Developer's Eight-Year Investment Yields $160M Grand Plan

James S. Cornelius, Sowell principal, tells GlobeSt.com that the estimated $14 million of infrastructure construction will wrap up by August 2005, allowing Duke's Dallas division to jump into development of its share of the land. In recent weeks, Sowell sold 130 acres to Duke, one of three developers who returned full-price offers within 24 hours of an e-mail declaring the time had come for the long-awaited land sale. Sowell's plan is to hold 65 acres for "a higher use than distribution," retail-related users looking for "a nameplate on Interstate 30." Another 30 acres will be banked for future residential development.

In 1996, Sowell bought 534 acres of predominately flood plain land along the interstate. Since then, the developer's team has stayed a course with city, county, state and federal agencies to get the first Interstate 30 frontage road in Grand Prairie and site access plus completed a reclamation and wetland mitigation that's created an 82-acre lake and a handful of smaller ones.

Jeff Turner, Duke's senior vice president in Dallas, says its acreage will be built out with 2.5 million sf of institutional-grade distribution product, with an estimated $75-million value. "The access is incredible for distribution. Throw in rail-serve, Triple Freeport and TIF (tax increment financing) and it's a good recipe for big box industrial development," says Turner, who's been chasing the deal since 2001. "We consider, as prizes, land where you can build up to one-million-sf buildings." Duke's site can hold two one-million-sf boxes and there'd still be room for a third building, he says.

Turner says the team is "looking at three nice RFPs from brokers." The deals range from 100,000 sf to 800,000 sf. Though Duke's product is nearly filled in Dallas/Fort Worth, he says there's no plan to build any spec at this point. Still, Turner is betting buildings will be rising in 2005--based on interest shown thus far.

"It's one of the last close-in sites in the Dallas area," Turner says. "We bought at a price that's very conducive to building big boxes." Land in the Grand Prairie corridor is going for $2.50 per sf.

Cornelius says Duke's perseverance swung the right to buy its way. Duke's Turner was introduced to the deal by Sowell's land brokers from Grubb & Ellis Co.'s Dallas office, Gary Lindsey, senior vice president, and Robert O. Fulford II, vice president, who've spent six years helping to bring the development to fruition.

"We always believed in the real estate," Cornelius emphasizes. "We had faith in it. Once the frontage road was done, we knew it was just a matter of time."

Halff & Associates of Dallas is Sowell's engineer. Bids on the infrastructure work will be floated in 60 days, according to Cornelius. Duke does have "an obligation related to the infrastructure," Turner confides.

Of all the product that could have been built, "industrial distribution will be the most successful," Cornelius asserts. "It is the proper use for that land and as back-up support for the land that we're holding."

At some point, every industrial developer in Dallas/Fort Worth knocked on Sowell's door for the coveted prize. "It is," Lindsey says, "the answer for industrial for Dallas/Fort Worth for several years to come."