116,228-SF Lease Backing Consolidation Plan

DALLAS-With a consolidation plan in the works, Dart Manufacturing Co. stepped up for 107,091 sf and then came back for another 9,137 sf as the ink was drying on the lease for its relocation. The just-merged distribution company will move in April 1 to Turnpike 16.

The long-term lease for the 261,255-sf distribution center at 3860-90 La Reunion Blvd. was at the bargaining table nearly four months. John Gorman, principal of Holt Lunsford Commercial in Dallas, tells GlobeSt.com that Dart Manufacturing rolled in an extra bay just this week. In the Pinnacle-Turnpike submarket, industrial space is hovering $3 per sf, triple net.

Gorman says Turnpike 16 has had several short-term tenants in it for the past three years so the coup for the long-term lease reinforces Des Moines-based Principal Financial Group’s decision last summer to redo its 2.8 million sf in Turnpike Distribution Center. “We really dressed up these buildings,” he says.

Principal’s 16-building stake is 81% leased, with more deals pending. In addition, Gorman points out “market conditions have improved” so the 2008 outlook is promising.

Dart Manufacturing occupies space at 4012 Bronze Way and 2424 N. Westmoreland Rd., both in nearby Redbird Industrial Park. Tenant rep Craig Jones of NAI Robert Lynn says the search for relocation space began in early 2007, but the dynamics of the deal changed as the year progressed due to its merger with Senator GmbH & Co. of Gross-Bieberau, Germany, which did a lock, stock and barrel buy-out of the Dallas-based company. The new plan calls for the consolidation of the local sales team and one in Greensboro, NC, home since 1989 to Senator’s US division.

Jones says the new company, Senator Promotional Group USA, will double Dart’s size with the move. The North Westmoreland Road lease is set to expire, but the 30,000 sf at 4012 Bronze Way has 18 months left on the term, he says, adding it will be put out for sublease.

Jones says there were three buildings on the short list. “This proved to be a good opportunity because of the timing that it could be delivered.” The plan is to add some extra office to the 10,000 sf that exists in Turnpike 16.

Dart was opened in 1995 by Sam and Irene Kogutt, who retired in 1999 and turned it over to their three sons. The trio will remain part of the new company, according to Senator’s merger release.