Tuesday, March 30 2004 @ 07:16 PM UTC
Contributed by: Admin
Mar. 30 - Two of Dallas' oldest real estate empires are in merger talks.
If the Trammell Crow family's Crow Holdings buys Industrial Properties Corp., which was once run by the late John Stemmons, it will be a bit like a family reunion.
Developer Trammell Crow got his start by leasing land from Industrial Properties to build his first warehouse.
And Mr. Crow and Industrial Properties were partners in the development of the huge Dallas Market Center complex and other local real estate projects.
The Crow and Stemmons partnership lasted until the early 1970s, when the companies went their separate ways.
Now the two firms are talking about a second marriage.
"We are still four or five months away from a deal," said Heinz Simon, CEO of Industrial Properties.
"Crow Holdings has to do its due diligence, and we have to finish a contract and have shareholder approval.
"We are pleased to make this deal with Crow Holdings," he said. "It furthers a long-standing relationship between us and the Crow family."
The 76-year-old Industrial Properties developed the 1,500-acre Trinity Industrial District near downtown Dallas. The privately owned company still has more than 100 acres in the area and owns about 70 buildings in Dallas, Austin and San Antonio.
"We still have most of the land under the Dallas Market Center, the Anatole and other buildings" along Stemmons, Mr. Simon said.
Crow Holdings – which manages the Crow family's investments – would buy Industrial Properties for one of its real estate investment funds, the company said Monday.
The fund is a partnership between Crow Holdings and institutional investors, including university endowments, charitable foundations and pension funds.
Terms of the transaction were not disclosed.
Mr. Simon said that when the merger is completed, "indications are that the name will survive to build a new portfolio of real estate holdings for their fund."
Tony Dona, CEO of Crow Holdings, said the companies are a good fit.
"There is obviously some nostalgia to it," Mr. Dona said. "But they've built great buildings and have a great brand.
"We sold our industrial business a few years back, and this gives us an opportunity to get back in that business."
In 1948, Trammell Crow's original real estate deal was to build a warehouse.
He bought the development site on Cole Avenue from Industrial Properties.
The 11,250-square-foot warehouse cost $30,000 and was leased to Ray-O-Vac Battery Co. and Decca Records.
Based on the success of that first project, Mr. Crow went on to build the biggest real estate development company in the world.
Mr. Crow, 89, stepped down from day-to-day operation of his companies in the mid-1980s.
Mr. Stemmons died in 2001 at the age of 92. He was named president of Industrial Properties in February 1945 and served as chairman and chief executive officer from 1971 until his retirement in 1994.