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Austin Business Journal - September 8, 2006
by A.J. Mistretta
ABJ Staff
When it comes to owning their own offices, many professionals remain unaware of their options or simply don't know where to begin.
Consequently, small business owners in fields from medicine to accounting who might benefit from ownership continue to lease space, staying subject to the sometimes volatile trends of the marketplace.
But the newly formed Business Real Estate Ownership Council hopes to change that. This month, the group launched BREOCouncil.org, a comprehensive Web site designed as a one-stop shop for those interested in owner-occupied real estate -- from available locations to financing and legal advice.
The benefits of owning an office can be extensive, says Scott Morledge, president of Land Creek Development and the president of BREO. Not only are the costs of housing one's business fixed, he says, but the business owner is also building equity and creating an asset.
According to an industry report, roughly 1.3 million square feet of space in 35 different office condo projects is now in the planning, construction or initial sale stages in the Austin area. That's up from about 300,000 square feet in the works five years ago.
Industry experts say that not only have the number of projects increased, so too have the type of products and the geographic area. At one time, only premium developments were hitting the market, but today developers are creating office condos with a wide range of price points. At the same time, office condos are coming online in every Austin submarket and spreading into surrounding communities from Leander to Round Rock.
Morledge says his company has been building office condos in the area since 1993. And, while the owner-occupied market has grown, the biggest obstacle remains tenants' lack of understanding that it's an option.
"They've leased for so long that often they don't know this is out there," he says. In turn, those who do recognize the benefits of owner occupancy have few resources for learning the ins and outs of the process. "There really hasn't been a centralized resource."
The office condo trend has become a vehicle to allow people to get into the real estate market and share the overall cost, says Kyle Spears, an affiliate member of BREO and local vice president of Scottsdale, Ariz.-based Ironstone Bank. In Austin, Ironstone is a major provider of financing for owner-occupied commercial real estate.
Spears says there hasn't been a great deal of speculative office condo building in Austin compared with other markets.
"Here in Austin, the office condos have developed as the need has developed," he says, adding that growth has been strongest around medical centers that create nodes of medical office needs.
Morledge says the biggest benefit BREO offers to commercial brokers is a centralized database of available properties.
Typically, brokers might know of only a handful of such projects from news reports or developer relationships, making it hard to compare and contrast options. By putting all of the projects in one place, the organization hopes to make it easier for brokers and their clients to weigh options.
Project part of growing medical corridor
Austin Business Journal - July 7, 2006
by Jonathan Selden
Austin Business Journal Staff
Austin Diagnostic Clinic is preparing to build a 30,000-square-foot medical building adjacent to its main clinic at St. David's North Austin Medical Center.
The project, which is expected to cost $4.5 million to build, is right in the middle of two other planned medical complex projects totaling more than 240,000 square feet near the hospital on North MoPac.
The Austin Planning and Zoning Commission recommended ADC's rezoning request for approval June 20 and ADC is expected to get final city council approval later this summer, says John Joseph, an attorney with Clark Thomas & Winters PC who is represents ADC in the zoning action.
If all planned projects come to fruition they will bring more than 380,000 square feet of medical office space to the area around the North Austin Medical Center, which is near the intersection of MoPac Expressway and Parmer Lane.
Already there is HealthCare Facilities Development Corp.'s 110,000-square-foot Medical Oaks Pavilion, which houses St. David's North Austin Surgery Center and Renaissance Women's Group.
Next door, Austin-based HCFD is within 60 days of breaking ground on an identical $18.5 million, 110,000-square-foot structure called Medical Oaks Pavilion II, says HCFD President Kent Ferguson. He expects to open its 70,000-square-foot first phase around September 2007.
Just up the street, owners of the Mopac Medical Professional Building are courting tenants for a proposed 132,000-square-foot building planned for completion later this year or in early 2007.
ADC's planned 30,000-square-foot building will alleviate some pressure on its main clinic inside North Austin Medical Center.
ADC plans to relocate some existing pediatric doctors' offices from North Austin Medical Center to the new building, President Bob Spurck says. "This will allow us to expand in specialties" at the main clinic, Spurck says, "18 months from now as the need arises."
In all, ADC expects to put about 25 to 30 doctors in the new building.
The building's first floor will house a convenient care clinic with open-access, same-day service and drop-in care, says Spurck. Its second floor will be reserved for pediatrics and the third floor will house family practitioners.
ADC plans to break ground for the structure in about five months and to move during January 2008, Spurck says. Although the building's budget numbers aren't final, Spurck says a "ballpark" figure is about $4.5 million.
City planners first opposed ADC's rezoning request partly because the three-story building would closely border a North Austin neighborhood.
"It was just an issue of height," Joseph says. "We're going to work all that out with the council before they take action on it."
But neighborhood resident Raymond Yarbrough, who lives within close view of the proposed structure at 12301 Cedar Spur, says, "I welcome it because I think it's going to increase the value of the property here."
HCFD's Ferguson says his investment in the area around St. David's is simply a matter of economics.
"We're just responding to the demand for additional medical office space at the St. David's North Austin Medical Center campus."
April 17th, 2005
Land\Creek Development, a subsidiary of Ash Creek Homes, has just completed the first phase of Ladera Park Office Complex at 11671 Jollyville Road. Ladera Park is an office condominium community consisting of approximately 35,500 square feet that can accommodate 100% medical usage.
Despite the slump experienced by some in the office market, Building A was 80% pre-sold. Rick Lindley, Project Manager for Land\Creek Development, said, "We are very excited about the response Ladera Park has received from the medical community. Jollyville Road is a diamond in the rough. You have such easy access to the rest of Austin via Highway 183, but are situated in a more relaxed and pleasant setting.
We have already started construction on Building B and expect to be complete the building shell by June 2005."
Some of the professionals who will open a practice in Ladera Park are: Dr. Janet DuBois (dermatology), Dr. William Stavinoha (family practice), Dr. John Bangston (family practice) Dr. Robert Ramirez (Periodontics), Drs. Blair Bradford and Julie Beasley (Endodontics) and Worth Finance. Most plan to open by this fall.
This is Land\Creek Development's 9 th office condominium project over the past few years, making it the largest office condominium developer in the area. Many of the end-users are drawn to Land\Creek Development's use of classic Texas hill country architecture.
by Mary Kaspar
AUSTIN BUSINESS JOURNAL STAFF
March 21st - 27th, 2004
An Austin tennis academy has found a new home, which includes a $1.2
million first phase consisting of 10 courts and a clubhouse.
Austin Tennis Academy, which was launched in June, has been leasing
six courts at Barton Creek Country Club for the past 10 months. The academy
was set to put 3.7 acres under contract March 21, after Austin Business
Journal press deadlines.
The land is in Spanish Oaks at Bee Cave, a mixed-use development on
State Highway 71 near RR 620.
Jack Newman, managing director of the Austin Tennis Academy, calls
the project the group's "Field of dreams."
Construction is scheduled to begin shortly after the land deal closes
in May. That should offer ample time for construction of the first phase
to open in time for the next academic year, which begins in late August.
The land offers room to add three courts.
The academy now is a nonprofit but is switching to for-profit status
in September, Newman says.
Daniel Porter, developer of Spanish Oaks at Bee Cave, says the tennis
academy complements the rest of his mixed-use development. Tennis courts
always have been a part of the vision for the community, he says.
Eric Schmidhauser, head of fundraising and public relations for the
academy, says more than half a dozen schools are within five to 10 minutes
of Spanish Oaks. The academy's goal was to locate near school-age
children - its target audience.
As it settles into its new home, the academy wants to expand its offerings,
which now consist of competitive-level training for about 30 students,
Schmidhauser says. Space limitations have prevented the academy from
accepting more students and catering to a wider range of skill levels,
he says. The new location and additional capacity should enable the academy
to serve hundreds of students annually, Schmidhauser says.
An angel investor donated $500,000 to the campaign for a new home,
Schmidhauser says, while Newman contributed $150,000.
Dick Clark, a local architect known for designing high-end restaurants,
completed the conceptual design for the academy for free.
Bruce Wencel, vice president of Austin-based Ash
Creek Homes Inc.,
agreed to provide services for less than market value. For example, Ash
Creek Homes agreed to build the clubhouse for $68 per square foot, compared
with the going rate of $90 to $140 per square foot. Its Land\Creek
Development subsidiary won't charge for working as general contractor, Wencel
says.
Ken McAllister, executive director of the Texas section of the United
States Tennis Association, says the academy is pulling together a project
in a difficult economy. That signals the strength of the tennis industry
and the people behind the Austin Tennis Academy.
McAllister says Austin boasts two nationally recognized tennis academies:
the Austin Tennis Academy and the Tennis Academy at St. Stephen's
Episcopal School. Some of the founders of the academy formerly worked
at St. Stephen's, including Newman and Schmidhauser.
There's plenty of room in the market for two tennis academies,
McAllister says.
A St. Stephen's representative couldn't be reached for comment.
AUSTIN BUSINESS JOURNAL, MARCH 21-27
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