Sublease Tenant Goes Direct With 200,000 SF

GRAPEVINE, TX-With a half dozen proposals to fuel talks, Pegasus Logistics Group has opted to hold tight to its five-year warehouse address by shifting the deal from sublease to direct. The hotly chased deal had 200,000 sf riding on the line.

The third-party logistics provider inked a six-year lease for the 540,000-sf DFW Trade Center at 4051 N. Texas 121, part of a summer portfolio purchase by Denver-based Dividend Capital Trust Inc. "They are very customer-oriented and are very aggressive in wanting to keep tenants," says John Amend, founder of the Amend Group in Dallas. He tells GlobeSt.com that he had a half dozen suitors, "three of which were very, very interesting." But J. Cannon Green, Dividend Capital's, regional leasing director in Dallas, and the ownership "did what they needed to do," Amend adds.

Amend says Pegasus' new rate will be higher than what it was paying to General Cable Co. for the sublease space, "but it's quite a bit less than the market for newer." The company is adding 50,000 sf to the bottom line with the new deal, which keeps the warehouse close to the headquarters at 615 Freeport Parkway. The terms call for a 1,000-sf expansion to the 4,500-sf office area and some general improvements to the warehouse area.

Pegasus' sublease was set to expire at the end of this year; the new deal kicks in Dec. 1. "We knew General Cable was expiring," Green adds, "and we were able to make a deal with Pegasus with no down time."

The Pegasus lease hangs a "no vacancy" sign on a warehouse that had its open space on the market for $3.40 per sf to $3.80 per sf net. In fact, the entire two million sf that Dividend bought in June is fully leased, according to Green.