Thursday, June 18, 2015

Dallas Symphony selling Arts District corner for new tower project

A new high-rise is in the works for downtown Dallas at an unexpected location.
The Dallas Symphony Foundation is selling the high-profile corner of Woodall Rodgers Freeway and Pearl Street in the Dallas Arts District to developer Lincoln Property.
The property – which is next door to the Meyerson Symphony Center – for the last 20 years has been used for green space and sculpture.
Developer Lincoln Property plans to build a 23-story office tower on the corner. (Lincoln Property)
Developer Lincoln Property plans to build a 23-story office tower on the corner. (Lincoln Property)
Lincoln Property plans to build a 23-story office tower on the site, which is across from Klyde Warren Park and the Federal Reserve Bank of Dallas.
Symphony representatives on Thursday confirmed the pending sale of the just more than half-acre property. They will use the proceeds from the transaction to fund ongoing operation of the symphony orchestra.
“The real estate market in downtown Dallas, and especially the Arts District, is at a historic high, so it just made good financial sense to put this asset to the best use for the symphony,” Dallas Symphony Orchestra president and CEO Jonathan Martin said in a statement.
Lincoln Property is already talking with potential businesses that are interested in renting space in the tower, which will have about 250,000 square feet of office space built on top of a parking garage and ground floor retail.
Construction will start on the project in September, said Lincoln Property president Bill Duvall.
“We are excited about the property and the location,” Duvall said. “We try and find development sites that maybe aren’t the first ones you think about.”
The building will be constructed on one of the last available development sites in the Arts District on land that was never expected to sell for new construction.
The symphony bought the land in 1995 after appeals from Meyerson architect I.M. Pei and local civic leaders. The busy corner was then used for a motor bank.
Pei and symphony leaders were worried that the site right next to the landmark concert hall would be used for an incompatible commercial development. “I dreamed of golden arches being built on that corner,” Pei reportedly said.
The symphony earmarked the property – at the gateway to the Arts District – for a park for future expansion of its facilities.
Lincoln Property hired Dallas architect HKS Inc. to design the tower it plans on the corner. It’s right across the street from where developer Trammell Crow Co. and Metropolitan Life Insurance propose construction of two new high-rises also designed by HKS.
Word about the new downtown office project has caused a stir in Dallas commercial real estate circles.
“It has certainly caught people by surprised and it’s been very much under the radar,” said Johnny Johnson with commercial real estate firm DTZ. “It’s a very important location in the Arts District. It’s not going to be a huge building and will fit well within the immediate area.
“They are appealing to the market with a high-end, boutique type building in a strategic location.”
The planned office tower is likely to be the most expensive and exclusive new business address in Dallas, property brokers say.
The property sales price is $7.2 million – one of the highest prices ever paid in the Arts District.
Back in 1995 when the corner last sold, it traded for just over $1 million.
“We felt this was the most prudent thing we could do to help support the symphony for years to come,” said symphony foundation president Scott Hancock. “We felt like the price and the timing were right.”
Last year the Chase motor bank property on the opposite corner of Woodall Rogers and Pearl sold for more than $300 per square foot.
The sale of the symphony land is scheduled to be completed in about 90 days.
As part of the deal, the symphony foundation has secured the right to review and approve the architect and plans for development on the property.
“There are ramifications to being next to such an important building,” said Hancock. “After meeting with Lincoln we felt they would be a strong partner.”
Lincoln officials said they are working closely with the symphony on the project.
“The Meyerson is one of the greatest buildings ever,” Duvall said. “You want to make sure what you build is compatible.”
Lincoln’s tower is one of several new office projects in the works on the north side of downtown.
Developers Hall Financial, Crescent Real Estate and Harwood International have new buildings under construction. And Hillwood, Hines and RED Development have other projects on the drawing board for Uptown.   
Steve Brown/ Dallas Morning News