Creation is pairing up with PGIM Real Estate to turn trash into treasure.
The joint venture started construction on a 600,000-square-foot logistics hub, according to a news release. The project, 635 Exchange, is rising on a 36-acre plot that used to be a City of Dallas landfill. It’s expected to be delivered next fall.
Dallas-based developer Creation and PGIM, the asset management arm of Prudential Financial, landed a $65.5 million construction loan for the project in recent months, D Magazine reported. JLL Capital Markets arranged the financing.
The three-building hub will be at the nexus of Interstates 35 and 635 in northwest Dallas. The old landfill was at 11535 Newberry Street. The location offers easy access to DFW International Airport.
At the groundbreaking celebration, Creation made a $25,000 donation to vocational school CLC Inc.’s YouthBuild project, which provides education and job training to at-risk youth.
PGIM’s Soultana Reigle expects the timing of the project to allow it to “benefit from structural tailwinds in supply-chain optimization and e-commerce demand.”
Though its vacancy rate ticked up in the third quarter, Dallas-Fort Worth’s industrial market is strong. The region logged its 60th consecutive quarter of positive industrial space absorption, according to CBRE.
Less than 3 percent of third-quarter deliveries were pre-leased, which caused the vacancy rate to rise 20 basis points in the third quarter to 9 percent. But that figure is expected to drop again, since the percentage of pre-leased products in the pipeline increased from 18.4 to 40 percent by the end of the third quarter.
Manufacturing drove most of the quarter’s leasing demand. The most in-demand industrial submarkets in the region are South Dallas and Northwest Fort Worth, which is home to AllianceTexas, Hillwood’s 27,000-acre mixed-use development and logistics hub.
