Race Heats Up for 13-Acre Redvelopment Op

DALLAS-A 37-building apartment complex, positioned on land more valuable than the units, has redevelopment pros near and far jockeying for the 12.86-acre, two-block piece in North Dallas. In the first 24 hours of the marketing campaign, 60 buyers had registered for the offering, with 100 stepping up by week's end.

"Some people have been trying to buy this for several years," says Don Ostroff, senior director for Cushman & Wakefield of Texas Inc.'s multi-housing group. The hot item is the 332-unit Signature Point at 5936 E. Lovers Lane. "We are the preeminent development site in the entire sector from Mockingbird to Northwest Highway and from Central Expressway to Skillman," he says.

Ostroff and C&W partners Will Balthrope Lamont Rattler are running the deal for a local joint venture backed by Transwestern Investment Co. and Stellar Management Co. "We anticipated a very strong response, but what we've seen has exceeded our expectations," Ostroff tells GlobeSt.com. "I think it's very likely on a land per sf basis that we will set a new high water mark on low- to mid-density with this sale." Signature Pointe has hit the market for $22.5 million in an all-cash run. Still, the value is in its dirt as submarket prices hover from $40 per sf to $50 per sf and small tracts in neighboring Uptown can easily hit $100 per sf.

Offers are due July 11. The game plan is to get the deal closed by year's end.

The two-block foothold, with 940 feet of frontage along Lovers Lane, is a prime candidate for a mixed-use development due to its positioning across the street from Lincoln Property Co.'s Village, a 7,500-unit multifamily development with varied vintage product that its owner is now selectively scraping and rebuilding to strengthen the value factor. The Signature Pointe land, though, is only zoned for multifamily use. Therefore, developers are sure to start, if they haven't already, polling city officials to determine their mindset about rezoning as part of the due diligence before placing offers. "To some extent, the level of interest will be tempered by the response they get from city officials," Ostroff adds.

Ostroff points out that Signature Pointe's 96% occupancy allows an income buyer to come in and run it as-is or a redevelopment pro to get a solid yield while working through the rezoning process. It also has condo conversion potential, he says. "The timing is great to bring it to market," he says. The complex rose in 1973 and was last renovated in 1996.

Signature Pointe, with Central Market as a neighboring amenity, is two blocks west of a DART light-rail station, two blocks east of Central Expressway and five miles north of the Dallas CBD. It's also within easy striking distance of Southern Methodist University, NorthPark Mall and Dallas North Tollway. From an income-producing perspective, the mix has one-, two- and three-bedroom units ranging from 490 sf to 1,573 sf. The current monthly rents, averaging $951, go from $645 to $1,427.