Duke's $200M Mixed-Use Starts With Office

Duke will start with 180,000 sf of the 800,000-sf office component to get the development moving at the northwest corner of Interstate 635 and Belt Line Road. The three-story Point West I will deliver in February 2008.

Duke bought the former Lesley Farm in late September 2006, getting "one of the best pieces of property we've ever bought," says Jeff Turner, senior vice president of the Indianapolis-based company. The site has more than one mile of interstate frontage. "The location sells itself," he adds. "The City of Coppell helps to sell it. Everyone is working together in that. We're real fortunate to own it."

If the construction schedule holds true, walls will be going up in late summer on Point West I, a spec project that closely resembles the developer's Frisco Bridges and creates a middle-of-the-road product for the Freeport submarket. "We try to develop a value office, almost a hybrid, to be nicer than most value office and just a little shy of class A as a good middle ground for tenants," Turner tells GlobeSt.com. "We believe and are confident that we are hitting that submarket at the right time."

The submarket veteran has practically filled 3.8 million sf of flex industrial and bulk space in the submarket so the land buy was a lifeline for Duke to continue its momentum in the high-demand pocket. Point West has been mapped out for 2.1 million of industrial space, the first of which will be rolling out "very soon," Turner says. Until the deal is sealed, though, he's not talking.

Meanwhile, Turner is gathering offers from hotel and retail developers for 22.3 acres earmarked for a 300-room hotel and nine retail pad sites. A decision most likely will be made before summer. Duke has built retail in other regions, but not in Dallas/Fort Worth. If Turner's considering a JV on the 15.4-acre retail tract, he's playing that close to the vest as well.

Blair Oden, Duke's vice president of office, says he's already fielding inquiries about Point West I. "Considering we haven't even started, the activity's been very good," he says. The opening quotes are $20 per sf to $21 per sf.

Oden credits the interest to the brokers' familiarity with what Duke considers value office: large floor plates and ample parking. The Point West development has 40 more acres of office-designated land so if more parking is needed, there's room to build. He says the building--designed by Corgan Associates Inc.'s Dallas team--is tailored to tenants larger than 10,000 sf or a single tenant.

Point West I's leasing pro forma is 12 to 18 months. "It's a high-stakes poker game. We'd love to prelease it and there's a good chance of that," Oden says. "Certainly, we'll work as hard as we can to make that happen."