West End Story

How the warehouse district came back to life

THE EFFORTS OF a few developers working in and around the West End, the city’s second official historical district (the first was Swiss Avenue), are-at long last-beginning to show. To outsiders, the revital-ization of this turn-of-the-century warehouse and manufacturing area may have seemed agonizingly slow.

In 1975, the city’s official historical designation of the area preserved it from the inevitable march of skyscrapers westward from the city’s core and made possible the city’s last chance to have a unique downtown area composed of restaurants, retail shops, offices and even residential housing that reflects Dallas’ past. But it has taken almost a decade for large-scale development to come into its own in this area, which is bounded essentially by Lamar Street, Wood-all Rodgers Freeway, Stemmons Freeway and Commerce Street.

In 1982, a unique blend of people and events came together to end the years of speculation and behind-the-scenes negotiations. The 1977 city bond election finally produced $1.3 million in landscaping and street improvements along Market Street. Future improvements were assured with a 1982 city bond election that not only provided for more street improvements (particularly along Houston and Ross avenues), but also should trigger additional funds to upgrade old sanitation and water lines.

Although the West End Task Force (volunteer citizens appointed by the city’s Landmark Commission) and others must be credited with gaining the city support that made development feasible, it wasn’t until two additional forces came on the scene that the West End moved from the hands of speculators into the hands of developers. Economic factors (particularly lower, more stable interest rates) made development more attractive, along with a key incentive from the U.S. government: Effective in 1982, renovators of commercial structures are allowed up to a maximum 25 percent investment tax credit for preserving and renovating historic buildings. A year later, in February 1983, the city also offered another tax incentive in the form of a tax freeze for eight years at pre-improvement levels to those who renovated downtown historic buildings.

Since 1982, 15 key buildings-brokered by the Preston Carter Co.-have been turned over to developers. Twelve buildings are now in the final planning approval phase or have begun renovation; four more (those making up the block east of the School Book Depository) are slated for action by the end of this year or by early 1985. Today, the West End market is prime, with prices more than 500 percent higher than they were at the beginning of the decade.

The remnants of farm implement manufacturing and the clothing trades that marked Dallas as a trade and commerce center are being cleared away to create a historical first for Dallas: a place to visit in the heart of the city that offers a wide selection of food and drink. Already The Old Spaghetti Warehouse, Nick’s Barbeque, the Austin Alley eateries and the Record Grill have been joineaby an upscale burger restaurant (Grumbles Grill), an Italian restaurant that offers authentic food prepared by a European chef (Ferrari’s), a French restaurant that serves haute cuisine with a personalized style (Restaurant Silvano), and a famous new transplant, The Palm, which is already noted for its steaks and seafood in cities such as New York, Los Angeles and Houston. And more restaurants and gourmet shop openings are planned.

A stone’s throw from the district, just across Woodall Rodgers, is the old Dallas Brewing Co. building (renamed The Brewery), which is the home of five new additions to the restaurant/entertainment area. Although it’s something of a plain-Jane building on the outside, the renovation surprises within the structure have created an interior with far more character than the exterior suggests.

In the basement is a pub, aptly named The Prohibition Room. “The Prohibition Room actually has credentials to back up its name,” says Martin. “It was a secret room we discovered-complete with rotting old stills- when we were doing our demolition work. After the Dallas Brewing Co. had been put out of business by Prohibition, they apparently just moved into a section of the basement and walled it off. There are old tunnels leading under McKinney-apparently the way they wheeled the beer out of the building. We also found an old well that’s 50 feet deep and 25 feet across at the top. When we discovered it, it had 30 feet of water in it that was still drinkable.” The bricked well now forms the center of Newport’s, an American seafood grill and oyster bar.

A French-style bistro, Ceret, which also gets its atmosphere fromthe bricked walls and heavy wood, rounds out the list of new restaurants in The Brewery. Another newcomer, Morgen Chocolates,is reminiscent of San Francisco’s Ghirardelli Square, with chocolatemade as you watch. Although nightclubs won’t be plentiful in thearea, the Starck Club is bringing a distinctive European flair to theDallas club scene. Polished black terrazzo stairs lead into the high-tech, high-contrast, 20,000-square-foot club, which may eventuallybecome a full-service restaurant, too.

With so many restaurants cither already open for business or opening within the next year, the West End is becoming the city’s latest restaurant area. But it doesn’t have the same feel as other restaurant strips. The low profile of the stocky buildings set along widened, tree-lined sidewalks with a central, narrow bricked street is a rarity in Dallas, an area that invites foot-not automobile-traffic. Market Street, the central corridor, is lighted at night with rows of old-style street lamps.

Ultimately, though, the economic vitality of The area can’t depend on the restaurants alone. The upper stories of the renovated buildings are presently being developed for office leasing. For the most part, those spaces are as unique to downtown as the West End district. One owner of a recently completed space explains, “The West End District is the last best chance to have anything downtown other than an office in a skyscraper. It’s an alternative space for people who feel uncomfortable in the usual glass tower.”

Many of the area’s renovators have been sensitive to the basic character of the older structures, leaving the interior red-toned brick walls bare, the massive East Texas yellow pine columns and crossbeams uncovered and the high ceilings untouched.

The Landmark Center at Ross and Lamar is one such building. The center, which comprises the biggest single chunk of real estate in the West End, was the first to be renovated, says Otto Wetzel, part owner of the center. The structure, originally built in 1913, used to be a warehouse for General Electric. The center has been completely remodeled inside, but in such a way-with ceiling fans and imported chandeliers-that it recalls an earlier era. The center’s leasing and building manager, Barbara Hill, says that their tenants-all professional offices-have responded favorably to the days-gone-by feel of the place. “It’s true we don’t appeal to 100 percent of the people,” Hill says. “Some people want the glass-wrapped buildings. We don’t really want to compete in that market. We want tenants who prefer the kind of environment we can offer them.”

The White Swan building, which is separated from the district by Woodall Rodgers, is another prime example. Within the interior brick walls and massive exposed beams, the offices are located behind wood-planked balconies that overlook a central atrium. Architect Dave Braden presided over the restoration, which combines wood, brick, glass (including glass bricks) and luxurious planting in a way that evokes the old Waples Platter Co. without overdoing it. Tenants tend to be young professionals, some in advertising and public relations. The Katy Building, an early renovation that’s been completely leased for years, is also a notable example of a building that has retained the original character of its turn-of-the-century facade, both inside and out.

The building known as the Old City Jail is the only one in the West End to receive tax-investment credit for both interior and exterior renovation, says attorney Charles Robertson, one of its renovators. Located on Ross between Lamar and Market, the building was constructed in 1907 to house a police station and corporation court-only a quarter of the space was actually used for the jail. Abandoned as a jail in 1914, the structure was used for a variety of purposes over the years. It had fallen into great disrepair by the early Eighties, when Robertson and seven other attorneys decided to buy and renovate the place. “When we bought it [in October 1982], it was just a shell-four concrete walls,” he says. It took a good architect (Brent Byers) and a decorator who specialized in renovation (Anne Courtin) to restore the structure to its former glory. The Old City Jail now has both state and national historic landmark status.

Although some of the buildings don’t retain much of the historical flavor on the inside, they may be able to pull some CBD-style tenants to the West End. The polished interior of SPG International’s Interstate Trinity Building (which faces Pacific at Market and Record streets) is similar in character to that of many upscale North Dallas office buildings. Arbor Development’s Chip Johnson describes his company’s plans for renovating the old Mel Rose Building and three adjacent structures (which form the block east of the Texas School Book Depository): “It will be Class A office space-like the new high-rise spaces-commanding Class A market rents.”

Even though purchase prices of the older structures have escalated dramatically through speculation during the last few years, leasing prices are still lower than those of the CBD. Rates range from about $13 to $18 a square foot, but the majority of quoted rates fell between $15 and $16.50. According to M/PF Research’s fall 1983 survey, the last report for which figures are available, the quoted rates for leasing unfinished new space in the CBD averaged $28.03 a square foot. Average lease prices for finished spaces in older high-rises were quoted at $19.57 per square foot.

The West End boasts another distinction: It includes the largest amount of open space of any area downtown. Although the center of renovation activity is north of Pacific Avenue, the actual historical boundaries encompass a larger area. The majority of that land (which extends down to Commerce and zigzags up to Main in front of El Centro Community College) is publicly owned and includes the county’s administrative and court buildings along with open spaces dedicated to Dallas’ history. Inside the historic boundaries lie Founder’s Plaza, Dealey Plaza, the JFK Memorial, Old Red (the county’s fifth courthouse, built in 1890 of Pecos red sandstone) and the infamous Texas School Book Depository (now the County Administration Building).

It was the 1963 assassination of President John F. Kennedy in this western corner of the district, in fact, that spurred the city’s designation of the area. The force behind most historical designations is a desire to preserve and glorify the past, but the West End designation-at least initially-grew out of a search for ways to overcome the stigma of the past event.

Former city planner Alan Mason, now a city planning consultant and historian, explains, “The city had a terrible image problem. About a block from here, the president of the United States was assassinated. Years after the assassination, the Texas School Book Depository stood vacant. The city and county were very concerned as to what to do with the building. The City Council pondered this problem, went to the Planning Department and, in essence, said, ’You’re the planners. You come up with something.’ “

At the time of the assassination and for the next decade, the Texas School Book Depository was held by private owners. At one point, the owner began to sell off the building-one brick at a time-as tiny “memorials.” The city and county questioned whether the building should be bought by the public or if it should be razed to create a silent memorial in the form of a public park.

“We needed to inject new life into the warehouse area, and we also needed to do something about the School Book Depository,” recalls Mason. “Perhaps we could shift some of the attention away from the School Book Depository by having a major activity area in the west end of downtown.” With the recent success of the Swiss Avenue historical designation, the historians and city planners combined forces to work for a designation in the West End.

Local owners, with few exceptions, vehemently opposed the designation. Robert Abernathy, who held a number of properties in the area and who still holds the properties where Grumbles Grill and the New Arts Theater are located, says, “The city had gone east as far as it could and land was cheap in the West End. You could build a 72-story building on that property and still have airport clearance. With the historical ordinance on it, the value of the property was lowered because you couldn’t put a high-rise on it.” (Height limitations within the district are 100 feet.)

The protest of local property owners was overpowered by the weight and influence of opinion from outside the district. At an hours-long City Council meeting, key city movers, such as Stanley Marcus and Tram-mell Crow, along with a host of local leaders of nationally affiliated organizations, spoke in favor of the designation. The “ayes” prevailed, and in 1975, the West End became the city’s first commercial area to receive historic designation. Two years later, the county solved the dilemma of ownership of the Texas School Book Depository building by purchasing it for its administrative offices.

Although the long-term value of the properties was capped, the short-term value was enhanced. With the historic designation, the area became one with a purpose, not one sitting idle, waiting to be demolished and raised again as skyscrapers. During the rather slow years that followed the City Council’s designation, a few risk takers did revitalize properties-most notably MKT’s Katy Building, Keith Cecil’s 311 Market (which sits in the core of the district at Ross) and the Dahl Braden PTM Inc.’s 1800 N. Market St. building.

The price escalation that occurred in the area, particularly within the last few years, traces the area’s development and its eventual status as a “hot” property. Raw warehouse space in the early Seventies was rented for as little as 25 cents per square foot, and those buildings that actually sold went for $3 to $5 per square foot. Today, the value of those buildings, with no improvements, has risen to between $43 and $50 per square foot.

During the late Seventies and early Eighties, the central character-to some a hero, to others a villain-was Robert Bagwell, president of Preston Carter Co. Until Bagwell came along, buying activity in the area had been relatively sparse, with the values of unimproved structures slowly edging upward to $8, $9 and sometimes $10 per square foot. With the entrance of Preston Carter, the speculative activity increased.

Bagwell placed options on almost all of the major buildings, so most of the properties from McKinney to Pacific along Market were blocked up. With few exceptions, every building in the northern portion of the West End has been brokered through Bagwell-some as many as three times. But the interest wasn’t strong at first, he says. “At one time, when I bought all these options, I felt like I’d gone tishing and caught a whale-and didn’t know quite what to do with it.” It wasn’t long, though, before he decided what to do with his big catch.

With city bond money being turned into improvements and speculators betting on the outcome of the area, prices rose between 300 and 375 percent between 1999 and 1982, when the factors came together for developers to get in on the action. Today, the going purchase prices range between 400 and 625 percent of what they were in 1979, and the number of buildings available has dwindled to just a few.

Although speculative activity frequently precedes any major market development, some observers charge that virtual control of the market by Preston Carter drove prices upward more rapidly-and perhaps postponed development longer-than what might otherwise have occurred. At the same time, says George Roddy, CEO of DRESCO Inc., a real estate research and analysis firm, “You could have the same kind of process [price escalation]-even if 50) people were holding the properties-through sheer speculation. The area itself is really hot. You could almost look at the West End Historic District as more prime than downtown.”

The catalysts are now the developers. One of the key developers is Patrick Duprez’s Blackland Properties, a well-financed firm that originally speculated in raw land with foreign investors. Blackland is now concentrating more activities in development. The company owns the two blocks between Record and Austin streets and Ross Avenue and Corbin Street (except for the Old City Jail), The Brewery and holds an option on the massive Home Furniture Building. Another developer, the Switzerland-based SPG International, a diversified real estate company that has moved its U.S. headquarters to Dallas, is now leasing out their Interstate Trinity Building and owns the adjacent triangular lot just across Record Street. Marketpoint Associates is about to begin work on the Oilwell Supply Building and owns the lot adjacent to The Old Spaghetti Warehouse. Chip Johnson’s Arbor Development recently acquired the four buildings that form the block east of the Texas School Book Depository just across Houston Street. Crow Hodges Properties, a partnership from Little Rock, Arkansas, holds the future of the Nu Ideas in Furniture building at Pacific and Market.

The West End still has some critical stages to go through before its image in Dallas is solidified. The upgrading of outdated sanitation and water lines, for example, has been a project of the West End Task Force for several years.

And even though it’s easier and cheaper to park in the West End than it is closer to the city’s core, parking is still a problem there. Local landowners are working with a parking garage construction company to build a garage on the edge of the district across Lamar Street. Marketplace Associates has long-term plans to develop the lot adjacent to The Old Spaghetti Warehouse into a combination of parking, retail and office space.

The West End Task Force is also looking into the possibility of a special transportation system-such as a trolley without rails -for the area. Says Task Force Chairman Raye Reynolds: “We’re trying to provide some type of transportation into the district that would pull people in from the Central Business District, the Convention Center and the Market Center.”

Another key question of development that is as crucial to the future of downtown Dallas as it is to the historical district is the possibility of building housing there. Turning warehouses into condominiums has been discussed for years. However, plans for condominiums in more than one building Have been scrapped in favor of office leasing.

The prospects for housing within the district are limited, but the revitalization efforts aren’t limited to the specific historical boundaries, says John Martin, project manager for Blackland Properties.

To the southeast of the West End district,the old Higginbotham-Bailey Building is being brought back to its former glory. Already, 45 properties to the north of WoodallRodgers have been packaged together; theeventual use of the property is still uncertainand probably won’t be apparent for a fewyears. But much of the risk-taking has already been done within the general area.With the West End finally demonstrating itsviability, perhaps downtown housing willfinally get its chance.

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