Under-The-Radar Waxahachie Snapping Up Deals, Developments
While much of the real estate world looks north to Plano and Frisco, southern Dallas suburb Waxahachie has quietly been snapping up national retailers and residents, and catching the attention of Dallas developers.
Over the last several years, several factors have helped put Waxahachie on the commercial real estate map. In 2014, the former Baylor Medical Center at Waxahachie opened a new hospital under the Baylor Scott & White name. Waxahachie’s school district started making progress on a new high school to replace its aging one. And in 2014, Dallas developer Jim Lake Cos. started buying up properties in Waxahachie’s historic downtown, including a local icon, the Rogers Hotel.
“There’s lots of demand in Waxahachie, but not a lot of product available,” NAI Robert Lynn partner Tom Hearty said. “We’re close to 100% leased all around. There’s room for more development.”
Waxahachie has historically been supported by industrial warehouses and small neighborhood retail centers. Industrial warehouses such as Owens Corning Fiberglass, Dart Container Corp. and Walgreens are the city’s largest employers. Those industries are still strong, but other asset classes are now sharing the spotlight.
When Baylor Scott & White Medical Center Waxahachie opened two and a half years ago, it employed about 300 people. Today, Waxahachie Economic Development Director Doug Barnes estimates it employs about 800. A new medical office building that could be about 80K SF is in the planning stages within the campus’ 51 acres. Barnes said the hospital pulls patients from a four-county radius, making it more of a regional medical center.
“We wanted to create a medical mecca in the southern part of the Metroplex and we are moving forward in that direction,” Barnes said. “The hospital was the first piece to that and now we’re looking at biotech and life sciences advancements.”
Senior housing and medical-related housing has also surged recently with more institutional investors taking hard looks.
Retail growth can also be seen all over the city, concentrated on U.S. Highway 77 north of U.S. Highway 287. In 2015, the Waxahachie Marketplace opened with anchor tenants Academy Sports + Outdoors and TJ Maxx.
North Grove Business Park is under construction on U.S. Highway 77 and will be anchored by an Atwoods Ranch and Home. The park has already snapped up restaurants such as Chicken Express and a few other to-be-announced tenants.
“I think you’ll see nicer restaurants coming,” Hi View Real Estate developer and broker Brett Hess said. “We have a 100,000-people trade area. Better restaurants are coming.”
Lots deliver in five or six months for the 18K SF center, Hess said.
Hearty echoed the city’s demand for better restaurants.
“Waxahachie needs more high-end steakhouses and fish houses. I think that’s in the future, but it’s not quite there yet. There’s still a lot of pent-up demand for mid-range retailers and restaurants,” Hearty said.
Even after North Grove delivers, Hess sees room for more retail development.
“We could use another power center or two, and another grocer or two in this market in [nearby cities like] Red Oak and Midlothian,” Hess said. “I think we’ll see new development in industrial next. Housing is affordable here, wages are a little bit lower, but we have no buildings to offer.”
Interested developers will find lower land prices than northern suburbs. While Frisco and others quote prices by the SF, Waxahachie still offers residential lots around $15K to $18K an acre and retail sites around $12K to $14K an acre.
Though Waxahachie boasts some of the same accolades as northern suburbs that developers love — strong demographics, large workforce, good schools — Hearty sees one major point of difference.
“Waxahachie has that 19th century feel because of all the Victorian homes around Downtown,” Hearty said. “It’s a great quality of life if you’re looking to be close to the Metroplex.”