It’s one of the largest property trades in the country this year. But that doesn’t mean it’s good news for the U.S. office market.
Former Phoenix Suns owner Robert Sarver purchased the fully leased CityLine office campus in the Dallas suburb of Richarson for $580 million, CoStar reported. It last traded in 2016 for about $822 million — a nearly 30 percent plunge in price in just seven years. The sellers are South Korea-based Mirae Asset Global Investments and Houston-based Transwestern Investment Group.
The 2.2 million-square-foot complex comprises four buildings and is located at Bush Turnpike and Plano Road. The deal also included 120,000 square feet of retail space and a 42,000-square-foot medical office.
The complex sold for $264 per square foot, a drop from $374 per square foot in 2016.
The 30 percent price drop is about on par with national office market pricing trends, said Steve Triolet, who heads research and market forecasting at Partners Real Estate.
The complex’s anchor tenant is State Farm Insurance, which fully leases the site’s high-rises. Aerospace company Raytheon Technologies also has an office at CityLine.
There’s about a decade left in State Farm’s lease, and the complex is fairly new, so it’s surprising the discount was as large as 30 percent, Triolet said.
Despite a 64 percent year-over-year decline in commercial sales, Dallas-Fort Worth ranked first in the nation in the first nine months of 2023 with $13.2 billion in commercial real estate investment. The majority of that came from apartment sales.
In addition to his work in real estate, Sarver founded what would become the National Bank of Arizona, which sold to Zions Bancorporation in 1994. He sold the Suns and the Phoenix Mercury WNBA team in 2022 after the NBA suspended him and fined him $10 million following an investigation into allegations of racism, misogyny and workplace misconduct.
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