Posted on 05/14/2024 9:25:08 AM PDT by Miami Rebel
The tallest building in Fort Worth has a commanding position in the city’s skyline, but the 1M SF building only commanded a price of about $12 per square foot at a foreclosure auction.
The price per square foot amounted to less than 10% of the previous sale price for Burnett Plaza, which at 40 stories towers over the other buildings in Fort Worth.
The winning bidder was one of Burnett Plaza’s lenders: Pinnacle Bank Texas bought back the building at this month’s auction with a bid of $12.3M, according to a report in the Dallas Business Journal.
The previous owner, an affiliate of NYC-based Opal Holdings, defaulted on a $13M loan from Pinnacle and set off a foreclosure of Burnett Plaza, which is located at 801 Cherry Street, the report said. Opal bought for tower for $138M in 2021.
The Tarrant Appraisal District has assessed Burnett Plaza’s taxable value at about $104M.
Pinnacle took a second property back from Opal in an auction this month when the bank bought the Centerpoint office complex, a four-building campus encompassing 450K SF at 600 Six Flags Drive in Arlington, the report said.
The vacancy rate in the Dallas-Fort Worth office market hit 25.8% in the first quarter as net absorption again was negative at minus 620K SF, according to a market report from CBRE.
There is now more than 59M SF of vacant office space spread across DFW, the report said.
“Unlike prior quarters, Class A properties fueled negative net absorption in Q1 2024,” CBRE said.
The office-using industry sectors in DFW decelerated significantly in the first quarter as three sizeable deliveries pushed construction activity below 5M SF. Leasing activity for deals 10K SF and larger dropped by 33% in the first quarter compared to Q4 2023, the report said.
River Edge and Thirteen Thirty Three, office projects in the Stemmons Freeway submarket, delivered a total of more than 270K SF in combined Class A office space in the first quarter of which only 4% of the space was preleased at the time of completion.
On the brighter side, CBRE reported that large tenant requirements continue to grow compared to the previous quarter and the previous year. This metric tracks occupiers who are actively in the market for new space, lease renewals and expansions.
The bank just made a very good deal.
Someone likely found a better situation to launder their money.
Soviet 70s chic is not popular? Who knew?
-Homer and Jethro
Set up a profitable one million square foot migrant housing facility. Uncle Sugar will pay the rent.
I hope that’s sarcasm, but I can’t be sure.
REO for pinnacle bank on the cheap
It’ll come back in Dallas little sis soon enough
We TARPed Nashville based pinnacle bank from certain oblivion in 2008when they were done for (I’m friendly with a top five in that bank and I bitch to him too)
Nobody tarped Opal
holdings out of debt
Funny how that works isn’t it
The vacancy rate in the Dallas-Fort Worth office market hit 25.8% in the first quarter
I wonder what it is in America’s top 30 Cities....
NYC
DC
Chicago
Dallas
LA
SFO
Philly
etc....
WWW.bidenomics.com
Too many commercial real estate towers in big cities are averaging 50% vacancy. This is not sustainable. These properties are highly leveraged. The owners traditionally make their money by borrowing on the equity and flipping properties. Works well when demand was high and rents and values seemed to always increase.Problem is now there is not enough rental income to cover the loans and interests rates are rising. Banks are hurting, urban real estate taxes are down as is ridership on most urban public transportation networks. The silicon chip has made central, urban commercial centers non essential. You can conduct most business from anywhere.
Not even relatively conservatives regions are immune to Bidenomics.
I’m in Ft Worth and the central business district construction rate is insane. Most of the new construction is residential high-rise and medium-rise apartments. I know that the demand is not THAT high for residential units, considering the rent for one is insanely high. People have cars and don’t need to walk to work. I’m predicting 50% occupancy tops.
Yeah, it’s completely unsustainable.
Opal would never have qualified for TARP. It’s a private investor, not a bank.
Yes
My post was bitterness and sarcasm
Ah ha ha ha ha!!!
138 million to 12 million in just the 3 years of Bidenomics.
Coming soon to the largest city in the State of New York.
Retail and office space prices are sliding. The flip side is residential, which is why we’re seeing a boom in office-to-residential conversions.
I realized I could do my job better and more efficiently working remote, which I believe many people could. What did my previous employer learn from this? Nothing. They added office square footage, bought new furniture cramming people closer to gether, which made no sense after Covid.
I now work REMOTELY for another firm in another state and we both couldn't be happier. There is no reason for people to have to work in an office if they could accomplish their job remotely.
Coorporate offices are on their way out, they just don't know it yet.
They paid $138 mil for this at a time when most people were still working remotely? Idiots.
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