The City of Fort Worth will weigh incentives for Goldenrod Cos.’ two projects in the city, representing $400 million in mixed-use development between the pair and delivering a sizable chunk of new Class A office space.
Nebraska-based Goldenrod plans to deliver the Van Zandt and One University, located on the 2800 block of West 7th Street and the 3000 block of Morton Street, respectively. The two projects will bring a total of 195,000 square feet of office development to Fort Worth, a key priority as city leadership angles for corporate relocations.
The company initially announced the Van Zandt early last year. The project will feature 95,000 square feet of office space, 10,000 square feet of retail and 226 multifamily units. The Van Zandt has an estimated cost of $145 million, according to city documents.
One University, formerly known as “The Mullet,” will bring 100,000 square feet of office space, 10,000 square feet of retail, 240 multifamily units and a 175-key Autograph Hotel. Goldenrod first revealed One University to the Business Journal in an interview earlier this year.
The project will total about $255 million.
The developments have been folded into an overarching public-private partnership. The proposed partnership involves conveyance of parking garages in exchange for economic incentives to support a portion of the debt service that Goldenrod is shouldering.
Goldenrod will construct the parking garages and secure financing for them. Additionally, the firm will be responsible for servicing the debt. Once completed, Goldenrod will turn over ownership of the garages to the city.
The developer and the city will then fashion an agreement to use the garages together. After 2035, Goldenrod would have the opportunity to buy them back.
The incentives total a neat $30 million over a 15-year period. In return, Goldenrod will agree to spend at least $300 million out of the total in hard construction costs and 15% of its construction costs on minority, disadvantaged and women-owned businesses.
As a part of the incentives agreement, Goldenrod has agreed to prioritize leases for corporate relocations from outside the region. The company has also agreed to refrain from leasing any retail space to a freestanding nightclub or bar, adding retail diversity to an area renowned for its night life.
The latter recommendation comes on the heels of a killing on West Seventh that spurred debate about the area’s safety. In what police called a random act of violence, 21-year-old Matthew Purdy shot and killed TCU junior Wes Smith as he stood on a sidewalk earlier this year.
The agreement will go before the Fort Worth City Council during its meeting on October 17.
Last year, Fort Worth passed an economic development initiatives plan that called for launching public-private partnerships to bring in at least 1 million square feet of Class A office space in and around downtown Fort Worth by 2026. Fort Worth currently lacks sizable chunks of office space available for lease, and city leadership has made bringing in more office development a priority.
Former NFL player Zach Wiegert formed Goldenrod in 2005 to oversee his own portfolio of assets. In 2017, the firm launched its first fund and has launched several funds since then.
The company, which has about $4 billion in assets under management, targets primary and secondary markets in the central U.S. In any given fund, the firm is looking for 60% acquisition and 40% ground up development.
Of the ground-up development, Goldenrod targets medical, office, multifamily and industrial.
The company aims to place between $5 million and $25 million in equity in its deals. Goldenrod will go after larger deals, north of $100 million, but its sweet spot is typically between $25 million and $50 million per deal.