Uptown – Dallas Morning News

Published: February 3, 2023

17-story Uptown office tower set for Dallas’ McKinney Avenue

Dallas Morning News | Steve Brown | February 3, 2023

With the newest office buildings north of downtown Dallas filling up, developers are in a rush to bring new high-rises to the market.

Stonelake Capital Partners is joining the fray with plans to build a 17-story, 180,000-square-foot office tower on McKinney Avenue.

The building at 2626 McKinney would open in mid-2025 on a site across the street from Whole Foods Market. The property is now occupied by a low-rise office.

“Being next door to Whole Foods and walking distance to The Crescent and Ritz-Carlton, 2626 McKinney will provide the full spectrum of offerings for tenants who want to be in the urban core of one of the most dynamic markets in the country,” Stonelake Capital partner Coleman Brown said.

The glass-clad high-rise will feature an 11th-floor amenity level with tenant lounge, conference and event space, fitness center and landscaped terrace with views of the Dallas skyline. The penthouse suite will have a 2,300-square-foot private terrace.

Brown described it as having a “boutique, white glove feel.” Beck Group designed the project.

Matt Schendle and Zach Bean of Cushman & Wakefield are marketing the offices to prospective tenants.

Stonelake Capital Partners acquired the property in 2021. Office buildings completed since then in the area north of downtown have rented ahead of schedule and at higher rental rates.

Average quoted office rents for new buildings in the Uptown area now top $50 per square foot – more than double the rents in older buildings in some Dallas business districts.

The track record for recent projects is overwhelmingly positive.

The 12-story Weir’s Plaza office on Knox Street at the edge of Highland Park was fully leased when it opened at the start of 2022.

The newest Uptown office building – the 25-story Link at Uptown at 2601 Olive St., which opened last year – is almost fully taken by tenants including law firm McGuireWoods, financial firm Houlihan Lokey, PMG Worldwide, Shearman & Sterling and Newmark Group.

Developer Harwood International’s 27-story Harwood No. 14 office tower being built on Harry Hines Boulevard north of downtown is now more than three-fourths rented thanks to an expansion by law firm Haynes and Boone. That building opens later this year.

The 26-story 23Springs office tower is under construction across from The Crescent on Cedar Springs Road. Bank OZK — formerly Bank of the Ozarks — has signed a lease for more than 110,000 square feet of space in the project and is providing construction financing for the development.

The tower will include more than 626,000 square feet, making it the largest office project so far in the works for Uptown.

The 12-story Quad office tower being built near McKinney Avenue has already landed its first tenant – Chicago Title. The 335,000-square-foot office building is part of the $100 million redevelopment of the Quadrangle retail and office center.

Developer Hines is including more than 150,000 square feet of office space in its redevelopment of the landmark Maple Terrace building on Maple Avenue.

Other Uptown office tower projects are being eyed by developers, including Lincoln Property Commercial, KDC and Austin-based Endeavor Real Estate Group.

At the same time, developer Trammell Crow Co. has delayed a construction start on its planned $200 million McKinney Avenue office high-rise.

The 2626 McKinney office tower is just one of several projects Stonelake Capital Partners has in the works. In Deep Ellum, the commercial real estate firm is developing a residential tower on Taylor Street near Interstate 45.

Stonelake Capital is also developing the mixed-use Trinity Green project on Singleton Avenue in West Dallas and is partnering on the future development of the two-block El Fenix restaurant site on Woodall Rodgers Freeway near downtown.

The almost four-acre development site is across the street from where construction is starting on Goldman Sachs’ new regional office campus, which will house thousands of workers.

Stonelake, founded in 2007, has completed or has on the way 28 million square feet of warehouses, 8,100 multifamily units and 3.3 million square feet of office buildings. It targets properties in Austin, Dallas, Houston, Atlanta, Nashville, Phoenix, Tampa, Orlando, San Antonio and El Paso.

McKinney Avenue has seen a flurry of building construction during the last decade.