CBD Tower Redevelopment Triggers $50M Green Light

"The deal is done," Tony Landrum, president of Dallas-based TLC Realty Advisors, tells GlobeSt.com about the long-awaited financing for the Tower, which is shucking its image as a tornado-battered Bank One building for a $65-million, high-style makeover into 168 apartments, 147 condos, 28,000 sf of retail and about 30,000 sf of office space.

Landrum says the Tower project has exceeded all expectations. "I have more interest than I have space," he says. With buyers and renters lining up, talks are moving along for an 11,000-sf retail anchor; a signing could come in 60 to 90 days.

The lending community was particularly receptive to the 487,000-sf redevelopment, but it was Anaheim Hills, CA-based Fremont Investment that "was clearly in the lead because they understood it and they offered favorable economic terms," says Jay Wagley, managing director in Dallas for LJ Melody & Co., who arranged the complicated financing package. The multiple-component funding consists of a 36-month, interest-only bridge loan to get construction going and a roll to a five-year mini-perm once the project's stabilized. The floating rate interest is Libor-based.

"They took the time to recognize and understand the value in this project," Wagley says, adding the strength of the sponsorship cemented the deal with Fremont. The transaction took six months to pull together for the investment group formed by TLC Realty Advisors and Greenfield Partners of South Norwalk, CT, which bought the 500 Throckmorton St. property in March 2003.

Fremont's California execs, in town on more than one deal, took a trip to the Tower's 37th floor, says David Striph, the lender's regional director in Dallas. The view, the sponsorship, the strength of the city's apartment market and the Sundance Square positioning brought a resounding "let's do it," he says of the unanimous vote of confidence in a 30-year-old office building damaged by a March 2000 tornado.

The Tower redevelopment, which included $2 million from the city for asbestos removal, will deliver in early 2005, bringing the first new residential product in nearly a decade to the city's core. The last project, Ed Bass' Sundance West, filled all 120 units in one week, Landrum recalls.

A VIP preview is set for tomorrow from 4:30 to 7:30 p.m. in a temporary sales center at the corner of Third and Throckmorton streets. The event includes virtual tours and the chance to book private appointments with sales representatives from Garrison Partners Consulting of Chicago. A refundable $5,000 deposit reserves condos for up to seven days. About 75% of the 168 condos will be priced below $325,000, with $175,000 as the lowest tag. Sizes are flexible, including a higher-priced, full-floor option of 12,500 sf. Apartments, priced on the average of $1,000 per month, will range from 725 sf to 2,000 sf.

Corgan Associates Inc. and Gideon Toal, both in Fort Worth, designed the makeover. Turner Construction Co. of Dallas is the general contractor. United Commercial Realty, also Dallas, holds the retail assignment while a Fort Worth favorite son, NAI Stoneleigh Huff Brous McDowell, is handling office leasing.