Overcoming Zoning Challenges in South Dallas

Challenge

The South Dallas industrial market has faced some challenges in recent years, primarily due to an oversaturation of industrial product. This specific deal added a layer of complexity due to the constraints imposed by the Dallas Logistic overlay (PD 761), which restricts permissible uses for the property. Although initially developed as a truck parking facility, the zoning had additional requirements including a Residential Adjacency Review (RAR) for most industrial outdoor storage activities.

Strategy

The seller, Guion Gregg, had purchased the site with the intent of developing a truck parking facility. However, they discovered that the zoning regulations did not align with their intended use, significantly limiting the property’s potential. The seller’s objective was to offload the property and recoup their investment despite the unforeseen zoning challenges. While representing the seller, Matthews™ agents Murphy Sloan & Andrew Wiesemann were working with another client who was seeking a facility to establish their operations in the DFW metroplex. Despite touring several available options in the region, the buyer found none suitable for their needs. They ultimately chose this site with the intention of building a customized facility to meet their operational requirements.

The agents conducted a thorough analysis to identify how this property could still offer value despite zoning restrictions. Open communication between the seller and buyer ensured that expectations were clean. The agents worked closely with both parties to highlight the properties’ potential despite its limitations. They guided their client on how they could navigate the zoning regulations and leverage the site’s location and attributes to create a facility aligned with their goals.

Results

Despite the initial hurdles, the deal was successfully closed. The seller achieved their goal of divesting the property, while the buyer secured a site that will be transformed into a class A industrial outdoor storage facility tailored to their operations in the DFW area. This transaction exemplifies the importance of strategic thinking, adaptability, and a collaborative approach in overcoming market and regulatory challenges. Understanding local zoning ordinances is crucial to providing proper support to clients in the industrial outdoor storage real estate sector.