Kodiak Capital Scores $30M Off-Market Win for Uptown Center

DALLAS-Armed with a tenant-in-common play for a $30-million, off-market transaction, Kodiak Capital Partners LLC is in control of the 111,274-sf, class A Uptown Center after parceling shares to 26 investors. Though it took months of prepping, the TIC sale ended within hours of hitting the open market.

Kodiak will manage the prize and lease the retail component; Trammell Crow Co. will lease the office space. DW Landers, founder and managing partner of the locally based investment group, says talks began with the Carrozza family, one of Uptown's most well-known backers and developers, in December for the three-acre prize at 2626 Howell St. To make the close, Kodiak secured an $18.63-million conduit loan with a 10-year term and 5.67% fixed-rate interest from Bank of America CMBS. Holliday Fenoglio Fowler LP's Dallas senior managing director John Brownlee and associate director Kevin MacKenzie arranged the financing.

The man behind the dealmaking, Jack Crews, senior vice president with Dallas-based TCC, says the Uptown Center owners simply decided the market was ripe for a sale. "They did a successful job of developing and leasing it up. The timing was right to harvest the proceeds and look for the next investment opportunity for them," he says. "And, Kodiak was a fabulous buyer. Raising the money was not an issue, which speaks to the quality of the building." John Alvarado, also a TCC senior vice president, partnered with Crews to sell the eight-year-old, 10-story building and five-level parking garage. Scott Landers, Kodiak's acquisitions director, bargained the buy side.

The senior Landers says 65% of the building is leased to Republic Title of Texas and the Lane Gorman & Trubitt LLP accounting firm, with at least 10 years left on their terms. On the vacancy side, there is 6,000 sf of retail area and a comparable amount of office space in the tower. Uptown Center's overall occupancy was 86.7% at sale time. The eight-tenant mix includes two restaurants.

Landers tells GlobeSt.com that the average TIC investment was $415,000, with one local investor joining the play and 70% of the US-only pool hailing from California. The anticipated hold, he says, is 10 years. Shannon Gatlin with Republic Title handled the closing.

Landers admits the sale was fast-paced, but adds that's not overly unusual for their offerings. "Most of our transactions are well received. With our backgrounds, we were able to create some rapid traction in the securities industry," he explains. But, he says, the ease of the deal is a credit to the sellers. "They were well-organized sellers," he adds.

Landers says Uptown Center is Kodiak's highest priced acquisition to date. "We have been constantly looking to acquire in Uptown," he says. "We started the company 18 months ago and it took us that long to find the right kind of property in Uptown. And, I've got a lot of history here."