smontgomery
20 September 2002, 11:13 AM
Mood is upbeat in Uptown
As economy dives, the area is enjoying a building boom
09/20/2002
By STEVE BROWN / The Dallas Morning News
For years, driving down McKinney Avenue in Dallas' Uptown neighborhood has been a slow crawl through blocks of construction.
Those construction trenches aren't going away, even though the economy's in a ditch.
"Everybody has acknowledged that it's a great area, and a lot of people want to play here," said property broker Newt Walker, who's worked in the area for almost 20 years. "Uptown has done a lot better in the current real estate market than some of the suburban areas, and developers want to capitalize on it."
If even half the projects currently in the planning stages get off the ground, Uptown will look dramatically different in the years ahead.
Most of the pending development is centered in two areas – near the new West Village retail and apartment center at Lemmon Avenue and around the Crescent office and hotel complex closer to downtown.
A Dallas firm working with one of the West Coast's biggest apartment builders – Legacy Partners – is negotiating to buy the former Red Cross building at McKinney and Pearl Street.
The potential owners are proposing more than 200 residential units on top of a 25,000-square-foot retail and restaurant complex, property brokers say.
A few blocks away, at Akard and Cedar Springs, developer JTS Interests of Baton Rouge, La., is buying a vacant block for more residential.
"We're working on plans for an eight-story building which we plan to start after the first of the year," said partner Thomas Wells. "We think it's where a lot of people want to live, and it is centrally located to all the amenities."
Outlook inviting
The perception that development locations are limited is prompting builders to take positions in Uptown even though the overall apartment market is about 8 percent vacant, said analyst Ron Witten of Witten Advisors.
"The market may be soft now, but if I think the economy is going to get better next year, I may start a project late this year, or in early 2003," Mr. Witten said. "A successful real estate investment is all about the future."
Brokers and developers say another factor in the building boom is the delay of the Victory retail and residential development near downtown.
Some builders held off potential projects in Uptown because they didn't want to compete directly with the $385 million Victory complex, Mr. Walker said. But with delays in funding approvals from the city of Dallas, the project was not started as early as expected.
Developers have now set the start date for Victory in summer 2003.
"The earliest we could start is next summer," said Ken Wong of Related Urban Development, formerly Palladium Group. "But I would not want to mislead you and say a groundbreaking is scheduled. I've got a lot of work to do."
The agreement between Victory developers and the city of Dallas stipulates that the project must be completed by the end of 2005.
Most of the projects on tap in Uptown will be finished long before then.
"A lot of people were scared by what Victory might have been able to do," Mr. Walker said. "But Uptown developers now believe they can go ahead and do their deals.
"It has opened the flood gates again, and those that have been sitting idle have revved up their engines," he said.
Two towers
Two apartment buildings being built near Lemmon and McKinney avenues will each have seven to nine stories. The residential towers are within sight of the West Village complex that opened this summer.
Developers in that area credit West Village with causing a building boomlet. "West Village has really brought in a lot of great tenants, and it has attracted more people to the area," said Barry Howard of Fairfield Residential, which is building the 232-unit mid-rise apartment complex on Lemmon Avenue east of McKinney. "West Village has moved the ground zero location for Uptown to Cityplace."
Fairfield Residential plans to finish its apartment building next summer, along with 10,000 square feet of retail space on the new trolley line running from McKinney to North Central.
"I've already had a number of retailers contact us about space," Mr. Howard said. "Everybody wants to get in on the act."
A block away on McKinney, Austin developer CWS Apartment Homes LLC is building the 144-unit Marquis on McKinney apartment building. It will be completed next year.
And on Blackburn Street between West Village and Turtle Creek, construction is under way on the Drexel Grand, a four-story, 28-unit loft apartment building.
More to come
Even bigger deals are still to come.
At the northeast corner of McKinney and Blackburn, Florida developer ZOM Inc. is buying land for a 20-story residential project.
"There has been a lot of energy down here in the Uptown area," said Kevin Wisdom, senior vice president of ZOM Texas. "It continues to be a very resilient market.
"The access to transportation and the DART light-rail line is also important."
West Village's developers aren't sitting still while their competitors take all the deals. Builders Henry S. Miller III and Robert Bagwell are wrapping up plans for the second phase of West Village on Blackburn Street. "We want to break ground on the building before the end of the year," Mr. Bagwell said. At Lemmon and Cole – the vacant corner once known as the "Hole on Cole" – a Denver apartment builder, Archstone Communities, is working on preliminary plans for a mid-rise apartment building.
And closer to downtown, on Cedar Springs Road across from the Crescent, Houston-based builder Hanover Co. has a property under contract and plans to build yet another mid-rise residential project. It will be on the site of the Dallas Children's Theater, which plans to relocate.
Near McKinney and Routh, Hotel ZaZa will open its doors next month with 146 rooms, meeting space and a restaurant.
Neal Sleeper of Cityplace Development said that even if Victory's project starts as planned next summer, there won't be much direct competition with the Uptown projects around West Village.
"Victory is a lot closer to downtown," he said. "If Victory gets built, it's two different markets, and both can survive successfully."
E-mail stevebrown@dallasnews.com
--------------------------------------------------------------------------------
As economy dives, the area is enjoying a building boom
09/20/2002
By STEVE BROWN / The Dallas Morning News
For years, driving down McKinney Avenue in Dallas' Uptown neighborhood has been a slow crawl through blocks of construction.
Those construction trenches aren't going away, even though the economy's in a ditch.
"Everybody has acknowledged that it's a great area, and a lot of people want to play here," said property broker Newt Walker, who's worked in the area for almost 20 years. "Uptown has done a lot better in the current real estate market than some of the suburban areas, and developers want to capitalize on it."
If even half the projects currently in the planning stages get off the ground, Uptown will look dramatically different in the years ahead.
Most of the pending development is centered in two areas – near the new West Village retail and apartment center at Lemmon Avenue and around the Crescent office and hotel complex closer to downtown.
A Dallas firm working with one of the West Coast's biggest apartment builders – Legacy Partners – is negotiating to buy the former Red Cross building at McKinney and Pearl Street.
The potential owners are proposing more than 200 residential units on top of a 25,000-square-foot retail and restaurant complex, property brokers say.
A few blocks away, at Akard and Cedar Springs, developer JTS Interests of Baton Rouge, La., is buying a vacant block for more residential.
"We're working on plans for an eight-story building which we plan to start after the first of the year," said partner Thomas Wells. "We think it's where a lot of people want to live, and it is centrally located to all the amenities."
Outlook inviting
The perception that development locations are limited is prompting builders to take positions in Uptown even though the overall apartment market is about 8 percent vacant, said analyst Ron Witten of Witten Advisors.
"The market may be soft now, but if I think the economy is going to get better next year, I may start a project late this year, or in early 2003," Mr. Witten said. "A successful real estate investment is all about the future."
Brokers and developers say another factor in the building boom is the delay of the Victory retail and residential development near downtown.
Some builders held off potential projects in Uptown because they didn't want to compete directly with the $385 million Victory complex, Mr. Walker said. But with delays in funding approvals from the city of Dallas, the project was not started as early as expected.
Developers have now set the start date for Victory in summer 2003.
"The earliest we could start is next summer," said Ken Wong of Related Urban Development, formerly Palladium Group. "But I would not want to mislead you and say a groundbreaking is scheduled. I've got a lot of work to do."
The agreement between Victory developers and the city of Dallas stipulates that the project must be completed by the end of 2005.
Most of the projects on tap in Uptown will be finished long before then.
"A lot of people were scared by what Victory might have been able to do," Mr. Walker said. "But Uptown developers now believe they can go ahead and do their deals.
"It has opened the flood gates again, and those that have been sitting idle have revved up their engines," he said.
Two towers
Two apartment buildings being built near Lemmon and McKinney avenues will each have seven to nine stories. The residential towers are within sight of the West Village complex that opened this summer.
Developers in that area credit West Village with causing a building boomlet. "West Village has really brought in a lot of great tenants, and it has attracted more people to the area," said Barry Howard of Fairfield Residential, which is building the 232-unit mid-rise apartment complex on Lemmon Avenue east of McKinney. "West Village has moved the ground zero location for Uptown to Cityplace."
Fairfield Residential plans to finish its apartment building next summer, along with 10,000 square feet of retail space on the new trolley line running from McKinney to North Central.
"I've already had a number of retailers contact us about space," Mr. Howard said. "Everybody wants to get in on the act."
A block away on McKinney, Austin developer CWS Apartment Homes LLC is building the 144-unit Marquis on McKinney apartment building. It will be completed next year.
And on Blackburn Street between West Village and Turtle Creek, construction is under way on the Drexel Grand, a four-story, 28-unit loft apartment building.
More to come
Even bigger deals are still to come.
At the northeast corner of McKinney and Blackburn, Florida developer ZOM Inc. is buying land for a 20-story residential project.
"There has been a lot of energy down here in the Uptown area," said Kevin Wisdom, senior vice president of ZOM Texas. "It continues to be a very resilient market.
"The access to transportation and the DART light-rail line is also important."
West Village's developers aren't sitting still while their competitors take all the deals. Builders Henry S. Miller III and Robert Bagwell are wrapping up plans for the second phase of West Village on Blackburn Street. "We want to break ground on the building before the end of the year," Mr. Bagwell said. At Lemmon and Cole – the vacant corner once known as the "Hole on Cole" – a Denver apartment builder, Archstone Communities, is working on preliminary plans for a mid-rise apartment building.
And closer to downtown, on Cedar Springs Road across from the Crescent, Houston-based builder Hanover Co. has a property under contract and plans to build yet another mid-rise residential project. It will be on the site of the Dallas Children's Theater, which plans to relocate.
Near McKinney and Routh, Hotel ZaZa will open its doors next month with 146 rooms, meeting space and a restaurant.
Neal Sleeper of Cityplace Development said that even if Victory's project starts as planned next summer, there won't be much direct competition with the Uptown projects around West Village.
"Victory is a lot closer to downtown," he said. "If Victory gets built, it's two different markets, and both can survive successfully."
E-mail stevebrown@dallasnews.com
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