$20M Bid for Shuttered Hospital, Prized Land Clears First Hurdle

If the council OKs the offer from Mansion House Ltd., it then passes to Commissioners' Court for additional action and ultimately goes to the lawyers to iron out a contract. "All those hoops have to be jumped so it can close, probably in March," Jay Lorch, a CB Richard Ellis Inc. senior vice president in Dallas, tells GlobeSt.com.

Lorch and CBRE senior vice president Stan McClure brought the 3819 Maple Ave. property to market in late September on behalf of the hospital and city, collecting six offers for the sealed bid listing. Mansion House's offer was $5.25 million more than the second-place bid from Gary Trebert with Corporate USA Real Estate Services. Other bids were Post Services Inc., $13 million; JPI Development Services LP, $12.5 million; the Morgan Group Inc., $11.2 million; and Lincoln Property Co. Southwest Inc., $11 million. The city owns three-quarters of an acre; Parkland owns the balance.

It's a classic case of the land being far more valuable than the buildings, totaling 168,583. The former Woodlawn Hospital, nurses' dormitory and annex, built between 1913 and the late 1930s, are protected under historic preservation ordinances, but the lion's share of the shuttered space can be razed to make way for new construction. The hospital closed in 1974.

The land, which includes a hard corner at the intersection of Maple and Oak Lawn avenues, could support up to 800,000 sf, local brokers say. The land is zoned for mixed-use development, with a maximum height of 240 feet. The Oak Lawn address and zoning have just the right elements for residential development and it's a safe bet that it's part of the buyer's plan.

Mansion House's plan is being kept under wraps, but it was reviewed by Richard Brown, Parkland's senior vice president. "He is comfortable with it," Lorch says.

Lorch says the listing attracted more interest than the number of placed bids. "It got a lot of interest, but a lot didn't want to bid because it was too expensive [an $11-million minimum] and others didn't want to negotiate with the city and county," he explains.