DENISON, TX-A development joint venture should be going vertical in 30 days on a 25,000-sf suburban shopping center in Grayson County. Construction ramped up as soon as the $3.2-million loan cleared the lender.
Dallas-based JV partners Cross Development and Today Realty Advisors Inc. expect to deliver Cross Roads Plaza in July for tenant finish-out, says Todd McNeill, senior director for Dallas-based Metropolitan Capital Advisors Ltd. The center, situated on 3.4 acres off US Highway 75, is 66% preleased to Cato, EB Games, Cingular Wireless and Citi Group, but should be 100% sold out by the time it delivers, according to McNeill.
McNeill tells GlobeSt.com that the developers' one-year interim financing equates to an 80% loan-to-value ratio, but was funded at Today Realty's usual 90% loan to cost to cover land acquisition and construction on acreage across the street from a Wal-Mart Supercenter. "The trick is to find a lender willing to do it at a higher leverage," he says of the floating-rate financing. Legacy Bank in Plano and First Texoma Bank in Sherman provided the capital.
McNeill arranged the financing and wed the equity to the project. He says the JV, a frequent neighbor of Wal-Mart, acquired the acreage for about $5 per sf from two local landowners rather than take down pad sites from the Bentonville, AR-based retail giant, which has charged $12.50 per sf for comparable suburban parcels. "They knew they could get it and they got it," McNeill says, adding the advantage is the JV isn't bound by Wal-Mart's non-compete restrictions for tenancy.
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