Partnership acquires 50% stake in Dallas-based developer KDC with eye toward acquisitions


Toronto-based Cadillac Fairview in partnership with Dallas-based Compatriot Capital has acquired a 50% interest in Dallas-based developer KDC.

KDC will continue developing corporate office facilities across the U.S., while also focusing on the development and acquisition of high-quality, mixed-use projects. Coinciding with the partnership, Cadillac Fairview, Compatriot Capital and KDC have closed on their initial $800 million U.S. commercial office and mixed-use fund. The fund marks new ground for KDC and will serve as a long-term investment vehicle for the partners, bolstering their combined portfolio of Class A office and mixed-use properties.

“For more than 30 years, the KDC team has been focused on developing commercial office buildings and custom corporate homes for some truly great companies in the U.S.,” said KDC CEO Steve Van Amburgh. “As we look to the future, now is the best time to take the next step and elevate our growth model with two dynamic partners: Cadillac Fairview and Compatriot Capital.”

Compatriot Capital is a wholly owned subsidiary of Sammons Enterprises, Inc. Cadillac Fairview is the global real estate arm of the Ontario Teachers’ Pension Plan, which has over $200 billion of assets.

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“This is an exciting time in KDC’s history as we join with two like-minded companies that also have a strong commitment to developing offices for Corporate America and expanding our platform to include more mixed-use development and acquisitions in target markets,” said Toby Grove, president of KDC.

“Having partnered with KDC for over a decade, we value the integrity and expertise of the KDC team and are looking forward to working with Cadillac Fairview in this new venture,” said Heather Kreager, CEO of Sammons Enterprises, Inc.

“This partnership represents a shared vision to build a premier business in the development and ownership of office and mixed-use properties, an asset class that is particularly dynamic and exciting in today’s economy,” said Mark Van Kirk, president of Compatriot Capital.

“We are thrilled to be joining forces with KDC and Compatriot given their strong reputations, commitment to high-quality assets, and long-standing client relationships,” said Duncan Osborne, executive vice president, Investments, Cadillac Fairview. “We are also excited about the prospect of bringing new partners together and believe that Cadillac Fairview’s existing strategic partnership with Lincoln Property Company’s residential division can play a unique role as we seek out mixed-use opportunities and maximize our collective expertise to grow KDC,” furthered Mr. Osborne.

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The internally capitalized fund will focus on the development and acquisition of Class A corporate office projects and mixed-use projects in top markets across the United States. This is a long-term investment and development platform that will allow Cadillac Fairview, Compatriot Capital and KDC to aggregate a diversified portfolio of the highest quality office and mixed-use projects throughout the country, according to a company news release.

Currently, KDC has six commercial projects totaling more than 2.1 million square feet and valued in excess of $1.1 billion under development nationally. KDC is developing several mixed-use developments, including Santa Fe Yards as part of Denver’s Broadway Station development and Peña Station NEXT in Denver, along with Aureum in Nashville, Hub RTP in Raleigh, North Carolina, and Parkline in San Antonio. Other notable mixed-use projects include CityLine in Richardson, and Park Center in Dunwoody, Georgia, both home to State Farm, as well as Legacy West in Plano, the corporate home for Toyota North America, FedEx Office and JPMorgan Chase.