses; it’s certainly one of the area’s most stunning. What began with Crow Holdings’ remake of the former hospital and nurses quarters has evolved into an eight-building, 490,000-square-foot complex.

Woodlawn Hall and Reagan Place were added in 2010; Maple Hall was completed in 2013. A three-building West

Campus that’s now underway completes the project. Two smaller four-story buildings (Commonwealth Hall and Oaklawn Hall) flank Parkland Hall, a six-story, 87,000-square-foot building that’s topped by a gleaming dome that’s visible from both the Dallas North Tollway and Interstate 35E. Crow Holdings was the first tenant to take occupancy of Old Parkland, moving into the 60,000-square-foot former hospital in 2008. The private campus, which

sits behind iron gates, is favored by family offices, hedge funds, foundations, private equity investment groups, real estate investment groups, executive offices, and other smaller tenants. The lone exception is a 164,000-square-foot headquarters for Robert Rowling’s TRT Holdings which controls Omni Hotels and Gold’s Gym. In 2012, TRT bought a parcel of Old Parkland land from Crow to build its $40 million corporate office. The project was designed to be in keeping with the rest of the campus, which is inspired by Jeffersonian architecture and American Classicism.

“The motivation for Harlan was really to preserve this asset for the community,” says Cathy Golden, Crow Holdings’ general manager of Old Parkland. “He could build a nice corporate headquarters anywhere he wanted to, but he very much wanted to preserve this and keep it as true-to-form as he could. Additionally, he wanted to create a really different real estate model than we’ve seen anywhere else.”

KEY PLAYERS DEVELOPER: Crow Holdings ARCHITECT: Beck, Dalgliesh Glipin Paxton Architects LEASING AGENT: Crow Holdings

WAITING IN THE WINGS Several developers are ready to pull the trigger on new projects in Uptown/The Arts District—as soon as they can secure a lead tenant. Here are some that are poised to kick off, as soon as that happens.

AKARD PLACE. In early summer 2014, RED Development and several partners announced plans for a new, 800,000-square-foot mixed-use project on land RED had purchased at Field Street and Cedar Springs Road.

Akard Place, slated to open in 2017, will include a 300-unit residential tower and a 17-story office tower above retail, restaurants, and a parking structure. Around 75,000 square feet of ground-level retail space will be up for grabs. Shannon Brown and Burson Holman with CBRE are marketing office space. The project is designed

by HKS Inc. and Graphite Design Group.

The Office of James Burnett is the landscape architect, and Kimley-Horn is the project engineer.

TRAMMELL CROW UPTOWN. Longtime Dallas developer Trammell Crow Co. acquired the coveted JP Morgan Chase Bank site at the corner of Woodall Rodgers Freeway and Pearl Street in June 2014. Soon after, MetLife and Crow announced plans to build a 20-story office building and 30-story residential tower there. The mixed-use project will also include 20,900 square feet of restaurant space. Office space will total 513,000 square feet, and the residential tower will be comprised of 275 luxury units.

The project is being designed by HKS Inc.

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TWO ARTS PLAZA. Now that its One Arts Plaza is nearly full again (with EnLink Midstream stepping up to backfill space left by departing 7-Eleven Inc.), Billingsley Co. is ready to go with its neighboring Two Arts Plaza. The 12-story, 290,000-squarefoot tower will take about 24 months to construct. Two Arts will be connected to neighboring One Arts by a 1-acre park, which will feature pavilions and other amenities.

VICTORY CENTER. Hines and its development partner Cousins Properties plan to soon break ground on this 470,000-squarefoot, 23-story office tower at 2371 Victory Avenue, a “sloped crystalline structure” that was designed by Duda/ Paine Architects. TBG Partners is serving as landscape architect, and ME Engineers is the project engineer.

Cushman & Wakefield is overseeing leasing for the project, with Bill Brokaw leading the team.

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DALLAS IS BIG...

BUILDINGS, BUSINESS, ARTS, CULTURE, STEAKS, SPORTS, FUN, IMAGINATION & MORE!

City of Dallas Office of Economic Development Dallas-EcoDev.org \ 1500 Marilla Street, Room 5CS \ Dallas, Texas 75201 \ 214.670.1685 Photography: Iwan Baan, Winspear Opera House; Brian Birzer Photography, The Traveling Man

\

Concept and Design: Dennard, Lacey & Associates

A ANATOMY OF A DEAL

MULTIFAMILY BOOM

BY HILARY LAU

The multifamily market continues to thrive in Uptown, bringing the live-work-play full circle with a record number of apartment buildings planned or under construction and rents on the rise.

In a stark contrast to the decades-long mass exodus of residents to the suburbs north of Dallas, Uptown has lured throngs of people back to the urban core. Baby boomers, millennials, and everyone in between are finding homes in Uptown, with more than 20 projects underway, according to data from Axiometrics. More than 3,000 new units were delivered in 2014.

Uptown also has the highest rents in North Texas—$1,622 per month, on average. Renters are drawn to the submarket for its trendiness, convenience to major highways, proximity to the central business district, and amenities like Klyde Warren Park, the Arts District, and myriad dining and entertainment venues.

Even more projects will be underway soon, and a slew of developers have jumped into the multifamily game in Uptown to build some of the most innovative, attractive, and expensive apartment buildings around. In September, Trammell Crow’s High Street Residential subsidiary an-

HIGH-RISE HOTBED Here’s a look at some of the new apartment and condo projects underway in Uptown, and the key players involved.

BLEU CIEL

3008 N. HARWOOD ST. DEVELOPER: Harwood International ARCHITECT: Jean-Michel Wilmotte ARCHITECT OF RECORD & INTERIOR DESIGNER: HDF LLC LANDSCAPE ARCHITECT: Sadafumi Uchiyama SPA GROUP: Be a Dragonfly Bleu Ciel will feature two junior Olympic pools—one shallow, one for laps and swimming—in its fitness club. There will be onsite dining, a market, and a private underground parking garage.

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M-LINE TOWER

nounced a 20-story, 271-unit Class A residential tower at 3230 McKinney Ave. called M Line Tower.

The new building will include 13,000 square feet of ground-level retail anchored by a new Café Express (a 5,500-square-foot Café Express restaurant currently stands on the site). The building also will be home to the McKinney Avenue Transit Authority, and the entire southwest corner of the ground floor will be dedicated to its offices and museum, plus a new trolley barn.

One Uptown, a project on the horizon for Stoneleigh Cos.’ Waterford Residential subsidiary, will soon bring 198 units to 2500 McKinney Ave. The all-glass building will include 18,500 square feet of retail space, plus a 550-space parking structure. Rick Cavenaugh, president of Stoneleigh Cos., says that Waterford has had the

CAMDEN VICTORY PARK 2787 HOUSTON ST.

DEVELOPER: Camden Development ARCHITECT: Wallace Garcia Wilson Architects INTERIOR DESIGN: MLB Design LANDSCAPE ARCHITECT: BURY GENERAL CONTRACTOR: Camden Builders Inc. ENGINEERS: SCA Consulting Engineers The four-story, 423-unit apartment building will open in the summer of 2015 and will cater to tenants with pets with its “bark park” and “paw spa.”.

BURY’s Jim Knight, executive vice president, said Camden gets credit for identifying the site three years ago. “They recognized an opportunity way before the market turned around,” he says.

GABLES MCKINNEY AVENUE

2500 MCKINNEY AVE. DEVELOPER: Gables Residential ARCHITECTS: WDG Architecture Dallas and Architexas INTERIOR DESIGN: SJL Interiors LANDSCAPE ARCHITECT: Studio Outside GENERAL CONTRACTOR: Gables Residential ENGINEERS: Kimley-Horn, Jordan & Skala The eight-story, 239-unit apartment and townhome building will open spring 2015.

Its units (222 apartments, 17 townhomes) will sit atop a brand new and highly anticipated Whole Foods Market.

GABLES UPTOWN TRAIL 2525 CARLISLE ST.

DEVELOPER: Gables Residential ARCHITECT: Humphreys & Partners INTERIOR DESIGN: SJL Design LANDSCAPE ARCHITECT: Kevin Sloan Studio GENERAL CONTRACTOR: Gables Construction ENGINEERS: Viewtech, Jordan & Skala, Halff Associates The seven-story, 335-unit condominium mid-rise is now leasing. Units feature quartz counters and built-ins, while outdoor amenities include a bike room, fitness center, and business center.

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piece of land at McKinney Avenue and Routh Street under contract for nearly two years. It acquired the site about 18 months ago, and went through rezoning efforts with the City of Dallas to maximize both density and intensity of usage at the site.

“When we identified this site, which was the old Hard Rock Café, we recognized that we had the premium location in Uptown at the corner of McKinney and Routh,” Cavenaugh says. “You have, across the street, the Whole Foods project that’s now under construction, and we have what is arguably one of the busiest corners that is pedestrian-friendly.”

One Uptown also will be home to two restaurants—a Fogo de Chão location, and a new-to-Dallas restaurant called Style & Grace.

The impact of the project’s unique design on the Dallas skyline was carefully considered, Cavenaugh says. “From any view that you’d have in the city, you’re ONE UPTOWN

MODA

looking at a building that moves from every direction that you look at it,” he says. “As you do that, the experience of seeing the building and how it sits in landscape is going to be a lot more vibrant than some of the other brick, balconied, tongue-depressor-type buildings that are there.”

On the for-purchase front, Harwood International is developing its second condo tower in Uptown. Bleu Ciel follows the developer’s successful Azure, a 31-story project that opened in 2007. At 33-stories, the teardrop-shaped Bleu Ciel will offer 158 units and open in the winter of 2016.

AMONG DALLAS SUBMARKETS IN Q3 2014, UPTOWN REPRESENTS 21% OF MULTIFAMILY UNDER CONSTRUCTION AND 20% OF TOTAL NET ABSORPTION M-LINE TOWER

MODA

DEVELOPER: High Street Residential ARCHITECT: Good Fulton Farrell The 20-story, 271-unit apartment building’s opening date has not yet been announced, but once the project gets the go-ahead from city planners, construction could start in 2015. It’ll include a new Café Express, among other tenants occupying 13,000 square feet of ground-level retail.

DEVELOPER: Alamo Manhattan ARCHITECT: Hensley, Lamkin, Rachel Inc. INTERIOR DESIGN: Moore Design Group LANDSCAPE ARCHITECT: Studio Outside GENERAL CONTRACTOR: Hunt Building Co. ENGINEERS: Viewtech, Spiars Moda’s location just blocks from the American Airlines Center puts its residents in the heart of Victory Park’s action, and the amenities don’t disappoint, either. The rooftop terrace provides uncontested views of the city, which you can also see from the infinity-edge pool. The six-story, 263-unit apartment building is now leasing.

3230 MCKINNEY AVE.

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1855 PAYNE ST.

MONACO ON KATY TRAIL 3003 CARLISLE ST.

DEVELOPER: Alamo Manhattan ARCHITECT: Hensley, Lamkin, Rachel Inc. INTERIOR DESIGN: Moore Design Group LANDSCAPE ARCHITECT: Studio Outside GENERAL CONTRACTOR: Andres Construction ENGINEERS: Viewtech, Spiars, Jordan & Skala The six-story, 192-unit apartment building is now leasing. Accessible from the building’s pool area, the boardwalk connects a veranda right to the Katy Trail.

ONE UPTOWN 2500 MCKINNEY AVE.

DEVELOPER: Stoneleigh Cos. LLC, Cheng Investments INTERIOR DESIGN: HPA Design, Toledo Geller Interior Design, TAI Architecture & Design, ID 810 LANDSCAPE ARCHITECT: T. H. Pritchett / Associates GENERAL CONTRACTOR: Hunt Construction Group ENGINEERS: Viewtech, Sowlat Engineering, Henderson Engineers Inc., Curtainwall Design Consulting The 20-story, 198-unit condominium tower is slated to open late spring 2016. Units in the parallelogram-shaped building will feature floor-toceiling glass, offering expansive views of the downtown Dallas skyline.

ROUTH STREET FLATS

ROUTH STREET, BETWEEN CEDAR SPRINGS ROAD AND CARLISLE STREET DEVELOPER: Alamo Manhattan ARCHITECT: Hensley, Lamkin, Rachel Inc. INTERIOR DESIGN: SJL Design LANDSCAPE ARCHITECT: Studio Outside GENERAL CONTRACTOR: Andres Construction ENGINEER: Viewtech Not much has been revealed about this project’s specifics, but it does plan for a “resortstyle” saltwater pool and a 2,600-square-foot rooftop terrace. The six-story, 263-unit apartment building is slated to open in the summer of 2015.

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A ANATOMY OF A DEAL

SANCTUARY SPACES Parks and green amenities bring new quality of life

THE KATY TRAIL

BY JENNY FUENTES

Those who live and work in Uptown, home to 10 million square feet of office space and approximately 24,000 residents, thrive on green space.

Perhaps no project has revealed that more than Klyde Warren Park. The 5.2-acre park over Woodall Rodgers Freeway has averaged 1 million visitors a year since opening in fall 2012.

It’s partly because the deck park offers 1,300 programs, most at no cost. Residents can join a yoga class before work or enjoy a game of chess, all provided at the park. Lunchtime heralds the arrival of food trucks and, on select evenings, live music draws hundreds. On sweltering summer days the park’s water features provide a welcome respite for children and canines alike.

“I don’t think Dallas realized how hungry it

MARIE GABRIELLE GARDENS

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was for green space and gathering space,” says Klyde Warren Park President Tara Green. “This park has really tapped into that need.”

It’s also helped spur economic development. According to CBRE in Dallas, the increase in office rents for buildings close to the park has been staggering, some seeing as much as a 64 percent increase in rental rates since October 2012. Even downtown addresses off the park saw a 46 percent spike in rates during the same time period.

Recognition has grown to a national scale, with news in October of a 2014 Urban Land Institute Urban Open Space Award.

“It’s not just about driving property values,” Green says. “It’s about quality of life, providing an environment for residents to come out and relax. It really does provide a holistic approach to life in downtown and Uptown.”

Another center-city sanctuary is Griggs Park, located within Uptown and nestled in the State Thomas Historic District, offering 8 acres of renovated space, with a playground and basketball court in the works for 2015.

“Visit right after work, and you’ll see the community that this park is building: Dozens of nearby residents visiting together while their dogs and young children play,” says Amy Tharp, president and executive director of Uptown Dallas Inc. The presence of urban oases like nearby Katy Trail, which wends along the borders of Uptown to Oak Lawn and Highland Park, provides a built-in amenity that corporations eyeing a relocation can offer to employees. Construction to connect the 3.5-mile trail to White Rock Lake is underway, with the section from Mockingbird Station to White Rock Creek Trail scheduled for completion by the end of 2014. The Mockingbird Pedestrian Bridge is on track for a mid-2016 completion.

The calming influence of lush greenery and pedestrian-friendly walkways attracts and retains office tenants in the 18-block Harwood District. With 6.5 acres of gardens — including water features and secret green rooms at Marie Gabrielle Restaurant and Gardens, office space in the district is nearly 100 percent leased, says Jihane Boury, Harwood International vice president and director of leasing.

Boury reports that Frost Tower, which will be ready for occupancy in the spring, was 92 percent leased before the project’s December 2014 topping-out ceremony.

“The design will be similar to the model at Saint Ann Court with landscaped gardens and a restaurant and café available for tenants, residents, and patrons,” Boury says.

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MAJOR VENUES

PHOTO: TIM HURSLEY

CULTURAL CONVERGENCE

PHOTO: NIGEL YOUNG / FOSTER + PARTNERS

AT&T PERFORMING ARTS CENTER

A ANATOMY OF A DEAL

AT&T PERFORMING ARTS CENTER: This 10-acre center includes the Winspear Opera House, Wyly Theatre, Annette Strauss Square, and the Elaine D. and Charles A. Sammons Park.

DALLAS CITY PERFORMANCE HALL: This venue hosts a broad range of events and performances by emerging and mid-sized cultural organizations, representing all artistic disciplines and reflecting the cultural diversity of organizations within Dallas.

(2520 Flora St.)

The Dallas Arts District creates a vibrant community, attracts millions to the area.

DALLAS MUSEUM OF ART: Founded in 1903, the DMA ranks among the leading art institutions in the country. Built in 1984, the 370,000-square-foot Edward Larrabee Barnes–designed building, was the first arts organization in the Dallas Arts District.

The museum’s global collection contains over 22,000 works of art spanning 5,000 years of human creativity. (1717 N. Harwood St.)

BY JENNY FUENTES

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MORTON H. MEYERSON SYMPHONY CENTER: Created by the internationally renowned design team of architect I.M. Pei and acoustician Russell Johnson, the Meyerson was completed in 1989. The legendary rich sound of its Eugene McDermott Concert Hall has made it a premier destination for the world’s finest soloists and conductors. (2301 Flora St.) NASHER SCULPTURE CENTER: Opened in 2003 as the first institution in the world dedicated exclusively to the exhibition of modern and contemporary sculpture, the Nasher was designed by Pritzker Prizewinning architect Renzo Piano, in collaboration with landscape architect Peter Walker. (2001 Flora St.)

PHOTO: MARK KNIGHT PHOTOGRAPHY

With 20 blocks of museums, performance halls, parks, and other venues, the Dallas Arts District is the largest contiguous cultural district in the country. Walkable and accessible to all four Dallas light rail lines and the McKinney Avenue trolley, it attracts more than 1 million visitors a year.

After decades of strategic planning dating back to the 1970s, the district wasn’t completed until 2009 and is just now hitting its prime, with 31 arts organizations located or presenting in the district.

“Because of the Arts District, downtown is becoming more of a neighborhood,” says Catherine Cuellar, the district’s executive director. “There are now tens of thousands of people within walking distance.”

To cater to the growing number people who live and work in the area, the Dallas Museum of Art began offering free memberships in 2013, swelling its ranks by about 100,000 new members. The DMA and other venues also offer free health and wellness classes seven days a week.

On the north side of Woodall Rodgers Freeway, the Perot Museum of Nature and Science celebrated its second anniversary in December. It has been an immediate hit, attracting about 1.2 million patrons a year. Museum CEO Colleen Walker says the Perot is nearly at capacity.

“We could probably see 1.4 million visitors a year, maybe top out at 1.5 (million),” she says. The recent purchase of land abutting the parking lot next to the museum provides an expansion opportunity, although specific plans haven’t yet been released. “There is enough space for a footprint of a second tower the same size,” Walker says.

Although the museums and venues host world-class collections and performances, visitors don’t even need to go inside to experience good art. That’s because the district houses more buildings designed by Pritzker Prize-winning architects than any other location in the world.

The cultural value of the offerings greatly enhance the livability of North Texas, giving relocating companies another reason to move here. And there’s a real bottom-line impact, too. Since the Perot and nearby Klyde Warren Park opened in fall 2012, for example, average office rents in the Arts District and Uptown have climbed from $25 to $37 per square foot triple net, according to statistics from CBRE.

WINSPEAR OPERA HOUSE

PEROT MUSEUM OF NATURE AND SCIENCE

PEROT MUSEUM OF NATURE AND SCIENCE: The latest venue to join the district, the Perot opened in December of 2012. The 180,000-square-foot facility houses 11 permanent exhibit halls, as well as six learning labs. (2201 N. Field St.) TRAMMELL CROW CENTER AND CROW COLLECTION OF ASIAN ART: A variety of spaces and multiple galleries focused on the arts of China, India, Japan, Korea, and Southeast Asia, drawn from both ancient and contemporary cultures. A sculpture garden surrounds the base of Trammell Crow Center.(2001 Ross Ave., 2010 Flora St.) SOURCE: The Dallas Arts District

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A ANATOMY OF A DEAL

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FREE RIDE McKinney Avenue Trolley expansion enhances mobility, connectivity.

> D-Link is a free bus service provided by DART that allows riders to move around downtown, Uptown, and Oak Cliff, providing access to arts, culture, and dining.

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The two-phase project is MATA’s second expansion since its founding in 1983.

Construction on the North Olive Street stretch began in 2013 at a cost of about $10 million, funded equally by a federal grant and a North Central Texas Council of Governments grant.

This second phase, which includes looping the track onto Federal Street and connecting it with existing track on North St. Paul Street, also cost about $10 million, a combination of federal and local grants. Construction on the second phase began in early 2014; the expansion is expected to be fully operational by February or March, Cobb says.

MATA is free to ride and receives financial support from DART, Downtown Dallas Inc., and Uptown Dallas Inc. Crawford expects more transportation options to positively impact commercial real estate development in the area.

“As we continue to expand that concept, it’s going to increase land prices, it’s going to increase rentals,” he says. “The whole real estate market is going to be enhanced the more we develop bigger and better public transportation concepts.”

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In just two years, Klyde Warren Park has bound together Uptown and downtown Dallas, drawing a major influx of people to the area. The McKinney Avenue Transit Authority’s trolley route expansion is extending that connectivity, with plans to increase downtown ridership by 200,000 annually.

The project will add about one mile of track to MATA’s route, bringing the total length to about 3.8 miles. The expansion will add 11 new stops, including one at Klyde Warren Park, says Phil Cobb, MATA co-founder.

“We expect that the Klyde Warren Park stop will be our biggest pick-up and dropoff place in the entire route of the trolley,” he says. “We’re already noticing tremendous upswing—almost a 40 percent increase in our business on the weekends” since the park opened.

John Crawford, president and CEO of Downtown Dallas Inc., says the expansion is just what the area needs.

“It’s all about connectivity, whether you’re talking about residents, whether you’re talking about workers, whether you’re talking about visitors to the city,” he says.

“It’s another form of connecting everybody to places that they need to go.”

The new MATA track will encircle part of downtown’s Arts District, including the Dallas Museum of Art and the Nasher Sculpture Center. It will extend a previously existing stretch on North St. Paul Street down to Federal Street, where it will take a left over to North Olive Street and then extend northwest into Uptown, where it will connect with existing track on McKinney Avenue.

“For MATA, it gives us a projection into the downtown area that we presently don’t have,” Cobb says. “It allows us to penetrate really the densest part of downtown Dallas.”

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BY CONNOR YEARSLEY

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LIFE IN

The Ann & Gabriel Barbier-Mueller Museum: The Samurai Collection

Saint Ann Restaurant & Bar

2727

• 18-CITY BLOCK DISTRICT • 6.5 + ACRES OF GARDENS • 4 MILLION SQUARE FEET OF BUILD-TO-SUIT OPPORTUNITIES

Marie Gabrielle Restaurant and Gardens

Bleu Ciel

• WILL GROW TO INCLUDE OVER 7 MILLION SQUARE FEET

Azure

Frost Tower

Mercat Bistro

Harwood International | 2501 N. Harwood St.14th Floor | HARWOOD, Dallas, Texas 75201 For more information about residential living, commercial leasing, or events call 214.871.0871or email us at info@harwoodinc.com.

#harwooddistrict

A ANATOMY OF A DEAL

PATIO DINING AT ONE ARTS PLAZA

VYING FOR A SEAT AT THE TABLE

PHOTO: ERIN BURROUGH PHOTOGRAPHY

In a market where demand trumps supply, restaurants continue to flock to Uptown.

BY JENNY FUENTES

Dallas has a thriving restaurant scene, and with several new projects in the works in Uptown and the Arts District, even more options will soon be on the menu.

Del Frisco’s Double Eagle Steakhouse announced in October that it has leased 13,000 square feet for a two-story restaurant at Crescent’s McKinney & Olive tower. Nearby, just steps from Klyde Warren Park, another 7,500 square feet of restaurant space will anchor Invesco Real Estate and KDC’s 1920 McKinney office project. On the other side of the park in

the Dallas Arts District, Chef Stephan Pyles will move his signature restaurant east on Ross Avenue to a new 6,000-square-foot space in Craig Hall’s new development.

Mitch Traub, senior vice president of brokerage services with The Retail Connection, is handling retail leasing at 1920 McKinney. He says talks are in the works with a potential restaurant tenant he describes as a “great concept that has not entered the market yet.”

Competition is fierce, Traub says. “There’s a lot of people looking and not enough space,” he says. “Uptown is one of the hottest markets in the country.”

Office developers are jumping in to help meet that demand, while at the same time diversifying their projects and adding amenities for tenants. It makes sense, says Jack Gosnell of UCR Urban. He and UCR colleague Jack Breard negotiated the Del Frisco’s lease and are marketing remaining space in the development. Even in a market with a number of restaurant strongholds—including emerging hot spots like Trinity Groves,

TENDERLOIN DISTRICT Del Frisco’s will join two other high-end steakhouses—Morton’s and The FEARING’S AT THE RITZ-CARLTON. Chef Dean Fearing has been serving up bold flavors in this elegant eatery since 2007. Also home to Rattlesnake Bar.

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THE CAPITAL GRILLE. Specializes in steak and innovative seafood fare, located in The Crescent in the heart of Uptown.

MORTON’S THE STEAKHOUSE. Also known for its seafood, Morton’s is situated along the McKinney Avenue Trolley line.

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SAINT ANN RESTAURANT & BAR PATIO PHOTO: ERIN BURROUGH PHOTOGRAPHY

Bishop Arts District, Lower Greenville, and Deep Ellum, Uptown stands out.

“Those are edgy restaurants with high-end, progressive concepts,” Gosnell says.

“As far as being a powerful, existing city center, none of them quite match up to Uptown.”

Scarcity of land coupled with high-density zoning throughout much of Uptown is creating the opportunity for mixed-use, vertical development anchored by retail and restaurant space. On the retail front, Whole Foods, scheduled to come online in 2015, will anchor the Gables Residential apartment and townhome development.

It’s part of a trend in urban redevelopment that Gosnell says begins with grocery and drug stores, dry cleaners, and home furnishings retailers.

“Finally, once density hits a certain level, you start seeing clothing and amenity-style, specialty retail” Gosnell says. “I think Uptown is just starting that stage of urban redevelopment where we are getting residential densities deep enough for substantial retail development.”

Tenants are willing to pay to be in Uptown. Nathan Wood, senior vice president with the retail services division at the CBRE Dallas office, says he has seen rates range from $50 to the mid-$60s per square foot triple net for Class A retail space.

“There’s absolutely more demand than supply,” Wood says. “We probably have more retail space coming online in Uptown than we have in any period I can recall.

Dallas is growing up, and we are getting a lot of attention, in both the retail and restaurant categories.”

WHOLE FOODS AT GABLES McKINNEY AVENUE

Capital Grille—when it relocates to Uptown. Here’s a look at fine-dining options in the market: NICK AND SAM’S. A part of the Uptown landscape since 1999, this Maple Avenue venue serves prime steaks, chops, and seafood, and offers a 450-selection wine list.

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OCEAN PRIME. This white-linen restaurant features seafood, steak, and handcrafted cocktails, all to the backdrop of piano music at the restaurant’s Blu Lounge.

SAVOR. One of the newest additions to the Uptown dining scene, this glass-walled gastropub opened in Klyde Warren Park in September 2013.

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T TOOLBOX

As with all services businesses, commercial real estate brokers who represent tenants sometimes have a tough time differentiating themselves from competitors. To help gain an edge, a number of tenant brokerages that operate in North Texas are building in-house data tools to better assist clients in assessing everything from a region’s labor availability and cost to commute times, airline transport and, yes, real estate expenses.

PROBABLY THE BIGGEST GAP IN THE MARKET IS THERE IS NO CONSOLIDATED SOURCE THAT HAS— READY TO GO, PLUG AND PLAY—ALL ASPECTS OF WHY COMPANIES MAKE DECISIONS.

This type of information has been available for years from commercial providers such as New York’s Nielsen.

“They do a very good job,” says Randy Cooper, vice chairman and principal in the Dallas office of Cassidy Turley of the various data services. “The demographic information is terrific.”

But area experts say that no single data tool on the market covers every factor a client might need in choosing a site.

“Probably the biggest gap in the market is there is no consolidated source that has—ready to go, plug and play—all aspects of why companies make decisions,” says King R. White, president of Site Selection —KING R. WHITE, Group LLC in Dallas. “That’s where PRESIDENT OF SITE SELECTION GROUP LLC the confusion is happening.”

That’s one reason why more tenant brokerages operating in these parts are hiring data whiz kids to crunch their own numbers and create their own heat maps. Another is sheer pragmatism. If your brokerage is using the same commercial data tools as the guy down the street, why should a client prospect pick your shop?

Thus the emergence in tenant rep circles of people like Evan Stair. As vice president of site selection and research at Cresa Dallas, Stair specializes in geographic information systems, or GIS, which involves using computers to analyze and create maps and other images out of geographic data.

Need to know where all electrical engineers live in Garland? Stair can gather that data, crunch it, and create a map to show the concentrations. Ditto for the average commute times in traffic for a new facility, along with projections

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of where that labor force will be living in five or 10 years.

Stair can even use Google databases to check out the cars that Garland’s electrical engineers are driving to help validate the wages that a Cresa Dallas client might be considering paying.

“As our baby boomer generation gets older and ages out of the workforce, the millennial population is taking over,” Stair says. “That’s the target market that companies want to hire.”

Most of the data tools that Cresa Dallas uses are Stair’s creations, says Susan Arledge, managing principal.

“Subscription databases are very expensive,” she says. “There is a huge initial frontend investment. And they wouldn’t do you any good if you can’t manipulate or map the data.”

THE NUMBERS GAME People like Stair are popping up in the North Texas offices of other tenant rep firms, too.

Site Selection Group, for instance, now has five people on staff with undergraduate or advanced degrees in GIS, urban planning, or related fields, according to White.

“It’s all staff- and resource-intensive, and depends on what you have the ability to do,” says Duane Dankesreiter, vice president, business information and research at the Dallas Regional Chamber. “Most of the site selectors have their own tools and

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T TOOLBOX databases.”

The emerging plethora of data tools is a big reason why the Dallas Regional Chamber created its Economic Development Guide, which aims to give answers in a general sense to all the questions that companies have about North Texas when they are looking to relocate, Dankesreiter says.

“From the Dallas Chamber’s perspective, we’re using tools to explain Dallas-Fort Worth over places like Atlanta,” he says. “From the number of corporate relocation projects we’re doing, I think that’s a good sign that we’re doing something right.”

JLL, the Chicago-based company formerly known as Jones Lang LaSalle, has a sizable North Texas presence, owing to its acquisition of Dallas-based The Staubach Co. in 2008. JLL uses a proprietary offering called iLocate, which helps companies uncover and rank potential locations while finding savings in areas like infrastructure, labor, and business taxes.

Another JLL tool, Blackbird, allows the firm’s clients to see tenants in a given building and where competitors are located, says Steve Thelen, a Dallas-based managing director at the firm.

“In the past, it would take three to six months to evaluate markets,” he says. “Now it’s a matter of weeks. More companies are using this, and more of our brokers are using this resource.”

Cushman & Wakefield uses four or five different data tools, depending on a project’s needs, says Michael McDermott, a Chicago-based consulting manager. For instance, a decision-modeling tool allows clients to see how different locations

THE COLORS OF MONEY

The map below was created by Cresa Dallas’ Vice President of Site Selection and Research, Evan Stair. It shows per capita income in different parts of North Texas within the 25-minute traffic drive of downtown Dallas, and just outside of that zone.

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T TOOLBOX measure up based on their criteria, such as labor cost, he says.

“They’re meant to be adaptable,” he says of the group of tools. “There are different ways to narrow in on what the hot buttons might be.”

For its part, CBRE uses a collection of external data sources and internally aggregated data, tools, and analysis to arrive at customized solutions relative to each

PUBLIC USE DATA TOOL SPOTLIGHT

TRY IT YOURSELF Although companies evaluate everything from transportation routes to building amenities when selecting sites, the most important factor, generally, is the availability and cost of labor.

A number of commercial services can provide a detailed picture of where desired workers are in specific geographic areas. Many tenant rep brokers that operate in the Dallas-Fort Worth area also provide this type of information as a client service.

There are free online tools that brokers and companies can use, too, such as the Census Bureau’s Longitudinal Employment Household Dynamics (LEHD) On The Map. The LEHD can help determine if a given site merits further investigation as a possible option.

HERE’S A QUICK GUIDE TO WORKING WITH ‘ON THE MAP’: > GO TO ONTHEMAP.CES.CENSUS.GOV

> CONFIRM THE SELECTION

This is a Census Bureau online tool to map where employees live and work in a given area.

Under the “Selection” tab, users can choose a drawing tool, along with layer and buffer selections, to create their own geographic areas to analyze. Layers, for instance, range from census blocks to large regions. Buffers define areas beyond the geography the user has chosen. Advanced users can choose multiple geographies on which to do paired area analysis.

> SELECT A GEOGRAPHIC AREA Under the “Start” tab, choose the region for analysis. Advanced users can upload geographic files. Other user-defined areas can be found under the “Selection” tab. > CHOOSE MAP LAYERS Under the “Base Map” tab, users can decide what information they want to include, such as political and legislative boundaries, transport arteries and water features, along with labels, points, outlines, and fills.

> PERFORM THE ANALYSIS Click “Confirm Analysis,” and a pop-up box will appear with basic information about the geographic area. By choosing “Perform Analysis,” users will get all available parameters for consideration. Clicking on the resulting “Area Profile Analysis” will identify specific locations on the map, animate overlays, and export or print detailed reports, charts, and maps.

ON THE MAP: This example shows how many people commute into and out of southern Dallas County for work, and how many residents live and work in the area.

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site selection process, says Steve Berger, Dallasbased first vice president in the firm’s industrial brokerage group.

CBRE’s data sources include property information, demographic studies, labor studies, tax impact analysis, and logistics, Berger says.

“CBRE has a broad array of resources available across the company, including in Dallas, that we draw upon for the data needs of a given client,” he says. “Those resources include centers of excellence, which are specialized groups within CBRE that focus on different areas of analysis.”

BOOTS ON THE GROUND Meanwhile, real estate professionals across North Texas rely on data tools that keep track of commercial properties, such as buildings available for sale or lease, which tenants are in what facilities, lease rates, and building occupancy.

One of the biggest players in that field is Blue Springs, Missouri-based Xceligent Inc. Chris Summers, the company’s Dallas-Fort Worth market director, says Xceligent’s database covers 14 counties in and around DFW. It provides real estate pros with information about everything from leasing and sale histories on given facilities to vacancy listings.

“It is their daily working platform,” he says.

Xceligent goes head-to-head with Washington, D.C.-based CoStar Group Inc. Jim Trainor, CoStar’s Dallas regional director, says the business spends about $120 million to $130 million annually companywide on research.

CoStar also helps make deals happen through its LoopNet business, an online marketplace for commercial real estate. “It’s a huge operation,” Trainor says.

No matter how sophisticated the data crunching methods a tenant firm might have in-house, nothing beats checking out short-list properties in person, experts say. The reason: a data analysis is only as good as the underlying information it relies upon, whether that comes from a state, county, federal agency, or a private vendor. No database can contain every item of information that a particular company may value in making a decision.

And when it comes to checking out access to labor in a particular submarket, clients sometimes go old school, says Cooper, of Cassidy Turley.

“They will do [help wanted] ads in the paper and see how many responses they get,” he says. “They’ll do job fairs at a hotel and see how many prospective employees show up. They will virtually always test it.”

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SPECIAL ADVERTISING SECTION

ECONOMIC DEVELOPMENT DIRECTORY Looking for a new place for your company to call home?

Consider this the start to your search.

Dallas-Fort Worth is a great place to do business, and its vibrant and thriving communities offer myriad resources to help companies grow. With its high quality of life, strong state and regional economies, low cost of living, skilled labor force, and lack of corporate and personal income taxes, companies in DFW are well positioned to flourish in a market that ranks among the top three U.S. metropolitan areas for business expansions, relocations, and employment growth.

The hardest part of your relocation search might just be choosing between DFW’s various communities, as they each provide unique qualities and impressive benefits. This guide to area economic development agencies at some of the best and most rapidly growing cities can help you get started.

Benbrook is in southwest Tarrant County. Benbrook retains its small-town appeal, while located only minutes from regional attractions such as Fort Worth’s cultural and historic districts, and Granbury’s shopping opportunities. Encompassing the northern shoreline of Benbrook Lake, Benbrook affords outstanding leisure and recreational amenities, acres of lush parkland, and family-friendly festivals and events. Highly rated for its city services, Benbrook offers superb quality of life for residents, visitors, and businesses.

DAVE GATTIS, deputy city manager BENBROOK ECONOMIC DEVELOPMENT CORPORATION / CITY OF BENBROOK 911 Winscott Rd. Benbrook, TX 76126 817.249.3000 dgattis@benbrook-tx.gov benbrook-tx.gov

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Opportunities grow naturally in Cedar Hill, with its vibrant businesses, natural beauty, and a family-friendly quality of life. With a location just 20 minutes from downtown Dallas, 30 minutes from DFW Airport, and 40 minutes from downtown Fort Worth, Cedar Hill offers outstanding amenities for business growth and relocation.

ALLISON J.H. THOMPSON, director CEDAR HILL ECONOMIC DEVELOPMENT 285 Uptown Blvd., Bldg. 100 Cedar Hill, TX 75104 972.291.5132 ext. 3 allisonthompson@cedarhilltx.com cedarhilledc.com

The City of Dallas Office of Economic Development is a full-service shop that offers business development and area redevelopment programs, small business assistance, and innovative programs such as the City of Dallas Regional Center and New Market Tax Credits. We can successfully usher a project from beginning to end. The Office of Economic Development offers a range of programs and services to assist developers, investors, and businesses looking to expand or relocate, and small businesses looking to grow.

With innovative programs, a supportive business climate and a city full of opportunities, we are ready to make your project a success.

HAMMOND PEROT, assistant director, Business Services CITY OF DALLAS OFFICE OF ECONOMIC DEVELOPMENT 1500 Marilla St. Dallas, TX 75201 214.670.1685 joseph.perot@dallascityhall.com dallas-ecodev.org

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SPECIAL ADVERTISING SECTION

The McKinney Economic Development Corporation (MEDC) was created in 1993 to support the development, expansion, and relocation of new and existing companies.

The MEDC is an organization with a mission to work to create an environment in which community-oriented businesses can thrive.

JIM WEHMEIER, president and CEO MCKINNEY ECONOMIC DEVELOPMENT CORPORATION / CITY OF MCKINNEY 5900 S. Lake Forest Dr., Ste. 110 McKinney, TX 75070 info@mckinneyedc.com 972.547.7651 mckinneyedc.com

Rockwall Economic Development Corporation assists new and existing companies, both large and small, in the development, modernization, and expansion of business in a booming global economy. We are dedicated to your company’s growth through incentive programs, financial assistance, comprehensive sites, and resource collaboration.

While collaborating with city leaders, we have secured the necessary infrastructure, services, and high-tech amenities to maintain thriving, profitable businesses. Rockwall has big-city conveniences yet maintains a small-town atmosphere. Rockwall offers quality of place and peace of mind.

SHERI FRANZA, president and CEO ROCKWALL ECONOMIC DEVELOPMENT CORPORATION 2610 Observation Trl. Rockwall, TX 75032 972.772.0025 sfranza@rockwalledc.com

The mission of the Sachse Economic Development Corporation is to act on behalf of the City of Sachse in promoting and developing authorized projects, while supporting economic development activities to retain, expand, and attract businesses for the purpose of diversifying the tax base and improving the quality of life of the citizens of Sachse.

LESLYN BLAKE, CEO 3815 Sachse Rd., Bldg. B Sachse, TX 75048 469.429.4764 lblake@cityofsachse.com sachseedc.com

Waxahachie is the Crossroads of Texas. Situated at the intersection of Interstate 35E and U.S. Highway 287, Waxahachie is a strategic location with excellent transportation corridors, quality workforce and training, reasonable land development costs, and a pro-business environment.

Many of Waxahachie’s businesses have an impressive track record of success. We invite you to experience that same success by making Waxahachie your company’s home.

DOUG BARNES, Director DBarnes@ Waxahachie.com 469.309.4121 KASSANDRA CARROLL, Economic Development Coordinator KCarroll@ Waxahachie.com 469.309.4122 www.CrossroadsOfTX.com

rockwalledc.com

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C COMMUNITY The Dallas Regional Chamber recognizes the following companies and organizations for their membership investment at one of our top levels. Bold-faced companies are represented on the DRC Board of Directors. For more information about the benefits of membership at these levels, call 214.746.6600 .

STRATEGY BKD Chase Texas Instruments

CATALYST AT&T Baylor Scott & White Health Capital One Bank Chickasaw Nation Comerica Bank Dallas/Fort Worth Int’l Airport Hunt Consolidated, Inc. JC Penney Company, Inc. MV Transportation ONCOR Tom Thumb Food & Pharmacy Wells Fargo

ADVOCATE 7-Eleven, Inc. Akin Gump Strauss Hauer & Feld Amegy Bank of Texas Atmos Energy Corporation Axxess Baker Botts L.L.P. BB&T BBVA Compass CBRE Group, Inc. Children’s Medical Center Citi Copart Corrigan Investments, Inc. Dallas Morning News Dal-Tile Corporation Deloitte LLP Energy Future Holdings Exxon Mobil Corporation EY FedEx Office Fidelity Investments Fluor Corporation Frito-Lay North America Forest City Texas Inc. GE Capital Glazer’s Golden Living

Haynes and Boone, LLP Highland Capital Management LP HKS IBM Corporation Jones Day KPMG LLP Kroger Food Stores Littler Mendelson, P.C. Locke Lord LLP Lockheed Martin Luminant Medical City Dallas Hospital/ Medical City Children’s Hospital Methodist Health System Microsoft Corporation NEC Corporation of America Omni Dallas Hotel PwC Reliant Energy Rent-A-Center Sheraton – Dallas SunTrust Robinson Humphrey SWS Group, Inc. TDIndustries Tenet Healthcare Corp.

Texas Central High-Speed Railway, LLC Texas Health Resources Texas Scottish Rite Hospital for Children Thomson Reuters, Tax & Accounting TM Advertising Torchmark Corporation TXU Energy UT Southwestern Medical Center ViewPoint Bank Winstead PC

BOARD OF ADVISORS Abbott Labs Accenture Aetna AIG Airbus Helicopters, Inc. Alcatel-Lucent Andrews Distributing Company

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Andrews Kurth LLP Army & Air Force Exchange Service Arthur J Gallagher & Co. Austin Industries Baker & McKenzie, LLP Bank of America Bank of Texas, N.A. BDO USA, LLP The Beck Group Blue Cross and Blue Shield of Texas Big 12 Conference Bracewell & Giuliani LLP Breitling Energy Brinker International, Inc. Brinkmann Corporation Bury C.C. Young Cantex Continuing Care Cassidy Turley CHRISTUS Health CIGNA Healthcare City Credit Union Civitas Capital Group ClubCorp Inc. Coca-Cola Refreshments Colliers International Consolidated Communications Cook Children’s Healthcare Corgan Associates, Inc. CP&Y, Inc. Cresa Dallas LLC Cushman & Wakefield of Texas, Inc. Dallas County Community College District Dallas Cowboys Football Club DHD Films Dallas Marriott City Center Dallas Stars Hockey Club Dean Foods Company Dell Services Dialog Direct E Smith Realty Partners Ebby Halliday, Realtors Edelman Public Relations Worldwide Emerson Process Management

EN Consulting, Inc. Eulen America Etihad Airways The Fairmont Dallas Fisher & Phillips, LLP Flowserve Corporation Fossil Freeman Frost Bank Fujitsu Network Communications, Inc. Furniture Marketing Group Gardere Wynne Sewell LLP Generational Equity Gensler Global Power Equipment Goldman Sachs Grant Thornton LLP Greatbatch, Inc. Greenberg Traurig, LLP Gulfstream Aerospace Corp.

Gupta & Associates Hall Financial Group Hill & Wilkinson Hilton Anatole Hilton Worldwide HNTB Corporation Holland & Knight LLP HollyFrontier Corporation Holman Boiler Works, Inc. HOLT CAT Humana Inc. IBC Bank InStaff Interceramic, Inc. International Leadership of Texas Jackson Walker L.L.P. Jacobs JE Dunn Construction JLL LegacyTexas Bank LeTourneau University Lincoln Property Company MHBT, Inc. Midway Press, LTD Minerva Real Estate Mission Foods W I N T E R 2014

Most Valuable Personnel Munck Wilson Mandala, LLP Neiman Marcus Nestle Waters North America Norton Rose Fulbright The Novo Group NTT Data, Inc. NYLO Hotels, LLC Oliver Wyman ORIX USA Corporation Parker University Parkland Foundation PDS Technical Services People Performance Resources Pioneer Natural Resources, LLC PlainsCapital Bank Pollock Paper Distributors Publicis Dallas Regions Bank Rexel Holdings USA RIB U.S. Cost Rosewood Crescent Hotel Schneider Electric SimplexGrinnell Slalom Consulting Softlayer Technologies Inc. Southern Methodist University Southwest Airlines Southwest Office Systems, Inc. Squire Patton Boggs (US) LLP Staff elbach, Inc. State Farm Insurance Companies Strasburger & Price, LLP Strategic Staffing Solutions STRAVIS Consulting Symantec Corporation TDJ Enterprises Texas Oncology Texas Woman’s University Thompson & Knight LLP Time Warner Cable TopGolf Town of Addison Trane Commercial Systems TrustPoint Management Turner Construction Company UMB Bank N.A. UnitedHealthcare University of Texas at Arlington URS Corporation Verizon Wireless Village Green Holding, LLC Vinson & Elkins L.L.P. Weber Shandwick Southwest WFAA-TV Whitley Penn, LLP WFF W I N T E R 2014

LEAD AAA Texas, Inc. Ackerman McQueen Acme Brick Company Adolfson & Peterson Construction Adolphus Hotel Advocare International, L.P. Allegro Development Alliance Data AlliedBarton Security Services Alvarez & Marsal American Bank of Commerce APAC - Texas, Inc. Arise Virtual Solutions Ash Grove Cement Company Ashton Atkins of North America ATOS IT Solutions and Services Automatic Data Processing Aviall, A Boeing Company Bain & Company, Inc. Balfour Beatty Construction BancTec, Inc. Belk Berger Engineering Co. Beshear Group Boka Powell, LLC Boston Consulting Group Brunswick Group, LLP BullsEye Telecom Callison LLC Cancer Treatment Centers of America Carrington, Coleman, Sloman & Blumenthal, L.L.P. Carter Financial Management Cawley Partners Champion Partners Chandler Signs L.L.P. CLEAR CityDoc Urgent Care Coldwell Banker Residential Brokerage Commercial Metals Company Consumer Credit Counseling Service of Greater Dallas, Inc. Crowe Horwath LLP CyrusOne Dallas Center for Rehabilitation Dallas Foundation Dallas Lighthouse for the Blind Dallas Mavericks Dalworth Restoration Databank, Ltd. DeGolyer and MacNaughton Denali Construction Services Duro-Last Roofing, Inc. ECS Refining, Recycling and Asset Management

EnLink Midstream LLC Essilor of America, Inc. Estrada, Hinojosa & Company, Inc. Federal Reserve Bank of Dallas FPL Fibernet, LLC Fresh Point Gables Residential Trust Guardian Mortgage Co. George W. Bush Foundation Gibson, Dunn & Crutcher LLP GLP & Associates Halff Associates, Inc. Hart Group, Inc. Hazel’s Hot Shot, Inc. Hill + Knowlton Strategies Holmes Murphy and Associates HRSmart Huawei Technologies Hunt Construction Group Hunton & Williams LLP Huselton, Morgan & Maultsby, PC Hyatt Regency Dallas Hyatt Regency DFW iFLY Dallas Indoor Skydiving Imaginuity Interactive, Inc. In-N-Out Burger Joule, A Luxury Collection Hotel Kaplan College - Dallas Kimberly-Clark Corporation LBJ Infrastructure Group LLC Linebarger Goggan Blair & Sampson, LLP Lucas Group Manhattan Construction Company Marsh USA, Inc. Mary Kay Inc. McAlister’s Deli – Dallas McKinsey & Company, Inc. Metl-Span, LLC Monitronics International, Inc. Monogram Apartment Collection MW Logistics, LLC MWH Americas, Inc. Munsch Hardt Kopf & Harr, P.C. Networking Results, Inc. New York Life Regional Headquarters North Central Surgical Center Hospital Ocean Prime Restaurant Office Depot Business Solutions OHL Pegasus Community Credit Union Peter O’Donnell, Jr. Polsinelli PC

Post Properties, Inc. ProBuild Prudential Asset Resources Questcare Medical Services Ragan’s HOPE Foundation The Ritz-Carlton, Dallas River Ranch Educational Charities Russell Reynolds Associates, Inc. Saxton Group Schwan’s Home Services, Inc. Sewell Automotive Companies Shepard Agency Smart City Networks LP Smart Cookie Southwest International Trucks Sparks Agency Spine Physicians Institute Spring Hill Suites Dallas Downtown – West End State Fair of Texas Structure Tone Southwest Sun Holdings, LLC Supreme Lending Texas A&M University Commerce Texas Brand Bank Texas Rangers Baseball Club Towers Watson TracyLocke Trinity Basin Preporatory Triumph Learning Tuesday Morning Corp.

TXI/Texas Industries, Inc. Union Bank Union Pacific Railroad United Surgical Partners International University of South Carolina Career Center University of Texas at Dallas USAA U.S. Memory Care Virgin America Airlines Vision33 VOX Global W Dallas – Victory Hotel Walnut Hill Medical Center Walton Development and Management Warrior Group, Inc. Weaver West End Events, LLC Westin Galleria Dallas Weston Solutions Winston School Woodbine Development Corporation Younger Partners Zale Corporation

D A L L A S - F O R T W O R T H R E A L E S TAT E R E V I E W / 7 9

C COMMUNITY

IMPACT INVESTORS

Paul Rowsey, Chairman

Each year The Real Estate Council receives both financial and volunteer support from funding partners and member companies. Special thanks to each of you for contributing your time, talent, and resources to help us achieve our mission.

CHAMPION’S CIRCLE Bank of America Charitable Foundation Inc. Bank of Texas Bank of America Merrill Lynch BURY Chicago Title Company/Fidelity National Financial (FNF) Citigroup Foundation Compatriot Capital HFF Hunt Realty Investments, Inc. JPMorgan Chase Bank

CHAIRMAN’S CIRCLE Bank of America Merrill Lynch Balfour Beatty Construction Behringer Butler Burgher Group CBRE Deloitte.

EY Granite Properties Goldman Sachs Holt Lunsford Commercial The Howard Hughes Corp Jackson Shaw JLL Jones Day JPMorgan Matthews Southwest Matthews Paradise development KPMG Munsch Hardt Kopf & Harr, PC NorthMarq Capital Republic Title of Texas, Inc. Schwob Companies Stewart National Title The Howard Hugest Corporation

US Bank Wells Fargo

PRESIDENT’S CIRCLE BBVA Compass/ Foundation Beck Group Breitling Royalties Corporation Comerica Bank Corinth Properties Corgan Associates, Inc Crow Holdings Capital Partners, L.L.C. Gables Residential Gaedeke Group LLC Goldman Sachs Grant Thornton Invesco Real Estate Jones Day KeyBank KPMG Matthews Paradise Office Development Regions Bank Thackeray Partners Winstead PC ViewPoint Bank Wells Fargo

BENEFACTORS CIRCLE Amegy Bank American National Bank of Texas Sue Ansel Ares Management LLC Beck Group Diane Butler Capital One Bank Cassidy Turley Chief Partners LP Corgan Diane Butler

E2M Partners, LLC Fischer & Company Frost Gaedeke Group LLC Gardere Wynne Sewell LLP GE Capital Real Estate Good Fulton & Farrell Hall Financial Group Hart Advisors Group, LLC Haynes and Boone, LLP Hillwood Investments Hudson Americas Husch Blackwell LLP Independent Bank Jackson Walker L.L.P. Jones Day - Martha Wach Kane Russell Coleman & Logan PC KDC Kimley-Horn and Associates, Inc Lincoln Property Company Locke Lord LLP Lowery Property Advisors Marvin F. Poer & Company MetLife Real Estate Investors Mill Creek Residential Trust LLC Peloton Commercial Real Estate PlainsCapital Bank Rampart Construction Roger Staubach Rosewood Property Company Stockdale Investment Group, Inc. Stream Realty StreetLights Residential TDI Real Estate Texas Capital Bank Thackeray Partners The Retail Connection Thompson & Knight/Foundation

WHO WE ARE 1,500 commercial real estate professionals strengthening our industry and community by connecting members, developing leaders, advocating for business and investing financial and human resources in good works.

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Sue Ansel, Vice Chairman

Tonti Properties Trinsic Residential Group UBS Financial Services Inc. UCS Group, LLC Venture Commercial Real Estate, LLC Michelle Wheeler Vinson & Elkins L.L.P. Winstead PC

PATRON’S CIRCLE* Aspenmark Roofing and Solar Central Kia Clampitt Paper Corinth Properties Corgan Associates Cushman & Wakefield - Billy Gannon & Mary Henry Eliza Solender EMJ Construction ENTOS Design Fauxcades Gensler Gold Crown Valet Greenlight Real Estate Development GXA Network Solutions Hill & Wilkinson Hilton Anatole J&S Audio Visual Jones Day - Martha Wach Millet the Printer Munsch Hardt Kopf & Harr, PC Murad Auctions O’Brien Architects RTKL Steve Crosson, Crosson & Dannis Turner Construction * Donors who have provided in-kind goods and services

Learn more at recouncil.com or by calling 214.692.3600.

W I N T E R 2014

JOIN US AND BUILD THE CITY YOU’VE IMAGINED

The Real Estate Council is Texas’ largest and most influential organization of its kind representing more than 1,600 commercial real estate professionals and 500 companies that make up 95% of the top commercial real estate businesses in North Texas. We strengthen our industry and community by connecting our members, developing leaders, advocating for business, and investing financial and human resources in good works.

JOIN US FOR OUR ANNUAL MEETING Wednesday, January 14, 2015 at 11:30 a.m., Belo Mansion You and your colleagues can learn about the exciting things we have in store for our 25th anniversary year, join The Real Estate Council, network with our board and members, and sign up for committees.

Be there for a chance to win two tickets to FightNight XXVII. To sponsor this event or purchase a table, visit recouncil.com or call 214.692.3600

C COMMUNITY THE REAL ESTATE COUNCIL’S 2014 GIVING GALA PHOTOGRAPHY BY JAMES EDWARD The weather was glorious for The Real Estate Council’s 22nd annual Giving Gala, held Oct. 23 at the beautiful Hilton Anatole Sculpture Park.

The popular westernthemed event attracted a record-breaking crowd of more than 1,200, who dined on a delicious meal of chicken fried steak, brisket, cheese grits, jalapeno corn muffins, and cobblers, then two-stepped to an entertaining performance by country music star Roger Creager. The gala’s sponsorships, ticket sales, and live auction supports The Real Estate Council Foundation’s good works in four key areas: education, housing, jobs, and the environment. These funds are crucial in helping to fulfill our mission—to make a tangible positive difference in Dallas’ neediest neighborhoods and provide the vision to ensure a bright future for all of Dallas.

THE 2014-2015 ASSOCIATE LEADERSHIP COUNCIL WITH GALA ENTERTAINER, ROGER CREAGER

HOLT AND KAYE DAWN LUNSFORD

THE REPUBLIC TITLE TEAM

ROGER CREAGER AND FRANK MIHALOPOLOUS OF CORINTH PROPERTIES

TREC VICE-CHAIR SUE ANSEL, CENTER, FLANKED BY MUNSCH HARDT KOPF AND HARR’S KITTY HENRY AND GLENN CALLISON

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BOARD CHAIR, PAUL ROWSEY; EVENT CHAIR, PAT GIBSON WITH TREC PRESIDENT, LINDA MCMAHON

HFF’S DE’ON COLLINS WITH HOLDEN HEIL OF CHICAGO TITLE

W I N T E R 2014

L LEADERSHIP

PLAYING AROUND FOR A GOOD CAUSE One of the highlights of The Real Estate Council’s annual Giving Gala is the live auction of one-of-a-kind playhouses, designed and built by the organization’s members. Three other big prizes also were up for grabs this year: a weekend in Napa, a VIP experience with the Dallas Mavericks, and tickets to a Dallas Cowboys game. And for the first time, The Real Estate Council raffled off a new car, donated by Central KIA and Corinth Properties. This year’s Giving Gala Chair Pat Gibson announced Chip Johnston as the winner of a new 2015 KIA Soul.

Funds raised from the auction and raffle benefited The Real Estate Council Foundation. Limelight sponsors for the sold-out event were Holt Lunsford Commercial, Hunt Realty Investments, and Schwob Building Co. Ltd.

PHOTOGRAPHY BY JAMES EDWARD

O’BRIEN ARCHITECTS AND EMJ CONSTRUCTION

GREENLIGHT DEVELOPMENT AND HILL & WILKINSON

GENSLER AND BALFOUR BEATTY CONSTRUCTION

RTKL AND ASPENMARK ROOFING AND SOLAR

CORGAN AND TURNER CONSTRUCTION

W I N T E R 2014

A PROGRAM THAT’S BUILT TO LAST Developer Sue Ansel says TREC’s Associate Leadership Council helped her gain knowledge, strengthen relationships.

BY HALEY ROGERS

In 1985, Sue Ansel moved to Dallas from Connecticut with the intention of only staying for two years. The CEO of Gables Residential Trust has been making an imprint with development projects here ever since.

Gable’s latest Uptown mixed-use project, which is anchored by Whole Foods, is set to open in 2015.

Ansel is an active member of The Real Estate Council, serving as 2014 vice chair of the executive committee. She’s also a graduate of TREC’s 1997 Associate Leadership Council (ALC) program, which helped deepen her knowledge of all aspects of the city.

“It’s a very broad, robust program that develops leaders as well as knowledge— through experience and exposure, as well as great relationships,” she says.

In the program, Ansel says, “you get way more than you give” and she has been able to leverage that experience at Gables Residential. Each year, her company closes all of its properties, in each market, for one day.

“We take that day to give back to organizations in our neighborhoods,” she says. “We are very fortunate to be able to do this, and it’s the most looked-forward-to event of the year.”

Ansel sees untapped demand in the baby boomer demographic.

They seem to be attracted to an urban lifestyle, and she’s excited to explore ways of creating more of those type of living options for that market.

The ALC program has helped her to gain insight into the city as well as create great relationships that remain strong today, she says.

“It’s a very competitive program, but you’ll be surrounded by some of the best and brightest minds in the industry, and you’ll have very unique experiences that you would not otherwise have,” she says.

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CALENDAR OF EVENTS Make plans now to attend these upcoming real estate and business events. For information on programs hosted by The Real Estate Council, visit www.recouncil.com. For details on events presented by the Dallas Regional Chamber, visit www.dallaschamber.org.

L LEADERSHIP

AN EVOLUTION IN LEARNING For JLL executive Alan Wood, Leadership Dallas revealed the inner-workings of a region—and a mission to get involved.

BY HALEY ROGERS

JANUARY..

JANUARY 14 Annual Membership Luncheon, Belo Mansion, 11:30 a.m. Join us to learn about the state of our union and how TREC is adding value to the industry and community. This event will feature the opportunity to network with our board members, sign up for committees and learn about the exciting things we have in store for our 25th anniversary year. (TREC)

JANUARY 23 Annual Meeting, featuring Stephen L. Mansfield, Ph.D., 2014 DRC board chairman and president and CEO of Methodist Health System; Dale Petroskey, president and CEO, Dallas Regional Chamber; and H. Ralph Hawkins, 2015 DRC board chairman and chairman and CEO, HKS. Signature program to bring membership together to discuss past year’s accomplishments and next year’s plan of work, Hilton Anatole, noon to 1 p.m. (DRC)

JANUARY 29 Young Professionals Kickoff, 7:309 a.m., Dallas Regional Chamber offices, 500 N. Akard St., Suite 2600, Dallas (DRC)

FEBRUARY..

FEBRUARY 3 Education Outlook Series, 7:30-9 a.m., Dallas Regional Chamber offices. This three-part program series kicks off, featuring education experts briefing the business community on current issues impacting education. (DRC)

FEBRUARY 5 Chamber Live, orientation for new members and prospective members to learn about the Chamber and its initiatives.

Program is hosted from 8:30-9:30 a.m. both in the Chamber offices, 500 N. Akard St., Suite 2600, Dallas, and in member locations throughout the region. (DRC)

FEBRUARY 13 Infrastructure Summit, partner event with Building America’s Future that focuses on various transportation initiatives, including road, rail and air, for the D-FW region, Texas and the U.S. To be announced. (DRC)

FEBRUARY 19 Young Guns Casino Night, 7 p.m., Southside on Lamar. This annual networking party for young D-FW commercial real estate professionals raises money for the annual Young Guns Foundation Project and celebrates with a night of casino-style gaming, a live DJ, raffle prizes, and cocktails. (TREC)

FEBRUARY 24 Texas Lobby Day, Austin, Texas (TREC)

MARCH..

MARCH 4 Austin Fly-In, one day trip to the Texas Capitol for members to meet with elected officials on issues important to the D-FW business community. Capstone event is cocktail reception with elected officials and DRC members. (DRC)

MARCH 6 State of the Economy, first-quarter forum that brings in a renowned speaker on the economy. Details to be announced. (DRC)

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Growing up in North Texas during the fast and furious deal-making days of the 1980s, Alan Wood was drawn to the energy of the commercial real estate energy. Now a senior vice president at JLL, Wood was working in planning and zoning for the City of Addison when he participated in the Dallas Regional Chamber’s Leadership Dallas Program in 2008. Addison was exploring urban trends and the city’s role in the region. Wood believed that Leadership Dallas could give him a behind-thescenes look at the region and the challenges it faced.

The enlightening experience led him move from a government role to a brokerage career.

ALAN WOOD “When you graduate and you’ve been through nine or 10 months of the inner workings of so many different places in the region, you really are, at that moment, some of the most educated and connected people in the city,” he says.

Wood’s Leadership Dallas class partnered with the Dallas Fire and Rescue and the Parkland Injury Prevention Center to install 2,500 smoke detectors in Hamilton Park, and even threw a carnival for the kids who lived there.

“Imagine a group of 50 people [both current and alumni members] coming together to make something big happen, and then, once it’s over, those same people continue to want to do more,” Wood says. “That is what the program is all about.”

“The evolution of trying to learn” has remained a theme throughout his career at JLL, Wood says.

“Never think you know everything,” he says. “Always try to learn new things—new ideas, where the market is going, and what the trends are.”

Leadership Dallas, the flagship program of the Dallas Regional Chamber for leadership development, is aimed at increasing the leadership pool for community activities in the Dallas area. Visit dallaschamber.org for more information.

W I N T E R 2014

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