DALLAS-For more than a decade, multifamily investors have focused their attention on Uptown, developing mid-rise and high-rise properties on infill sites. However, Uptown is nearly built out, and multifamily investors have set their sights on the Design District as the newest hotspot for apartment development.
"Of all the submarkets in Dallas to invest in, many institutional apartment investors believe the Dallas Design District has the most upside for potential rent growth in the future,” says Will Balthrope, a senior director with the Balthrope Group of Institutional Property Advisors, a Marcus & Millichap Co. “It is truly an up-and-coming, urban infill location.”
Balthrope tells GlobeSt.com the Design District is one of the most unique submarkets in all of Texas. Situated just north of downtown and west of Interstate 35, it features more than 370 shops and art/design showrooms, some of the city’s best restaurants and convenient access to Uptown, The Arts District, the American Airlines Center, Dart and downtown, as well as Dallas’s newest soon-to-be completed five-acre recreational park.
“Once considered a collage of industrial warehouses and small design showrooms, the Design District has blossomed into a true live-work-play environment that is so attractive to multifamily developers and investors,” Balthrope says. “Now the area is very livable with several large, attractive apartment projects available for rent, and street appeal due to the city’s investment in sidewalks, lighting and other area amenities.”
More than 1,000 multifamily units already exist in the Design District, and several apartment projects are under development in the submarket. Houston-based PM Realty Group, for example, recently broke ground on 1400 Hi Line, a 23-story, mixed-use project.
1400 Hi Line, which will be owned jointly by PM Realty Group and Washington, DC-based National Electrical Benefit Fund, will offer 314 multi-family rental units, approximately 27,000 square feet of retail on the ground floor and parking for 650 cars.
Designed by local architectural firm Gromatzky Dupree & Associates, 1400 Hi Line will feature units ranging from 650-square-foot efficiency apartments to 1,400-square-foot penthouses. Monthly rents will exceed $2 per square foot, according to Bryant Nail, senior development officer with PM Realty Group.
Nail tells GlobeSt.com that 1400 Hi Line is the first high-rise apartment building to break ground in Dallas during the current development cycle. It is scheduled to be completed during first quarter 2013.
New York City-based Broad Street Advisors acted as exclusive advisor to PM Realty Group with respect to formation of the venture with the National Electrical Benefit Fund, and also helped arrange a $50 million construction loan from US Bank.
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