KBS Real Estate Investment Trust III Sells Class A Office Tower in Dallas
By Staff
KBS Real Estate Investment Trust III, Inc., a publicly registered non-traded real estate investment trust, announced the sale of Sterling Plaza, a 19-story, 320,000-square-foot, class A office tower located in Preston Center in Dallas. The property was purchased by real estate investment company Shorenstein Investment Advisers. Newmark represented KBS in the disposition.
According to Newmark, the undisclosed sales price is the highest amount paid for an office property in the Dallas-Fort Worth market this year. The REIT originally acquired the property in 2013 for approximately $74.3 million. Tower at Park Lane sold for $66 million in the market earlier this year, which is the highest disclosed transaction price for an office property in the Dallas-Fort Worth market thus far in 2025.
“Offices play key roles in the fabric of our communities, forming the basis of local employment centers and helping support small businesses,” said Giovanni Cordoves, KBS regional president, western United States. “In general, high-amenity, well-located class A properties, like Sterling Plaza, have been leasing quickly, maintaining occupancy, and enjoying better performance than class B and C buildings, which continue to struggle. Sterling Plaza exemplifies KBS’s proven strategy of targeting high-potential buildings in the best locations and enhancing them with the market-specific amenities that quality tenants are looking for.”
Sterling Plaza is located at 5949 Sherry Lane, in between the Dallas North Tollway and U.S. Route 75. The property reportedly offers easy access to Dallas Love Field and immediate walkability to Preston Center’s shopping, dining, and entertainment venues.
In 2023, KBS added an entire amenity floor with a state-of-the-art conference center, a fitness center with showers and lockers, and a tenant lounge with a bar and complimentary coffee. Sterling Plaza tenants also enjoy an on-site café, electric vehicle charging stations, shoeshine services, an ATM, complimentary bike checkout and storage, a car wash, and a 15-passenger Mercedes-Benz Sprinter van for additional access to the many surrounding dining and shopping amenities in the vibrant submarket.
“Tenants want modern office spaces that are vibrant, amenity-rich, and located in desirable locations that attract talent and foster collaboration,” said Brett Merz, asset manager of Sterling Plaza and co-director of asset management and senior vice president at KBS. “With its emphasis on flexibility, state-of-the-art technology, and tenant well-being, Sterling Plaza helps promote teamwork and innovation, making it a great place to work.”
The sale of Sterling Plaza follows closely on what have been challenging times for the REIT recently. In 2023, the REIT first issued a “going concern” warning, and in 2024, it had to return the keys to an office building in San Francisco. Earlier this year, KBS REIT III extended the maturity date on another one of its loans. Most recently, it took a neutral stance on an $0.80 per share unsolicited tender offer.
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