COVER STORY, AUGUST 2005

DALLAS STARS
Dallas is in the midst of a far-reaching public/private effort to revitalize the city.
Kevin Jeselnik

In January of this year, approximately 30 of Dallas’ most prominent professionals joined together to tackle the issue of economic development, which has been designated the city’s Number 1 priority. Over a 4-month period, this Stakeholder Task Force evaluated the city’s strengths and weaknesses as well as the major challenges hindering its growth.

The study found that the first step in revitalizing and establishing Dallas as a top-tier city — in the vein of Boston, Chicago and Los Angeles — is to reinvigorate the downtown core. In order to do so, an expansive effort has to be undertaken by many public and private groups throughout the city.

“We had to look at what Dallas really was and we concluded that the city needs to redefine its urban character,” Karl Zavitkovsky explains. Zavitkovsky, a recently retired managing director at Bank of America, is the newly appointed director of the Dallas Office of Economic Development (OED) and headed the task force that created the city’s plan for economic development.

“We have traditionally thought of the central business district as bounded by the expressways,” Zavitkovsky says. “In order for our traditional downtown to be successful, we have to link it to surrounding neighborhoods.”

The city is taking a leading role in the effort to create a more inviting, vibrant city. But the OED is not alone in its endeavor.

“Every time I go downtown and walk the streets, I see a new project starting construction or a new restaurant or retail space,” says John Zogg, managing director of asset management and leasing at Fort Worth, Texas-based Crescent Real Estate Equities. “I can tell that our downtown is evolving into something that will be very special, and as a lifelong Dallas resident, [I think] that is really exciting.”

All over the city, public and private institutions are undertaking a variety of exciting projects that will draw money and attention away from the sprawling suburbs and back into Dallas. In order to do so, the task force proposed a plan that calls for the city to dramatically increase the number of multifamily units in its core, retain and attract corporate tenants, and create a unified downtown by linking together the various areas disconnected by the interstates. The key to revitalization is drawing residents, businesses and consumers back to the city’s Downtown, Uptown and Arts District neighborhoods. A number of projects are underway or in the pipeline that aim to do just that.

Hillwood is developing the W Dallas Victory Hotel and Residences in Victory Park. The project is the first W-branded hotel in Texas and will offer 261 hotel rooms and 144 condos in two towers, the 33-story North and nine-story South towers.

Hillwood will own the building; McCarthy Building Companies is serving as the construction manager for the development. The W project, designed by architecture firm HKS Inc., is one example of the surge in contemporary, architecturally significant properties that are now rising on the Dallas skyline — a trend that is occurring in every real estate sector. The focus in Uptown, though, is firmly on the multifamily market

The development of the W Hotel and Residences marks the first major high-rise project in Dallas in 20 years. According to Chris Peck, vice president of business development at McCarthy, the high-rise condo market is hotter than it has been in quite a while. “I don’t know if Dallas has seen this kind of run on residential condos in the last two decades. The W project is certainly creating a lot of excitement for urban living and we are seeing a lot of other residential construction projects in Victory and throughout Uptown and Downtown that are coming on to the market.”

Philippe Starck and YOO UK are bringing The House, a 26-story condominium tower, to Hillwood’s Victory Park. The House is expected to be open for occupancy in early 2008.

Situated on 1.67 acres, the $70 million project is located at the southern tip of Victory Park, steps from the Arts District, another example of the blurring of the boundaries between the neighborhoods. Manhattan Construction is the general contractor. Elkus Manfredi of Boston designed the building and Starck provided his innovative design style for the interiors and public space. The House should be ready for occupancy in early 2008.

Just beyond Victory Park in Uptown, ZOM Development is adding another high-rise to the skyline. The $27.6 million Mondrian will offer 146 residential units and approximately 25,000 square feet of ground-floor retail. The building will total 20 stories with two levels of two-story urban lofts flanking the central tower. Tribble & Stephens is serving as the general contractor; RTKL Associates provided design and architectural services.

The current influx in residential development is not exclusive to Uptown. In Downtown, the city has taken its first steps in redeveloping underused assets into viable urban draws. The OED recently entered into an agreement with Cleveland-based Forest City to redevelop an entire city block of blighted buildings. The former Mercantile Bank complex will bring approximately 1,000 units of for-sale and for-rent multifamily space to the area along with 35,000 to 50,000 square feet of retail space.

“The hope is that this will substantially change the environment in our Downtown, where there are a lot of Class C office buildings,” Zavitkovsky says. “It’s a gamble, but I’m very optimistic. There is a limit to what the city can do, but our job at the OED is to create an atmosphere that stimulates market forces.”

So far, the OED has succeeded getting individuals and companies at the local, national and global level to take a vested interest in the city’s future. Another goal that sprung from the task force’s meetings was to retain existing businesses and attract new corporate tenants. Like Hillwood, another prominent local developer is bringing an important new project to the city. Billingsley Company is developing One Arts Center, a mixed-use building that will be located on the cusp of Downtown and the Arts District, with 7-Eleven signed on to relocate its corporate headquarters from across town in CityPlace Center. One Arts Center will consist of 425,000 square feet of office space (300,000 of which 7-Eleven will occupy), 30,000 square feet of retail and 110,000 square feet of residential space in 60 condos.

Billingsley Company is developing One Arts Plaza, a mixed-use complex in Dallas that will incorporate 425,000 square feet of office space, 30,000 square feet of retail and 60 residential condominiums in 110,000 square feet.

“Our campaign is a 9-year project,” says Bill Lively, president and CEO of the Dallas Center for the Performing Arts Foundation. “We’re raising $275 million to build the eastern terminus of the Dallas Arts District. We are four-and-a-half years in and we’ve raised $191 million so far.”

The project is proof positive that the private citizens of Dallas are taking an active role in the city’s future, Lively says. “We have 75 gifts of $1 million or more. The entire concept of the Dallas Arts District is the product of the private sector; it is providing 93 percent of the cost.”

The 75,000-square-foot Dee and Charles Wyly Theatre is a one-of-a-kind theater that will incorporate the non-performance space in a “stacked” design in 11 floors above and below the auditorium.

Though the development is far from its 2009 completion date, it has provided a noticeable economic boost to the area. “What this project has done is stimulate the whole area around the Arts District,” Lively explains. “Property values began to appreciate more than 1 year ago. We announced groundbreaking several months ago and now you have residential and retail developments planned all around.” Along with the 7-Eleven headquarters relocating just east of the Arts District, two other undisclosed $100 million mixed-use projects have just been announced in or around the neighborhood.

Construction for the 198,000-square-foot Margot and Bill Winspear Opera House, designed by London-based Foster and Partners, is expected to start in 2006 and end in 2009.

The Winspear Opera House will be a 2,200-seat venue designed specifically for opera and all forms of dance and musical theater. The 198,000-square-foot project will serve as the anchor of the Arts District’s eastern terminus. Sir Norman Foster of London-based architecture firm Foster & Partners created the design. Linbeck, a Texas-based construction firm, is providing construction management services. The striking red exterior of the Winspear Opera House will serve as a distinctive focal point for the Center’s Grand Plaza. A 60-foot high curved glass wall will provide views of the facility’s distinctive interior.

The Wyly Theatre was designed by Rem Koolhaas of the Office for Metropolitan Architecture (OMA), a renowned firm with offices in New York City and Rotterdam in the Netherlands. McCarthy will serve as construction manager. “The design will be one-of-a-kind and incorporate new and innovative design techniques never before seen in the performance theater world,” McCarthy’s Peck says.

The 11-story, 75,000-square-foot theater will seat 575 and will incorporate some advanced mechanics that will allow for a variety of interchangeable layouts. The performance area can be configured in a variety of ways, even becoming an open, outdoor theater if a performance calls for it.

When the Dallas Center for the Performing Arts is complete, the city expects the new venues to infuse $170 million a year into the Dallas economy and create 2,000 permanent jobs. It is truly exciting to see non-traditional projects stimulate the city’s economy, Zavitkovsky says. And the growth of the Arts District, which is located right between Downtown and Uptown, is essential to the OED’s goal of providing a connected, expanded downtown core.

The primary obstacle keeping Uptown separated from Downtown and the Arts District is the network of interstates weaving through the center of the city, creating the boundaries of its distinctive neighborhoods. The Woodall Rodgers Freeway is one example, a recessed expressway separating the two districts at the northwest point of the city. Built below grade, it creates a discernible rift when one passes over it, says Zogg, whose company, Crescent Real Estate Equities, began the movement to bridge this gap nearly 2 years ago.

“When you drive over Woodall Rodgers Freeway, you feel a transition,” Zogg explains. “You know you have made a move from one area to another. And what we want to accomplish is a seamless transition between these two neighborhoods.”

To this end, Crescent has teamed up with the Dallas Real Estate Council, private citizens, the city and the state to develop a 5-acre deck park over the freeway. The Woodall Rodgers Park will create that connection between the neighborhoods and serve as a great urban walking environment in Dallas. Much like Millennium Park in Chicago and the Big Dig in Boston, the Woodall Rodgers Park will essentially be constructed atop a bridge that will span the freeway separating Downtown from Uptown.

Crescent and the Real Estate Council have each committed $1 million to the project. Jody Grant and Texas Capital Bank have also each provided $1 million. The city has committed $15 million and the state is providing $10 million.

With the appropriate funds in place, Dallas-based architecture firm Carter & Burgess is currently finishing up the initial feasibility studies and helping design the platform upon which the park will be built. The park is tentatively scheduled to come on line in late 2009.

A number of other projects that will create open, public space are underway in Dallas. Three additional parks are underway and several new bridges are planned for the Trinity River corridor in southwest Dallas. These projects provide further evidence the city is working toward providing a safer, more enjoyable urban environment for its residents. As these and the many commercial and residential projects open over the next 5 years, the city will become a more vibrant, attractive destination.

Through the efforts of an expansive array of local, national and global parties, Dallas is on the rise. The city had the foresight to step back and evaluate the direction in which it was headed and has effectively assessed its strengths and weaknesses in order to reprioritize and focus on developing assets that will help establish the city as a top-tier market in every sense.

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