DALLAS-Putting itself into an enviable position, a local investment group is holding an off-market contract for a 2.1-acre site. The seller is a local family trust that's been rejecting suitors for years to the hallowed ground in Preston Hollow.
PRG Realty Partners LP will only confirm that it's under contract to buy the northwest corner of Northwest Highway and Hillcrest Road. But, local sources say the plan is to redevelop the already-scraped 7-11 store site with 35,000 sf of street retail, several floors of class A office space and underground parking. Under the existing zoning, the developer is limited to a four-story building, but a variance request always remains an option.
If local experts peg it right, PRG's executive team is ponying up at least $30 per sf for the coveted dirt. The best guess is the land cost is closer to $35 per sf, which means any building is likely to push to the maximum height to glean the most return on the investment. And from a retail leasing perspective, it's a $40 per sf triple net marketplace.
"What can you say, it's a terrific corner," Sam Kartalis, president and COO of locally based Henry S. Miller Commercial, tells GlobeSt.com. "I'm tickled that they got it. It would be very difficult to make a mistake with that site. That's a good infill piece of dirt."
Jack Gosnell, executive vice president for UCR Urban in Dallas, agrees it's one of the best infill tracts in the city. "It's incredibly strong," he says, "and that particular corridor is really under-retailed."
The Preston Hollow pocket includes some office space, but predominately is a sea of high-end residential lining both sides of the street. The nearest retail is roughly a half-mile away, but it's a mall-type setting and long lines of traffic. "They really don't have access to convenience retail," Gosnell says, citing the need for fast-casual restaurants and high-quality shops catering to daily needs. "Those people would come there in a nanosecond."
The pros say the most recent suitor was local broker King Laughlin, who tried to assemble a large site, including the family trust's prized corner. The objective was to get enough dirt on a deep-enough tract for several office buildings and street-front retail. With that deal out of the way, PRG zeroed in on the street front and 160 feet of depth. And if street talk is on target, the deal will close before summer ends.
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