Buchanan Street Makes Waves in Dallas
- Aug 19, 2015
Buchanan Street Partners has acquired Richardson Office Center I & II, a 238,301-square-foot campus located in Richardson, Texas, in a partnership with CarVal Investors from Principal Real Estate Investors, for an undisclosed amount.
This is Buchanan Street’s second purchase in the greater Dallas area in 2015, following its February acquisition of the 240,000-square-foot Granite Tower along the LBJ Freeway.
“If you look at Dallas, it’s one of the greatest job generators in our country today, and it’s expected to continue to be that way,” Tim Ballard, Buchanan Street Partners’ president & co-founder, told Commercial Property Executive. “Major companies are coming to Dallas so there’s tremendous demand and it really hasn’t been met with a lot of construction in the marketplace.”
Located at 3001 and 3101 E. President George Bush Highway, the campus is currently 90 percent occupied by high-credit tenants including Boeing, Genpact and Avnet. Richardson Office Center also boasts a parking ratio of six parking spaces per 1,000 square feet.
“Company-wide, we are looking to do two things. We invest in markets that aren’t gateway cities—like Dallas or Denver or Phoenix—a lot because we don’t have that much competition and get better value for it,” Ballard said. “The second thing we look for is markets we believe will help us from an economic growth engine standpoint and create demand for our real estate.”
According to Ballard, Buchanan Street plans to complete modest renovations to the two-building campus including painting the exterior of the buildings and making lobby upgrades.
“It’s modest. They were built in 1999 and 2000 between the two and we will bring them to a fresher standard,” he added. “Over time we will put in more capital.”
The Far North Dallas submarket has been experiencing strong positive absorption and growth in rental rates causing a wider-than-normal price gap compared to Richardson, so companies in search of better real estate value have moved to Richardson because of its affordability and projected growth. Ballard said the company will continue to buy in the area, with hopes of closing another $100 million in acquisitions there in 2015.
Gary Carr and Robert Hill of CBRE represented the seller in the transaction, and Buchanan Street represented itself.