Sources confirm the city's biggest sale was Bank of America Tower, which garnered $325 million in 1998. Kam Mateen, president of the Los Angles-based Cannon Commercial, says the closing for the Noel Road landmark was pushed once, but a loan modification for the assumption quickly put it back on track. "We are very optimistic about this deal and closing more in Dallas," he tells GlobeSt.com, adding $10 million has been released to the seller. "It's a sure thing it's going to close."
Mateen and his brother, Shervin, who's the company's CEO, already are negotiating with a prominent hotel company to joint venture on a boutique low-rise for the vacant land. "It's a very, very important hotel flag. We're going to put the most exclusive hotel on the vacant lot at the corner," Mateen vows.
A fourth office tower was planned for the land at one time. "It would obstruct the view of Galleria II," Mateen explains. "I just think the very best use would be a low-rise hotel of no more than four stories."
Cannon Commercial is buying the crown jewels from Brooklyn, NY-based Fortis Property Group, which is being kept on as asset manager, sans any vested financial interest, according to Mateen. Jones Lang LaSalle is staying in place to lease the towers, which went from 97.5% occupancy to 99% during the escrow period.
Mateen says there is minimal lease roll in the first two years. The remaining leases have two to 10 years left on terms, he adds, pointing out the majority of the tenant base has been in place for years.
Mateen says the intent is a long-term hold. He says a multimillion-dollar "refreshing" is planned for the lobby of the 468,750-sf, 25-story Galleria I at 13355 Noel Rd., but nothing has been firmed up as yet for its sisters, the 430,045-sf, 24-story Galleria II at 13455 Noel Rd. and 519,675-sf, 26-story Galleria III at 13155 Noel Rd.
Fortis acquired the high rises in November 2006, bringing them to market last fall after driving up occupancy and raising rents from $28 per sf to $30 per sf. The sale's point man was JLL managing director John Alvarado who, as always, was partnered with Jack Crews and Evan Stone.
Mateen says there are more contracts in hand for Dallas office properties, but none are equal to the Galleria in size, amount or name recognition. Cannon owns the 239,049-sf Toll Hill Office Park at 5310 and 5440 Harvest Hill Rd., which less than one mile south of the Galleria. "We are very bullish on Dallas," Mateen says, "and we believe in these intersections of LBJ Freeway. We have the highest traffic in Dallas and the Galleria is the best address."
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