Toys R Us Vacancies Are Not So For Long
Murdoch Capital LLC and Parkway Partners, two Houston-based privately held real estate investment companies, formed a joint venture for the acquisition and redevelopment of the former Toys R Us.
McALLEN, TX—With significant redevelopment potential, a former Toys R Us property sits on 4.5 acres and maintains strong visibility at a high traffic intersection in addition to being adjacent to La Plaza Mall, a popular shopping destination in the Rio Grande Valley. Located at 1101 W. Expressway 83, the 45,500-square-foot box became available when Toys R Us ceased operations after declaring bankruptcy earlier this year.
Murdoch Capital LLC and Parkway Partners, two Houston-based privately held real estate investment companies, formed a joint venture for the acquisition and redevelopment of the former Toys R Us.
“McAllen has a strong reputation for high retail sales volume, so we jumped at the opportunity to purchase this site as soon as it became available,” said Jonas Fertitta, founder and managing principal of Murdoch Capital.
Redevelopment plans for the property have not yet been finalized, but Murdoch Capital and Parkway Partners have received positive feedback in the preliminary stages of marketing the property
“Not only is it a hot market with tons of job growth, foot traffic and potential, but the city has been great to work with through this entire process,” Fertitta tells GlobeSt.com.
With major dining and entertainment destinations nearby such as Yard House, H&M, Texas de Brazil and Carlo’s Bakery, the surrounding area is continuing to flourish as a result of its affordability coupled with its close proximity to the Mexican border which is instrumental in driving growth.
“When you see such a vibrant retail market like McAllen, one where existing tenants are opening additional locations and new tenants are constantly entering the trade area, it’s really encouraging,” said Brian Kaplan of Parkway Partners.
Not to be outdone, McAllen’s industrial market also ended 2018 on a high note. Fourth quarter net absorption increased compared to the previous quarter and pushed the annual net absorption 230,000 square feet above the total for 2017. The quarter closed with users seeking almost 1.6 million square feet of space. This is only 111,000 square feet less than the total available square footage and more than double the total vacant square feet in the market.
The market-wide vacancy rate also declined to 2.4%, a new record low. Class-A product had a vacancy increase due mainly to one new vacancy of 76,000 square feet.
The overall industrial average asking rate declined quarter-over-quarter by $0.12 per square feet while the warehousing and manufacturing space asking rate increased by $0.07 per square foot.
“McAllen is a diverse and complex city with tremendous growth opportunities, thanks to our strong ties to South Texas and northern Mexico, which draws shoppers, visitors, tourists and more to our community,” said McAllen mayor Jim Darling. “As the retail hub for our region, McAllen continues to be a smart choice for investors.”