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SOUTHLAKE, TX-Panattoni Development Co. is firing up a 100,000-sf, second phase of construction to add a class A, multi-tenant building to Cedar Ridge Office Park. The $30-million-plus project was drafted into action after a full-building tenant scooped up the park’s first spec space with a 10-year lease for 30,000 sf.

In quietly orchestrated direct talks, NCI Building Systems LP preleased a two-story class A building that will deliver this month at 850 State Highway 114 in the 15-acre park. The firm plans to move Nov. 1 to Cedar Ridge, factoring in an expansion with the relocation from 400 N. Kimball Ave., also in Southlake.

Jon Napper, the Texas partner for the Sacramento-based Panattoni, tells GlobeSt.com that he’s now planning to break ground within a month on the second phase–a two-story building with 126 spaces of underground parking. Delivery is planned for March 2006. Like the first phase, O’Brien & Associates Inc. of Dallas designed the building; Panattoni Construction Inc. will build it. Construction financing was provided by Regions Bank, which is negotiating for a pad site to plant a flag in one of the region’s top income-generating residential pockets.

“Our business assumption,” Napper says, “is there is a shortage of class A office space in that market. People who want to be in that area have very few choices.” Panattoni’s development manager Daniel Anderson is courting the small-office user who’s willing to pay a $23 per sf, full-service rate, for “the convenience of being west of the runway…where they reside.”

Napper says “two or three” office users already have inquired about the multi-tenant building. Interest, he says, is sure to rise when the building does.

The 100,000-sf project will almost build out Panattoni’s Southlake land at the crossroads of Texas 114 and Carroll Avenue, save for two pad sites earmarked for 6,000-sf office buildings. Will he stake a second land claim? “I like the market,” Napper says. “I’m interested in other opportunities out there. It’s a great market with a lot of decisionmakers who live out there.”

The first wave of construction included three 6,000-sf spec office buildings, one of which has been sold to the law firm of Carnahan Thomas. The for-sale product, with seven parking spaces per 1,000 sf, is tagged at $185 per sf.

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