SkyWalker Property Partners has closed on its largest acquisition to date for its value-add fund, When Opportunity Knocks, buying a 227,891-sf office building with clear visibility from all levels of the High Five interchange in North Dallas.
The fund's newest property is an eight-story, multi-tenant building at 8151 LBJ Freeway, Dallas. The buyer plans to invest at least $500,000 into upgrading, rebranding and reintroducing the class B office building, formerly Crosspoint Atrium, to the market.
Gary Walker and Clint Holland of SkyWalker Property Partners handled negotiations for the buyer of record, Crosspoint My Heart LLC. HFF represented the seller, the Credit Union of Texas, which has leased back 110,876 sf of its former headquarters building.
The "atrium-style" structure was developed in 1981 on a 3.4-acre tract at the edge of Park Central. It is strategically positioned at the intersection of Central Expressway and LBJ Freeway and less than two miles from Richardson, one of the office absorption leaders in Greater Dallas at the end of Q4 2018. It's also situated in familiar territory for Walker, who grew up in Richardson and understands the LBJ submarket's dynamics.
"We will make this the top affordable option, a quality B in a class A submarket," Walker says. "It's a well-located office building with easy freeway access, which bodes well for our tenants' talent recruitment efforts both close-in and cities farther out to the north, east and west."
The Credit Union of Texas will maintain its 2,450-sf bank branch in the lobby, inking a 10-year lease to do so, and has made a seven-year commitment for two floors totaling 54,668 sf for its servicing divisions. The financial institution also has signed a nine-month lease for 53,758 sf to build in time to complete its headquarters relocation.
The building was 53% leased at sale time after the credit union's space realignment, which has freed up 30,137 sf on the penthouse floor along with the opportunity for top-of-the-building signage. The project is supported by 247 surface parking spaces on its land and 492 leased garage spots. Holt Lunsford Commercial has been retained to lease and manage the asset for the new owner, who is starting out the investment with five tenants in place for the long term and ample space to lease at market rate.
"Our goal is to be the nicest value alternative for tenants in this submarket," says Holland, acquisitions director for North Texas-based SkyWalker Property Partners.
In recent years, the credit union had invested nearly $2.4 million into infrastructure improvements, including all mechanical systems. The buyer's renovations will target tenant amenities and aesthetics. Creating an inviting tenant lounge and a flexible and functional conference center are foremost. Updates also are planned for the 1980s-era lobby and deli, including the daily menu. Entos Design of Dallas is the project architect.
"We want to provide what the market tells us they want and need," Holland adds.
The value-add fund's seventh acquisition was seller-financed. "We got a good property at a significant discount to replacement and upside in below-market vacancy," says Walker, who is sourcing potential buys in Texas and surrounding states.
SkyWalker Property Partners identifies, underwrites, acquires and executes highly opportunistic and value-add investments on behalf of When Opportunity Knocks LLC and Cash Flow Fever LLC, funds formed in 2017 to build a $200 million portfolio of office, industrial and retail properties in Texas and surrounding states. The strategy targets transactions from $2 million to $15 million. Additional information about the investment group is available at www.SkyWalkerProperty.com.
