The Platinum Corridor Beyond the $5B Mile
Developers like Hillwood, Billingsley Co, Hall Financial Group, Granite Properties, Lincoln Property Co and many others already have addresses along The Platinum Corridor and there’s more development coming. That’s why we we’re excited to bring you the Future of the Platinum Corridor event starting at 7:30am on Feb. 25 at One Hanover Place. Register here.
Heady Investments founder Randy Heady was among the first brokers to recognize the North Dallas Tollway area as a target-rich environment. In the early '70s, there were two brokers who specialized in tenant rep and leasing the area: Randy and fellow real estate legend Wayne Swearingen. Fast-forward 40 years and the Platinum Corridor (which runs along almost 20 miles of Tollway from LBJ to SH 380 in Frisco) is booming. How far north will the development go? Randy says his old boss, Hank Dickerson, predicted back in the '70s that it would eventually go all the way to the Red River and Randy agrees. His evidence: he has a friend who bought 3,000 acres in Celina for $3,700/acre in 1985. The tollway is designated to run right through his land in the future and it’s now valued at $150M.
Randy is in the midst of building the 170k SF Frisco Bridges Place (rendered) at the southeast quadrant of Gaylord Parkway and the Dallas North Tollway. The project (slated for an early 2016 completion) filled 25% of the building before breaking ground with the 40k SF lease to Strasburger & Price. Look for construction to start on Headquarters II (northeast corner of Headquarters and the Tollway) maybe in August, Randy tells us. He’s got a handshake deal for a 100k SF user and gained control of the land just six months ago to push the deal forward. That building will be 15% larger than its twin, Headquarters I (7800 Dallas Pkwy), he tells us. Expect to get a history lesson (with lots of names you’ll recognize) from Randy at the Future of the Platinum Corridor event. “It didn’t look anything like this in ’72; it was cows, pastures and grain silos,” he tells us.
It was Tranwestern principal Randy Garrett who first coined (and then trademarked and registered) the term The Platinum Corridor. That was back in 1997 after a dozen years of repping tenants along the North Dallas Tollway area. “To me, it was obvious the growth was going north and there were so many new office buildings under construction, the entire office submarket in that area would be going platinum,” Randy recalls. His first career (out of TCU) was in advertising, so he knew the advantage in registering the phrase. But, beyond that, he wanted to pinpoint this area to help it gain recognition not only locally, but also for the national market, as well. He wanted to see the moniker do for the North Dallas Tollway what the "Telecomm Corridor" did to boost Richardson’s recognition nationally.
Everyone has heard about the $5B mile in Frisco, but there is a lot more to it than just those developments and just the Frisco part of the Tollway, he tells us. Randy (with his wife, Marialice, at Machu Picchu in Peru), won’t tell us more here; he says you need to come to the event to get the deets on the numbers, tenants, demand and projects. Randy says, even 20-something years ago, it was apparent that this would be a dynamic office market. He anticipates continued infill development in the remaining open land sites between LBJ and SH 121. It’s simply a matter of time, he tells us. Randy says the growth could stretch all the way to Oklahoma because of the affordable land and the excellent school districts. Rooftops drive development, and they’re abundant in Frisco and Prosper. Plano also continues to be in high demand.
Van Trust Real Estate EVP Ran Holman (here with The Trocchio Advantage CEO Liz Trocchio Smith) tells us the Tollway is a powerful business address and many decision-makers live within a mile on either side of the 25-mile stretch. He’s even bold enough to call it the business spine of the MSA. That used to be Central Expressway, he says, but it was redefined in the ‘90s when North Central's construction fueled a seismic shift to the west. As you move further north and travel toward SH 380, office will eventually follow the already-thriving infrastructure, retail and residential.
Van Trust Real Estate is in the thick of the Tollway development as the exclusive office partner (with Hillwood and Rudman) in the 242-acre Frisco Station (rendered). That project will be a mixed-use of office, entertainment, food and beverage, multifamily, medical, hospitality and green space, he tells us. The project wraps around the Cowboys complex on the northwest corner of Warren and the Tollway. Ran says the project will ultimately include 4M to 6M SF of office depending upon the users and density. VanTrust is starting construction of a 210k SF six-story spec office building this summer and is in design now on a 350k SF 14-story office building on the Tollway frontage. It should break ground before year-end, he tells us. Van Trust has an appetite for development and the stability in capital structure to build truly spec product, Ran tells us. “And, we’re bullish on this market,” he says.
Another reason for moving forward with spec is the time it takes to build large office buildings, Ran says. Pre-leasing in this market can be difficult, but job growth is strong, and there’s a confluence of the quality of living that people want in Frisco and West Plano, he says. So, will all the projects that are planned along the Tollway come to fruition? Ran says it’s all about the capital behind the deals. “Equity can be fickle, but if they have strong capital backing and commitment, those are the projects I would bet on.” Once you get past the fancy presentations, then you have to look at the capital stack, underwriting and financial backbone of the project, he says. It comes down to your ability to honor your promises. Businesses simply gravitate toward certainty. Ran tells us he’s OK with the groundhog’s prediction of more winter. He’s planning on taking his wife and their three kiddos (ages 13, 10 and 9) for a skiing trip on spring break. Make sure to join us at Bisnow's Future of the Platinum Corridor event starting at 7:30am on Feb. 25 at One Hanover Place. Sign up now for the event or click HERE if you are interested in sponsoring with us!