When I first began covering commercial real estate in North Texas about 15 years ago, a big office deal was one that created 200 new jobs, and a big industrial deal was anything over 100,000 square feet. In today’s market, you'll see a zero at the end of both those figures. Activity in 2015 was unprecedented, across the region and across all sectors. That—and the huge pile of about 300 nominations—made judging D CEO’s fourth annual Commercial Real Estate Awards program difficult, to say the least. In the end, though, editors selected outstanding finalists in 16 categories, from Community Impact to Executive of the Year. The winners are profiled in this feature. Visit our commercial real estate news site, D CEO Real Estate, for profiles of all 51 honorees.
Community Impact—Deal of the Year
When J.C. Penney released 240 acres of land surrounding its corporate campus in Plano for development, no one imagined the profound impact it would have. No one except, perhaps, Fehmi Karahan. The developer who showed America how suburban-urban is done with The Shops of Legacy and Legacy Town Center, Karahan is as bold as they come. In college, he read a book by the Greek shipping tycoon Aristotle Onassis, who wrote, “Never start a business, a battle, or a love relationship if the fear of losing is greater than the belief of winning.” The advice has stuck with him. “I don’t start anything with fear,” Karahan says.
For years, he watched from his office in Legacy as commercial and residential growth migrated north. He had talked with various Penney executives about developing its land, but a deal never came to fruition. When the retailer ran into financial woes, though, it decided to open up bidding to five suitors: Lincoln Property Co., Trammell Crow Co., Forest City, Hines, and Karahan. Sizing up the competition, Karahan brought in reinforcements: urban multifamily pioneer Robert Shaw and corporate office developer KDC, led by Steve Van Amburgh and Toby Grove. On Feb. 4, 2014, the trio announced their partnership—dubbed Team Legacy—and its winning bid to develop Legacy West.
It kicked things off in a big way, securing a corporate headquarters for FedEx Office and a new 2 million-square-foot U.S. base for Toyota Motor North America, which had considered more than 100 other options nationwide. Those stamps of approval led to a dizzying array of announcements: Liberty Mutual and JPMorgan Chase (1 million square feet each), a 24-story luxury condo tower, a 30-story multifamily high-rise, a 300-room hotel, a 14-story multitenant office building, 127 single-family homes, and Legacy West Urban Village—355,000 square feet of retail and restaurant space and 320,000 square feet of boutique office space, with at least 800 apartments.
Legacy West is one of the largest new projects in North America—one whose brand-name tenants and development velocity are unmatched. Only 15 acres remain available for development.
Best Land Sale
Facebook Data Center
With 1.5 billion users, Facebook can’t afford any downtime. So, it doesn’t take its data center location decisions lightly. The company considered more than 200 sites before deciding to buy 110 acres from Hillwood in North Fort Worth for its fifth—and largest—global center. Robust infrastructure and access to renewable energy and a deep pool of talent were among the reasons the site won out.
Facebook’s three-building campus, which will total about 750,000 square feet, will be completely powered by renewable sources, including 200 megawatts of wind energy. The massive data center is the first project in Fort Worth whose capital investment exceeds $1 billion. It’s being built by DPR Fortis Mission Critical.
Finalists: Lakview Ranch; The Laurel; Pate Ranch; WW Caruth-Richardson TOD
Best Headquarters Deal
Kubota Tractor Corp.
Toyota isn’t the only Japanese company moving its U.S. headquarters from Southern California to North Texas. After considering options in Georgia, Kansas, and other states where Kubota Tractor Corp. has a strong presence, the company selected Grapevine for its new home—a move that will bring 400 new jobs to the region.
The community was a perfect fit, says CBRE’s Steve Berger, who, along with colleague Ann Huntington, represented the tenant in the deal. “Both Grapevine and Kubota Tractor Corp. have agrarian roots that still influence them today,” he says. “The natural setting and topography of the site reflect that past and also serve the vision for the future.”
The new headquarters will include 125,000 square feet of office space and 68,000 square feet for research and development. It will anchor a 184-acre masterplanned development that also will include a hotel and retail space.
Finalists: NEC Corp. of America, OneSource Virtual, RealPage, Sunoco LP
Best New Office Project
With its $325 million, 1 million-square-foot campus at Legacy West, Liberty Mutual will bring more than 4,000 employees to Plano by the end of 2017. Along with its sheer size and density, the campus also stands out for its unique design. Two 12-story office towers will sit atop seven-story parking garages. A nearly 250,000-square-foot eighth floor, the first floor of the office towers, connects the buildings and houses all of the amenities, including two rooftop gardens, dining facilities, a fitness center and locker rooms, employee health services, and conference spaces. With a height of about 300 feet, the Liberty Mutual campus will be the tallest office project in Plano.
It will sit at the gateway to Legacy West, at the southwest corner of the Dallas North Tollway and State Highway 121. Like all single-tenant office projects in the $2 billion development, it’s being developed by KDC. Toby Grove, president, says Liberty Mutual connects the corporate uses with the project’s mixed-use area. “You’ll have nearly 5,000 people right by the new food hall and the other restaurants and shops,” he says. “It’s 1 million square feet on 8 acres. That density is exactly what was envisioned for Legacy West.”
Craig Jablin and Ric Kanatzar with Savills Studley represented Liberty Mutual in its expansion. The campus was designed by Omniplan and is being built by Balfour Beatty Construction.
Finalists: Frost Tower (Fort Worth); Terraces at Douglas Center
Commercial Real Estate Executive of the Year
Michael Dardick, Granite Properties
Granite Properties has developed or bought more than 24 million square feet of real estate valued at about $3.6 billion. But one of President and CEO Michael Dardick’s proudest achievements is being named by Fortune magazine as a “Great Place to Work” for the last four consecutive years. As opposed to being in the real estate business, Dardick likes to say his company is in the people business—people who just happen to do real estate. It’s a philosophy he learned from his father, a World War II veteran who started at the bottom of a manufacturing company and worked his way up to becoming the owner.
Dardick stays in touch with his 165-person team through one-on-one breakfasts and lunches, and by taking groups bowling or sailing. The people-centric strategy is working. Granite had a banner year in 2015, developing Granite Park V, The Boardwalk at Granite Park, breaking ground on Granite Place at Southlake Town Square, winning a big 330,000-square-foot lease from Fannie Mae, and redeveloping West End Marketplace into a co-working project called Factory Six03.
“Companies can do three things—and two of them suck,” Dardick says. “They can grow, stay the same, or shrink. Nobody wants to shrink, and staying the same gets boring. The reality is, you can’t keep great people without giving them the opportunity to grow.”
Finalists: Vickie Bunch, Ericsson; John Goff, Crescent Real Estate; Bob Morris, Corgan
Broker of the Year
Jack Fraker, CBRE
Take a look at a list of Dallas-Fort Worth’s top industrial property sales of 2015, and a pattern will emerge: Every single one of the deals was brokered by Jack Fraker and his team at CBRE. Fraker’s group closed 39 local sales last year, adding up to nearly 97 million square feet and more than $5 billion in value. The super-broker also is a founding member of CBRE’s national partners team, which did more than $16 billion in transactions around the country.
Fraker wasn't always in real estate. He studied accounting at The University of Texas and went to work as an accountant in Alaska for a pipeline company, a gig that took him to Saudi Arabia and, later, to Scotland. He came back to Dallas in the 1980s and joined a railroad company that owned a lot of land and worked on dispositions. In a meeting one day, he noticed two Cadillacs parked out front. “One belonged to the developer and one belonged to the broker,” Fraker says. “I thought to myself, ‘I need to get on the other side of this desk.’” And that’s exactly what he did, spending 15 years at Cushman & Wakefield before joining CBRE in 2003. There, he and his team refer to themselves as an aspen forest. “An aspen grove is all one organism, connected by the roots,” Fraker says. “It sounds corny, but we all like each other so much.”
Finalists: Randy Fleisher, JLL; Steve Lieberman, The Retail Connection; Craig Wilson, Cushman & Wakefield
Best New Industrial Project
Farmer Bros. Co.
Big relocation deals are always tricky. For Stream Realty Partners, winning a manufacturing, distribution, and headquarters project for Farmer Bros. Co. came with plenty of complications. Stream first bid on the deal in 2014. At the time, it had 60 acres under contract for a spec industrial park in Northlake. Farmer Bros., a coffee manufacturer based in Torrance, Calif., went quiet for several months, so Stream moved forward with its spec development plans.
Then the opportunity resurfaced. Stream was able to lock down another 30 acres nearby and win the project, but there was a catch: Farmer Bros. wanted to sell its property in California and use the proceeds to acquire its new home through a 1031-exchange. So, Stream had to bring in a third-party financial intermediary to fund development.
The project will create up to 400 jobs in Northlake. Farmer Bros. was represented by NGKF.
Finalists: Shippers Warehouse; Southport Logistics Park
Best Mixed-Use Project
Trammell Crow Co. left its mark on downtown Dallas with several skyscrapers in the 1980s. Now it’s reshaping Uptown with Park District, a twin-tower development that totals more than 900,000 square feet. With partner MetLife, TCC won a hard-fought battle for the prime land off Woodall Rodgers between Olive and Pearl streets, where it's developing a 32-story luxury residential tower and a 19-story office building, PwC Tower at Park District. The professional services firm is anchoring the project with a 200,000-square-foot lease.
Designed by HKS Inc., Park District incorporates its proximity to Klyde Warren Park with a large plaza. “So many cities are dying to have mixed-use, but there aren’t very many markets that can do it," says Scott Krikorian, senior managing director at Trammell Crow. “It was the right use for the site and for the city of Dallas.”
Finalists: Preston Hollow Village; The Union Dallas
Best Office Lease
Fannie Mae had an abundance of options when it went looking for a new regional home in the spring of 2015. “The biggest challenge was selecting the best site and developer from so many good alternatives,” says Craig Wilson of Cushman & Wakefield. He represented Fannie Mae in its search, along with C&W colleagues Randy Cooper, Art Santry, and Ned Goodwin.
In the end, the mortgage company chose Granite Park VII, a to-be-built office tower in Plano. The 330,000-square-foot lease was one of the biggest office deals of 2015.
Fannie Mae will consolidate three North Texas facilities into Granite Park, where it will employ around 2,000 people.
Finalists: GEICO Insurance; PWC
Best Industrial Lease
Samsung Electronics America
When an existing tenant, Samsung Electronics America, needed more space in Coppell, Duke Realty found a way to provide it. But it wasn’t easy, and it took nearly two years. “The deal would get hot for two or three months, and then die again,” says Jeff Thornton, who runs Duke's local operations. “I bet we resurrected it four times.”
Samsung’s telecommunications group occupied 261,000 square feet in Duke’s Point West development. The new deal added 552,225 square feet for Samsung’s electronics group. Duke had to convince other tenants to relocate within the park, and juggle occupancies as companies transitioned in and out of the same space.
“The deal complexity was high,” Thornton says.
Finalists: Niagara Bottling Co.; Walmart.com
Excellence in Architecture & Design
The Rolex Building, Harwood District
From the start, developer Gabriel Barbier-Mueller has been guided by the principles he learned in his home country of Switzerland. “We are taught from birth about quality and service and lifestyle,” he says. Those sensibilities are woven into the fabric of the Harwood District, his 18-block, mixed-use neighborhood in Uptown that’s known for its provocative architecture and richly landscaped green spaces.
Barbier-Mueller’s first building in Harwood was an American headquarters for Rolex. Now, 30 years later, a new U.S. base for the luxury watchmaker is in the works. It will be the first office building in Dallas designed by a Japanese architect; Tokyo-based Kengo Kuma & Associates is collaborating on the project with Harwood’s in-house group, HDF. The 137,000-square-foot structure has a unique, rotated shape. Renowned landscape architect Sadafumi Uchiyama is creating tiered gardens with waterfalls that cascade over the side, and rampart stone walls will wrap around the base.
Kengo Kuma was recently selected to design the National Stadium in Tokyo, which will be the centerpiece for the 2020 Olympics. With the Rolex Building, he says, the goal is to fuse nature and architecture: “[It] will result in a beautiful urban-organic icon that will fundamentally change the Dallas cityscape.”
Best Commercial Property Sale
Towers at Williams Square
Hillwood knows a solid asset when it sees one. That’s why, when Apollo Global Real Estate and Vanderbilt Office Properties put together a partnership to acquire The Towers at Williams Square in Las Colinas, Hillwood got in on the action, too. Not only was it the largest DFW office property sale of 2015, but the $330 million transaction is among the biggest office sales on record.
The 1.4 million-square-foot property is known for its granite-paved plaza and massive bronze scuplture of wild mustangs galloping out front. At the time of the sale, the complex was 98 percent leased, mostly to investment-grade tenants like Flowserve Corp. and Accenture. It’s now being managed by Vanderbilt, with Hillwood Urban taking over leasing. The property was marketed by HFF, which also helped secure financing.
Finalists: Galleria Office Towers; Legacy Central; Tom Thumb Portfolio; Village on the Parkway
Devloper of the Year
Scott Krikorian, Trammell Crow Co.
With more than 65 years in the business, Trammell Crow Co. has had a huge impact on Dallas—and on the commercial real estate industry itself. Unlike some developers that specialize in a certain product type, TCC has proficiency across all major uses. Those capabilities were on full display in 2015, when the company had more than 5.7 million square feet of commercial space under construction, valued at more than $600 million.
On the office front, it built the Federal Aviation Administration’s 357,214-square-foot Southwest region headquarters in Fort Worth. On the industrial side, it signed a 500,000-square-foot lease to Amazon at JJ Lemmon Distribution Center in South Dallas. Its residential subsidiary, High Street Residential, broke ground on two mixed-use projects—M-Line Tower and Knox Heights—bringing more renters and retailers to the region. And TCC capped off the year by announcing Park District, a mixed-use complex off Klyde Warren Park in Uptown that totals 900,000 square feet.
“We’re lucky and very grateful to be based here,” says Scott Krikorian, who oversees the company's Dallas business unit. “We’ve got tremendous winds at our back with the strong, diversified North Texas economy. I’m excited that this cycle still has some legs on it. So, let’s build the right product and keep running.”
Finalists: Harwood International, led by Gabriel Barbier-Mueller; Billingsley Co., led by Lucy Billingsley; KDC, led by Steve VanAmburgh
Herb Weitzman, The Weitzman Group / Cencor Realty Services
Herb Weitzman has staying power. The retail guru has more than 55 years in the business, yet he still has the energy and drive of a rookie. His passion for real estate helped him build a brokerage and development force in Texas. Along the way, he inspired and groomed many of the region’s top brokers—some of whom now lead their own firms.
Weitzman got into the business in 1960, while still taking classes at The University of Texas. He was inspired by his father, who ran a retail shop in downtown Dallas and owned a few rental properties on the side. After college, Weitzman joined Henry S. Miller Commercial. He worked in the farm and ranch division, and then got into industrial properties before some of his manufacturing clients took him into retail. Weitzman saw an emerging trend in franchising, and steered major brands like Kentucky Fried Chicken and Burger King through rapid expansions.
He formed The Weitzman Group in 1989, later adding its development arm, Cencor Realty Services. The companies currently have 14 projects underway statewide, and brokered several big North Texas retail deals last year. Even though Weitzman passed the CEO and president baton to former COO Marshall Mills in late 2014, he remains active as chairman—and has no plans to slow down. “I’m excited all the time about this business, and I’m especially excited to be doing it in the state of Texas,” he says. “We have the best business environment in the world.”
Best Retail Deal
Tom Thumb at the Union Dallas
With all the new office towers being built in Uptown, it takes a lot to stand out. But RED Development has found a way to offer something no one else has: an honest-to-goodness, on-site grocery store. Tom Thumb’s 60,000-square-foot lease at The Union Dallas is good news—not only for future office tenants and residents, but also for those who live and work in the grocery-starved urban core. Tom Thumb will be the area’s first full-size, standard-product supermarket. It also will offer prepared meals to go, a pharmacy, a Starbucks, and a floral department.
The store will bring a strong “livability factor” to The Union Dallas, says Mike Ebert, managing partner at RED Development. The company behind the 1.2 million-square-foot CityScape in Phoenix selected Dallas for its next big project. Located on Field Street and designed by HKS Inc., The Union includes a 23-story residential tower, a 414,000-square-foot office tower (anchored by leases from Vinson & Elkins and Weaver), and 87,500 square feet of retail space.
JLL’s Clay Smith and Mark Newman represented Tom Thumb in its lease.
Finalists: Bed Bath & Beyond (Southlake); Buc-ee’s (Terrell); Tyler’s (Fort Worth)
1700-1712 Commerce Street
With its acquisition and development of 1700 and 1712 Commerce Street, NewcrestImage, led by Mehul “Mike” Patel, is bringing new life to an entire city block in downtown Dallas. The 93-year-old 1700 Commerce tower (the former Allen Building) will reopen this spring as a 176-room Hampton Inn & Suites, a division of the Hilton brand. The former Mercantile Commerce building at 1712 Commerce is converting to a dual-branded, 209-room Marriott Residence Inn and AC Hotel—the luxury, European-style hotel’s first flag in Texas. The properties will share a swimming pool and a 10-story parking garage that NewcrestImage is adding.
Patel brought in Merriman Associates to oversee design and Munsch Hardt Kopf & Harr to guide him through the process of securing $35 million in financial incentives, including federal and state historic tax credits and tax increment financing.
Much of the revitalization work in Dallas’ urban core has been focused on Main Street, says Phillip Geheb, a real estate attorney with Munsch Hardt. NewcrestImage’s project extends those efforts to Commerce Street. “It’s the first true dual-branded hotel project in Dallas and the first lifestyle brand in the heart of downtown,” Geheb says.
Finalists: One Dallas Center; Hillside Village