A recent sale of an office building in McKinney has provided a comparison point for suburban and Uptown Dallas office property values. Kaizen Development Partners sold an eight-story, 190,000-square-foot office building at 7300 State Highway 121, which was completed in 2022 as part of the District 121 mixed-use development. The development also includes restaurants and a hotel.
The buyer, Eckard Enterprises, is an oil and gas company based in Allen. Colliers’ Randall Book, Jason Roth, and Jack Beare represented Eckard Enterprises in the transaction. According to Traded, the building sold for $66 million, or $346 per square foot. This price is less than half of what a comparable office property in Uptown Dallas sold for earlier this year.
In August, Cousins Properties of Atlanta purchased The Link in Uptown. The 292,000-square-foot building was delivered in 2021 and sold for $218 million, which equates to more than $746 per square foot. Another notable transaction involved Union Investment Real Estate selling the 2000 McKinney office property to Crescent Real Estate. The sale price exceeded the property’s valuation of $291.5 million for the 485,000-square-foot building, resulting in a price per square foot of around $600.
These transactions highlight that even high-quality suburban office buildings do not command the same prices as new properties in Uptown Dallas. Uptown has become a key area for built-to-suit office developments targeting financial services firms.
Office markets in North Dallas suburbs have seen strong performance as companies seek locations closer to where employees live. The Allen-McKinney submarket reported a vacancy rate of 20.1 percent, which is the lowest on the Dallas side of the Metroplex except for Preston Center’s rate of 7.9 percent, according to a report from Avison Young. In comparison, Uptown’s vacancy rate stands at 25.5 percent and has more than four times the office inventory of Allen-McKinney.
