Fortress increases office footprint as it invests heavily in DFW

After pouring hundreds of millions of dollars into a Dallas regional bank and investing in the new Texas Stock Exchange, Fortress Investment Group is expanding its office footprint in DFW. 

The private equity giant is adding a third floor to its existing two-floor spread at Weir’s Plaza, the Dallas Business Journal reports. The company already uses the seventh and eighth floors at the office, located at 3219 Knox Street in Dallas. The lease adds 20,000 square feet and brings its total at the building to 68,000 square feet. 

Fortress plans to build out the space to the tune of $4 million. Work is expected to begin in August and wrap up in February. The firm also has an office at 4550 Travis Street, according to its website. 

The company employs about 130 people in DFW, but has recently upped its stake in the Metroplex with a pair of significant local investments. 

Earlier this month, it led a group of investors that poured $228 million into First Foundation Bank, a struggling regional bank with significant exposure to commercial real estate. The investment comes in exchange for a 49 percent stake in the bank.

Fortress is among the power players predicting failures among banks exposed to commercial real estate.

“I expect to see more bank failures,” Steven Stuart of Fortress said in May. “Once you have a run on the bank, the FDIC will step in to take it over.”

Fortress co-CEOs Drew McKnight and Josh Pack touted the firm’s investment as a founding partner in the Texas Stock Exchange in an editorial in the Dallas Morning News last week. While the company has been in DFW for 22 years, it now considers New York and Dallas its co-headquarters, McKnight and Pack wrote. 

The firm could also be positioning itself to benefit from growing real estate distress in the Metroplex. As a lender, it has taken over a trove of troubled assets across the country in recent years. 

— Joe Lovinger

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