Eastern end of downtown Dallas is seeing new life, but challenges remain

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by By DAVE LEVINTHAL / The Dallas Morning News

wfaa.com

Posted on August 15, 2009 at 4:47 PM

Updated Friday, Oct 16 at 12:32 PM

Not five years ago, the eastern slice of downtown Dallas, once bustling, was more urban blight than business district.

JIM MAHONEY/DMN
Workers at Main Street Garden labor with the recently refurbished Mercantile Building (center) looming in the background. But the vacant Dallas Grand Hotel (left) is still a remnant of eastern downtown's recent past.

The towering Mercantile Building stood empty, as did the Dallas Grand Hotel, only their doorways full - with garbage and the smell of stale urine. Cut-rate parking lots proliferated, streetlights didn't work and a walk at night down its section of Commerce Street often proved dicey, if not outright dangerous.

Today, the Mercantile Building and a new, adjacent high-rise are filled with hundreds of apartment dwellers.

The Main Street Garden park, built on a city block bounded by Commerce, Main, Harwood and St. Paul streets, is nearing completion.

And earlier this month, the Texas Legislature approved creation of a University of North Texas law school, to operate by early next decade across Harwood Street in two soon-to-be-renovated Dallas municipal courts buildings.

All the while, patrols by Dallas police and a private downtown security force are noticeably more frequent.

Such redevelopment, so quickly, stuns even the center city's most ardent boosters.

"We've made some enormous inroads and progress. All of a sudden, you have a lot of the vitality you want," Mayor Tom Leppert said. "Not everyone expected that."

But such progress comes with significant expense. And the expenses continue to mount in what ranks among the most challenging fiscal years in Dallas governmental history, with steep staffing and service cuts looming.

Since 2005, Dallas City Hall has directed more than $100 million in public money and subsidies toward reinventing the three blocks on which the Mercantile Building, Main Street Garden and future law school sit.

The ultimate goal, city leaders say, is to create a vibrant, self-sustaining area with such gravity and gravitas that new residents and businesses simply can't stay away. That end is worth the means, for the center city and Dallas at large, they argue.

"If we let our downtown go, if we let businesses leave, if we forget to attract commerce and residents, we will not have a healthy city," said District 14 council member Angela Hunt, who represents the area. "The life of downtown, and the growth of downtown, is reflective of our city as a whole."

Challenges remain

Even with the city's investments, downtown Dallas' eastern flank still suffers from some of the urban ills that so dogged it earlier this decade.

The massive Dallas Grand Hotel, for example, remains empty save for a population of pigeons and plant life. Several buildings immediately to its west and south are also unoccupied - redevelopment plans either delayed by a flagging economy or altogether nonexistent.

The Dallas Grand, once known as the Dallas Statler Hilton, is particularly problematic, the center of a political tug-of-war among city officials, preservationists and the building's owners - owners who appear reluctant to sell or renovate it for anything less than top dollar.

Dallas' preservationist community has declared the hotel one of the most endangered buildings in the city. Many preservationists fear developers will convert the hulking specimen of midcentury modern architecture into something that strips it of its character, or worse, turn it into a rubble pile.

Notable problems the Dallas Grand now faces include a lack of parking and low ceilings that limit how, practically, it may be reused.

"A sensitive redevelopment is critical," said Katherine Seale, executive director for Preservation Dallas, whose influential organization has yet to endorse a specific renovation plan.

Seale says she believes the area's very evolution may remedy the Dallas Grand redevelopment conundrum. After Main Street Garden and the law school come on line, "it'll be too desirable to not redo it," Seale said, particularly if developers secure a 20 percent federal rehabilitation tax credit sometimes available for such projects.

The city government may also find itself offering subsidies to developers of the Dallas Grand, possibly in the form of tax increment financing incentives, or something more direct, such as tax abatements.

Another challenge this area faces: linking itself to the rest of downtown Dallas, pockets of which are also experiencing urban renaissances - the Arts District, Main Street District and, perhaps, areas north of the Dallas Convention Center, where City Hall plans to build a $500 million convention hotel.

Ending isolation

To date, the area is relatively isolated, several blocks from the nearest Dallas Area Rapid Transit rail station or McKinney Avenue Trolley stop, and a lengthy walk to and from other attractions, such as Uptown, Deep Ellum and the West End.

Hunt and District 11 council member Linda Koop in particular have advocated the construction of streetcar lines that would service the Main Street Garden area and link it to other sections of downtown. The air-conditioned streetcars, they say, would serve as economic engines, attracting new people downtown to live and recreate, while luring businesses to the center city to serve this population.

The beginnings of such business development are already materializing, said Jim Truitt, an executive with Forest City Enterprises, which redeveloped the block on which the Mercantile Building stands. In 2005, his company received about $70 million in city subsidies toward the quarter-billion-dollar project.

In the Mercantile Building alone, a new bistro and coffee house have recently opened to serve residents. More retail operations soon are expected to fill the complexes' remaining vacant storefront space, Truitt said.

"If people weren't walking in our doors looking to rent, I'd be nervous about this area. But that's not the case," said Truitt, noting that the Mercantile Building, opened last year, is 74 percent occupied, while The Element, a recently opened apartment tower next door, is 35 percent occupied.

"The challenge is now getting to a point where you no longer have a great area, and then you walk 200 or 300 feet where all the storefronts are vacant," he said. "Once you fix that, you'll really have something. And we're going in that direction."

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