$31M Blocks Marketing, Takes 134,953-SF Deal

IRVING, TX-In a pre-emptive move on the market, a Los Angeles-based private investor has acquired the largest block of class A retail space to come up for sale this year in Las Colinas. To make the $31.3-million close for the 134,953-sf prize, the buyer assumed a loan with seven years on the term.

Ken Shulman, executive vice president for Dallas-based Staubach Capital Markets, tells GlobeSt.com that Huntington Properties LLC's offer halted work on the marketing package for Las Colinas Plaza at 4000-4040 MacArthur Blvd., but it still took nearly 100 days to close the deal due to the loan assumption. "It was attractive debt," he explains, citing the upper 5% fixed-rate interest as part of the incentive. Wells Fargo Bank is the servicing agent for the 10-year conduit loan, which has a 30-year amortization schedule.

Shulman says Huntington was holding 1031 exchange funds from a Chicago-area multifamily property sale. "They looked at a number of locations. They didn't want just any shopping center," he says. "They wanted an irreplaceable location." The deal wasn't about immediate upside. "It was the preservation of capital and a long-term hold," he explains.

The Los Angeles-based Westwood Financial Corp. bought the 13.1-acre asset in 2003 as its first piece for a Dallas/Fort Worth retail portfolio. At sale time, Las Colinas Plaza was 95% leased to national and local retailers, with a 53,275-sf Tom Thumb flagship store as the anchor.

Shulman says 4% of the roster rolled this year and 14% of the leases come due in 2007. But, he adds, the 19-year-old center's maintained 74% tenant retention for the past decade, a testament to its value and standing in an upscale neighborhood with million-dollar homes and the Four Season Resort & Club right at its side. Dallas-based affiliates Cencor Realty Services and Weitzman Group have held onto management and leasing with the change in owners.

Shulman's team included senior vice president John Hammill and senior financial analyst Alan Gore. Huntington's broker was Doug Humphrey with Lee & Associates in Los Angeles.