nnn investment sale - loopnet · asking gross rents were uptown/turtle creek ($39.29 psf), preston...

NNN INVESTMENT SALE

912 N FIELDER RD.ARLINGTON, TX 76012

Theron [email protected]

Casey [email protected]

PROPERTY SUMMARYBUILDING DETAILS912 N Fielder Rd, Arlington, TX 76012

Building § +/- 4,136 SF Total

§ Medical/Dental Building

§ 100% Leased

§ Built in 2003

§ Rock & Masonry Construction

§ Located on 1.185 Acres

§ Traffic Counts:

Location § Mid-Cities Market, Arlington/Mansfield Submarket

§ Zoned OC - Office Commercial - Intended to provide areas primarily for high-quality office development and selected retail uses that serve community andcitywide needs.

TenantInformation

§ Office of Amy E. Schoening, DDS, PC

§ www.pecanparkdental.com

Lease Details

PricingDetails

§ Ten (10) Year Lease Expires 2/28/2028

§ Two (2) Five (5) Renewal Options

§ NNN Lease

§ Landlord Responsible for Foundation, Exterior Walls, and Roof

§ Tenant Maintains Casualty Insurance & all maintenance

§ Purchase Price: $1,040,000

§ Cap Rate: 7.5%

§ Price/Sft: $251.45

PROPERTY SUMMARYPROPERTY PHOTOS

912 N Fielder Rd, Arlington, TX 76012

PROPERTY SUMMARYBIRD’S EYE912 N Fielder Rd, Arlington, TX 76012

PROPERTY SUMMARYAERIAL AND MAPS

912 N Fielder Rd, Arlington, TX 76012

PROPERTY SUMMARYFINANCIAL OVERVIEW912 N Fielder Rd, Arlington, TX 76012

TENANT Sq. Ft. PSF MONTHLY ANNUAL TERM

Amy E. Schoening, DDS 4,136 $18.86 $6,500 $78,000March 1, 2018 -

February 29, 2023

$19.80 $6,825 $81,900March 1, 2023 -

February 29, 2028

PRO FORMA

RENT $78,000.00

EXPENSE REIMBURSEMENTSTAX $11,701.60

TOTAL GROSSINCOME $89,701.60

EXPENSES TAXES $11,701.60

TOTAL EXPENSES ($11,701.60)

PRO FORMA SUMMARYNOI Years 1-5 $78,000NOI Years 6-10 $81,900

OV E RV IE W

DFW Unemployment Held Steady Near Historical LowDallas-Fort Worth added 114,900 jobs over the last year, a growth rate of 3.2% (315 jobs per day). The industries that recorded the largest gains were professional and business services adding 31,800 jobs, leisure and hospitality adding 16,300 jobs, and mining logging and construction adding 15,800 jobs. August’s unemployment rate for DFW was 3.6% compared to Texas (3.9%) and the U.S. (3.7%) (not seasonally adjusted).

Ten buildings were delivered in the third quarter bringing 1.1 MSF of new office space to the region. Twenty-eight buildings were delivered year-to-date creating over 5.0 MSF of office space. Although construction activity for new office space has slowed compared to the same quarter last year, there is still 7.7 MSF of space currently under construction. Over 1.2 MSF is expected to deliver during the fourth quarter of 2018 and over 6.2 MSF is expected to deliver in 2019. At the end of the third quarter, only about half of all space under construction is preleased.

DE M A N D

29th Consecutive Quarter of Positive AbsorptionNet absorption ended the third quarter at a positive 1.2 MSF, a significant increase from the previous quarter of 272,365 SF. The 12-month total net absorption recorded 4.7 MSF. Submarkets withthe largest positive absorption include Lower Tollway (431,108 SF),Denton/Lewisville (404,072 SF), DFW Freeport (302,241 SF), Frisco/The Colony (193,300 SF), and Allen/McKinney (125,158 SF).

Large move ins during the third quarter included Pricewaterhouse Coopers’ 190,000 SF at PwC Tower, Rolex’s 130,000 SF at their new headquarters, and 7-Eleven’s 115,000 SF at Browning Place I.

OFFICE MARKET

DFW Office Market Maintains Strong PerformanceOffice rental rates continue to climb

Q 3 2 0 1 8 | D A L L A S - F O R T W O R T H

TRENDLINES

5-YEAR TREND CURRENT QUARTER

J O B G ROW T H

81,100 jobs YTD3.2% annual growth in August

A BSO R P T I O N

1.2 msfAbsorption remains positive with 12-month total of 4.7 MSF

VAC A N C Y

16.7%Vacancy rates remain strong across all property classes

U N D E R CO N S T RU C T I O N

7.7 msf48 buildings are currently under construction at 46% preleased

R E N TA L R AT E

$25.64 psfOverall asking rates have increased 26% over the past five years

Absorption

Overall Vacancy

UC

Rental Rate

Job Growth

MARKET HIGHLIGHTSDFW OFFICETHIRD QUARTER 2018

MARKET HIGHLIGHTSDFW OFFICE

THIRD QUARTER 2018Q 3 2 0 1 8 | D A L L A S - F O R T W O R T H | O F F I C E M A R K E T

Q3 2018 | DALLAS-FORT WORTH | OFFICE MARKET | 2

VAC A NC Y

Vacancy Rates Slowly Inch Up The overall office availability rate (all space marketed as available for lease, both direct and sublet) decreased 30 basis points (bps) over the quarter, ending at 20.5%. Class A properties recored a decrease of 20 bps from mid-year of 22.5% to 22.3%. Class B properties also recorded a decrease of 30 bps from mid year of 19.6% to 19.3%.

Direct vacancy remained the same this quarter at 15.6%, up 30 bps year-over-year. Overall vacancy rose 60 bps year-over-year and ended the quarter at 16.7%. Class A properties saw direct vacancy increase by 10 bps over the quarter ending at 16.7%, while Class B properties recorded a 10 bps decrease ending the third quarter at 15.4%. Overall vacancy for class A properties were unchanged at 18.0% while overall vacancy for class B properties fell to 16.4%.

SU PPLY A N D DE V E LOPM E NT

Construction Still Hot At 7.7 MSFThe construction activity for DFW decreased from the previous quarter but continues to show strong growth ending the quarter with 7.7 MSF of projects under construction. The submarkets recording the largest space under construction are Mid-Cities, Las Colinas/Office Center, and Uptown/Turtle Creek. Notable office product currently underway include American Airlines Corporate Campus (1.7 MSF) in Mid-Cities, Pioneer Natural Resources (1.1 MSF) in Las Colinas/Office Center, and Charles Schwab Corporate Campus (500,000 SF) in Westlake/Grapevine. All three projects are 100% leased.

RE NTA L R ATE S

Asking Rates Edge Up To $25.64 PSFOverall asking rates for the DFW metro area increased by 0.3% over the quarter and 1.5% over the year, finishing the period at $25.64 PSF. Class A rates closed the quarter up 0.8% (+$0.24) year-over-year, ending at $28.97 PSF. Class B asking rates also increased by 3.8% year-over-year, ending at $21.35 PSF. The submarkets with the highest asking gross rents were Uptown/Turtle Creek ($39.29 PSF), Preston Center ($37.22), Frisco/The Colony ($32.59 PSF), and Northeast Dallas ($31.68 PSF).

Large Office Space Under ConstructionDallas-Fort Worth Metro | Q3 2018

SUBMARKET # OF BUILDINGS SF

Mid-Cities 3 1,840,000

Las Colinas/Office Center 1 1,125,000

Upper Tollway/Legacy 5 944,787

DFW Freeport 4 696,400

Uptown/Turtle Creek 3 683,992

Westlake/Grapevine 7 653,000

Northeast Dallas 1 294,820

Frisco/The Colony 3 286,126

Alliance 2 260,000

Denton/Lewisville 6 202,324

AVERAGE OFFICE RENTS Dallas-Fort Worth Metro Area Q3 2018

SOURCE: CoStar, Transwestern*Year-To-Date

$15

$20

$25

$30

Class BClass AOver All

18*17161514131211100908

OVERALL VACANCY Dallas-Fort Worth Metro Area Q3 2018

SOURCE: CoStar, Transwestern *Year-To-Date

100908 11 12 13 14 15 16 17 18*

14%

15%

16%

17%

18%

19%

16.7% Average

Q 3 2 0 1 8 | D A L L A S - F O R T W O R T H | O F F I C E M A R K E T


IN V E S TM E NT SA LE S

Sales Record A Small Dip In Q3 Dallas-Fort Worth recorded sales volume of approximately $1.3 billion across 40 transactions in the third quarter of 2018. Pricing on a per-square-foot basis averaged approximately $289/SF, considerably higher than the $230/SF recorded in the prior 12 months. The average cap rate increased to 7.3%, ranging from a low of 6.5% to a high of 7.9%.

Notable sales for the second quarter include Cityplace Tower of 1.4 MSF to Highland Capital Management, One AT&T Plaza of 965,800 SF to Dundon Capital Partners, Pier 1 Imports of 409,977 SF to Hertz Invest-ment Group, Granite Park VII of 322,917 SF to Union Investment Real Estate, and Nissan Motor Customer Center of 268,445 SF to Davidson Kempner Capital Management.

LE A SING AC TI V IT Y

Year-to-Date Leasing Activity Totals 13.9 MSFLeasing activity in the third quarter of 2018 recorded 4.2 MSF. Class A properties accounted for 2.6 MSF of leasing activity, and Class B recorded 1.6 MSF. The submarkets with the highest leasing activity in the second quarter include DFW Freeport (545,161 SF), Upper Tollway/Legacy (473,770 SF), Dallas CBD (403,838 SF), and Richardson (303,384 SF). Despite the current dip in overall leasing for the same period last year, there are approximately 19.5 MSF of deals currently seeking office space in the DFW metro.

Comparative Office Investment Sales Volume Select Metro Areas

SOURCE: Real Capital Analytics, Transwestern

SOURCE: Real Capital Analytics, Transwestern

Notable Q3 Lease Transactions

TENANT SF LEASE TYPE BUILDING SUBMARKET

Nokia Siemens Network 350,000 New The Sound at Cypress Waters DFW Freeport

Steward Healthcare 133,184 New Galatyn Commons D Richardson

Hewlett-Packard 106,325 New Platinum Park Upper Tollway/Legacy

Eating Recovery Center 101,608 New Parkside on Legacy Upper Tollway/Legacy

Beck 81,698 New Thanksgiving Tower Dallas CBD

Average Office Sale Price Dallas-Fort Worth Metro Area Q3 2018

*Year-To-Date

*Year-To-Date

Sale

s V

olu

me

in B

illi

ons

$0

$2

$4

$6

$8

$10

HoustonDenverDallasAtlanta

18*17161514131211100908

$0

$50

$100

$150

$200

$250

Average Sale Price Per SF

18*171615141312111009080706


MARKET HIGHLIGHTSDFW OFFICE

THIRD QUARTER 2018



OU TLOOK

Office Demand Remains Strong For North TexasEmployment gains have been widespread across all major industry sectors in the third quarter of the year bringing the total non-farm employment to 3.7 million, a yearly change of 3.2%.

According to the third estimate released by the Bureau of Economic Analysis, the U.S. gross domestic product (GDP) increased to 4.2% at mid-year of 2018, compared to the first quarter at 2.2%. The third quarter’s estimates point towards GDP dropping to the 3.1%-3.4% range.

Over the past 24 months, vacancy rates have continued to slowly inch up but remain moderately stable given the new supply that is being added to the market. DFW delivered 10 new office buildings during the third quarter bringing the year-to-date total to 5.3 MSF of new supply and more than 1.0 MSF is expected to deliver by the end of 2018.

Unemployment held steady near historical lows and stayed below the state and U.S. rates. Employment growth was the strongest in leisure and hospitality (4.0%), professional and business services (3.3%), and education and health services (2.8%). All major industry sectors recorded employment gains in the metro.

The U.S. Federal Reserve raised interest rates again by 0.25%, creating a target range of 2.0-2.25%. The interest rates remain relatively low, but another rise is expected by the end of year. Inflationary pressures and record levels of low unemployment continue to weigh on the Fed’s decision making and will dictate actions taken in the fourth quarter as investors wonder how high the Fed may go or signs its pace could continue to accelerate.

WHY OUR METHODOLOGY IS THE BEST INDICATOR OF CURRENT MARKET CONDITIONS

We include owner occupied and single-tenant buildings in our inventory, vacancy and absorption statistics to capture more market activity than many of our competitors. This allows us to better

correlate changes in the market with changes in employment. As single-tenant space does compete with multi-tenant space, we believe it is critical to understand all components of the market.

The inclusion of single-tenant and owner-occupied space tends to yield lower vacancy rates and higher absorption totals than some of our competitors’ results, but our coverage of the market

is more comprehensive.

SOURCE: Texas Workforce Commission*12-month job growth July 2018, net absorption YTD through Q3 2018

Office Absorption and EmploymentDallas-Fort Worth Metro Area Q3 2018

1

2

3

4

Payroll Job Growth (in Millions)

-1

0

1

2

3

4

5

6

7

Net Absorption (Millions of SF)

18*17161514131211100908



Fort Worth Office Market Indicators - Class A

Submarket Inventory Vacant SF Direct

Vacant SF Overall

Direct Vacancy

Overall Vacancy

Under Construction

Leasing Activity

Quarter Net Absorption

12 Month Net Absorption

Average Rental Rates

Fort Worth CBD 5,185,699 1,000,329 1,000,329 19.3% 19.3% - 48,016 (63,784) 130,107 $31.28

Northwest Fort Worth 40,000 - - - - - - - 40,000 $18.50

Alliance 1,098,694 180,450 180,450 16.4% 16.4% 260,000 - - 120,844 $22.27

Westlake/Grapevine 4,660,084 1,197,434 1,203,249 25.7% 25.8% 550,000 106,456 10,790 486,917 $28.53

Mid-Cities 352,780 125,524 125,524 35.6% 35.6% 1,700,000 22,389 4,287 24,101 $18.88

Northeast Fort Worth 459,921 307,280 307,280 66.8% 66.8% - 63,237 (145) 32455 $21.39

Arlington 2,087,636 304,254 314,949 14.6% 15.1% - 40,299 (41,167) 27,557 $22.33

Southeast Fort Worth 541,630 - - - - - - - - -

Southwest Fort Worth 3,396,053 168,703 196,351 5.0% 5.8% - 55,739 29,091 349,223 $29.11

TOTAL - FORT WORTH 17,822,497 3,283,974 3,328,132 18.4% 18.7% 2,510,000 336,136 (60,928) 1,211,204 $27.10

Dallas-Fort Worth Office Market Indicators - Class A

Inventory Vacant SF Direct

Vacant SF Overall

Direct Vacancy

Overall Vacancy

Under Construction

Leasing Activity




TOTAL - DFW 157,031,894 26,194,010 28,270,177 16.7% 18.0% 7,183,404 2,623,974 656,891 6,269,564 $28.97

Dallas-Fort Worth Office Market Indicators

Inventory Vacant SF Direct

Vacant SF Overall

Direct Vacancy

Overall Vacancy

Under Construction

Leasing Activity




ALL SPACE 310,339,524 48,336,001 51,856,059 15.6% 16.7% 7,736,622 4,245,222 1,154,853 4,721,699 $25.64

CLASS A 157,031,894 26,194,010 28,270,177 16.7% 18.0% 7,183,404 2,623,974 656,891 6,269,564 $28.97

CLASS B 136,155,824 20,936,234 22,378,625 15.4% 16.4% 553,218 1,557,622 520,190 (1,663,989) $21.35

SOURCE: CoStar, Transwestern

NOTE: Includes buildings 20,000 SF RBA and greater.


TRANSWESTERN FORT WORTH777 Main StreetSuite 1100Fort Worth, Texas 76102

www.transwestern.com/fortworth

ph 817.877.4433fax 817.870.2826

nnn investment sale - loopnet · asking gross rents were uptown/turtle creek ($39.29 psf), preston...

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