Sun Life Assurance is considering selling an East Dallas shopping center amid surging retail demand in North Texas.
The Toronto-based company has hired JLL brokers Erin Lazarus and Adam Howells to sell the 74,700-square-foot Skillman Live Oak Centre, located at 2014 Skillman St. in the affluent Lakewood neighbourhood, according to the Dallas Business Journal.
Sun Life Assurance purchased the property in 2015 after its previous owner, Stonelake Capital Partners, had recently renovated it at a cost of $3 million to $4 million.
The shopping center at the intersection of Skillman and Live Oak streets is 77 percent leased, with tenants including Society Bakery & Tea Room, Black Swan Yoga and Paradigm Fitness, but the property has lost several anchor tenants over the past year, including restaurants Buzz Brews and Mat’s Rancho Martinez.
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JLL is touting this as an opportunity to immediately increase value through leasing and redevelopment. The complex has about 10,000 square feet of available space, and the average rent is about 19 percent below market rate, according to marketing materials.
After several years of uncertainty due to the pandemic, retail has emerged as perhaps Dallas-Fort Worth’s strongest commercial real estate sector, fueled by an accelerating rise in e-commerce.
Through the third quarter of last year, investors have poured more than $1.3 billion into DFW shopping centers. With just 4.3 percent of the region’s retail space vacant, about 1.2 million square feet of retail space have been leased, outpacing new supply of 915,600 square feet. Shopping center rents rose 8 percent year over year in the third quarter, increasing their appeal among investors.
The only potential drawback to DFW’s retail market is a looming supply shortage that could lead to rents continuing to rise and become unaffordable. With rising interest rates and construction costs, and a tough lending environment, developers have been slow to meet the demand for expanding retail space.
—Quinn Donahue
