Mixed-Use Property In Uptown Dallas Gets New Owners Via $395M JV Deal
A 557K SF mixed-use property in Uptown has traded hands following the formation of a $395M joint venture.
McKinney & Olive, located at 2021 McKinney Ave., was acquired by Dallas-based Granite Properties and North Carolina-based Highwoods Properties. The property includes 507K SF of Class-AA office space, 50K of retail space and a 1-acre piazza.
“We continue to be focused on growing our firm through acquisitions and developments of high-quality projects in the best submarkets, and this building is a very strong addition to our Dallas portfolio,” Granite Senior Managing Director Will Hendrickson said in a statement. “It embodies the highest quality in architectural design and amenities to offer a compelling and productive work experience to top talent.”
The joint venture’s investment sets aside $1.7M for minor, near-term building upgrades and $2M for transaction costs, according to Seeking Alpha.
The property, which is 99% leased, is expected to generate $48.2M in 2023. Current rental rates are at 35% below-market.
"We have long emphasized the importance of having a strong balance sheet with dry powder to capitalize on exactly this type of strategic opportunity — acquiring a singularly iconic asset such as McKinney & Olive at or below estimated replacement cost," Highwoods President and CEO Ted Klink told Seeking Alpha.
Just down the road from McKinney & Olive, Granite is in the midst of developing 23Springs, a mixed-use project with 625K SF of office space. The property will also include 17K SF of retail, which is being developed in partnership with Highwoods.
23Springs is expected to deliver in the first quarter of 2025.
CORRECTION, DEC. 18, 11:19 A.M. CT: An earlier version of this story had the incorrect sales price in the headline. It has been updated.