Even though it was 1:30 a.m. on Wednesday morning, Flower Mound’s Town Council unanimously voted to approve a Chapter 380 Agreement for the development of a speculative office building and parking garage located on 10-acres (aka the Roach Tract) on the west side of FM 2499, immediately south of the Lakeside Crossing development and Silveron Boulevard; which is across from The Point development.
Chapter 380 of the Local Government Code authorizes municipalities to offer incentives designed to promote economic development, such as commercial and retail projects.
“We’ve missed many opportunities, because no [office] space is readily available,” said Andrea Roy, director of Economic Development.
At the direction of the council, the town staff conducted extensive research to determine if Flower Mound was the right setting for Class A office space to thrive. According to information from other municipalities and real estate brokers and other sources, the town was judged to be a desirable location to attract Class A office users.
After learning of the town’s desire to have this type of real estate in the community in addition to the anticipated demand for such a product, FM 2499 Office Venture developed a concept plan that would fit the town’s chosen criteria.
Realty Capital Management’s group, FM 2499 Office Venture, proposes to build a four-story, 120,000-square-foot office building with a 480-space parking deck.
According to the cost benefit analysis, it is estimated, once occupied, the project will have a $50 million economic impact to the town over the next 20-years.
“It’s my anticipation that the Town of Flower Mound does this deal one-time,” said council member Bryan Webb. “It’s priming the pump.”
In addition, the agreed-upon development timeline is to seek a Planned Development (PD) zoning request by Sept. 16, 2018, specific milestone dates thereafter and a completion date of Dec. 16, 2022. As a protection for the town, it’s agreed-upon that the town may terminate within 60-days of any missed deadline.
“The Town Council’s support of the incentive should send a strong message to the development and business community that Flower Mound is committed to becoming a prime location for office,” said Mayor Tom Hayden. “The other place this has been done is Allen, Texas.”
The future Class A Office building will have a minimum of four stories, a central interior lobby, on-site support services and maintenance, access to all suites from inside the building, 24-hour security and an architectural plan that will meet or exceed Flower Mound’s standards.
Hill & Wilkinson is the preferred contractor, with Prosperity Bank as the lender.
“The addition of this new Class A office building will allow the Town to compete for tenants in the office market, an arena in which we could not previously participate,” said Flower Mound Town Manager Jimmy Stathatos.
It is the intention that this will be the first of many office buildings in this area. In turn, the developer has agreed to reach several development milestones, which will push the project forward toward a completion date no later than December 16, 2022.
In exchange for investing a minimum of $25 million to construct the office building, the town will offer several incentives– including a debt service guarantee to the lender– which will mitigate the speculative nature of the project and reduce its pre-leasing risk.
“It offers the ability for so many of our residents, who control their company’s locational decisions, to consider Flower Mound as a viable business location,” said Stathatos.