Day 2: Bisnow Everything You Need to Know About Office
Spreads in office rents have never been wider, we learned at Bisnow's DFW Office event Tuesday. Champion Partners co-managing partner Steve Modory (left, with Ratcliff Constructors’ Robert Williams) says he’s seen full-service rents from $15/SF to $50/SF. Granite’s rents hover around $50/SF gross plus E with the same for Crescent’s new tower under construction at McKinney and Olive. Steve wonders how many tenants can pay those rents, but thinks the pool may be pretty deep for some of the law firms, in particular. They’re consolidating space, so they can pay more per square foot than for the luxury offices.
Billingsley Co SVP Marijke Lantz says there’s suburban developments creating new urban areas like Cypress Waters and Legacy. These urban cores are attracting the younger professionals as well as the executives who want bigger homes near their offices. Suburbia has hot spaces (comparable to Uptown and Downtown) and that trend will continue to grow, Marijke says. She also made a prediction for the college football championship: TCU.
When KDC was courting State Farm, the big voice in the room was HR when discussing how to build its new project, says KDC SVP Bill Guthrey (chatting with Acuity’s Aaron Godwin). HR didn’t want to build a value office, noting that payroll is four times as much as the annual real estate expenses, Bill says. They wanted structured parking near a DART station with a lounge feel spread throughout the building. In addition to State Farm, THR is taking 18k SF in the CityLine development (where State Farm is located).
When Hillwood was gearing up to build the new HQ for Perot’s family of companies in Turtle Creek, the research efforts took the team to visit HQ facilities for the Gates Foundation, Google, Pixar and others, says Hillwood Properties SVP Bill Burton (left, with Cassidy Turley’s Bauer Willis). The challenge was how to mix a variety of divisions that don’t typically work together from investments to oil and gas and construction, Bill says. The end product was to combine open spaces, offices and boat slips (offices without doors), Bill says. Every group got its own thing with a big common area for all to use.
Avison Young managing director Greg Langston (left, with Republic Title’s Jeff Montgomery) says the key to successful offices are the amenities within walking distance. Millennials want denser areas with more collaboration. That will tax some of the suburban buildings that don’t have that, but will open up those micro markets in the burbs like Legacy that have that. As DFW sees about 300 new residents moving here daily, demand is going to stay strong. He also sees the demand for office growing north as the rooftops go up in Celina, Prosper, Frisco and Little Elm. Watch for office to chase these rooftops (and multifamily).
Chicago Title southwest region director Dennis Noebel (right, chatting with Spire’s Campbell Henry) says he can’t join Marijke in her TCU pick. The SMU alum just can’t go there. Chicago Title has been a part of the real estate landscape for about 170 years. With multiple locations throughout the DFW area (and with offices across the nation), Chicago Title provides title insurance, escrow and closing services, and related real estate services to homeowners and real estate professionals.
Here’s event sponsor Cadence McShane’s Wade Wimbish, AHI Landscape’s MLise Webb, Cadence McShane’s John Schmidt and Craig Morris, and Holt Lunsford Commercial’s James Engels and Cullen Donohue. We learned that John was promoted earlier this year to VP of health, safety and environmental, and will oversee the firm’s safety initiatives throughout Texas and nationally. We also learned that the construction company was selected by Frisco ISD to complete new construction and renovations to the Career and Technical Education Center. Cadence McShane originally completed this facility in 2008 but the district’s successful programs have necessitated the school’s expansion and upgrades. Cadence McShane began the assignment in August with a scheduled completion in June 2015.
Here’s event sponsor Bury’s Richard Nixon, Jay Marsh and Grayson Hughes. They tell us Bury is serving as the structural engineer on the $20M 44k SF Parkland Clinic at Hatcher Station Village near Fair Park. The outpatient clinic is on a seven-acre site at Scyene Road and Hatcher Street, adjacent to DART's Hatcher Station. Completion is targeted for early 2015.