Frisco, Texas–Hillwood Multifamily has been engaged by the Frisco Station Partnership to develop an “urban living community” called Station House in Frisco, Texas. The 300-unit apartment project will be the first development to break ground in Frisco Station.
Frisco Station is a multi-use development encompassing 242 acres in the northwest quadrant of the Dallas North Tollway and Warren Parkway in Frisco. In addition to more than 2,400 residences, Frisco Station will be home to offices, shopping, dining, entertainment, hospitality and a “green spine” of parks, trails and gathering places.
“We think this is a good opportunity to develop Frisco Station because Frisco, Texas, is one of the fastest growing communities in the nation,” Fort Worth, Texas-based Hillwood Multifamily Managing Director Mark McHenry told MHN.
“There is strong job growth in the Frisco-West Plano submarket, with companies such as Toyota North America, Liberty Mutual, JPMorgan Chase, Fed Ex and others relocating major corporate campuses to the region, making Frisco an ideal location for quality multifamily housing. The superior job growth is expected to drive strong demand for rental housing over the next two years in the submarket.”
Hillwood targets market-driven returns of approximately 150 basis points over the prevailing cap rates for class A product in the markets in which it develops, he added.
“The location of the Frisco Station property in relationship to the massive job creation in the region, proximity to the wealth of amenities in the area, and the ability to create a unique master-planned development with a complementary mix of uses focused on driving corporate office development were compelling factors in our decision,” he said.
“The project is being developed by the Frisco Station Partnership, which is a partnership among Hillwood, the Rudman Partnership and Van Trust Real Estate, which serves as the office development partner. Station House is the first urban living apartment community in this development.”
The escalation of construction prices over the past several years has made underwriting new projects more challenging, McHenry remarked. “We worked with our general contractor throughout the design process,” he said. “[That was] to ensure that the design of the project would be cost effective while providing a level of quality and amenities that would differentiate Station House from the existing product in the region and support the targeted rents and demographics for the community.”
The Station House site measures 4.2 acres in size, McHenry said.
“Costs are confidential but are in line with construction costs for similar product in the Dallas-Fort Worth region,” he added.
The financing for Station House was furnished through the Dallas office of Associated Bank, a U.S. regional bank that offers retail banking, commercial banking, commercial real estate lending, private banking, specialized financial services and insurance services. This is the first Lone Star State project on which Associated Bank has teamed up with Hillwood, and the second project nationally.