FORT WORTH—Dallas-Fort Worth as a whole recorded sales volume of approximately $803 million across 22 transactions in the first half of 2017, according to Transwestern research. While the number of transactions remained fairly static from last quarter, sales volume is down 13% year-over-year.
Pricing on a per-square-foot basis maintained its elevated level from 2016, with an average sale price of $197 per square foot. The average cap rate was 6.96%, ranging from a low of 4.9% to a high of 9%. Class-A deals had an average cap rate of 5.86% and class-B deals had an average cap rate of 7.35%.
The emergence of major deals occurred in the second quarter after a quiet start to the year. Four deals had sale prices of more than $50 million. Transwestern forecasts larger deals to continue to drive the market as several corporate campuses are currently up for grabs.
Breaking down Fort Worth on its own, this metro has garnered more investor interest beyond the local area and buyers from throughout the country due to higher pricing in other markets. One recent example is Navstar Commercial's sale of One Ridgmar Centre. Frontier Equity purchased the property for an undisclosed amount.
Transwestern managing director Steve Simon and senior vice president Steve Rowland represented the seller, Navstar Commercial, in the transaction.
“One Ridgmar Centre proved to be a highly sought-after property receiving multiple offers on the sale,” said Simon. “This robust activity is representative of the increased level of investor interest in the Fort Worth office market.”
The asset is located at 6500 W. Freeway in the Southwest Fort Worth office submarket. The 10-story 177,199-square-foot class-A office building has a visible location along Interstate 30, with proximity to restaurants, hotels, shopping, entertainment and multiple residential options. One Ridgmar Centre was 89% occupied at the time of sale, with rents at 10 to 15% below market rate.
“As increased pricing in other markets has forced investors to look for alternatives, Fort Worth is quickly becoming a preferred destination for investment capital,” Simon tells GlobeSt.com. “Fort Worth is no longer considered only a market for local investors, as evidenced by the high level of interest received from both regional and national players. It is now on the national map for commercial real estate investment.”
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
