By Cheryl Hall, Dallas Morning News
Over the course of his nearly three decades in commercial real estate here, Fehmi Karahan has been dismissed as “that crazy Turk” by a lot of smart folks behind his back — and to his face.
But as the mastermind behind Plano’s massive $3 billion Legacy West Urban Village, nobody’s still questioning the sanity of the 61-year-old naturalized citizen from Turkey.
Turns out the CEO of Karahan Cos. is crazy like a fox.
That’s why he’s my nominee for Texan of the Year.
In case you’re befuddled by all of the mixed-use developments cropping up around town, Legacy West is the grand kahuna that’s located at the Dallas North Tollway and State Highway 121.
While it’s primarily known for being the North American headquarters of Toyota, it’s also the new home for JPMorgan Chase’s $300 million-plus, 1 million-square-foot, 49-acre office campus. And early next year, thousands of employees of Liberty Mutual will start moving into two 19-story towers in the insurance giant’s $325 million complex.
By next year, almost 20,000 people will work in the area for some of North Texas’ largest new employers.
And it’s because Karahan had the vision, tenacity and powers of persuasion to pull off a David-and-Goliath victory which made all of North Texas the winner.
Eight years ago, Karahan approached then-J.C. Penney CEO Mike Ullman about buying 250 acres of raw prairie land surrounding the retailer’s expansive corporate headquarters.
But Ullman wasn’t interested in selling.
In 2012, Ullman’s successor, Ron Johnson, was.
Penney wanted to keep a piece of the action, so it asked commercial developers how they’d transform the surplus property. Heavyweights, including Trammell Crow Co., Hines, Lincoln Property and Forest City Enterprises, all made their pitches.
Karahan, whose company has less than a dozen staffers, pulled together his version of a dream team, joining forces with KDC and Columbus Realty to give him more financial clout and street cred. He also drew from his remarkable success with the Shops at Legacy, the village-like retail center on the east side of the tollway, and won the day in February 2014.
Just three months later, Toyota stunned the market by announcing it would build its new headquarters in Legacy West, joining FedEx Office as the first major companies in the project that’s 23 miles north of Dallas’ central business district and 20 miles from DFW International Airport.
After Toyota’s announcement, Legacy West took off.
What was supposed to be a 10-year project is almost out of land after just 3 1/2.
Talk about, “If you build it, they will come.”
Now Legacy West copycats are springing up throughout Dallas’ northern hemisphere. I give Karahan partial credit for that.
It’s not the first time that Karahan has boldly gone where others, with more “rational” heads on their shoulders, feared to go, and then made his mark as a pioneer.
In 1993, when nobody with any sense was adding to D-FW’s staggering vacant shopping center inventory, Karahan bought 105 acres in Irving at the corner of Interstate 635 and North MacArthur Boulevard — which at the time was a two-lane street, not a six-lane boulevard.
Karahan turned the pasture into MacArthur Crossing, a 250,000-square-foot shopping center anchored by an Albertsons grocery store. He sold 70 acres to Baylor Hospital, Hilton Hotels, McDonald's and a slew of others and pocketed millions.
“People thought, 'This Turk is out of his mind,' " Karahan told me in 2002. "Now all the corners are developed, and the people who bought land after me paid two to three times more money. That project put my name into the big real estate developers group. People started saying, 'Why haven't we heard about this guy before?' "
In 1998, Electronic Data Systems Corp. could have landed any developer for its retail centerpiece for Legacy Town Center.
Karahan, who knew next to nothing about master-planned town centers, was certainly an underdog choice. But Marilyn Kasko, EDS' director of Legacy, liked his entrepreneurial spirit. Her gut feelings proved prescient.
I’ve learned a lot about the guy I first profiled 15 years ago.
Fehmi (fee-mee), whose name means understanding and wise, grew up in a lower-middle-class Turkish family in Istanbul. He lived with his grandparents, parents and younger brother in a two-bedroom home, where the bathtub was a hole in the concrete floor.
"We warmed water with a butane tank and then poured it into the hole. That's how we took a bath," Karahan told me. "I never thought of us as poor, only as deeply loved."
He came to the U.S. in 1978 to get his MBA at Columbia University in New York on a scholarship from the company his father worked for.
His $400-a-month stipend for living expenses didn't go far in the Big Apple. His English was limited, so he handed out fliers for a Turkish restaurant on Manhattan's East Side for $3 an hour and one meal a day.
With expenses eating him alive, Karahan followed a cousin to Texas in 1979. "I felt Dallas was the real America more than New York City, because I'd watched Western films as I grew up," he told me.
He waited tables and tended bar at a tavern near Bachman Lake and earned his MBA from the University of North Texas.
Karahan looks you straight in the eyes, speaks from the heart and gives his word as a bond.
He thanks his father for that.
When he was 7, his father broke an egg on the kitchen counter and asked Fehmi to fix the egg. When he told his father he couldn't, his father told him: "That's how trust is. Once it is broken, it cannot be fixed."
"To this day I remember that shattered egg," he told me. "That helped me build a reputation that if Fehmi says it will be done, then it will be done."
That leads to another reason why I’m nominating Karahan for Texan of the Year.
In this year of dissension over immigration, he exemplifies the American spirit of if you come, you can build it.
What’s in Fehmi Karahan’s Field of Dreams
The $3 billion Legacy West development started out as prairie land less than four years ago. Here’s what’s in it now.
Toyota Motor Corp. North American headquarters
A $350 million, 2 million-square-foot, 100-acre campus at Legacy Drive and State Highway 121 that opened in May with more than 4,000 workers.
A 265,000-square-foot international headquarters with 1,200 employees. The building opened in 2015 on Legacy Drive just south of State Highway 121.
Gaedeke Group One Legacy West office tower
A 327,856-square-foot, 14-story multitenant office high-rise on the east side of Legacy Drive at 121.
JPMorgan Chase regional campus
The more than $300 million, 1 million-square-foot campus is at the southwest corner of Dallas North Tollway and 121. It opened in November and will ultimately have 6,000 employees.
Palladium Apartment Tower
A 30-story, 312-unit rental high-rise residential building to be built by Dallas-based developer Palladium USA International, just south of 121.
Liberty Mutual Insurance regional office
The $325 million, 900,000-square-foot, two-tower office complex will open on the
west side of the Dallas North Tollway in early 2018 with 5,000 employees.
Construction on this 24-story, 95-unit luxury condo tower started this summer on
Headquarters Drive, just west of Dallas North Tollway.
Villas at Legacy West
Urban single-family neighborhood with 127 homes next to the J.C. Penney headquarters complex. The first houses by Britton Homes went on sale this year
starting at $600,000-plus.
Legacy West Urban Village
A $400 million development with 415,000 square feet of retail and restaurant space, 325,000 square feet of offices and 1,200 apartments at the northwest corner of Legacy Drive and Dallas North Tollway.
This 304-room, 15-story luxury hotel, on Legacy Drive just west of Dallas North Tollway, was developed by Sam Moon Group and opened in July.
SOURCES: Legacy West; Dallas Morning News files