In the past few months, there have been several large and relatively new office towers in the inner core of Dallas that have lost major tenants and are now in financial trouble with lenders. Loans are in default, as occupancy nears 50 percent or less.
Dallas can ill afford to let these major landmarks on our skyline fall into the “fire sale” category and erode the tax base.
On the plus side, most of these properties are DART-served and on the CBD tunnel system. Reasonable upgrades can restore tenant appeal. Bargain rents are ranging from $15 to $19 per square foot, plus electric.
On the minus side, these buildings are short of parking, which would make them competitive with options in Uptown and North Dallas. Why were they built short of parking? The answer is simple. They were surrounded by ample parking lots in the 1970s and ’80s. Not now. Converting parking to green parks is a fine idea, but not if no one is left to walk in the park.
Parking can be created and apportioned to buildings according to the need, and the building owners must “buy” the parking when they buy the buildings.
It may take some form of public/private initiative, but the time is right.
Wayne Swearingen is a principal at Glacier Commercial Realty. Contact him at firstname.lastname@example.org.