KBS Scores 400,100-SF Dallas Cowboys Distribution Center
- Jul 13, 2010
July 13, 2010
By Barbra Murray, Contributing Editor
Newport Beach, Calif.-based KBS Realty Advisors’ KBS Real Estate Investment Trust II fund has acquired the Dallas Cowboys Distribution Facility in Irving, Tex. The 400,100-square-foot warehouse is fully leased to companies related to Dallas Cowboys merchandising activities.
Carrying the address of 2500 Regent Blvd., the Dallas Cowboys Distribution Center occupies a 22-acre parcel within the 500-acre Dallas Fort Worth International Commerce Park, a master-planned business park development endeavor spearheaded by Dallas-Fort Worth International Airport. DFW Airport is larger than the island of Manhattan and DFW Airport officials’ original rationale for developing the park was to land the shuttle. Now the site is being developed to draw in companies seeking premium space near airport transportation and the benefits that come from a location within a foreign trade zone.
Developed by Bandera Ventures Ltd. in 2009, the state-of-the-art two-story building serves as the Cowboys’ merchandising headquarters, with Dallas Cowboys Merchandising Ltd., Dallas Cowboys Pro Shops L.P. and Blue Star Graphics and Design making their home at the site. The tenants lease the space at a cost of $3.86 per square foot, for a total base rent of $1.5 million. KBS shelled out $19 million for the property acquisition, which includes a 40-year ground lease.
Commercial real estate services firm CB Richard Ellis represented the seller in the transaction, while KBS relied on internal representation. “There was a ton of interest in the property,” Josh McArtor, senior vice president with CBRE’s Institutional Group, told CPE. “A lot of people want to have a piece of the Cowboys. They’re buying a piece of the Cowboys enterprise and they’re getting a credit tenant.”
And the facility is much more than an industrial property. It features retail space and, with a full data center, “serves as the technological nerve center that runs and backs up the distribution center, Cowboys Stadium and Valley Ranch [team headquarters],” McArtor said.
KBS’s purchase of the Dallas Cowboys Distribution Facility dovetails with anticipated investment trends in the Dallas-area industrial market. As market conditions begin to stabilize in the second half of the year, institutional investors will have high quality properties with stable tenancy on their radar, and opportunity investors will pursue well-located properties with occupancy challenges or financial issues, according to a second quarter report by commercial real estate research firm Delta Associates.