Construction will start this fall on the city of Allen’s first Class A office building.
In July, Allen City Council and the Collin County Commissioners Court approved 10-year partial tax abatements for a $34 million, five-story, 125,000-square-foot office building with an attached parking garage.
The building—coined One Bethany—will be developed by Kaizen Development Partners in the Watters Creek Office Park west of US 75 and north of Bethany Drive. The building is expected to be complete sometime in mid-2018, said Dan Bowman, executive director and CEO of Allen Economic Development Corp.
Bowman said the new building is a big step in the city’s initiative to bring more daytime traffic to the area’s plethora of retail and restaurant offerings.
“We’ve gone from a market where there is limited opportunities for entertainment and dining to one that now is everything you could possibly want,” Bowman said. “So the next step has been taking our daytime population—the people who work here on a day-in and day-out basis—and having more of those people here during the day, and having employers here that pay high wages and can afford the people who live here in the Allen/McKinney area.”
Allen has several office developments that are planned and are being marketed to tenants before construction or expansion gets underway.
As the Dallas North Tollway corridor fills up with developments—including Plano’s Legacy West and Frisco’s $5 Billion Mile—Allen and Fairview are looking to capitalize on the advantages of US 75 and SH 121. Both corridors are relatively less expensive and less crowded with commuters, said Ray Dunlap, Fairview economic development manager.
“The [DNT] is hot right now,” Dunlap said. “However, the tollway is gridlocked both north and south. Traffic on [US] 75 is just one way. You’ve got a morning commute and an evening commute, but the opposite traffic is not jammed up. Plus, [the Texas Department of Transportation is] in the process of widening US 75—they are doing ramp reversals in both the Allen and Fairview area, which will improve some of the access.”
One Bethany/convention center
One Bethany will be constructed without first having a committed tenant—speculative office space that Bowman said will allow the city to attract large businesses or corporations that might not be willing to wait the length of time it takes to construct a building from start to finish.
There is about a 5 percent vacancy rate in Allen’s existing office space—not enough for big corporations, he said.
“We really do need the space,” Bowman said. “Tenants don’t have a long decision-making time frame. They don’t give you 16 months to get a building like [One Bethany] built.”
One Bethany will join the existing building in Watters Creek Office Park, One Allen Center, which Bowman said would be considered Class A office space if the parking garage was attached.
Along with high-end finishes and amenities, the dividing line between Class A and lower class office space is generally having an attached parking garage. One Allen Center has a parking garage, but it is not connected directly to the building.
The timing for One Bethany ties in with The Convention Center at Watters Creek, which is a $91 million convention center and hotel project that will soon be under construction directly south of Watters Creek Office Park.
The convention center will have 60,000 square feet of convention space and another 40,000 square feet of exhibition space, plus a 12,000-square-foot ballroom and 8,000 square feet of meeting space. The four-star, five-story hotel will have 292 rooms.
Bowman said it will be the largest hotel/convention center on US 75 between downtown Dallas and Choctaw in Oklahoma.
He said the convention center and office projects will enhance Watters Creek at Montgomery Farms, the large mixed-use development just south of Bethany Drive.
The city is talking about a pedestrian sidewalk connection—similar to the one at The Shops at Legacy in Plano—which would facilitate traffic and pedestrian flow across Bethany, Bowman said.
“One hundred and twenty-five million dollars worth of development coming out of the ground creates an amenity base that will bring those tenants here,” he said.
There is also room for four or five more office buildings in Watters Creek Office Park.
“It’s the daytime driver that is going to continue to grow Watters Creek,” Bowman said. “You’ll have even more restaurants coming into that area.”
High-quality development
With limited land mass compared with the neighboring cities of Plano, Frisco and McKinney, the town of Fairview and city of Allen are focused on bringing the right type of high-quality tenant to the area.
“We have a fantastic opportunity where the costs are good, the demographics and labor are there,” Bowman said. “So to me, it’s a market that’s going to blow up, and you’ve got a supportive city from an incentive perspective.”
Allen already has a number of companies that call the city home. Kone, a company that designs elevators and escalators, moved into the AllenPlace office park in June. Allen is also home to Experian Information Solutions, Jack Henry & Associates and Frontier Communications, among others.
“We’ve got the ability to be selective when it comes to the type of companies and the quality of development we want to see in Allen, because we only have so much space,” Bowman said.
Dunlap said Fairview in the last few years has become aggressive in its efforts to attract office tenants.
The Fairview EDC is looking to attract businesses in several different sectors, including regional headquarters, financial services, accounting and legal services.
The town’s strategic plan is designed for commercial development west of SH 5, which preserves east Fairview for the large lots and country feel the town is known for, Dunlap said. However, the city is looking to increase the commercial tax base that will help Fairview thrive, he said.
“Currently, Fairview is an exporter of jobs,” Dunlap said. “So with our push toward office [space], we hope to eventually become an importer of jobs and certainly to keep that daytime population.”
Sharon Mayer, Allen/Fairview Chamber of Commerce CEO, said Watters Creek and The Village at Fairview and The Village at Allen would benefit from an influx of lunchtime traffic.
“Projects that the Allen Economic Development Corp. and city bring to Allen are top-quality projects, so they are something we can be proud of and something that will draw more businesses,” she said.
Highway corridor future growth
Bill Guthrey, senior vice president for KDC, a Dallas-based commercial real estate company, said he sees the SH 121 and US 75 corridors through Allen and Fairview as being the next wave of office, commercial and retail sites.
“They are both very strong growth corridors for commercial development, and it’s all being driven by master-planned residential communities that are in McKinney, Allen, Frisco—just that whole northern part of the [Dallas-Fort Worth] metroplex,” he said.
KDC is marketing a 100-acre site at Alma Drive and SH 121 where it is potentially looking to draw a 20-50-acre corporate campus, then retail and multifamily projects to fill out the rest of the development.
Guthrey said the SH 121 and US 75 corridors are surrounded by a wide range of housing options, including multifamily, affordable single-family and executive high-end housing. SH 121 also has the added benefit of large tracts of available land and a short commute to the Dallas/Fort Worth International Airport.
“You can create a master-planned environment with all the components of retail, multifamily and a corporate campus and create an environment the employees want to be in,” he said.
Guthrey said corporations are attracted to areas like North Texas because of the educated workforce many of the area communities have.
“It’s all about attracting and retaining employees, and employees are choosing these neighborhoods in which to move, [so] the employers are trying to move as close as they can to qualified labor,” he said. “It’s all about housing and schools, which is attracting the labor, and the labor is attracting the corporations.”
