Institutional Investor Rescues Triad From Today's Auction Block

"There will be no foreclosure," John Hoctor, Triad's managing director in Dallas, emphasizes to GlobeSt.com. The final details were just worked out at the end of last week, with the final contract signing coming through yesterday.

With the deal comes a "significant" capital pool for tenant improvements to facilitate leasing for 250,000 sf of vacant office space. Hoctor says the Triad pipeline has 50,000 sf of deals in letters of intent or in the negotiating stage, primarily for the 123,000-sf Atrium at Bent Tree at 1675 Addison Rd. in Addison and the 150,000-sf Belvedere at 14481 Quorum Dr. in Dallas. The portfolio also includes the 91,000-sf Fairway Plaza at 300 Decker Dr. in Las Colinas and what Triad calls it trouble spot, the 205,000-sf Courtyard at Arapaho in Richardson. In September 2001, Triad was caught short by dual tenant bankruptcies at the Courtyard at Arapaho that plummeted occupancy from 100% to 30% and resulted in a $216,000 monthly loss.

Huntsville, AL-based Triad's Dallas operation also gets a capital partner, whose identity is being kept under wraps, with buying clout. Hoctor says acquisitions, though, won't come into play until the third or fourth quarter and after the portfolio is solidified. "Our main focus for the next six to nine months is to get these buildings leased," he stresses. The Atrium, valued at $11 million, is 70% occupied. The Belvedere, valued at more than $15.2 million, is 78% occupied. The 22-year-old Decker Drive office building, assessed at nearly $6.5 million, is 92% full and the Courtyard, valued at $18.3 million, is down by 130,000 sf.

Hoctor says talks were under way with the new capital partner when attorneys for Bankers Trust Co.'s servicing office in Dallas took the precautionary step of filing the foreclosure notice. "We now have an agreement with our lender and it's elected not to proceed," he says. The outstanding $45-million debt encompasses all but one of Triad's Dallas properties.