A Lot To Chew On: The Merc Is Eating Up Funds

[MidtownCoog]

OpEd on something RedScare mentioned a few weeks ago, much to the chagrin of the Dallas posters on this board.

Seems like others are starting to pay attention, too.

A Lot to Chew On: The Merc is eating up funds

No big surprise

05:02 AM CST on Monday, February 13, 2006

The Mercantile Bank complex has always been touted as the big enchilada of downtown redevelopment. Now it transpires that to make a big enchilada, you've got to use a lot of cheese. If that comes as a nasty surprise, maybe someone needed to read the recipe more closely.

http://www.dallasnews.com/sharedcontent/dw...n1.910a89d.html

[Dallasite]

...Not to the chagrin of Dallas posters in this board....

It has been and always will be a controversial development, regardless of the status. It requires a ton of money period. Some say it's return will be worth and others do not.

[The Great Hizzy!]

The council OK'd the project anyway, because its members believed that as long as the Merc moldered, nothing much else was going to happen in downtown anyway.

I'd be concerned if my council thought like this. You really don't have a grasp of your community if you're bound to such limited thinking. Seriously.

[rantanamo]

The Merc brings about mixed feelings. For those that don't know much about it, the project is huge. Bigger than the Pavillions project in Houston. The Mercantile complex involves 3 or 4 structures I believe. A couple will be demolished and two new towers built, while the main tower and other structure will be renovated. So its not just an ordinary renovation. The amount of area, street surface down Main and number of units it would add are almost as much as what's currently there. Otherwise, it would be demolished and Dallas would hope that something else is built. So its a hard choice. Demolish and distribute to other projects that might equal the retail and residential units, or spend it all on the Merc and the Atmos complex(can't forget that part. It will equal a large amount of renovation and residential units) So there you have it. Guranteed units, vs potential a more projects. So who knows which is best. I certainly don't.

I don't agree with that reason it was OK'd. If they just look around and see all the cranes and blocked streets downtown, they'd know that plenty is going on.

[dfwcre8tive]

Just an update... work on the Merc is still going on. Over recent months the 1949 14-story Securities Building, 1958 22-story Mercantile Dallas Building and the 5-story Securities Annex Building were demolished. Before demolition most of the mosaics and artwork were removed and saved. In their place will rise the new 15-story 150 unit apartment building, retail space and park. The original Art Deco Mercantile building is being restored and converted into 225 apartments. The 'modernized' facade around the base was removed and they are currently cutting balconies into the side of the building.

You can see recent photos of work on the building here on the Dallas Forum.

There are renderings of the project located here.

[dfwcre8tive]

The crane went up this weekend for the new building construction, while work continues on the renovation of the historic building (and clock spire). Here are a few photos from today:

Perhaps the thread title can be changed to "Downtown Dallas Mercantile Renovation" now that the project is well under way?

[zebra]

it dont look like it gonna be bigger than HP. Maybe vertically but not in square feet.

[Dallasboi]

it dont look like it gonna be bigger than HP. Maybe vertically but not in square feet.

Uh......It will be....The rendering is only showing part of the entire project.There are more buildings included.

[Houston19514]

The Mercantile Block is nothing like HP. The Mercantile Block is a residential development with a smattering of retail (30,000 square feet of retail). HP is a retail and office project (360,000 square feet of retail plus roughly 200,000 square feet of office space).

The Mercantile Block (375 apartments - 30,000 square feet of retail) is really fairly comparable to One Park Place (346 apartments - 22,000 square feet of retail).

(And btw, the renderings indeed show the entire project. They are renovating the main clock tower building, and have already demolished three smaller complex buildings which will be replaced by one new 15-story apartment building)

[dfwcre8tive]

(And btw, the renderings indeed show the entire project. They are renovating the main clock tower building, and have already demolished three smaller complex buildings which will be replaced by one new 15-story apartment building)

Actually, the renderings show the Mercantile block, which is only one part of the project (which will consist of 7 buildings -- 6 converted, 1 new-- when complete). So it depends if you are comparing just the block or the entire project to HP.

From Forest City's website:

"After a number of challenges and delays, the Mercantile project is underway. The project will be part of a redevelopment area consisting of six vacant buildings in downtown Dallas that will be converted into residential apartments and condos. An additional three vacant buildings in the Mercantile block will be torn down to make way for a new 15-story residential building and amenity deck. Developers anticipate a spring 2008 completion date for the Mercantile block.

...

The complex is part of a $250 million project that includes the former Mercantile Bank Building, the nearby Continental Building and the four-building Atmos Energy Complex.

The four-building, 1.1-million-square-foot, Mercantile Bank Complex, vacant for almost 20 years, sits in the heart of downtown Dallas across from Neiman Marcus

[Houston19514]

Actually, the renderings only show one part of the project. From Forest City's website:

"After a number of challenges and delays, the Mercantile project is underway. The project will be part of a redevelopment area consisting of six vacant buildings in downtown Dallas that will be converted into residential apartments and condos. An additional three vacant buildings in the Mercantile block will be torn down to make way for a new 15-story residential building and amenity deck. Developers anticipate a spring 2008 completion date for the Mercantile block.

...

The complex is part of a $250 million project that includes the former Mercantile Bank Building, the nearby Continental Building and the four-building Atmos Energy Complex.

The four-building, 1.1-million-square-foot, Mercantile Bank Complex, vacant for almost 20 years, sits in the heart of downtown Dallas across from Neiman Marcus

[dfwcre8tive]

Gotcha. Why can't I find that on Forest City's website? All I can find is information about The Mercantile Block.

They haven't released any plans for the rest of the project yet. The Mercantile block is the first part of the project. They are renovating the old tower and constructing the new building (both apartments). Then they will convert the Continental building into condos (the brown building with the relief sculpture across the street... it's currently housing the construction offices for the Mercantile block). After this they will move onto the Atmos complex, which sits behind the Continental building and vacant Dallas Grand Hotel on an entire block (various buildings, including some nice old art deco structures). The renderings posted above are about a year old, so final plans for the Mercantile block and new building may be a bit different. Construction is rumored to start soon on the city park on the entire block across the street from the Mercantile block but no formal announcement has been made yet. I live across the street from the project so I'm always watching (and hearing) the construction. The entire project will add a lot of needed activity to this area of Main Street.

[Houston19514]

Actually, the renderings only show one part of the project. From Forest City's website:

"After a number of challenges and delays, the Mercantile project is underway. The project will be part of a redevelopment area consisting of six vacant buildings in downtown Dallas that will be converted into residential apartments and condos. An additional three vacant buildings in the Mercantile block will be torn down to make way for a new 15-story residential building and amenity deck. Developers anticipate a spring 2008 completion date for the Mercantile block.

...

The complex is part of a $250 million project that includes the former Mercantile Bank Building, the nearby Continental Building and the four-building Atmos Energy Complex.

The four-building, 1.1-million-square-foot, Mercantile Bank Complex, vacant for almost 20 years, sits in the heart of downtown Dallas across from Neiman Marcus

[dfwcre8tive]

Gotcha. I had not previously been able to find the information about the larger project on Forest City's website. But, here is the part of the description that you left out... "The Continental Building will be transformed into 160 condo units. Plans for the Atmos Energy Complex are still being developed."

Depending on what they decide to do with the Atmos Energy part of the project, it still appears a whole lot more comparable to One Park Place than to HP.

Any news on their plans for the Atmos Energy Complex? And for that matter, has there been any news on the transformation of The Continental Building into condos? Neither of those parts of the overall project appear on Forest City's "Projects and Properties" pages.

As part of the deal with the City of Dallas, I think Forest City is required to convert the Atmos complex into residential. This is what the Wikipedia article had to say about it:

"Three different proposals fell through before Cleveland-based Forest City Enterprises was able to make the financial numbers work. FCE announced a deal with the City of Dallas in June of 2005 that they will receive US$60.5 million dollars from the city to redo the building. The main tower will be converted to 225 apartments with ground floor retail. The three additions will be demolished. On the site of the Securities Annex will be a fifteen-story apartment building. On the former site of the Dallas Building will be low-rise retail buildings. The entire block will also have a plaza area and underground parking.

Forest City will also receive US$5 million from the city to redo the Continental Building into 150 for-purchase condominiums. The city will receive a share of the sales receipts of the condos. Forest City is redoing this building at the same time as the Merc complex.

Also in the deal between the City of Dallas and Forest City, FCE will convert another complex of four buildings that Atmos Energy donated to the City for residential use. They will start on this project when the Merc is completed."

Lone Star Gas building (part of the Atmos complex) photos.

Dallas Gas Company building (part of the Atmos complex) photos.

[Houston19514]

As part of the deal with the City of Dallas, I think Forest City is required to convert the Atmos complex into residential. This is what the Wikipedia article had to say about it:

"Three different proposals fell through before Cleveland-based Forest City Enterprises was able to make the financial numbers work. FCE announced a deal with the City of Dallas in June of 2005 that they will receive US$60.5 million dollars from the city to redo the building. The main tower will be converted to 225 apartments with ground floor retail. The three additions will be demolished. On the site of the Securities Annex will be a fifteen-story apartment building. On the former site of the Dallas Building will be low-rise retail buildings. The entire block will also have a plaza area and underground parking.

Forest City will also receive US$5 million from the city to redo the Continental Building into 150 for-purchase condominiums. The city will receive a share of the sales receipts of the condos. Forest City is redoing this building at the same time as the Merc complex.

Also in the deal between the City of Dallas and Forest City, FCE will convert another complex of four buildings that Atmos Energy donated to the City for residential use. They will start on this project when the Merc is completed."

Lone Star Gas building (part of the Atmos complex) photos.

Dallas Gas Company building (part of the Atmos complex) photos.

Ohhhh.... so if I understand you and the maps correctly, it really sounds like three separate projects are being developed under the same master agreement with the City of Dallas.

At any rate this new information merely confirms my earlier judgment that the Mercantile Project (even if we consider all three projects as one), is much more comparable to (if larger than) One Park Place, and not at all comparable to Houston Pavilions. Even with all three Forest City projects taken together, it looks they are talking about approximately 625 residential units and 40,000 square feet of retail versus 346 residential units and 22,000 square feet of retail at One Park Place and 360,000 square feet of retail and 200,000 square feet of office space at HP.

[dfwcre8tive]

Here's a good photo from November that shows the Mercantile project area and illustrates the importance of the project. Starting from left to right: the Atmos Complex (consisting of 4 buildings), the Grand Hotel, the Continental, Merc Commerce, 1700 Commerce (the only one not vacant), and the Mercantile block, are the buildings there in the immediate area.

With the Mercantile project these vacant buildings will be converted into 7 buildings of residential high rises. This leaves just the Grand Hotel and Merc Commerce as vacant. Also in the foreground is the old Dallas City Hall which will be turned into UNT's law school, and the entire block of low rise buildings/parking garages it faces will be turned into a park. Several blocks of downtown will be transformed.

[dfwcre8tive]

Ohhhh.... so if I understand you and the maps correctly, it really sounds like three separate projects are being developed under the same master agreement with the City of Dallas.

At any rate this new information merely confirms my earlier judgment that the Mercantile Project (even if we consider all three projects as one), is much more comparable to (if larger than) One Park Place, and not at all comparable to Houston Pavilions. Even with all three Forest City projects taken together, it looks they are talking about approximately 625 residential units and 40,000 square feet of retail versus 346 residential units and 22,000 square feet of retail at One Park Place and 360,000 square feet of retail and 200,000 square feet of office space at HP.

The Mercantile deal is all one project but may better be described as "3 phases" of development. As far as retail goes it doesn't really compare to the Houston Pavilions (unless Forest City surprises us with plans for the Atmos complex or something huge comes into the space across from Neiman Marcus in the Mercantile Tower). However, both projects will greatly affect the redevelopment of their city's downtown.

[Houston19514]

Here's a good photo from November that shows the Mercantile project area and illustrates the importance of the project. Starting from left to right: the Atmos Complex (consisting of 4 buildings), the Grand Hotel, the Continental, Merc Commerce, 1700 Commerce (the only one not vacant), and the Mercantile block, are the buildings there in the immediate area.

With the Mercantile project 9 vacant buildings will be converted into 7 buildings of residential high rises. This leaves just the Grand Hotel and Merc Commerce as vacant. Also in the foreground is the old Dallas City Hall which will be turned into UNT's law school, and the entire block of low rise buildings/parking garages it faces will be turned into a park. Blocks of downtown will be transformed.

Wow. I can see what you mean. I honestly had not realized just how bad of condition downtown Dallas is in. Are there many more empty buildings yet?

[dfwcre8tive]

Here's a photo from the other direction showing the area and the new UNT law school. The Mercantile Tower will face the new park. UNT also purchased the nearby Universities Center, which also faces the park, and will be expanding classes there. This whole area of Main Street/Downtown has been empty and quiet for some time but is starting a revival with the Mercantile construction. The Harwood Historic District protects the oldest buildings from demolition.

http://www.uh.edu/ednews/2006/dmn/200610/20061016unt.html

[Dallascaper]

Wow. I can see what you mean. I honestly had not realized just how bad of condition downtown Dallas is in. Are there many more empty buildings yet?

When 1/3 of a downtown is empty, this is what it looks like. The newer buildings are doing well or surviving, but the older structures economically unviable as office space. Dallas experienced a huge building boom in the '50s, and those ugly hulks are sitting empty, waiting for the wrecking ball or redevelopment. The Merc project is huge for Dallas. While the Merc may not have the retail aspect of HP, I think downtown Dallas has a lot more riding on it than Houston has with HP.

[The Great Hizzy!]

Well, I really hope things work out the way Forest City and the CoD envision. It looks like a much needed boost to DT in general and particularly that area of DT. Maybe Forest City, if things go well, can come on down here and do something similar to the lot where the Shamrock Tower was to be built.

[dfwcre8tive]

Here's a fun graphic of how the Mercantile clock used to function. They are currently working on the clock and have some green and red neon "mockups" turned on. Everyone is curious to see how much is restored. I'll be glad when the clock actually shows the right time!

And there are very nice photos of the Merc pre-renovation here: http://nostalgicglass.org/display.php?pn=16#

[Houston19514]

Here's a photo from the other direction showing the area and the new UNT law school. The Mercantile Tower will face the new park. UNT also purchased the nearby Universities Center, which also faces the park, and will be expanding classes there. This whole area of Main Street/Downtown has been empty and quiet for some time but is starting a revival with the Mercantile construction. The Harwood Historic District protects the oldest buildings from demolition.

http://www.uh.edu/ednews/2006/dmn/200610/20061016unt.html

Has that UNT law school been approved? And was their purchase of the Universities Center approved? The article you posted was pre-approval, and made it look pretty iffy.

[troyboy]

When 1/3 of a downtown is empty, this is what it looks like. The newer buildings are doing well or surviving, but the older structures economically unviable as office space. Dallas experienced a huge building boom in the '50s, and those ugly hulks are sitting empty, waiting for the wrecking ball or redevelopment. The Merc project is huge for Dallas. While the Merc may not have the retail aspect of HP, I think downtown Dallas has a lot more riding on it than Houston has with HP.

Exactly. DTD had two building booms, one in the 50's and one in the 80's. And in the 80's while some companies went to the surburbs, many moved into the shiny new modern buildings, leaving the old 50 buildings empty. And it's several of those older buildings that still are counted in Dallas' office vacanacy rate. That's why the Mercantile is so great. Developers have been snatching up the "historic" properties for a while, but the Mercantile is showing developers that the 50-era buildings can be redeveloped as well.

[dfwcre8tive]

Has that UNT law school been approved? And was their purchase of the Universities Center approved? The article you posted was pre-approval, and made it look pretty iffy.

The law school is still awaiting approval by the state, but the Universities Center purchase was made in December. Currently other colleges use the first few floors of the building but the rest remains empty. UNT will renovate the 4-8th floors into classrooms for fashion and upper level courses. The ground floor houses the fashion collection. No news on when construction will begin, but I live in the Majestic Lofts next door and received a notice a few months back showing transfer of ownership to UNT. The Universities Center and Majestic Lofts are connected and were once the Titche-Goettinger / Joske's department store.

[C2H]

I still wouldn't go so far as to say that downtown Dallas has more riding on it than downtown Houston has w/ HP. Downtown Houston is about to make a HUGE turnaround. Downtown houston is already about 10 years ahead of downtown Dallas in terms of development. With all these projects: Discovery Green, HP, and 1 Park Place, its about to see another renaissance.

All in all, i think both cities downtowns have very promising futures and i'm proud that both will represent some of the best of what Texas has to offer.

[Dallascaper]

I still wouldn't go so far as to say that downtown Dallas has more riding on it than downtown Houston has w/ HP. Downtown Houston is about to make a HUGE turnaround. Downtown houston is already about 10 years ahead of downtown Dallas in terms of development. With all these projects: Discovery Green, HP, and 1 Park Place, its about to see another renaissance.

All in all, i think both cities downtowns have very promising futures and i'm proud that both will represent some of the best of what Texas has to offer.

You could be right; I am not as familiar with the part of town HP will be built compared to the Merc. What I do know is that the part of downtown around the Merc is (or was) dead. I walked around the Merc area in August '05 and aside from being hotter-than-hell, virtually that entire part of downtown was a boarded up ghost own - very depressing. I thought I was living a scene from an old

[Houston19514]

Beyond this bunch of buildings that Forest City has torn down and is either currently refurbishing or plans to refurbish, plus the former city hall, are there many other buildings in downtown Dallas that are still standing vacant?

[TexasStar]

Beyond this bunch of buildings that Forest City has torn down and is either currently refurbishing or plans to refurbish, plus the former city hall, are there many other buildings in downtown Dallas that are still standing vacant?

Two that I can think of off hand.

I know there are other significant structures that stand empty, I just never see them.

211 North Ervay

(Blue building lower left corner of pic)

18 Stories (1958)

Renovation ideas have floated around for years, and the Mayor wanted to demolish it for a park.

But, nothing concrete has surfaced in the past few years.

1600 Pacific

Saw better days once as the famous LTV Tower

32 Stories, 454 Feet (1964)

Again, rumours of residential reuse have abounded the past 5 years.

But nothing yet.

[dfwcre8tive]

Vacant:

Tower Petroleum Building (the art deco in with green panels in the background) and Corrigan Building behind it. These are kind of in the same area (this photos is taken from the Mercantile block). The owner wants to turn this into a hotel and build high rise condos behind it but is in a fight with the city over a nightclub issue in the same block (story here).