400,000-SF Office Planned for Victory Park

Last Updated: February 16, 2012 07:17pm ET

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A 400,000-SF office building is
planned for Victory Park.

DALLAS-In its first project since taking complete ownership of the 75-acre, mixed-use Victory Park, Estein & Associates USA Ltd. of Orlando, FL has announced plans for a 400,000-square-foot, class A office building on the site near Dallas’ CBD. Estein has partnered with local KDC on the project, and assuming preleasing goals are met, construction could launch as early as fall, 2012, with completion scheduled for late 2014.

KDC senior vice president John Brownlee tells Globest.com that the building, which will go north on Victory Park Lane, will be 50% committed before construction begins. “There are a number of prospects in the market now, approaching us and other developers for new projects,” Brownlee says. “I’m not at liberty to say who, but I can say there is a strong deal flow of people out there looking for space.”

And when it comes to this commercial real estate development, there is little office space to be had. Though Victory Park developer Hillwood underwent a great many issues with the project in the depths of the financial crisis, the office space, which totals approximately 691,180 square feet, was quietly being leased up. The space today is 95% leased.

Brownlee says the idea for an office building at Victory Park was discussed around six months ago, when a client approached KDC with a build-to-suit suggestion for the piece of land. “That’s when we really began discussions about that particular site and got to know the Estein people,” Brownlee remarks.

The 23-story office building itself will offer its own amenities, including an upscale restaurant, fitness center and delicatessen. BOKA Powell will serve as the project architect, and KDC will pursue LEED certification from the U.S. Green Building Council for the project.

The residential component at Victory Park has done well, too, with complexes 98% leased and the W. Dallas-Victory Condo residences 94% sold. Though the 28-story condo tower, known as The House, was recently sold back to its lender for $32 million at a foreclosure auction, Lance Fair, COO of Estein & Associates and vice president of Victory Park points out that The House was delivered during the height of the financial crisis.

“We couldn’t sell those at a lower price,” he explains. “But now someone else can do so, and can get the building filled up.” And that, Fair says, is the goal right now of Victory Park. “Density on a 24/7 basis,” he comments.

When Hillwood broke ground on Victory Park during the late 1990s, the idea was create a kind of an urban renewal oasis at the northern edge of downtown. Anchored by American Airlines Center, Victory had initial success before running into problems in 2008 due to dropping retail occupancy and a lack of demand for luxury housing. In 2009 the Hillwood stake went to German equity partner, US Treuhand XVI LP, a process that avoided certain foreclosure.  US Treuhand GmbH is an affiliate and fund-raising arm of Estein & Associates USA Ltd.

Though the current retailers at Victory have done well, Fair says E&A’s main goal for Victory right now is to ensure office and residential stability. With more density in the area, retail will be better supported. As such, in addition to the new office project, a multifamily project is also in the works.

But Fair is clear there is no set-in-stone deadline about when everything will be built. “We’re patient about making sure things happen in the right order and right time,” Fair says. “We’re committed to this project over the long term, and want to make it an iconic destination in Dallas.”

Categories: Southwest, Office, Development, Dallas/Fort Worth

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400,000-SF Office Planned for Victory Park