Monthly Archives: December 2012

Jonas Woods Playing Huge Role in Southern Dallas Golf Course Deal

Famed real estate executive Jonas Woods is reportedly playing a major role in the development of a championship golf course located within the southern Dallas area.

While Mayor Mike Rawlings and other city officials involved in this project have decided to keep Mr. Wood’s participation a bit of a secret from the media, concrete evidence gathered from city documents and interviews clearly indicate the investor’s significance in bringing the deal together.

In a joint-effort with AT&T and Southern Methodist University, the City Hall has recently unveiled plans to build the tournament-quality golf course last November 30. The asset is to be developed on unused landfill property situated along South Loop 12 east of interstate 45.

Amongst the several goals this project is geared towards, developers are hoping that it’ll be able to attract the PGA’s HP Byron Nelson Championship – an annual tournament that’s currently being held at the TPC Four Seasons Resort in Irving.

Woods – former president of Ross Perot Jr.’s Hillwood Capital — is so far the most notable real estate executive with participation in the development. During interviews, Woods described his role in the project as “assisting” others in bringing this deal together.

He also says his real estate firm Hayman Woods — which was co-founded by hedge fund manager Kyle Bass back in 2007 – has zero connections to the development. “I’m really just one of the people helping AT&T and SMU,” says Woods, who claims to be keeping his involvement at a personal level.

Although many of the project plan’s details are yet to be worked out, the city is reportedly releasing the landfill property for a nominal fee, and will be committing $12 million to the project. Meanwhile, the nonprofit is required to invest $20 million at the minimum.

According to Rawlings, Wood’s participation hasn’t been publicly announced before because he currently isn’t a party that has direct involvement in the deal.

New Home Construction Gaining Momentum in Dallas

Although the financial meltdown and residential market crash forced almost fifty percent of North Texas homebuilders to go broke or shutdown, many of these builders are now making a comeback by purchasing old properties, knocking down these homes, and constructing brand new ones.

A large portion of the on-going construction of next generation houses is taking place in North Dallas, East Dallas, and the park cities.

“It’s starting to come back, and it’s better than it was,” says builder Josh LeComte, who has already snatched up a few properties within East Dallas. “Compared to the worst real estate crash in history, this is way better than that.”

Although business has been doing better in comparison to the years 2008 and 2009, and that statistics show developmental progress are indeed taking place at an increased pace over more recent years, recorded figures pale in comparison to data gathered almost six years ago. According to studies conducted by Residential Strategies Inc., builders started erecting a little over a dozen dwellings for the 12-month period which ended this spring.

On the other hand, research indicates that there were a whopping 162 starts during the same duration of time back in 2006. “We’ve heard some rumbling that the teardown market is picking back up,” says Ted Wilson of Residential Strategies. “But it’s still pretty weak. There were a lot of custom builders who were crippled during the downturn.”

Nonetheless, the fact that there is less than a four-month supply of pre-owned homes currently on the market, groups specializing in building abodes from the ground up are looking to capitalize on the opportunity by creating new product.

“There’s a huge new home shortage in some Dallas-area neighborhoods,” says Rivas, one of the partners who own M. Christopher Custom Homes. “If you are in the right area with fresh product, there is lots of demand.”

DFW Industrial Real Estate Market Poised for Growth

Significant growth in the industrial real estate market can be expected in the Dallas−Fort Worth (DFW) area, according to the managing director of Jones Lang LaSalle’s Dallas office, Terry Darrow. DFW industrial real estate companies are firing from all cylinders to maximize supply chain efficiency, said Darrow, who manages his firm’s industrial division. These firms have become sharper in streamlining their distribution networks and managing their inventories, he noted.

It is estimated that North Texas now has 660 million square feet of industrial space, including those for flex and manufacturing. Custom-built and speculative industrial real estate developments in the pipeline will provide a continuing impetus for growth in space availability, Darrow also said.

A research conducted by Jones Lang LaSalle showed an overall 8.5 percent vacancy level in the industrial real estate market. This study further indicated that rental rates will increase to $4.00 per square foot by 2014 from the current $3.60. The DFW area is highly marketable because of its central location. Projects seeking North Texas industrial space that DFW has attracted included those for Amazon, BMW, Quaker Oats, and L’Oreal. In turn, these build-to-suit projects provide an incentive for speculative industrial real estate development in the area.

Darrow is excited with the large amount of new industrial space being created for occupancy in 2013. He foresees that speculative development will gradually build up steam when more financing becomes available to these building ventures. Banks are keen on lending to North Texas industrial projects, says the research director of at Jones Lang LaSalle’s Dallas unit, Walt Bialas. However, he added that current reserve requirements and lending regulations stymie bank lending to industrial real estate builders. Little capital is being made available to them because of changes in lending policies, Bialas explained.

Nevertheless, some speculative industrial real estate development projects have pushed through despite financing constraints. One project that has started is that of Majestic in South Dallas. Another speculative venture that has come off the wraps is the Trammel Crow joint venture for a three-building industrial project at the DFW international airport.

Overall, Darrow sees a rosy picture for the industrial real estate market in 2013. He expects continuing activity in build-to-suit and speculative projects, along with increasing rentals spurred by cost spikes in such building materials as steel and concrete.

Land cost is one of the factors to watch in 2013, he added. Darrow pointed out that developers with readily available land will be ahead of the rest in taking advantage of the bullish prospects in the industrial real estate market.

Office Tower and Hotel to be Constructed in West Plano

West Plano is currently one of the hottest commercial real estate markets across the country today. As demand for more office space is steadily on the rise, developers are currently making plans for more office towers to capitalize on the massive opportunity for excellent ROI.

Following the record-setting $120 million sale of the recently completed Encana Oil & Gas Tower to Arizona investor Cole Real Estate in Dallas North Tollway, Granite Properties released plans pertaining to the construction of another tower within the same area.

According to the builder, the erection of their Granite Park IV building – designed by Dallas architect BOKA Powell — will happen sometime during the start of 2013. The speculated 300,000-square-foot soon-to-rise development is to stand 12-stories tall, and will be situated east of the tollway, south of State Highway 121.

“We feel it’s the right time to move forward,” says Greg Fuller, Granite Properties’ chief operating officer. “It’s to meet the demand of business tenants that want to be in this area.”

Previous developments within the area have already garnered immediate success. Fuller says that his company’s properties in Granite Park are approximately 95 percent leased. He also says that they’re expecting the demand to continue throughout the succeeding years.

“There’s been virtually no construction here since 2008,” Fuller said. “We believe that for the next three to five years, the market here looks pretty good.”

Aside from this upcoming project, Granite Properties also plans on commencing the construction of its 300-room Hilton Granite Park by April next year. Upon completion of both buildings, the developments will holster a total value of roughly $150 million.

Since its foundation in 1991, Granite Properties has purchased and developed over 20 million square feet of commercial space. The private real estate firm currently has office setup in Atlanta, Dallas, Denver, Houston and Los Angeles.

Dallas Home Prices See Largest Gain Since 2007

The housing market crash may have been a major contributing factor to the economy meltdown back in 2008, but things are seemingly turning around for the better much faster than many would have predicted. Recent statistics show that Dallas’ residential market has vastly improved as local home prices have experienced its biggest gains in five years.

“This news today is going to encourage more people who want to buy homes, which will encourage homebuilders to build homes and create jobs,” says Mark Dotzour, the chief economist for Texas A&M University’s Real Estate Center. “This is excellent news for the entire economy, not just the housing market.”

Price increases have bumped up steadily over the past seven months leading up to September from a year earlier. According to statistics, pre-owned single-family dwellings within Dallas have witnessed a 4.4 percent increase in comparison to 2011.

“We have six months of good numbers, which we haven’t had for some time,” says Blitzer, managing director of S&P Dow Jones Indices. “Housing overall — not just home prices and construction — is improving. This recovery is for real and will be maintained going forward.”

Economists believe that house prices in North Texas may reach even higher levels in the near future. Experts say that the price hike will likely be attributed to multiple factors, such as increasing cost for renting a dwelling instead of owning one, pent-up demand, and a dwindling supply of residences for sale.

“We’ve seen pretty good job growth here, and apartment rents have risen so high that people are ready to get off the fence and buy a home,” says D’Ann Petersen, a business economist for the Federal Reserve Bank of Dallas. “Our economy is one of the few that has reached the point where we’ve gone beyond pre-recession employment levels.”

Boxer Property Acquires Two More Dallas Properties

As the Dallas real estate market continues to amend itself, more investors are coming into the picture with hopes of capitalizing on the city’s growing industry. Meanwhile, other organizations, which already have properties within Dallas, are working on expanding their local portfolios to other developed areas.

 

Boxer Property Management Corp. has purchased Rochelle Park located at 600 E. John Carpenter Fwy. and Bank of America Tower at 101 E. Park Blvd.  The Houston-based real estate company represented itself during both dealings, while Mike Hardage and Steve Simon of Transwestern, along with Tom Strohbehn and Scot Farber of Cushman & Wakefield represented the sellers.

Rochelle Park is a three-story office building that measures 80,418 square-feet, and is located in Las Colinas. As of today, the development is approximately eighty-percent leased. Notable features of the structure include polished granite floors, an atrium lobby, as well as on-site leasing, management and maintenance.

The Bank of America Tower, on the other hand, is the company’s first building in Plano. This thirteen-story office building measures 225,445 square-feet, and is 81 percent leased as of today. The tower’s most noteworthy features include a diversity of executive suites, an on-site deli, as well as the fact that it has been awarded Energy Star labels for its operating efficiency from 2007 to 2010.

Including these two recently purchased properties, the group has acquired a total of 700,000 square feet of office space in North Texas this year, and roughly three million square feet nationally. Representatives at Boxer say that the company predicts the local market to grow stronger by the start of next year, and that plans for the acquisition of more commercial real estate is currently underway.

“We still feel as though there is more opportunity in the DFW market, and hope to have as strong or a hopefully stronger acquisition year in the area in 2013,” says Andre Pereira, Boxer’s acquisitions director.

$100M Financing For Dallas’ The Shops at Park Lane Arranged by HFF

HFF Inc., a leading provider of capital markets and real estate services within the US real estate industry, has recently announced that it made arrangements for the financing of a portion of The Shops at Park Lane. The company worked on behalf of Northwood Investors to engage dealings for the $100 million long-term loan given by ING Investment management.

All groups involved in the transaction believe that the property – previously ridden with debt – still bears excellent potential for generating substantial profits. The Shops at Park Lane is a mixed-use development encompassing 325 residential units, 340,000 square-feet of office space, and 600,000 square-feet of retail space.

Completed in 2009, the property’s prime location across Northpark Center has helped attract various notable tenants, such as Whole Foods, Old Navy, HomeGoods, Gordon Biersch, and Dick’s Sporting Goods.

The Art Institute of Dallas and Kosmos Energy are amongst the noteworthy occupants within the establishment’s office sector.

HFF (Holliday Fenoglio Fowler) and HFFS (HFF securities), owned by HFF Inc., operate out of 21 offices spread across the country. The business entity offers clients various capital services, which includes financial advisory, debt placement, equity placement and commercial loan servicing. HFF is amongst the largest groups within the US, as the transactions dealt by this company range anywhere from less than $1 million, and can reach as high as $1 billion and beyond

During the third quarter of 2012, the average size of transactions dealt by HFF is reportedly over $30 million.

The borrower of the multi-million dollar loan, Northwood Investors, established a reputable name for itself as a leading global real estate investment firm. Founded by John Z. Kukral back in 2006, the organization has quickly acquired over $2 billion in real estate assets, which includes shopping centers, hotels, residential developments, and office buildings.

Texas Employers Adding Over 36,000 Jobs in October

Texas Employers Adding Over 36,000 Jobs in OctoberThe strengthening of the residential market, in combination with a boost of economic confidence, has brought forward various improvements for Texans in general, including the creation of 36,600 jobs by Texas employers in October.

Based on data recently released by the Texas Workforce Commission, local unemployment rates have dropped for the second month in a row, wherein September saw a decrease from 6.8 per cent to 6.6 per cent, which is much lower than the unemployment rate of 7.9 per cent noted across the US.

As of today, the prospect of fiscal cliff, which is basically a combination of federal spending cuts and the expiration of tax breaks, seems to have no impacts on employment in Texas or across the US, with the latter adding 171,000 jobs just the other month.

“For many, many months, there’s been this uncertainty, this malaise,” says Michael Davis, an economist working at Southern Methodist University. “People have not felt really confident about the future, and the threat of the fiscal cliff is just part of that overall picture.”

Davis then goes on to explain how many locals are aware of the financial difficulties awaiting for them by the start of next year, but have also realized that there’s no other option but to press on with their lives.

“Employers have been working people extra hard, working overtime, and they’re saying we need to hire more permanent workers,” he says.

On that note, statistics show that Texan employers have added 277,400 jobs so far from the beginning of this year. In addition, new jobs have been added every month since July 2010.

While the sector receiving the highest number of new jobs in October – approximately 13,700 — was education and health care services, the construction industry added 13,600, which also reflects the category’s biggest monthly gain in state history.

Experts in economics believe that as the residential market will bring forth a two-fold effect on locals as it continues to bounce back.

“The housing industry is putting construction workers and real estate agents back to work. That’s the direct effect,” says Robert Dye, chief economist of the Dallas-based Comerica Bank. “Then there’s an indirect effect I call the positive wealth effect: As people feel more comfortable about their equity in their homes, they’ll spend more.”

According to studies conducted by Texas A&M University’s Real Estate Center, home sales in North Texas increased by 29 percent in October, which is a fact they accredit to improved consumer confidence stimulated by low interest rates.

The Importance of Choosing a Realtor in Dallas

Importance of a RealtorAlthough the thought of buying or selling a house in Dallas for the first time can be overwhelming, it’s important that an educated approach is taken when handling such transactions. Various factors need to be considered beforehand when it comes to engaging activities related to the residential real estate market.

To ensure the best possible deal is secured, as well as to avoid unforeseen complications, hiring a reputable Dallas realtor will undeniably be necessary. These specialists wouldn’t have achieved the level of success they boast today without having undergone an extensive education, grasping in-depth knowledge of the evolving market, while acquiring industry experience.

Dallas home buyers and sellers can also take advantage of a realtor’s numerous contacts with other professionals participating in this market. Almost every realtor will have developed a good relationship with mortgage brokers, real estate lawyers, and even contractors. These specialists are more than qualified to help homebuyers and homeowners alike with their dealings.

With all that said, there are several tips for individuals to keep in mind before choosing a realtor. First and foremost, an individual should always hire the guy or gal who has extensive know-how and experience in the local market – in this case, the ideal professional should specialize in dealing Dallas properties. Hiring a friend or relative who works as a realtor in a different area is a common practice amongst first-timers, but is a practice that usually ends up with regret.

Second tip is to avoid realtors who’ve accrued an excessively large number of listings, as it could be a sign that their marketing strategies is based on acquiring listings, and having fellow realtors sell on their behalf. Moreover, numerous listings isn’t an instant guarantee that a realtor is the right man or woman for the job , as it’s always possible for anyone to list fifty houses, but only manage to sell ten.

That being said, it’d be much better to transact with individuals who have a high ratio of sales versus listings, as it’s a good indicator on how well and seriously they take this business.

Third tip is to be wary of realtors who immediately provide his or her clients with the highest initial selling price for their houses, as it’s one of the easiest tactics for them to accumulate more listings. A better candidate to work with will present a detailed analysis as to why he chose to list a client’s property at a certain price.

The Shops to Receive $100 Million Financing Arranged by HFF

The Shops located at Park Lane Dallas, Texas worked with HFF to secure a long-term loan from ING Investment Management.  The 1.2 million-square-foot property in Texas was formerly buried in debt.  HFF joined with the Northwood Investors, the borrowers, for the financing.

HFF or Holiday Fenoglio Fowler L.P. is owned by HFF, Inc.  It has a total of 21 offices across the country and a consistent top leader in capital market services and commercial real estate in the United States.

The Shops at Park Lane was completed in 2009 and leased to stores such as Gordon Biersch, Old Navy, The Outlet Store, Saks Off Fifth, Bloomingdale’s – The Outlet Store, Nordstrom Rack, Whole Foods, Dick’s Sporting Goods, Home Goods, Grimaldi’s Pizza, and several other dining and entertainment offerings.  Other office tenants are the Art Institute of Dallas and Kosmos Energy.  The whole property houses 325 residential units, called The Heights at Park Lane, 600,000 square feet of retail spaces, and 340,000 of office spaces.

HFF managing director, Travis Anderson, and Jim Curtin, associate director, were the team representing the borrower in the deal.  They represented Northwood Investors, a real estate investment firm that has real estate assets amounting to $2 billion.  The firm was founded by John Z. Kukral in 2006.

Northwood’s business is in investing on various real estate assets across the globe.  It has a wide range of assets which includes hotels, residential investments, shopping malls, and office buildings.