GlobeSt.com EXCLUSIVE: 276,978-SF Retail Portfolio Draws About $40M

DALLAS-The locally based Dunhill Partners Inc. is collecting about $40 million from 276,978 sf of class A retail space in three properties in a two-phased sale to a California family trust. The final pass is ticketed to close by month's end.

The first leg of the deal handed off deeds to Mesquite Crossing at 1765 N. Town East Blvd. and Lewisville Town Centre at 1081-93 W. Main St. in the North Texas cities of Mesquite and Lewisville. At the next closing, Dunhill parts with Skillman Abrams Crossing at 6300 Skillman Rd. in Northeast Dallas.

The portfolio sale is a routine close-out of a four-year investment cycle just like the trade of Skillman Abrams Shopping Center, says William L. Hutchinson, president and founder of Dunhill Partners. For previous story, click here. The gain from the estimated $40-million portfolio sale is being used to pay off the partners and the partnerships closed down, he tells GlobeSt.com.

The portfolio is 85% leased. "They're stabilized, but there's some upside because there's a 15% vacancy, Hutchinson says. The quoted rents vary for the portfolio pieces, but the basic range is $10 per sf to $20 per sf.

Coy Quine of Quine & Associates in Dallas is handling the takeover for the trust, predominately funded by investors from Northern California. Buying as TSCA-223 LP, the trust owns 3.5 million sf of retail assets in Texas, New Mexico and Oklahoma and is a known long-term holder. "They've owned some properties since 1980 so they're not sellers usually," he says.

Quine's team will lease, manage and oversee minor cosmetic changes for the lot. "They're pretty stable centers," he says. "We think there's continued upside in Mesquite because of the location and Lewisville and Skillman because of the vacancy."

Howard Fuerst with Marcus & Millichap Real Estate Brokerage Co. in Dallas handled the confidential listing. He says a TIC buyer had the portfolio under contract, but then changed its investment strategy midway through the deal. "Coy came in right behind once he found out it was available," Fuerst says, "and he was able to get it done. With the complexities of a three shopping center package, I would say that Coy's group did an outstanding job in terms of due diligence."

Skillman Abrams Crossing is closing with a different lender. "I think occupancy was the issue," Fuerst says, adding a series of new leases recently were closed to fortify the financing.

The166,605-sf Skillman Abrams Crossing is 77% leased. A 58,432-sf Carnival grocery is the anchor.

The Lewisville sale spanned 47,697 sf of inline space in a 78%-leased center anchored by a 55,000-sf, corporate-owned Albertsons grocery. The buyer also got five acres of ready-to-go land to build more retail or set up some pad sites.

The 66,676-sf Mesquite Crossing is fully leased. A 12,500-sf Bookstop and 10,500-sf Sleep Experts are the anchors.