(For more retail coverage, click GlobeSt.com/RETAIL.)

FLOWER MOUND, TX-Direct Development and Rreef have once again sat down at the closing table for a piece of class A retail. Unlike other deals, the 160,771-sf Highlands Ranch has been set up as structured sale with the north of $30-million trade carrying an early fourth-quarter closeout.

The earn-out is based on filling the 20% balance of the open space in the 6100 Long Prairie Rd. shopping center, which essentially delivered in late 2005, Matthew Noack, vice president for the Dallas-based development group, tells GlobeSt.com. “Hopefully, we’ll have it closed out at the beginning of the fourth quarter,” he says.

The acquisition is Rreef’s second at the FM 2499 and 407 intersection, having bought the 450,000-sf Highlands of Flower Mound on the southwest corner from Direct Development in December 2004. The latest exchange does not include a trio of pad sites, being developed and sold piecemeal to maximize the developer’s yield from the project, according to Noack. Direct Development has a third project under way in the neighborhood, but it’s too early to say if Rreef is going to go for a triple play. The 450,000-sf Robertson’s Creek is due to deliver in spring 2007.

Not only was the San Francisco-based Rreef the logical choice for the quietly circulated, free-and-clear offering, but Noack says the dealmaker was the willingness to package a two-step sale. “Not everybody in the world could do this type of structured deal to sell what’s in place and in the future,” he explains. “It was a complicated transaction that we closed with Rreef and it was a market price.” Rreef had Chicago director Bradley Gries work out the terms.

The 21-acre center is anchored by a 175,000-sf Lowe’s Home Improvement Store on 19 acres that it bought in 2004 from Direct Development. Earlier this year, the development group sold a 54.254-sf ground lease with Chase Bank to a private investor from New York City. Noack says that’s the going-forward strategy for two more pad sites, one of which is in the home stretch in talks with Overland Park, KS-headquartered Applebee’s International Inc. “We thought we could maximize the value by ground leasing and selling the ground leases,” he says.

Highlands Ranch’s junior anchors are a 30,406-sf Best Buy, 27,074-sf PetSmart and 20,306-sf Office Max. The Retail Connection in Dallas leases the project for Direct Development.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.


GlobeSt Net Lease Spring 2024Event

This conference brings together the industry's most influential & knowledgeable real estate executives from the net lease sector.

Get More Information


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.