Texas Could Become Key US Market for TradeLane Properties With New Office

Candace Carlisle | Costar News

A privately held investment and development firm for industrial real estate is making its first foray into Texas with a new office in Dallas-Fort Worth, the nation's fourth-largest metropolitan area, with plans to focus on the region as it grows its U.S. portfolio.

TradeLane Properties, based in Oakbrook, Illinois, about 20 miles outside Chicago, hired David Castro to lead the Dallas-Fort Worth office as senior vice president and market leader.

David Castro is leading TradeLane Properties' efforts to build its industrial portfolio in the Dallas-Fort Worth area. (TradeLane Properties)

Castro has worked for decades in the region in industrial real estate and most recently was an executive vice president at Dallas-based brokerage firm ESRP. He also previously worked at DCT Industrial and Cushman & Wakefield.

"Demand continues to outpace supply," Castro said in an interview with CoStar News. "We are looking at one investment opportunity after another, touring buildings and looking at all types of industrial real estate. We are a creative company and we are looking for ways to create value."

The Dallas-area office is in Richardson in space that coworking provider Communion Neighborhood Cooperative transformed from a once industrial-looking automotive station into a trendy workspace.

The move comes as the company is launching its second investment fund, TradeLane Properties U.S. Industrial Fund II. TradeLane Properties plans to use the newly launched fund to invest in multiple markets throughout the central United States with a focus on the North Texas area, Castro said.

"We have the capacity to be quick to market and get the deals we like, with my goals including building a portfolio here and starting to hire," he said.

In the next year, Castro said, the firm is seeking to deploy $100 million in Dallas-Fort Worth, with a deal size of $5 million and up. Initially, he expects to hire a construction manager and leasing executive in 2021.

Dallas-Fort Worth is one of the top-ranked industrial markets in the United States, leading the nation in terms of new construction, according to CoStar's market analysts, with 32.3 million square feet of new space in the pipeline. That's more construction than the Phoenix and Memphis markets combined, CoStar's market analysts say.

Castro said most of the industrial real estate in the region is largely owned by small investors rather than big real estate investment trusts or institutional investors.

"It's astounding how many industrial assets in the region aren't owned by REITs or the typical institutional landlords," he said. "Only about 90%-plus are owned by smaller local investors or are unoccupied properties."

He said he plans to look at both on-market and off-market deals, with some of those potential off-market deals coming through his prior relationships while working at DCT Industrial in Dallas-Fort Worth. TradeLane Properties was founded two years ago by former DCT Industrial executives, including John Gates Jr. and Neil Doyle, after Prologis acquired the company in an $8.4 billion deal.

Full Article: CoStar News