Cannon bought the landmark office trio beside the Galleria Dallas mall in late May from New York City-based Fortis Property Group, which was kept in place to manage the "shell structure," specifically personnel oversight and related issues. Cannon's MO is to manage its holdings while opting to contract part of the day-to-day functions to a local company, according to Shervin Mateen, Cannon's CEO.
"Fortis had been doing that during the transition, but they are a New York company," Mateen says. "We are familiar with Grubb & Ellis and are very happy with them. They know we're not a typical owner and we're hands on. We are involved in all decisions from A to Z."
The Galleria towers' fate has been on the watch list of the local brokerage circle since Cannon took the deed to the 468,750-sf, 25-story Galleria I at 13355 Noel Rd., 430,045-sf, 24-story Galleria II at 13455 Noel Rd. and 519,675-sf, 26-story Galleria III at 13155 Noel Rd. The leasing assignment reportedly is up for grabs too. Jones Lang LaSalle's Dallas team has been at the helm before and after the prize changed hands.
"It's not been determined yet," Mateen tells GlobeSt.com. "For now, they [JLL] are leasing the space in our property, but I don't know what the future will bring." What he has confirmed is Grubb & Ellis' role will be strictly to assist with management. "We keep it clear cut between management and leasing," he stresses. The Galleria towers are 99% occupied, with minimal rollover in leases in the coming year.
George Gamel in Cannon's Houston office oversees the 20-million-sf portfolio in the US. John McAllister with Grubb & Ellis Management Services is the point man for Cannon's account, which includes a sizable portion, but not all, of its office portfolio.
From a management perspective, the priority will be lining up a renovation. Mateen says a multimillion-dollar makeover is planned for the trio's lobbies and other common areas. He says he expects to have an architect picked within three months so work can begin in the first quarter.
"We plan to keep these properties for a long time. We want to retain the triple A standards," Mateen says, "and preserve the elements of the trophy property that we bought."
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