Friday, September 05, 2008

Several big apartment, condo projects in works in East Dallas

Kirk Freeman and Clark Lauderdale managed the Newport apartments on Matilda Street near Lovers Lane for more than a decade.

And when the out-of-state owners decided to sell the complex, they saw that the timing was right for redevelopment.

"We thought a condominium conversion was perfect for this property," said Mr. Freeman, who cited the close-in Dallas location and two-block walk to a DART light-rail station as key ingredients to the redo plan.

More than a year later, the renamed Veneto condominiums have just opened, and buyers are starting to move in. The developers spent more than $60,000 a unit to rehabilitate the 72-condo project.

A few years ago, the neighborhood just east of University Park wouldn't have warranted that much of an investment, the developers say.

"There have been a lot of changes, and there are going to be more," said Mr. Lauderdale of Lauderdale Co.

Indeed, developers are tying up building sites and knocking down block after block of older apartments in the area.

A half dozen or so major projects are in the works.

"Neighborhoods served by mass transit have tremendous appeal among renter prospects right now, so these areas are the hot zones targeted by quite a few developers," said Greg Willett of apartment market analyst M/PF YieldStar. "It's happening not just in Dallas but all across the nation."

One of the largest new developments in the neighborhood is Prescott Realty Group's mixed-use complex along Yale Boulevard at Greenville Avenue. It's adjacent to DART's Mockingbird rail stop.

"With $4 gas and ozone action days, we like the concept of people staying out of their cars so they can live, shop and work in the same area," said Prescott Realty chief executive Jud Pankey. "The fastest way to make an impact on DART ridership and air quality is to build residential adjacent to the stations."

The developer and investor has just completed demolishing the old Shamburger Building Center complex and is working on plans for a new apartment and retail complex.

The development is planned to contain about 450 apartments plus retail space. And Prescott Realty owns other land nearby that is also earmarked for redevelopment.

Visible changes are under way along Lovers Lane east of Matilda Street.

Fairfield Properties and Behringer Harvard are tearing down about two blocks of old rental units that will be replaced with new apartments and some retail space.

Fairfield hopes to break ground on the site of the Signature Pointe apartments as early as November. But first, the developer has to get city approval for the project and tear down the old apartments. The apartments were vacated and fenced off months ago. Fairfield has been negotiating with city planners and neighbors over details of the project since then.

"We are looking at building between 365 and 375 apartments," said Fairfield's Steven Stamos. "We will also have a retail component and 23 townhomes."

The developer has already spent more than $25 million on the project and hasn't turned a spade of dirt.

"You can understand that we are anxious to start," he said.

Nearby at the Plaza at Skillman apartments, demolition crews are knocking down the buildings. Behringer Harvard and Greystar Development are making way for more new apartments.

"About 80 percent of the previous structures have been cleared," said Behringer Harvard's Jason Mattox. "Construction will begin immediately after."

About 155 townhouse-style apartments will replace the 185 old units, which were built in the early 1970s.

North of Lovers at Southwestern Boulevard and Skillman Street, Florida-based builder ZOM Inc. has already torn down the almost 40-year-old Village View apartments. ZOM plans a new rental complex with more than 400 units.

The widespread rebuilding has gotten a mixed reaction from neighbors. Some property owners in the area welcome the replacement of aging rental complexes. But others have complained that the redevelopments will bring more traffic and higher housing costs.

The appeal of living a short walk from shopping and mass transit is a big lure for Veneto's buyers, developers say.

"Another developer, Power Properties, had already done successful condominium conversions in the neighborhood," Mr. Freeman said. "A significant number of our buyers are going to be first-time homeowners."

And so far, east side locations are offering a bargain compared with other central Dallas neighborhoods. The Veneto condos range from the $130,000s to the $240,000s, for example.

"This market is at least 25 or 30 percent cheaper than Uptown," Mr. Lauderdale said. "And we have a DART station and a Central Market grocer right up the street."

Lauderdale Co. is pushing ahead with plans to redevelop a second rental building across Birchbrook Drive. That complex will add 65 condo units.

"Most of the apartments in this area are going to be torn down or redone," Mr. Lauderdale said.