Middle Market Digest: This Week in the South and Mountain Regions

CBRE released its first quarter 2018 Texas industrial MarketView. Statewide, the 90-day net absorption increased by almost 2 million square feet. This was due largely to Houston’s absorption growth of 2.5 million square feet. Occupied growth in inventory combined with robust leasing activity pushed down Texas industrial vacancy to 5.9%, down from 6.3% in fourth quarter 2017 and 6.2% a year ago. Dallas/Fort Worth leads in new construction starts but with a smaller margin compared to previous quarters.—Lisa Brown

BY THE NUMBERS

AUSTIN, TX—The Austin office market vacancy rate stands at 8.6% midway through the second quarter, with year-to-date net absorption at 384,000 square feet and deliveries at 1 million square feet, according to NAI Partners Austin office monthly market snapshot for May 2018.

AUSTIN, TX—Activity in the Austin industrial market is steady midway through the second quarter of 2018 with the vacancy rate up marginally by 10 basis points at 7%, from 6.9% at the end of the first quarter, according to NAI Partners Austin industrial monthly market snapshot for May 2018.

HOUSTON—Coworking remains a popular topic, although it actually accounts for a smaller percentage of office space in Houston than one might think. Using current data available, a recent survey of coworking space in 17 submarkets found approximately 115 coworking sites throughout the metro totaling 1.5 million square feet of space. That means that the amount of square footage of coworking space is a mere 0.7% of the total office space inventory of 207 million square feet, within these submarkets, according to NAI Partners’ recently released market insight report on coworking space in Houston.

SAN ANTONIO—The San Antonio office market vacancy rate stood at 10% midway through the second quarter—up slightly from 9.9% at year-end 2017—with year-to-date net absorption in the red at negative 75,381 square feet, and no new space delivered to the market, according to NAI Partners San Antonio office monthly market snapshot for May 2018.

NEWS AND NOTABLES

AUSTIN, TX—JLL announced the addition of commercial real estate expert Ace Schlameus. The industry veteran joins the firm as senior vice president for the JLL Austin industrial team, providing a new industrial expert and bolstering the team’s overall quality of service.

AUSTIN, TX/DALLAS/HOUSTON—The Dallas, Houston and Austin offices of architecture and design firm Perkins+Will announce the following promotions. Ian Sinnett was promoted to principal, and Julie Frazier and Jordan Thompson were promoted to associate principal.

HOUSTON—CBRE announced that Mark Witcher has joined CBRE as a senior vice president with the firm’s national retail investment group. Based in Houston, Witcher will cover Texas with a focus on representing institutional investors, owners and developers in retail investment sales.

HOUSTON—NAI Partners recently augmented its industry-leading industrial services team with two new sales professionals: Zane Carman and A.J. Williams. Both brokers join the company as associates, and their addition comes on the heels of NAI Partners bringing longtime CBRE industrial producer Gray Gilbert into the fold as partner earlier this year.

DEAL TRACKER

DALLAS—Artografx Inc. renewed its 12,960-square-foot lease at 10780 Shady Trail. Andrew Gilbert of Holt Lunsford Commercial represented the landlord, Prestonwood Building Services LP. Michael Chiocca of CBRE represented the tenant.

DALLAS—Trinet HR Corporation has extended its lease for 10,117 square feet of office space at Centura Tower I, 14185 N. Dallas Pkwy. Transwestern principal Duane Henley represented the landlord, Garden Centura. Andy Leatherman of JLL represented the tenant in the transaction.

DALLAS—Zeller+Gmelin Corporation has renewed its lease for 9,817 square feet of industrial space at Prologis Stemmons 11, 151 Regal Row. Transwestern vice president Timothy Veler represented the landlord, Prologis, in the transaction. Matt Elliott of NAI Robert Lynn represented the tenant.

DALLAS—DCS Residential leased 10,071 square feet at 9641-9677 Wendell Rd. Josh Barnes and Ben Wallace of Holt Lunsford Commercial represented the landlord, Red Tail Acquisitions. Brett Carr of Flintrock Commercial represented the tenant.

DENVER—Pathfinder Partners LLC, a San Diego-based firm specializing in value-add real estate investments, announced the sale of the historic Gold Star Sausage Factory building–now a completely modernized office and commercial complex–to an undisclosed buyer for $14.85 million. A former factory in the heart of Denver’s emerging River North/RiNo district, the Gold Star building is located at the corner of 28th and Walnut St.

DENVER—Holliday Fenoglio Fowler LP announces $83.03 million in financing for the development of Lakehouse on 17th, a 196-unit for-sale condominium project in Denver’s Sloan’s Lake neighborhood. HFF worked exclusively on behalf of NAVA Real Estate Development to place the floating-rate construction loan with a national bank. Lakehouse on 17th is located at 4202 W. 17th Ave. on the south side of the 177-acre Sloan’s Lake Park.

GRAND PRAIRIE, TX—Packaging Corporation of America renewed its 92,828-square-foot lease at 1305 Avenue H East. Canon Shoults of Holt Lunsford Commercial represented the landlord, Blackstone.

HOUSTON—NAI Partners recently arranged a 12,000-square-foot industrial lease for tenant Sentry Equipment Corp at 5285 Schurmier Rd. Travis Land and Darren O’Conor represented the landlord Cepak Holdings LP in the transaction.

HOUSTON—River Oaks Equity Partners, as exclusive advisor and agent, announces the sale of The Residences at Barbee Street located in the Inner Loop. The firm represented the seller and procured a qualified local investor to acquire the offering as a result of the firm’s marketing campaign. The Residences at Barbee Street is located at 2907 Barbee St.

HOUSTON—NAI Partners’ landlord services division has been named the exclusive leasing agent and property manager of 2550 North Loop West and 3131 West Alabama, two office buildings totaling approximately 225,000 square feet. Andy Parrish and Lesley Rice of NAI Partners’ office project leasing team will be handling the leasing duties for both buildings.

IRVING, TX—Paycom Payroll LLC has leased 13,789 square feet of office space at 125 at Water St., 125 E. John Carpenter Freeway. Transwestern principals Matt Hurlbut and Nathan Durham represented the landlord, KBS, in the transaction. Ryan McNaughton of JLL represented the tenant.

PLANO, TX—Ascent Surgery Center signed a new lease for 12,464 square feet of office space at 6957 Plano Pkwy. Transwestern principal Jeff Smith represented the tenant in the transaction. Ethan Garner of Welltower was the representative for the owner.

RICHARDSON, TX—Paranet Solutions LLC signed a new lease for 13,512 square feet of office space at Eastside Atrium, 800 E. Campbell Dr. Transwestern principal Michael Griffin and senior vice president Roy Reis represented the tenant in the transaction. Rick Currey and Pat Hanahan of Fobare Commercial LP represented the landlord, Skyrise Properties LLC.

RICHARDSON, TX—Inogen Inc. leased 22,905 square feet at 1380 Presidential Dr. Josh Barnes and Ben Wallace of Holt Lunsford Commercial represented the landlord, Red Tail Acquisitions.

RICHARDSON, TX—Ignite Partnership LLC renewed its lease for 7,133 square feet of office space at The Forum at Central, 2201 N. Central Expressway. Transwestern principal Justin Miller and associate Cohen Howard represented the landlord in the transaction. Bob Gibbons or REATA Commercial Realty Inc. represented the tenant.

RICHARDSON, TX—Triad Manufacturing Inc. renewed its 13,669-square-foot lease at 1352-1366 Exchange Dr. Josh Barnes and Ben Wallace of Holt Lunsford Commercial represented the landlord, ATCAP partners.

SPRING, TX—JLL’s capital markets secured $7.15 million in refinancing for The Shops at Spring Village, a fully leased retail center located just south of the Grand Parkway and Springwoods Village. Managing director Jimmy Board and analyst Connor Harrell led the JLL team on the financing on behalf of Capital Retail Properties. Goldman Sachs provided the fixed-rate non-recourse loan.

THE COLONY, TX—Panasonic Automotive Systems Company of America signed a new lease for 15,468 square feet of flex office space at Cascades at The Colony Building 4, 5904 Stone Creek Dr. Transwestern principals Joe Whitmer and Nathan Durham, and senior associate Emily Rankin represented the landlord in the transaction. Kyle Jett and Jamie Ragucci of Newmark Knight Frank represented the tenant.

WESTMINSTER, CO—KeyBank’s community development lending and investment team has provided a total of $49.7 million in financing to a joint venture among Koelbel and Company, Mile High Development and Longs Peak Advisors to support the new construction of Eaton Street Apartments, a 118-unit affordable housing development. Specifically, KeyBank provided a $24.8 million construction loan, a $14.1 million LIHTC equity investment and a $10.8 million Fannie Mae permanent loan. Jefferson County Housing Authority is a special limited partner.