COVER STORY, SEPTEMBER 2012

BEHIND THE SUCCESS
TOBY-winning industrial park turns the corner after years of decline.
John Nelson

Not many commercial properties are publicly recognized for a successful repositioning. Most owners and managers are more than happy with increased occupancy and a boost in revenue following a revamp.

Turnpike Distribution Center, a 16-building industrial park totaling more than 2.8 million square feet, has undergone an extensive retrofit, a $1.7 million upgrade to its exterior and a major infrastructure change-up giving the park immediate access to Interstate 30 via Cockrell Hill Road, plus newly paved roads within the park.

Turnpike’s manager, Dallas-based Holt Lunsford Commercial, and owner, Principal Real Estate Investors (PREI), would have been content simply with the park’s successful makeover. But the Building Owners and Managers Association (BOMA) had something else in mind for the development.

Turnpike Distribution Center has racked up accolades from BOMA and was recently honored with The Outstanding Building of the Year award (TOBY) in the industrial office park division, an international distinction.

“Only the best of the best even enter into the competition, so to win an award at the local or regional level is an exciting validation of our efforts, but to win at the international level is humbling,” explains Mary Leerssen, vice president of management services with Holt Lunsford Commercial. Leerssen led the firm in its bid to be recognized by BOMA.

Before Turnpike won the TOBY, the park had some serious challenges to overcome and needed the help of several entities to realize its revamp.

AROUND THE BLOCK
Turnpike was developed in the early 1980s by Trammell Crow Co. along I-30 and Loop 12, approximately three miles outside of downtown Dallas. The development was considered state-of-the-art at the time but deteriorating roadways and water lines became a blight to the property.

Not to mention that tenants were leaving the center to occupy space in Pinnacle Park, a business park located across the interstate from Turnpike.

“Pinnacle Park became a project for the various local and state government entities,” explains John Gorman, principal of industrial division of Holt Lunsford. “Local economic development wanted Pinnacle to be a stimulus for new business opportunities.”

Pinnacle Park obtained direct access to I-30 in its initial design, but Turnpike remained left behind until Holt Lunsford took the reins as managers.

Turnpike’s declining infrastructure and the loss of tenants to the new neighboring development served as catalysts for Gorman’s appeal to local government authorities for what Pinnacle Park had and Turnpike lacked: decent roads and immediate access to I-30.

Ironically, Turnpike previously donated a small portion of land for the Cockrell Hill Road exit ramp yet remained out of the government authorities’ plans benefiting Pinnacle Park. While attempting to get deteriorating road conditions addressed by the City, Gorman discovered the future thoroughfare plan to extend Cockrell Hill Road north into Turnpike.

This led Gorman to approach the City of Dallas and ask for better roads and access to I-30 in order for Turnpike to keep its existing tenants and attract new ones. He argued that the city wasn’t achieving its goal of creating an economic engine in Pinnacle since the park was simply taking tenants away from Turnpike instead of bringing new businesses to the area.

A LONG TIME COMING
The lobbying effort for the infrastructure upgrades began in August 2001.

Gorman presented the case of Turnpike’s deteriorating streets before an assembly of the City of Dallas, Public Works & Transportation and the Office of Economic Development, which kicked off an 18-month lobbying effort. Gorman asked for assistance in repairing Turnpike’s roads and adding interstate access to the park. He went so far as to take photos of the deep potholes himself as part of the presentation.

The presentation went well and the project was put into the city’s Needs Assessment as a Tier 1 project and was put on the 2003 Capital Bond Improvement Program, allotting $8.5 million to $9 million for infrastructure repair.

The Cockrell Hill road extension that would give Turnpike highway access was a joint venture between the City of Dallas and Dallas County. Since the City of Dallas had placed the project on its bond initiative, Gorman went to Dallas County to ask about their end of the deal, and what he heard wasn’t the most promising news.

“They told me it’s not due to happen for years, four years at the very least,” remembers Gorman.

Instead of postponing the project for that long, Gorman approached PREI about partially funding the road extension and then be reimbursed down the line. As with most government contracts, the reimbursement wasn’t guaranteed, but PREI and Holt Lunsford were confident in the decision to fund the project.

“We had to look at our $1.2 million investment as a capital investment and it made sense for us to get that access to I-30,” says Gorman.

Gorman also had to get the green light from Dallas County to fund a public project with private funds. Both sides agreed to terms and the public/private venture was a first for the county.

“We ended up doing — and I’m shocked looking back at it — the first advanced funding agreement ever with Dallas County,” says Gorman. “We put up private sector money to expedite a project being done years in advance.”

Cockrell Hill Road’s extension was completed in 2004, years ahead of schedule. PREI also wrote a $600,000 check to expedite the construction of La Reunion, the main thoroughfare that runs through Turnpike. PREI was reimbursed for the projects in 2008.

One of Turnpike Distribution Center's 16 building exteriors following the $1.7 million renovation.

The new Cockrell Hill Road entrance became Turnpike’s main portal and it changed the orientation of the park. The extension also changed the makeup of the surrounding area.

“The change was dramatic, it gave birth to opportunities like the restaurants, stores and hotels,” says Gorman. These new developments include Sonic, IHOP, Staples, Conn’s, KFC, Taco Bell, Hampton Inn, Comfort Suites and a Shell gas station. Gorman and tenants of Turnpike were pleased to have these stores and hotels nearby, as well as decent roads to drive on.

“Just to have smooth roads you could drive up and down was a great value, but the subsequent retail additions were appreciated as well,” says Gorman.

Following the massive infrastructure project, Holt Lunsford launched an exterior makeover to the park in 2007. The $1.7 million renovation included adding stone accents and a modern color palette to tie in the entire park. More recently, the park had an exterior and interior lighting retrofitting totaling more than $400,000.

The improvements to the 30-year-old property and its success helped spur Holt Lunsford’s Leerssen to enter the park into BOMA for consideration in the industrial park division.

BRING ON THE HARDWARE
BOMA’s TOBY award is considered one of the highest honors a commercial property could possibly win. BOMA judges all facets of a building, including its operations and initiatives. The award consideration is time-consuming, so Leerssen and the rest of Holt Lunsford Commercial didn’t submit Turnpike lightly.

“The entire process lasts a minimum of a year, so needless to say a full commitment from the entire management team is required to even enter in to the competition,” explains Leerssen. “The process includes a rigorous inspection of every inch of your building, not just the ‘pretty parts,’ as well as the preparation of a book which will tell the complete story of the building.”

BOMA looks at how the building and its management team impact the community, its tenant relations programs, energy conservation efforts, sustainability programs, emergency preparedness, security standards and continued education for the management team and tenants.

Holt Lunsford highlighted the property’s on-site management and leasing offices, its 24/7 security, rail access, DART bus stops, tenant newsletters, recycling drives, golf outings and charity events.

BOMA thought highly of Turnpike and ultimately awarded the park first place on the local, regional and international level, culminating in the 2012 TOBY award in the industrial office park category.

“Being able to say that we’ve produced an international winner is proof to our tenants, clients and competitors of our capabilities,” says Leerssen.

Gorman and Leerssen would have been content without the awards because the new roads, access to I-30, nearby retailers and an improved exterior helped bring Turnpike’s occupancy from approximately 67 percent in 2000 to 93 percent as of this writing. Turnpike’s current tenant roster includes Wilsonart, Dr. Pepper/Snapple, Spirit Brands, Tandy Brands Accessories, Snyders of Hanover and ThermoServ, and the industrial park currently provides approximately 1,300 jobs

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