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DALLAS-In a classic race against time, the Red Sea Group and Provident Realty Advisors Inc. have grabbed the last large tract available for retail and residential redevelopment in North Dallas from a Chicago-based fund in an off-market sale to stave a foreclosure. The 42 acres, holding 857 apartments and a 50,000-sf shopping center, had been marketed at one time for roughly $52 million.

Time has taken its toll on the class C multifamily property and class B retail space, but it couldn’t erode the land’s value. “We bought that property for its Triple A location,” Mitch Kralis, executive vice president of the Red Sea Group, tells GlobeSt.com. “It’s one of the best infill sites in all of Dallas. …The location is absolutely stellar. Therein lies the opportunity.” Though he won’t discuss the price, he did say that the sale closed at “significantly” less than the one-time ask for the Lakeside at Walnut Hill complex and Willow Creek Shopping Center.

Kralis says he, as did others in town, eyed the site for years. The land makes up the northwest corner of Central Expressway and Walnut Hill Lane, positioned less than five miles from the Dallas CBD and on the edge of the prestigious Preston Hollow. “There were several major, major players looking at this project in hopes that we would not buy it,” Kralis says.

The new partnership had 45 days to close the acquisition, according to Kralis. The Dallas-based Provident had some of the leg work already done due to a redevelopment plan that was scuttled in late summer by city officials. Still, there was due diligence and a loan to secure before they could sit down at the closing table with TVO Arbors Partners LP, the owner of the landmark corner since 1995. “We expedited quickly because of the condition of the real estate and the seller’s position,” Kralis says. “Through a relationship of the Red Sea Group, we were able to place the property under contract, move forward and close it.” The acquisition funding came through on the eve of the foreclosure.

Kralis, acknowledging Red Sea Group holds majority interest, says the plan is to sit tight and fully evaluate the purchase’s redevelopment promise. The apartment complex at 9837 N. Central Expressway is 70% occupied and the retail, 85%. Dallas-based Westdale Asset Management Inc. has been hired to oversee the asset and make some immediate repairs while the partners decide its fate. The complex and center were developed in the late 1960s by Dallas-based Lincoln Property Co.

“I think we’re going to be making a decision sooner rather than later,” Kralis says. “We will be as design conscious and community conscious as we can be. …The devil is in the details on this that’s why we’re not in any hurry to come up with a plan. That would be shortsighted and that’s one thing we do not do at Red Sea Group.”

The family-owned Red Sea Group started working the US commercial real estate market in 1992. In recent months, Red Sea Group USA, led by CEO Avner Papouchado, shifted the US headquarters from Dallas to Los Angeles. The entrepreneurial investment company’s portfolio exceeds $1 billion of hotel, office, industrial, retail and residential properties in Eastern and Western Europe, South Africa, Asia and North America.

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