Banking On Apartments At Republic Tower

[firstngoal]

when was the last time you visited that area? I think you'll find it has changed for the better over time.

I don't "visit" the area... I work there. Although I no longer live in Big D, I am in Dallas and work in the immediate vicinity at least once a week. This area of downtown Dallas - not the Arts District, not Victory, not the West End - is still challenged. C'mon, although it is changing, lets face it, it is no utopia and it has a long way to go. I must walk to my hotel or to my car after work in the office... and there are still some sketchy blocks and characters around there... try walking in the area on any random weeknight and you'll catch my drift. Now, I certainly hope that downtown Dallas turns the corner and becomes a true live/work environment, as it would make my work trips all the better. =)

If I had $46 million, I would not be comfortable investing in this project. All the projects on the boards are interesting, but must also be viewed as future competition... and in true Texas fashion... the high-rise market will get overbuilt. There is a lot of money that is going into real estate these days as an investment - because the money has been allocated and must be put out into the market - not because it has been well researched or proven investments. Trust me, there is a new "irrational exuberance"... and in my opinion, it does not have staying power. We will soon discover how deep the market is for converted high-rise office buildings... not only in Dallas, but around the country. And, btw, give me the West Village or Mockingbird any day over the Republic Tower. To those projects, I say well-done... to some of these high-rise conversions, I say good-luck. I'm happy to see that there seem to be at least two takers for these units on this thread though... no matter the price!

[TexasStar]

If I had $46 million, I would not be comfortable investing in this project. All the projects on the boards are interesting, but must also be viewed as future competition... and in true Texas fashion... the high-rise market will get overbuilt. There is a lot of money that is going into real estate these days as an investment - because the money has been allocated and must be put out into the market - not because it has been well researched or proven investments. Trust me, there is a new "irrational exuberance"... and in my opinion, it does not have staying power. We will soon discover how deep the market is for converted high-rise office buildings... not only in Dallas, but around the country. And, btw, give me the West Village or Mockingbird any day over the Republic Tower. To those projects, I say well-done... to some of these high-rise conversions, I say good-luck. I'm happy to see that there seem to be at least two takers for these units on this thread though... no matter the price!

Make that three takers. I intend to move to the central core within a year. And Republic is high on my list of possible residences.

The giant Mosaic renovation, a block away (the former Fidelity Union Tower) is another possibility.

And, no offense, I would give more credence to the opinion of the people who actually HAVE the $46 million than to someone who just has an opinion and 2 cents.

[slfunk]

Thank you for a voice of reality, tamtagon. The Dallas uber alles bias of the other two posters does not allow them to admit the fact that high rise living without balconies is a miserable existence in ANY city, not just Dallas. The reuse of a historic building is admirable, but you wouldn't find me in it either, if all I can do is open a window for "fresh air".

funk and dallasboi, we are not trashing Dallas, but a rather poorly designed redo.

Redscare.... Not all people want balconies. It is not a bias. I personally prefer a balcony, but not everyone sees the need for one. When looking at 1600 Main Street, more then half of the properties are without balconies in the redo of an office tower. 1600 is a for purchase property. Those properties sold out in less then 6 weeks of the first phase. But like I was saying with the quality of service, roof top garden, etc. etc. I would strongly consider living there. Other examples of buildings leasing very quickly in downtown Dallas (that are very limited on having balconies) are the Davis buidling (98 percent occupied) Dallas Power and Light complex, and the Interurban building. The last two just opened this past fall. I know from someone that lives in the Interurban it almost completely occupied. The Kirby downtown has no balconies and when it was one of two residential towers downtown it had a long wait list of people to get in. Today it usually has only a couple of units available at a time. (I went looking this past spring at this building) Now going to purchase something is different, I would have to have a balcony to buy (and that is my bias preference that not everyone holds).

I work on commericial-residential projects. They look at the foe balconies (juliet) and a number of units without them. It is all a numbers game to the developers. I am sure more people then not would take a balcony, but they would not develop these projects if they did not lease. You look at more and more of the urban type developments (now I am talking new construction) you will find developers building rentals with less and less balconies due to expense for the structure support and making the lease numbers work. These type of projects of office tower redos are not anything new, they have been working all across the country where the life cycle of an office building is ending. Sometimes they put in the balconies based on structure, design, and numerous factors. For example in Dallas, in order to qualify for TIF money (which they needed to make this project work) they had to preserve the exterior of the building since this a landmark building due to the design of the exterior metal panels. To say its poorly designed is purely subjective. What will be Objective is how it leases and I see this as a safe "gamble".

[MidtownCoog]

Dallas loves their apartments, so this place just may work.

Time will tell.

I would give more credence to the opinion of the people who actually HAVE the $46 million than to someone who just has an opinion and 2 cents.

The error in this logic is your assumption that all investments are a sure thing. There is a long list of multi-million dollar failures.

Back to school for you.

[RedScare]

These type of projects of office tower redos are not anything new, they have been working all across the country where the life cycle of an office building is ending. Sometimes they put in the balconies based on structure, design, and numerous factors. To say its poorly design is subjective. What will be objective is how it leases and I see this as a safe "gamble".

If these office to residential conversions are so common, why did the developer make this quote in the Morning News article?

"At first glance, turning an empty office high-rise into apartments seems like a smart makeover.

But when the Gables folks looked around the country for skyscrapers switched to rental housing, they came up with just a handful of examples.

"There have been only four or five like this

[slfunk]

If these office to residential conversions are so common, why did the developer make this quote in the Morning News article?

"At first glance, turning an empty office high-rise into apartments seems like a smart makeover.

But when the Gables folks looked around the country for skyscrapers switched to rental housing, they came up with just a handful of examples.

"There have been only four or five like this

[MidtownCoog]

Converted commerical high rise vs. a converted commerical building (no-high rise). That is the key.

And while we are talking about sold out units with no balconies, were they purchases, or rentals?

Renting, I guess some people could live without, especially if you just live there a year or so.

But buying a $500,000 high rise, you bet your bottom dollar they will be looking for a balcony. Even a faux one, as long as it has two doors.

[slfunk]

Converted commerical high rise vs. a converted commerical building (no-high rise). That is the key.

And while we are talking about sold out units with no balconies, were they purchases, or rentals?

Renting, I guess some people could live without, especially if you just live there a year or so.

But buying a $500,000 high rise, you bet your bottom dollar they will be looking for a balcony. Even a faux one, as long as it has two doors.

Yes they were units for purchase not rent at 1600 Main. Yes, I am talking about commercial high rise.

[MidtownCoog]

A proper risk assesment would show that what worked in NYC might not have a chance in Dallas. Same for Houston.

There is a huge demad in NYC apartments. Not so sure about Big D.

[slfunk]

True Midtown, you have point. But the facts are there that it is working and has been working in downtown Dallas.

[MidtownCoog]

So name a few commerical high rises that have been converted.

Or maybe we should define high rise first?

The ones I see in downtown Houston are definetly not to the scale of Republic Tower.

[slfunk]

So name a few commerical high rises that have been converted.

Or maybe we should define high rise first?

The ones I see in downtown Houston are definetly not to the scale of Republic Tower.

I already have in this thread..... Scroll up.

[MidtownCoog]

NYC and Chicago - I'd take that gamble.

[Dallasboi]

NYC and Chicago - I'd take that gamble.

You win Midtown!!!!!!!!Dallas will never suceed in anything. Face it Dallasites we Have poor infrasrtucture downtown none of the projects will last. So that means all of the people lined up to move downtown need to just turn around and move to Frisco. ............

[MidtownCoog]

I just feel sorry for the schmuck who gets stuck with the view of the cooling tower.

No wonder there are no plans for balconies.

[The Great Hizzy!]

What's working in Houston is the conversion of older commercial buildings (mid-rise to low tier high-rise) into residential (Kirby Tower, Commerce Towers, Franklin Towers, etc). I can't think of any highrise commercial project that's even been attempted here like what's proposed for the Republic Tower in Dallas. Then again, maybe we need to define what we mean by highrise. Are we going with the Emporis definition of 12-plus stories or are we talking 25 stories or 300 feet plus?

[MidtownCoog]

25 stories or 300 feet plus

[Dallasboi]

I just feel sorry for the schmuck who gets stuck with the view of the cooling tower.

No wonder there are no plans for balconies.

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uHHHHHHHHHHHH.........er..........Rooftop Pool....oh!...Don't tell me....U forgot.

[MidtownCoog]

Oh, on that roof top?

Good luck cramming the roof top garden in there as well.

Further proof of self-imposed hardship living.

[713 To 214]

Some people will argue ad noseum. . . just for argument's sake. They'll even argue a point until they've gotten everything all twisted and turned around, and they've ended up arguing with themselves.

Dallas loves their apartments, so this place just may work.

There is a huge demad in NYC apartments. Not so sure about Big D.

The point is every individual will have his/her own preference for what he/she is looking for at any given time in his/her life. Some look for temporary housing in the form of rentals/leasing. Some look for more permanent housing in the form of mortgaged homes. The preference could be a house in the suburbs, a town home in the city, a condo in the central business district (with or without balconies). Some prefer yard work/gardening and streets where the kids can play outside and don't mind the driving everywhere they need to go. Others want the convenience of a valet and concierge service in a high-rise where there is little to no maintenance required, views of the city are spectacular, and mass transit/walking is the preferred mode of travel to where they work and play.

There are developers and tenants all over who recognize these obvious differences in preference. I trust that they have all done their homework on what they think will work for their business. As for this specific property, I trust that the Gables (a successful real estate investment trust -with over 40,000 managed apartment homes in 160 communities, 78 owned communities with over 20,000 stabilized apartment homes and with an additional 11 communities with 2,600 new apartment homes under development or lease-up in 12 cities) has done its homework and is far better positioned than you are to assess risk in this project. Additionally, I trust that any resident that rents at the Gables' Republic Tower will have had the opportunity to preview his/her unit prior to occupying it, and consequently choose a unit he/she can live with.

Out of curiosity Midtown, what data do you have that supports your repeated contention that Dallas "loves" apartments, or many of the statements you've made in this thread, for that matter? Has there been some type of survey conducted? I really would like to know, because data like that interests me. Thanks in advance.

[MidtownCoog]

Recent DMN articles about Dallas having a hard time keeping up with demand for rental apartments.

Google it. For example:

"We see a huge demand for the rental units, and it's a great retail location," said Post executive vice president David Ward. "We're filling a slot that's been left vacant thanks to the change in the office market."

http://www.dallasnews.com/sharedcontent/dw...on.d4c87ca.html

far better positioned than you are to assess risk in this project.

Dude, this is an internet message board. If I can't opine, then what's the point? You might as well Logoff now if you don't like reading it.

[slfunk]

I just feel sorry for the schmuck who gets stuck with the view of the cooling tower.

No wonder there are no plans for balconies.

Thats not the roof top garden. Its at the top of the 36 story tower. It already has a roof plaza there (top of the 36 story building), was very nice some years ago. What you are seeing in this picture is what has been adapted previously into a parking garage. No apartments will be built in this park of the Republic complex.

[713 To 214]

Dude, this is an internet message board. If I can't opine, then what's the point?

You are correct about opining on an internet message board. However, the next time you want to state your opinion, try prefacing it with something like "I think" or "IMHO," rather than couching your opinion in terms that would lead the unsuspecting/uninformed reader to believe that it's actually fact. . .unless your goal is just to come off as a "know it all." I'll give you an example of how it's done. Watch closely.

"Midtown, I think you raise some interesting issues. However, IMHO you present them in a reckless way that disregards some established facts.

Now, you try it.

[MidtownCoog]

I THINK this project will flop.

[713 To 214]

Very Good.

Now, I think the jury will be out on this one for a while. While I'm not as sour as some on this thread, I am a little skeptical, just a little, about this project's viability due to other high-rise conversions in its immediate vicinity. I do think that this project will benefit from having a DART Rail station at it's doorstep, it's close proximity to numerous office towers filled with professionals who can afford the anticipated rents, and the STRONG desire to move DT Dallas shared by many local twenty to thirty-somethings. Additionally, DT Dallas' plans for expansion of its greenspace areas, combined with numerous supporting convieniences, will give people a reason to call this place home.

[Dallasboi]

I THINK this project will flop.

Interesting opinion.I hope thats not all that has to be said for a project to flop ,because if it is, then you must have voiced your opinion right before the construction of "The Shamrock Tower"? Just an Observation.

[firstngoal]

The giant Mosaic renovation, a block away (the former Fidelity Union Tower) is another possibility.

And, no offense, I would give more credence to the opinion of the people who actually HAVE the $46 million than to someone who just has an opinion and 2 cents.

Wow. That's just rude, TexasStar - offense taken. What makes you think - or assume - that I may not have involvement with people who might have involvement in real estate investment?????? I wasn't making anything up... I was just speaking from experience.

As a matter of fact, I do happen to work for a real estate investment company - actually sit on the investment committee. We have purchased two large assets in Dallas (which in total would be far more than $46 million) - which is why I am there often. I work on getting these projects financed - and have insight into the actual performance of these properties. So you may not care about my opinion... fine... but there is no need to knock it.

[tamtagon]

Well, I hate foe balconies; I would need an outside living room.

I think the Republic Tower will be successful because it's a bad-ass looking building.

[Dallasite]

I think the Republic Tower will be successful because it's a bad-ass looking building.

Me too!

[TexasStar]

From the Guidelines for this sub-forum:

Respectful discussions only. Any "my city is better than your city" flamewars will be deleted without notice.

~ HAIF Moderators

Well, so much for that idea. I joined this forum for two reasons. To keep up with the great projects going up in Houston and to contribute to keeping like-minded Houstonians up-to-speed with the developments in DFW. But, obviously, that can't be done here without the obligatory city-bashing. Sad, but so predictable. I mean if you're consumed with so much white-hot hatred for all things Dallas, why not just avoid the DALLAS/FT.WORTH/DFW sub-forum? Makes too much sense? Or more likely, what better place to pick the fight you've been spoiling for anyway, huh? Got it.

Well, since I don't have time for that kind of childish foolishness, it's so-long and goodbye to HAIF.

See you on dallasmetropolis.com!