City Celebrates Two New Housing Projects in Dallas

Dallas-Fort Worth News

DALLAS — District 11 Councilmember Linda Koop recently joined other elected officials and dignitaries to celebrate completion of the Willow Falls Townhomes, 13890 Brookgreen Drive. The 319 unit development of medium priced homes on 46 acres is a housing leader in the North Dallas High Five Corridor.

“The entire project cost $7.5 million, which was a big reinvestment boost for the community,” said Koop. A fundamental part of the revitalization project was a focus on crime prevention, Koop said, which included formation of a citizen’s patrol to work with law enforcement. As a result, crime has dropped significantly.

Funding was obtained through Community Banc of Arizona and paid for by the homeowners association through an HOA fee increase and no special assefee adjustment with no special assessment.

Each year since in the mid 1980s, residents have organized an appreciation luncheon for police officers and firefighters in their community. The event has grown over the years to include city, county, and state officials as well as local merchants and school principals.

In addition to a more updated and appealing structure, the revitalization has changed resident’s attitudes. Brett Ferguson, a resident who served as financial treasurer and construction chairman, said, “the otherwise busy owners have turned into friendly neighbors where they view the neighborhood not as a place to live but where they do their living.”

Another Dalls apartments project adjacent to Willow Falls is gaining praise too. Built in 1968, the former Woodside Terrace apartment complex has been in poor condition for years. In February, Knightvest Capital acquired the property which is now called Las Terrazas. Over the past several months, a $1.1 million renovation project has been underway at the 230 unit complex and is nearly complete. Renovations include upgraded interior units, a remodeled pool, exterior paint, new playground, exterior lighting, and new security gates.

“The complex has gone from 57% occupancy to over 80% since the renovation and we have experienced a decline in criminal activity,” said KC Kronbach with Knightvest Capital. “Our goal with this project was to take the worst property in the submarket and make it a safe, clean and inviting place for residents to call home.”

“This property was nearly uninhabitable and on the watch list with the City Attorney’s Office,” said Koop. “These revitalization projects will go a long way to bring economic vibrancy back to this area.”

Group Seeks to Stop Oak Cliff Apartments for Homeless

The Dallas News

 

Opponents of the Dallas Housing Authority's plan to rent apartments to chronically homeless people at an Oak Cliff high-rise have taken their fight to City Hall.

The fact that such tenants at the housing agency's Cliff Manor building on Fort Worth Avenue probably would have battled addictions or mental illness troubles some neighbors. It concerns the Fort Worth Avenue Development Group, which has been leading a turnaround of the corridor.

Specific-use permit

The development group has called on the city to require a City Council-approved specific-use permit for the project, arguing that the property isn't properly zoned for what the housing authority has in mind.

And on Wednesday, Randall White, a founder of the group and neighborhood resident, told the council that Cliff Manor neighbors were shocked to learn about the homeless housing plan.

"Help. Help. Help," he urged the council.

MaryAnn Russ, housing authority president, has said her agency has the necessary zoning and doesn't need the city's permission to proceed. And Wednesday she rejected talk of a city permit.

"The legal opinion we have is it continues the use we've had there all along – low-income rental housing," she said.

Last month, Russ said her agency would target women and older residents in setting aside 100 of the building's 180 units for "vulnerable" people who had been stabilized. Mental health services would be offered, and staffing would be increased, she said, with the possibility of a physical health clinic.

"We are an agency that's supposed to do this sort of work," she said. "The solution to homelessness is housing."

Mike Faenza, president of the Metro Dallas Homeless Alliance, said Wednesday that people now served through The Bridge, the city's homeless center, would be screened and referred by his group to Cliff Manor. They will have "worked hard to be ready for permanent housing and to assimilate into the community" and will have continued support after their arrival, he said.

"Health and human services are part and parcel of permanent supportive housing," he said.

In a letter to City Council member David Neumann, whose district includes Fort Worth Avenue, Scott Griggs, development group president, said the organization is "committed to our social responsibility to aid the longtime homeless with mental illness and addictions."

Yet he wrote that the housing agency needs a use permit from the city to provide medical and "social/psychological services" at Cliff Manor.

And, in his letter, Griggs asked for a decision from the city by Wednesday. City building official, Betty Antebi-Taylor, is considering the request and has given the housing authority until June 16 to respond to questions about its plans for Cliff Manor.

Neumann has said he favors the concept of permanent supportive housing. But the Cliff Manor project should have been discussed with neighbors before its announcement two weeks ago, he said.

'Show of indifference'

At the council hearing Wednesday morning, Neumann lashed out at the proposal.

"I have grave concerns about some of the decisions by the Dallas Housing Authority and the Metro Dallas Homeless Alliance and their show of indifference to the surrounding 12 neighborhoods," he said.

"The neighbors in this area are very concerned about this unilateral action," Neumann said.

Scott Batson, a resident of Stevens Park Village north of the Dallas apartment building, is one of those neighbors.

"The biggest issue for me is that Cliff Manor stands within yards of Stevens Park Elementary and Raul Quintanilla Sr. Middle schools," he wrote in an e-mail. "How can DHA justify housing such an unstable population such as this when we don't even allow registered sex offenders this close to schools?"

Myla Johnson asked in an e-mail: "What happens when an area resident is attacked? The Bridge has a history of violence and crime which could be funneled into the residential family neighborhoods in North Oak Cliff."

Faenza said such concerns are unwarranted. "I am very confident that the people [who are referred to Cliff Manor] will be some of the most positive residents in the neighborhood," he said.

Why? There's no evidence that people living in permanent supportive housing are a neighborhood blight, he said. "We're getting better and better" at placing residents, he said. And with Cliff Manor, "the plan of success is strong."

Faenza said he hopes the move-ins at Cliff Manor begin about July 7. That would give his group and the housing authority time to meet with neighbors, answer their questions and work with them to develop a system for measuring the Dallas apartments effect on its surroundings, he said.

"Words are cheap. We need to develop performance indicators," he said, such as Cliff Manor residents' impact on neighborhood crime and vagrancy.

"It's a business," Faenza said, "and we need to be held accountable."

Obit: M. Tom Lardner

The Dallas News

Dallas developer turned blighted area into Uptown

 

M. Tom Lardner had the inspiration for Dallas' Uptown neighborhood more than 30 years ago – when it was just a blighted area north of the central business district.

He was running a Chicago-based real estate investment firm when he first saw the potential of a high-density residential and commercial development here. In 1978, he moved to Dallas.

After nearly a dozen years of advocacy and many land transactions, he began to see his dream take shape with the construction of a 130-unit luxury apartment building, the first of many.

Mr. Lardner, 67, died May 24 of a heart attack while visiting Positano, Italy.

Visitation will be from 6 to 9 p.m. Thursday at Sparkman/Hillcrest Funeral Home in Dallas.

A Mass will be celebrated for Mr. Lardner at 10 a.m. Friday at the Cathedral Shrine of the Virgin of Guadalupe in downtown Dallas.

Mr. Lardner was what a good developer ought to be, said Trammell Crow Jr.

"He had a vision, not just for a profitable, long-term real estate project, but he really knew what he was doing," Mr. Crow said. "He knew full well that it would transform the central business district."

Mr. Lardner purchased much of the land roughly bounded by McKinney Avenue, Pearl Street, Hall Street, Woodall Rodgers Freeway and North Central Expressway. He also worked with city officials to create a tax increment financing district that paid for street and other infrastructure improvements.

The State-Thomas area of Dallas, where the Uptown development started, is now the most densely populated part of the city, officials said.

Mr. Lardner "was a serious, caring man who enjoyed life," Mr. Crow said.

Roger Staubach was a partner with Mr. Lardner in Uptown's first luxury apartment development, the Meridian building, which started in 1990.

"Tom will be missed – he was a great visionary," Mr. Staubach said.

Although Mr. Lardner is best-known for the role he played in Uptown, he remained civic-minded, through efforts that included his support of Texas Business for Clean Air, Mr. Crow said.

"TXU was trying to get permits for 11 coal-fired plants all at one time," Mr. Crow said.

Mr. Lardner was one of the first of about 10 major Dallas business leaders who opposed the fast-tracking of the coal-fired plants, Mr. Crow said. The group was concerned that the electric-generating plants would hurt North Texas' air quality.

"Perhaps more than any other member, he helped us with strategy, with contacts in Austin and with other business people," Mr. Crow said.

Mr. Lardner was born in Port Huron, Mich., and graduated from Barbour Hall Junior Military Academy in Kalamazoo, Mich., and Campion Jesuit High School in Prairie du Chien, Wis.

He attended the University of Detroit, now the University of Detroit Mercy, on a football scholarship. He received a bachelor's degree in business from Michigan State University, which he attended after the University of Detroit ended its football program.

Mr. Lardner later earned a master's degree in education from Michigan State.

He was a football coach and history teacher at St. Gabriel High School in East Lansing, Mich., before beginning his real estate career.

Mr. Lardner founded Lehndorff USA in Chicago and later moved the real estate investment and management company to Dallas, where it grew to have 700 employees while managing more than $3.8 billion of property.

The Meridian was the first test case in Uptown.

"That was to prove there was a market," said his son Colin Lardner, who followed in his father's real estate footsteps. "People were afraid at that time to do any investment, because of what had happened in the '80s."

In addition to his son, Mr. Lardner is survived by his wife, Ann Lardner of Dallas; another son, Eric Lardner of Dallas; and two brothers, Patrick Lardner of Port Huron, Mich., and Jim Lardner of Washington, D.C.

Relocating to Dallas: High Value Real Estate, High Quality Living

Stock Markets Review

 

People who decide to relocate to Dallas will be buying a home or renting a home in a major metropolitan area where real estate values have remained stable. Both the cost of living and the unemployment rate are well below the national averages.

** Major Population Center in North Texas **

With a population of 1,240,499 in 2009, Dallas ranks as the ninth largest city in the United States and the third largest in Texas. Although separated from neighboring Fort Worth by 32 miles, the two cities, forming the DFW Metroplex, comprise the 12th largest metro economy in the world with the fourth largest labor force in the United States.

Fort Worth has a population of 600,000 and is the 19th largest city in the nation and one of “America’s Most Livable Communities.” Whereas Fort Worth cherishes its western tradition and “Cow Town” image, Dallas fully embraces its role as a modern, 21st century, urban leader, proudly designated as one of the country’s “Most Ethnically Diverse Communities.”

** Diverse Population, Stable Economy, Strong Real Estate **

Together Dallas and Fort Worth apartments form one of most vibrant and compelling population centers in the United States. The area’s healthy economy is a significant draw for young professionals and families seeking to relocate to Dallas.

The cost of living index in the city is 7.06% lower than the rest of the nation (aided in part by the fact that Texas has no state income tax.) Dallas has grown at a rate of 3.73% since 2000 with a population of 50.4% males to 49.6% females. The median age is 30.5 years.

In May 2010, unemployment in Dallas stands at roughly 8% compared to the national average of around 10%. In recent years tech industries have made strong inroads in the metroplex. The city now has more than 233,000 tech workers, more than Austin and Houston combined, and is home to major companies including Research in Motion (the maker of BlackBerry smartphones), AT&T, Raytheon, and Lockheed Martin.

Real estate values in Dallas have weathered the recession well, remaining relatively stable with fewer of the wild price swings that have plagued other parts of the country. Currently median home prices stand at approximately $115,850, although they vary widely by neighborhoods within the city.

Anyone who is going to relocate to Dallas apartments should work with a knowledgeable real estate professional who can apprise them of all the implications of any location in the immediate city or surrounding suburbs. Dallas is a diverse urban area providing a wide variety of choices for anyone buying or renting a home.

** Education, Health Care, Culture, Access **

The region is especially strong in the terms of education and health care:

– The Dallas Independent School District serves more than 160,000 students.
– Overall, the DFW Metroplex is home to 17 two-year technical/trade colleges.
– There are 7 private colleges and universities, and six public four-year colleges and universities.

Ross Perot Jr. Selected to Real Estate Hall of Fame

The Dallas News

Dallas businessman Ross Perot Jr. and real estate investor James Sowell are getting top honors from the North Texas commercial property industry.

Perot and Sowell next month will be inducted into the North Texas Commercial Real Estate Hall of Fame.

The award is sponsored by the North Texas Commercial Association of Realtors and Real Estate Professionals and will be presented on May 13 in Dallas.

Perot’s Hillwood companies have developed landmark North Texas real estate projects including the Alliance apartments in Fort Worth and Dallas’ Victory Park development.

Sowell’s investment firm, Sowell and Co., has built residential communities such as Dallas apartments and in other Texas markets.

The new hall of fame members will join a group that includes the likes of Trammell Crow, Henry S. Miller Jr. and Roger Staubach. More than 70 past and present real estate players have been honored with this industry accolade.

Along with the awards to Perot and Sowell, a lifetime achievement award will be given to Dallas brothers Jerry and John Bradley, who’ve worked as commercial real estate agents here since 1970. 

Raytheon Shopping for Big Texas Office Space

The Dallas News

A high-profile office tenant is shopping for a big block of space in Dallas' northern suburbs.

International defense and high-tech conglomerate Raytheon Corp. is looking for potential locations for consolidating its Dallas-area offices, real estate brokers say.

The deal would encompass several hundred thousand square feet of space and would be one of the largest in the Dallas area in the last year.

Raytheon already looked at moving into part of the former headquarters of Electronic Data Systems, which is now a unit of Hewlett-Packard. But a transaction to take over a large portion of the EDS headquarters building in the Legacy business park fell through, real estate agents familiar with the deal said.

Raytheon is now considering office locations in the Telecom Corridor, including Nortel's buildings along U.S. Highway 75 near Campbell Road.

Officials with Massachusetts-based Raytheon wouldn't confirm that the company is hunting for office space. But they didn't rule it out.

"We stay abreast of opportunities in the market," Raytheon spokesman Keith Little said. "We don't discuss specific properties that we may be considering."

Real estate brokers say the EDS headquarters and Nortel buildings are logical choices for a company that needs a big office in Dallas' northern suburbs.

Both companies have reduced the amount of space they use in the Dallas area in recent years, and Nortel is in bankruptcy.

"Yes, we have been talking to companies about the Richardson space," said Nortel spokesperson Jamie Moody. "And, just like we're selling off all our businesses, we are also selling our assets, including real estate, so that we can recover the greatest value in the interest of our creditors."

Despite a real estate downturn that has left acres of North Texas' office space sitting empty, there are few prime vacant offices as big as Raytheon would need.

"For spaces 200,000 and up, your options are fairly limited," said Greg Biggs of Cushman & Wakefield of Texas. "We are working on a transaction in North Dallas that's fairly sizable, and the amount of existing space available is fairly limited in big blocks."

Raytheon has operations in several Dallas-area locations, including on U.S. Highway 75 north of LBJ Freeway, farther north in McKinney and on Lemmon Avenue in Dallas.

Unlike in previous economic downturns, the area isn't awash in vacant Dallas apartments or office space. That's why some companies – including Pizza Hut – have recently chosen to build.

"We don't have all the see-through [empty] buildings we had here in the early 1990s," said Greg Langston, managing principal in CresaPartners' Dallas office. "One thing we didn't do is overbuild this time."

Gables Residential Sells Dallas Apartments to California Investor

Dallas News

A California real estate investor has made its first push into the North Texas apartment market.

CIM Group's purchase includes two properties in the popular West Village neighborhood in Dallas' Uptown district: the 103-unit 3636 McKinney apartments and the 75-unit West Village apartments, at 3839 McKinney Ave. CIM also purchased the 334-unit Knoxbridge apartments, near the corner of Knox and Travis streets.

The investor, which specializes in urban-style real estate projects, bought the rental units from Gables Residential, which owns or manages more than two dozen apartment communities in the Dallas-Fort Worth apartments area.

The West Village properties were built in 2005 and are on top of retail space. Terms of the transaction were not disclosed, but the units are valued for taxes at almost $22 million.

The Knoxbridge, constructed in 1993 and 1995 at 4649 Cole, is listed on the tax rolls at more than $27 million.

As part of the deal, CIM also bought a Gables project in Houston apartments.

Gables will continue to manage all the Texas properties, which total 820 units.

Gables senior vice president Doug Chesnut said the developer decided to sell the properties because it was "overweighted" with Dallas-area apartments and had more in the works.

"We took the opportunity to move assets," Chesnut said.

CIM said in a statement that the apartments it bought are all in "districts positioned for economic expansion."

The investor also owns a mixed-use development called Penn Field in Austin.

CIM is a real estate fund manager that makes both private equity and debt investments in urban communities across North America. It has offices in Los Angeles, Oakland, Calif., and Bethesda, Md.

The Gables Dallas apartments sale is the second recent transaction involving high-end North Texas rental properties.

In December, Nebraska-based Slosburg Cos. purchased the five-story Delante Las Colinas apartments.

Dallas Housing Stimulus Effort Slow to Spend $25 Million

Dallas News

North Texas received more than $25 million in federal stimulus funds last fall to move homeless people into Dallas and Fort Worth apartments and prevent others from losing their homes because of the tough economy.

But so far, only a fraction of the Homelessness Prevention and Rapid Re-Housing Program money – about $2 million – has been spent, according to the U.S. Department of Housing and Urban Development, which oversees the program. The amount may be slightly higher because of a lag time for reporting the expenditures to the federal government.

The program was designed to provide temporary relief to people who need help with rent or utilities because of circumstances such as job losses or medical crises.

Things are off to a slow start.

Many applicants have been waiting for weeks just to get an appointment to apply for the help. And some agencies distributing the assistance say they have been overwhelmed with requests and do not have enough staff to keep up with the demand and extensive documentation.

In Dallas, where applicants have complained about long waits, the city is evaluating whether more staffing is needed.

Three charities withdrew from the program because they said they did not have adequate staff to carry out its requirements, said Bernadette Mitchell, assistant director of the city of Dallas' housing and community services. She said others are reporting problems with the online system they're supposed to use to enter client data.

"The city of Dallas is very concerned and we are evaluating the need for more staff persons to address this particular issue," she said in an e-mail. She said the city has contacted agencies that applicants have complained about for not responding to phone calls.

"The volume of people trying to access the service is overwhelming the system," she said. "Only a certain number of people can be fully interviewed for assistance and provided other needed referrals per day."

Other officials worry that many of those eligible – especially those who have never used social services before – don't even know about the assistance, which has mainly been publicized by fliers, posters and word of mouth.

"There's a lot of money in Dallas that people don't know they could access," said Paige Flink, executive director of The Family Place, which helps family violence victims. She said The Family Place received $1.3 million in stimulus funds and has distributed more than $150,000.

The meeting

A Feb. 16 meeting highlighted the lack of awareness about the program.

Only four people attended the public meeting at Dallas City Hall to learn how to apply for the funds. All were homeless and had seen fliers or heard about the event from a friend.

But they learned that the help would not come fast: They were told it would take up to a month just to get an appointment to apply for the aid, and as many as four months to move into an apartment.

London Brooks, one of the attendees, left frustrated. He said he was in a hurry to get out of a shelter after sleeping on the floor because there weren't enough cots.

"I'm trying to get out of that place as quick and fast as I can," said Brooks, whose unemployment benefits recently ran out.

Brooks called several agencies before finally getting an appointment with the Urban League of Greater Dallas' office in Garland last week. He said he was told that he could not qualify for the assistance without some type of income. Brooks, who attends school to train for an electronics career, said he's looking for a job so he can qualify.

Shirley Walker, the Urban League's senior vice president for community services, said the program aims to make sure recipients can sustain themselves after the temporary help runs out.

"Otherwise, what have we done for him?" Walker said. "We've caused him to fail and we've also put a blemish on his credit and he won't be able to get housing once he does meet those other requirements. It's like a double-whammy."

Walker said her agency is short-staffed.

"I want to assure you, I know all of the people in this community care and are trying the best they possibly can with the constraints they have," she said. "If our clients just give us a chance, we'll work to the best of our ability to serve them."

Yvette Jackson, another person at the City Hall meeting, also said she wants to move out of a Dallas shelter as soon as possible. More than a week after the meeting, Jackson still had no appointment. She said the agencies on a list did not call her back or did not allow her to leave a message.

"Living in a shelter is something I'm not used to," said Jackson, who came to Dallas 10 months ago after losing her job.

She eventually found housing through another program not tied to the stimulus money.

'As expeditiously as possible'

The American Recovery and Reinvestment Act of 2009 provided $1.5 billion nationwide. The program can pay rent and utilities, but not mortgages, for people who meet very specific criteria.

HUD announced the rapid rehousing program in February 2009, but people could not apply for the aid in many local cities until late last year or January.

During that time, the federal government entered contracts with state and local governmental agencies and provided training so they could distribute the funds in North Texas. Some of those agencies solicited nonprofits, like The Family Place or the Urban League, to help disburse the funds, which go directly to landlords or utility companies.

Agencies found the process was not as simple as handing out money.

They need extensive documentation – such as financial records and Social Security cards – that some applicants have had trouble getting together. They also need to make sure the Texas apartments people rent charge fair market rents, have been inspected and accept the federal payments. Some clients have been rejected because of bad credit records or felonies.

The city of Dallas received nearly $8 million, which it is sharing with several nonprofits. So far, about $333,000 of that has been spent, according to HUD. But the actual amount is at least $100,000 higher because of a lag time from when the city submits expenses to HUD for reimbursement, Mitchell said.

Governmental agencies and charities have three years to spend the funds, said HUD spokeswoman Patricia Campbell. She said that Dallas officials initially faced delays executing contracts with charities but that they expect a dramatic increase in the money given out now.

"We certainly are encouraging all grantees to spend the money as expeditiously as possible," she said.

Despite possible hurdles, the money is helping many families keep a roof over their heads.

In Plano, officials have distributed more than $35,000 since Jan. 1, according to HUD. The city received $509,050.

Garland, which received $304,952, has helped at least eight families and sent 20 more to search for North Texas apartments, said Tiffinay Slade-McClinton of the city's housing agency. So far, the city has spent $3,467, according to HUD.

Chelsea White, development director of the Housing Crisis Center in Dallas, said her agency has $184,877 to distribute – and is seeing a lot of people at the brink.

"There are households that, without this money, would probably be homeless," she said.

AT A GLANCE: HOUSING HELP

Across North Texas, agencies received more than $25 million through the federal stimulus package to move homeless people into Dallas apartments and prevent others from losing their homes because of the economic downturn.

The Homelessness Prevention and Rapid Re-Housing Program is designed for people who only need temporary assistance to get back on their feet. It is not for the chronically homeless, who have disabilities and need long-term help.

The money can only be used for people who:

•Are homeless or would become homeless without the assistance.

•Have no other housing options and lack resources to obtain or remain in housing.

•Earn less than 50 percent of the area's median income of $23,650 for an individual or $33,800 for a family of four.

Applicants can call 2-1-1, a help line for social services, to be directed to the nearest agencies that offer the assistance. Applicants must have a consultation at the agency to determine the appropriate level of assistance. Documentation will be required to verify income and housing status.

Missed Payment Rate Jumps on Dallas-Area Commercial Property

The Dallas News

An increasing number of Dallas-area commercial properties are falling behind in their mortgage payments.

At the end of last month, the missed payment rate for Dallas-area buildings with securitized mortgages was more than 33 percent higher than the national average, according to a new report by Trepp LLC.

The New York-based analyst tracks thousands of commercial properties across the country that are financed with securitized mortgages.

More than 9 percent of Dallas-area commercial properties with securitized debt were behind in payments at the end of February, according to Trepp's report, released Wednesday. The national delinquency rate was 6.72 percent.

The Dallas-area late loan rate has increased almost 200 percent from a year ago, said Paul Mancuso, vice president of Trepp, which provides real estate data and analytics.

"Although elevated, the [Dallas] region is well below the double-digit delinquency rates experienced in troubled states such as Arizona, Nevada, Florida and Michigan," he said.

Almost 160 Dallas-area commercial and investment properties are on the list of troubled real estate deals. The debt on these properties adds up to about $1.28 billion.

Among the largest real estate deals cited in the report is the Four Seasons Resort and Club in Las Colinas, which has been posted for foreclosure.

"Excluding the delinquent $175 million loan to the Four Seasons Resort and Club, the current delinquency rate would decrease significantly to 7.9 percent," Mancuso said.

Downtown Dallas' Harwood Center office tower and the Village on the Parkway shopping center in Addison are also on Trepp's watch list.

The Dallas apartments sector with the highest mortgage delinquency rate is hotels. Almost 17 percent of securitized hotel loans here were behind in payments at the end of February. The office building delinquency rate was just over 12 percent.

Loan data from properties with securitized debt provides an important window into the health of the commercial real estate sector.

Trepp said the nationwide increase in late loans in February was 23 basis points,. It was the smallest increase in six months, but late loans are still at an all-time high.

In 2009, the number of commercial properties posted for foreclosure such as Dallas-Fort Worth  apartments area jumped almost 27 percent.

Lochwood Residents Fear Return of Portable Elementary Classrooms

The Dallas News

The Lochwood neighborhood east of White Rock Lake is rallying to oppose possible DISD recommendations to alleviate crowding at Highland Meadows Elementary by moving students to M.T. Reilly Elementary. The fear is that the shift will return portables to the playground at Reilly, which is in the heart of Lochwood.

Neighborhood plea: Scott Robson, president of the Dixon Branch [Lochwood] Homeowners Association, sent an e-mail alert to residents, saying: "While we know that a solution needs to be found to the overcrowding at Highland Meadows Elementary, we would like to ask for neighborhood support in opposing any solution that would place portables at Martha Turner Reilly Elementary. ... Portable classrooms are unsightly, can invite crime, create havens for troublemakers, and adversely affect property values."

DISD options: Highland Meadows opened in 2004 and has a capacity of 766 students. It was built without utilities for portable classrooms. A board briefing report listed these options, which are on the agenda for discussion at Thursday's Dallas school board briefing at 11:30 a.m.:

• Move 48 PK-4 students from the small neighborhood south of the Highland Meadows campus to Reilly. This would not bring Highland Meadows below 100 percent capacity, however.

• Move 133 PK-4 students from Dallas apartments west of Jupiter and south of McCree to Reilly. This would relieve Highland Meadows but push Reilly to about 113 percent utilization.

• Eliminate the three prekindergarten classes (66 students) at Highland Meadows.

• Deny 15 students of employees and 20 hardship transfers permission to return for 2010-11. Review other transfers.

History: Reilly Elementary was dedicated in 1956. The school can take 589 students and is at 89 percent capacity. "It was not too many years since we had over 30 portable buildings at Reilly, and we do not want to repeat this situation," Robson said.

Denton Developers Want Input on Fry

Denton Record-Chronicle

A public meeting Wednesday could help shape the proposed redevelopment of Denton’s once-vibrant Fry Street area.

The company behind a proposal to build student housing on a mostly vacant block bordering the University of North Texas is inviting residents to offer their views on the area’s fate. The meeting is set for 6:30 p.m. Wednesday at City Hall.

 “We have ideas on what we want to see,” said Josh Vasbinder, a vice president with The Dinerstein Companies, a Houston apartments, real estate and development firm. “But I want to make sure our ideas align with what the community wants to see long-term for that property.”

Company officials plan to mostly listen during Wednesday’s meeting, Vasbinder said. They’re planning a second gathering, tentatively set for Feb. 17 at City Hall, to present revised plans incorporating feedback they receive, he said.

Company officials are already talking with community leaders to gather their views on the project, said Patrice Lyke, who leads the Denton Neighborhood Alliance, a consortium of local neighborhood groups. By contrast, the developer behind Fry Street Village — the doomed development planned for the same block in 2006 — didn’t reach out to neighborhoods until its plans were set in stone, she said.

“Time will tell, but this early willingness to listen to the neighborhoods is a really good sign,” said Lyke, who also serves on the city’s Planning and Zoning Commission.

The Dinerstein Cos. and Dallas-based Winkelmann & Associates Inc. filed a pre-application with Denton city officials last month to build 210 Dallas apartments for students in Denton with 586 beds in a four-story complex split by a multistory parking garage.

When the plans became public, some area residents said they’d rather see a mix of housing and retail uses at the site, a 3.8-acre lot bordered by Fry, Hickory, Welch and Oak streets. Others raised concerns about increased traffic on Oak and Hickory — two roads already stressed beyond their capacity.

City staff members reviewed the application and issued a report Dec. 31 listing potential conflicts with city codes. For example, buildings in the Fry Street district can’t exceed three stories, according to the report.

“What was submitted doesn’t meet city standards on a number of levels,” said Mark Cunningham, the city’s planning and development director. “My understanding from the applicant is that he just wants to … get feedback from the community and then factor that into the design of the site” before offering new plans.

The submitted plans were preliminary, and the company is open to changing them, Vasbinder said.

“People want to see more of a mixed-use concept,” he said. “We’re pushing to try to figure out what the best utilization of that mixed-use concept is, how that new urbanism can be done correctly.”

The block has been a center of attention since Houston-based United Equities Inc. bought most of it in 2006 and announced plans for new retail shops and eateries.

An opposition group, Save Fry Street, formed to fight the project, and nearly 9,500 people signed a petition supporting preservation of existing buildings and Denton apartments, some of which dated to the 1920s.

United Equities ultimately demolished five buildings, including one that housed The Tomato, but not before someone set fire to the iconic restaurant in an apparent protest of the project.

In December 2007, a divided City Council rejected a drive-through lane in the proposed Fry Street Village, derailing plans to build a shopping center anchored by a CVS pharmacy. A chain-link fence has surrounded most of the block since then.

United Equities still owns the land. Tim Sandifer, the project manager for Fry Street Village, did not return a call seeking comment.

If The Dinerstein Cos. can win city approval of its project, it likely would buy the block from United Equities, Vasbinder said. It also plans to develop and manage the property, he said.

“It’s our name on the building; it’s our reputation,” Vasbinder said. “We want it to be a long-term benefit to the community.”

Grub & Ellis to Acquire Luxury Dallas Apartment Homes

PR Newswire

DALLAS -- Grubb & Ellis Apartment REIT, Inc. today announced that it has entered into an agreement to acquire Bella Ruscello Luxury Apartment Homes, a 216-unit multifamily community located in the Dallas suburb of Duncanville.  The acquisition is subject to customary closing conditions and the satisfaction of other requirements as detailed in the agreement. 

Located at 250 E. Highway 67, Bella Ruscello Luxury Apartment Homes was built in 2008 on roughly 10.6 acres.  Approximately 97.4 percent leased, the gated community offers one- and two-bedroom apartments as well as a community clubhouse featuring a media room, business center and a well-equipped gym.  The property offers four floor plans ranging in size from 655 square feet to 1,074 square feet, all of which include nine foot ceilings, detached garages, track lighting, full-size washer/dryer connections, ceiling fans and other amenities. The community includes a resort-style swimming pool, running and bike trail, landscaped grounds, direct access to a five-acre waterview park, as well as wooded, creek and pool views.  Residents enjoy easy access to Highway 67, Interstates 20 and 35, and nearby shopping and dining options. 

"Bella Ruscello Luxury Apartment Homes is a well-occupied and well-equipped luxury Dallas apartments community that adds tremendous value to the Grubb & Ellis Apartment REIT portfolio," said Stanley J. Olander Jr., president and chief executive officer.  "We believe we are in the midst of one of the most attractive acquisition environments in recent years, and I am thrilled be able to take advantage of this opportunity to add Bella Ruscello to our portfolio."

California Investor Buys Preston Bend Apartments in Far North Dallas

Dallas News

Holliday Fenoglio Fowler LP said Wednesday that it has sold a Far North Dallas apartments development to a California investor.

The 255-unit Preston Bend complex is on nine acres at 18790 Lloyd Drive near State Highway 190 and the Dallas North Tollway.

The project was sold by Equity Residential and is more than 95 percent leased.

Anterra Realty Corp. negotiated the sale with Holliday Fenoglio Fowler. Terms of the transaction were not disclosed.

Drop in Construction Could Lead to Apartment Shortage

The Dallas News

A dramatic decline in U.S. apartment construction could lead to a shortage of rental housing in the years ahead.

This year, developers are expected to start about 87,000 units – less than a third of what they build on average each year. And the outlook for 2011 isn't much better.

"We will be facing a severe shortage of apartments in the next few years, which will increase the cost of housing for consumers," Sharon Dworkin Bell, senior staff vice president of the National Association of Home Builders, said at this week's convention in Las Vegas. "We believe we should have 300,000 starts every year to have a stable market."

That's not likely in the foreseeable future.

"We have a combination of limited supply coming on and increased demand when the economy recovers," Bell said.

Michael Costa, a partner in McFarlane Costa Housing Partners of California, said, "We know that the demand for housing – especially rental housing – is going to be there. Each month we are not able to get our starts going, we fall further and further behind."

At some point, a lack of rental units will take a bite out of consumers' pocketbooks. "We are predicting now we may see upwards of double-digit rent increases," Costa said.

His firm, which typically starts up to 35 rental communities nationwide each year, has just four projects in the works.

The slowdown has been even sharper for developer Jerry Durkin, whose Wood Partners builds rental units across the country, including several recent projects in the Dallas area.

In 2006, Atlanta-based Wood Partners started about 6,500 units.

"We closed one start in 2009 – a 150-unit deal," Durkin said. "I don't know how 2011 ramps up unless capital frees up."

Over the last couple of years, the Dallas-Fort Worth area has been one of the country's top rental housing construction markets. But startups of new Texas apartments have virtually stopped.

More than 11,000 Houston and Austin apartments were under construction in North Texas at the start of 2010, however, and there are lots of new units on the market, so rents have been falling and vacancies increasing.

The same is true in other U.S. markets, which makes apartment analyst Greg Willett of MPF Research skeptical about a shortage.

"To get back to an essentially full occupancy rate of about 95 percent, we've got to absorb about 600,000 apartments nationally and about 30,000 Dallas-Fort Worth apartments," Willett said.

"The builders are overestimating the number of kids in the basement" who will move out of their parents' homes when the economy rebounds, he said.

Dr. James Gaines of the Real Estate Center at Texas A&M University also says a shortage is a ways off.

"An offsetting factor is the number of foreclosures and other distressed properties being bought by investors and turning into rentals," he said.

Dallas apartments analyst Ron Witten predicts apartment markets around the country could be full by 2012, but that doesn't mean building would start right away.

"Developers have to find and entitle sites, then begin construction," he said. "It could easily be 2014 and possibly later before a meaningful number of new apartments are available for residents."

Homeless Women Find Room In Dallas Apartments

The Dallas News

The walls are bare. The closets, nearly empty. And there's barely any furniture inside.

But for 40 formerly homeless women, the Pebbles Apartments are home sweet home.The Metro Dallas Homeless Alliance, which coordinates area homeless services, opened Dallas' first permanent supportive housing program for homeless women and children there last month. A full-time caseworker helps tenants with things such as medical care and job searches.

The homeless alliance, one of 24 nonprofits that receive donations through The Dallas Morning News Charities, moved the women from Dallas' homeless assistance center, The Bridge.

The residents come from a variety of backgrounds. But they all lacked what the Pebbles complex offers: the stability of a home.

Lawanna Rogers, who moved in last month, had lost homes, jobs and the ability to care for her children because of her longtime addiction to a drug she now calls "Satan." She said she had resorted to theft and prostitution to support her addiction to crack cocaine.

"It took my life for over 20 years," said Rogers, 41, who was incarcerated last year on a drug possession charge. "By the grace of God, I'm still here."

She has gone through drug treatment and hopes to find work and reconnect with her family. Relatives have raised her daughter, 18, and son, 9, because Rogers said she "chose drugs over [her] children."

"The night before I went into labor, I did $300 worth of dope," she said, referring to her pregnancy with her daughter. "I was praying at the same time. I said, 'Please don't let anything happen to my baby because of my stupidity, but I can't put this drug down.' "

Rogers said she stays in touch with her kids, who are doing well.

Last summer, the Denton woman decided she'd had enough. And in five months, she went from a mat at The Bridge to a bed in a cubicle there to her own apartment.

While Rogers jumped at the chance for a home, neighbor Candice Kratson was hesitant.

Kratson, 50, worried about living on her own, something she had not done in many years. After a month in her apartment, Kratson, who's disabled with bipolar and schizoaffective disorders, said she is adjusting.

She said she was relieved to be away from what she called an abusive situation at a place where she used to live.

"I've settled in quite a bit," she said recently as she rested on her couch and watched a TV placed on the floor. "There's not too many people who will set you up with an apartment like this."

Dallas officials consider housing programs like the Pebbles the solution to homelessness. The city has a goal of opening 700 units of permanent supportive housing by 2014 but has faced neighborhood opposition to several proposals.

Before opening the Pebbles, homeless alliance officials met with community leaders to gain neighborhood support, said Mike Faenza, president and chief executive officer of the group. The project, which used to be a public housing site, sits in Vickery Meadows, next to other apartment complexes and a strip mall.

Faenza said the homeless alliance could not have opened the program without help from the Dallas Housing Authority, which owns the property. The housing authority leased the building to the homeless alliance for $1 a year, said MaryAnn Russ, DHA president and chief executive officer.

"To have a permanent supportive housing complex focused on vulnerable women and children is a great thing," Faenza said. "The moms and individual women are really grateful to be there."

No one may be more thankful than Rogers' daughter, Tanisha. The 18-year-old recently got to visit her mother at her apartment.

The high school student, who was raised by her grandparents, said she has hoped for years that her mother would change. She was skeptical when her mother headed to Dallas for help last summer.

But the teenager said she cried when she found out her mother was doing well enough to move into Dallas apartments.

"I'm very happy for her because she's been a drug addict for a long time. I hadn't given up on her, but I was beginning to doubt that she would change," Tanisha Rogers said.

"I've been praying for her. I know she's better than that."

Apartment Vacancies At Highest Levels In 20 Years

Dallas News

Apartment vacancies in Dallas-Fort Worth have grown to the highest level in more than 20 years thanks to a combination of overbuilding and the recession.

At the end of 2009, about 11 percent of local rental units were empty. Occupancy fell by a full percentage point in the fourth quarter as several large apartment communities opened their doors, adding to inventory.

“While those numbers are bad, they actually look better than we’d anticipated a few months ago,” Greg Willett, vice president of research with MPF Research said in the firm’s report released Monday. “Several of the properties that were finished right at the end of 2009 report initial lease-up moving along pretty well, so North Texas sidestepped the seasonal net move-outs that are routine during the last few months of the year.”

D-FW renters leased an additional 1,520 apartments in the final months of 2009. But at the same time, developers were opening the doors for 7,895 new units.

“That’s the biggest quarterly block of new supply seen since savings and loan associations fueled a frenzy of overbuilding during the early and mid-1980s,” Willett said.

More new apartments were added in North Texas in 2009 than in any market in the country - 18,029 units.

Last year the sagging economy reduced demand for Fort Worth apartments.

“Job loss weakened the apartment figures seen early in the year,” Willett said.

For all of 2009, net apartment leasing was down by 890 units from 2008, MPF reports.

Overall rents in the area dropped by 2.6 percent last year to an average of $748 a month.

With the credit crunch and recessions, apartment development in D-FW and across the country has slammed to a halt.

Willett said that developers began only a handful of new projects here in the second half of 2009.

But more than 11,000 Dallas apartments remain under construction.

“Texas will be one of the last markets across the country to wrap up its construction cycle” Willett said. “Thus, despite the comparatively positive outlook foreseen for the local economy, Dallas-Fort Worth seems apt to trail the apartment market recovery anticipated elsewhere.

“It’s certainly possible that occupancy has essentially bottomed out now, but it’s going to be a while before the leasing environment is healthy enough for rents to move up again.” 

Texas Agency Slow To Spend Weatherization Funds

The Dallas News

AUSTIN – The state received millions of federal dollars from the economic-stimulus package to help poor Texans cut their energy bills, but by the end of last month, just seven homes had been weather-treated under the program.

The state has spent $1.8 million of $163 million available over the past four months, with most of it going to administrative costs, such as the salaries of state workers.

The weatherization program was a key element of the federal effort to revive the economy, billed as a quick way to create jobs, save energy and cut utility bills.

In Texas, the task has been heaped onto a midsized agency that must figure how to hand out millions more in federal funds to local agencies and governments, but do it carefully enough to avoid wasting money.

Some community action agencies that will spend the money criticize the state's bureaucracy for the length of time it will take to get the program up and running. State officials acknowledge the slow start but say they're trying to ensure there is no waste or fraud. And they say federal red tape has been a problem.

The Department of Housing and Community Affairs is on track to get $327 million overall from the stimulus package – 55 times what the state typically gets in a year from the Department of Energy for weatherization work. It has until March 2012 to spend the money, with a goal of weatherizing 56,000 homes.

'Time and quality'

"It's the intersection of time and quality," said Brooke Boston, a deputy executive director at the state Department of Housing and Community Affairs. "If you could give agencies as long as they wanted, could you feel pretty good about every regulation followed to a T and every residence done perfect? Probably."

By the end of November, the most recent data available, the state had weatherized only seven homes through the stimulus program. Five were done by the Sherman-based Texoma Council of Governments and two by Tri-County Community Action in Center, Texas.

"I didn't expect tens of thousands, but seven is shocking," said Randy Chapman, executive director of the Texas Legal Services Center, one of several groups monitoring stimulus spending in Texas.

Boston acknowledged that federal officials "aren't excited about where we are today, and neither are we."

State officials say they expect a "huge jump" in the amount spent by March. Starting in January, the housing department plans to post data on its Web site projecting the number of homes that local agencies and governments will weatherize each month with stimulus funds.

The trickle of weatherization funds spent reflects the debate that has raged since President Barack Obama signed the $787 billion stimulus bill into law nearly a year ago. Among the questions that have been raised: whether the package was focused on work that would actually stimulate economic growth and job creation and whether government had the capacity to spend a great deal of money wisely but also quickly.

In September, Texas ranked 39th among the states in the amount spent. Texas reported to the federal government that three jobs had been created – all of them state positions. An update is expected early next month.

"No one wants to make mistakes," said Bob Scott, director of weatherization services for the National Association for State Community Services Programs. "They are trying to balance the need to show results quickly with the concern that there is increased scrutiny and accountability."

Some watchdog groups predict that states won't be able to keep a lid on waste and fraud as federal dollars flow through.

"There's all kinds of mischief in people fraudulently applying and getting the money when they're not eligible," said Leslie K. Paige, spokeswoman for the Council for Citizens Against Government Waste in Washington. "And then you have the homes and what work is done, and how you verify that."

Even groups that support the weatherization goal say the task is big.

"They were not an agency equipped to take on $327 million," said McCall Johnson, a clean-energy advocate with Environment Texas. "They didn't have the staff. To gear up for it is a lot."

Beverly Davis, an 84-year-old widow, has waited for work to be done on her Garland home since August 2008.

Davis, who said she lives on about $12,000 a year, said Dallas County Department of Health and Human Services workers recently checked her heating and air conditioning system, but it's unclear when caulking and insulation will be done. The work could have saved her money during the recent cold snap.

"It's slow. I heard they're having problems getting crews together," she said.

Daniel Araiza, a program monitor with the health department, said work using stimulus funds is under way on about 75 homes.

Past problems

Texas has a checkered past with the federal Weatherization Assistance Program, which the U.S. Department of Energy has run since the mid-1970s.

In 2003, a state audit documented how some local agencies that received money did weatherization work for people whose incomes were too high to qualify them for the low-income program:

• One local group, which was not identified, used $202,000 for weatherization work at an apartment complex without analyzing whether the work was needed, according to the audit.

• A second local agency changed expired contracts with firms to pay them more for labor costs, instead of allowing other firms to bid, the audit said.

• State inspectors failed to report that a local agency could not produce an entire set of employee time sheets for the past year. Nonetheless, the agency received federal funds for its work, the audit said.

• State housing officials didn't track the amount of federal funds used to weatherize multi-family dwellings and didn't ensure that local agencies and governments gave the low-income elderly and disabled a high priority for receiving weatherization work, the report said.

The state auditor's office has not done a follow-up review, but housing department leaders maintain the problems were corrected "very quickly" after the audit's release in 2003.

The state strengthened rules to determine how income is documented to ensure that people are eligible for the work at their homes, said Gordon Anderson, a housing department spokesman.

State officials said they have crafted an "aggressive monitoring program" to track how federal stimulus funds for weatherization are spent and will do so, in part, by doubling their energy assistance section from 15 to 30 employees, using federal dollars for payroll costs.

Under the Weatherization Assistance Program, the Energy Department ships money to the states, which then contract with community groups and local governments to spend it.

The local groups then hire contractors to insulate walls and attics, seal cracks, caulk windows, and supply energy-efficient appliances. They also monitor the work.

Under the stimulus program, the Texas housing department will more frequently inspect how the local groups and governments are handling their finances, said Michael DeYoung, director of the agency's community affairs division.

Federal regulations require states to inspect 5 percent of homes under the stimulus program. Texas officials say they will inspect 10 percent and possibly more.

Every three months, the state must send the federal government a report with the names of firms that the local agencies and governments hire to weatherize homes.

"If the agency knows their feet are going to get held to the fire for the quality of their work, then ultimately they are not going to keep using a contractor that gives them poor-quality work," said Boston, the state housing department official.

If the federal government is dissatisfied with how the program is run, it can demand that some of the money be returned.

A Dallas Morning News review of state inspection records found that problems at local agencies and governments this year ranged from zero at the Dallas County Department of Health and Human Services to nine at Tri-County Community Action in Shelby County.

The state said Tri-County's initial and final inspections of homes were "incomplete," and the agency spent federal funds on roof and other repairs that didn't save energy. The state said it plans to resolve its concerns with the agency soon. Tri-County's executive director couldn't be reached for comment.

When the state finds problems, it usually dispatches trainers to local agencies. If that doesn't work, federal funds are cut off until work is documented properly, Boston said. Typically, that happens to one to two agencies a year, she added.

Why the slow pace

State housing department officials cite several factors for the slow pace of spending so far, including a new requirement that contractors pay "prevailing wages" to weatherization workers.

But some of the community service agencies have voiced concerns about the state's oversight.

At a public hearing in April in Dallas, Stella Rodriguez, executive director of the Texas Association of Community Action Agencies, cited the housing department's delays in replacing staff and signing contracts, along with inconsistent inspection reports on Dallas apartments.

The agencies also criticized the state for proposing to send stimulus dollars to cities and small nonprofit groups that have no experience running a federally funded weatherization program. The state later dropped the small cities and nonprofits, but kept big cities, including Dallas and Houston, in the pipeline.

"It's not all the state's fault," said Art Kampschafer, contract manager for Community Services Inc. in Corsicana. "The feds have set up a whole bunch of roadblocks as far as restrictions on the money."

Dallas City Hall has set a goal of spending $13 million over two years to weatherize 1,800 Texas apartments and homes of lower-income residents.

Work is expected to start in March, said Terry Williams, assistant director of the city's housing-community services department. The city is collecting bids and will need City Council approval to award the work, he said.

Yesenia Serrato, a Dallas resident, has lined up weatherization work through the Dallas County Department of Health and Human Services.

"It was just supposed to be for insulation, to replace broken glass in the windows, and put caulking where that is needed," she said. "When they tested the house, they said they would replace all of my windows."

Dallas-Fort Worth Housing Poised For A Rebound

Dallas News

After slogging through two years of decline, the North Texas housing market is headed for a rebound in 2010. The only question, analysts say, is how strong the bounce-back will be. And that depends on the economy, of course."Any sustained turnaround in sales and construction activity will definitely depend on the economy and job growth," said D'Ann Petersen, a business economist at the Federal Reserve Bank of Dallas. "We do see increasing signs that the local economy has bottomed out, and business contacts say they are through cutting staff."

Petersen said there are signals that the worst is over for the Dallas-Fort Worth housing market. Next year will look better for builders and buyers.

"It will be slow going in 2010, but I do think that Dallas' housing market is in a better position than many other areas of the country to respond to positive economic growth," she said.

During the last two months, sales of pre-owned homes have increased significantly from year-ago numbers, and price declines have slowed. At the same time, the number of homes for sale in North Texas has fallen to the lowest level in more than two years.

Given the demand from homebuyers, builders will have to start more houses in 2010, said David Brown, an analyst with Metrostudy Inc.

"There now is currently less than a six-month supply of homes priced under $250,000 and just over a six-month supply of homes priced between $250,000 and $500,000," Brown said.

"If homebuilders are not able to start as many homes as they are closing because of lending constraints, then some of those buyers may be forced into the resale market and could cause new home closings to fall further next year."

Builders started only about 13,000 homes this year in North Texas – the smallest production volume in almost two decades.

"The current annual rate of about 13,200 starts should prove to be pretty close to the bottom," said Ted Wilson of housing research firm Residential Strategies Inc. "Interestingly, several builders have suggested that the bottom would have been closer to 11,000 starts – similar to the 1990 bottom – had we not had the $8,000 first-time buyer tax credit."

Wilson is projecting about 15,000 home starts in the D-FW area next year.

"If job growth picks up sooner rather than later, starts could push as high as 17,000, but we are still feeling conservative about the market," he said.

Tight lending

With many small builders cut off from construction loans, Wilson said that large public companies with better access to capital could have an edge in 2010.

"I wouldn't be surprised to see some of the larger builders flex their muscles with regard to access to interim financing and pick up market share in 2010," he said.

In the pre-owned home market, the number of properties listed for sale fell below the six-month supply point in November. That's considered a balanced sales market.

Price outlook

The decline in existing home prices in North Texas has all but stopped. Median home prices have actually inched up from their bottom in February.

National analysts agree that Texas – which for the most part didn't experience the last housing bubble – is poised to see home sector gains in the year ahead.

"We expect the Texas economy to perform better than the national average over the next year," said David Berson, top economist with mortgage insurance company PMI Group. "And because the bubble was less in Texas than in most other states, that's positive for house prices in the state."

"Price gains may be somewhat less in Dallas apartments than some other parts of the state," Berson said. "But [they're] still likely to be at least equal to the national average and probably somewhat better.

Analyst Stephen Bedikian of housing consultant Real IQ is expecting an uptick in the market next spring.

"By March, we're likely to see volume increase and prices firming," he said. "That trend will continue throughout the summer, and then we will return to a market that treads water for the balance of the year.

"I would expect people to be surprised by strength of housing prices between the March and August period."

But foreclosures are unlikely to ease in 2010.

Dallas-Fort Worth apartments and housing foreclosure postings set a record at more than 61,000 filings in 2009 and could be up again in 2010, analysts warn.

"I expect foreclosures next year to be a tad above this year – they are not going down," said George Roddy, president of Foreclosure Listing Service, which tracks local filings.

Roddy said that even when the economy rebounds in North Texas, the foreclosure market will lag. "It takes time after the job market comes back to help people who have been trying to hang on to their house."

Chop House Betting On Hungry East Dallas Crowd

Dallas News

Dallas boosters are hungry for signs that the millions being invested in downtown's long-neglected eastern end are bearing fruit.

Karen Babb is just hungry for a good meal closer to her workplace in the Comerica Building, one of the main employment centers on Main Street.Both might get their wishes. In two weeks, restaurateur Mike Hoque, known for his seafood shops, will take a stab at steak in the $3 million Dallas Chop House, opening on the Comerica Building's ground floor.

While most of this year's "development potential" chatter has focused on downtown's glitzed up Arts District, Hoque and his partners are opening where hulking relics of bygone businesses hover nearby.

Hoque said money already plowed into buildings near Comerica, with the promise of more to come, helps him focus on the future.

 "I think we're at the beginning of the upturn," said Hoque, 36, founder and owner of DRG Concepts, a Dallas restaurant company. "All I see is big developers buying buildings around me and converting them to condos. When I see people investing $300 million around me, I feel pretty secure."

DowntownDallas, a nonprofit booster group, offers a brightly colored map with downtown divided into at least eight districts. "Eastern edge" is not one of them. Rather, the phrase over time has become a shorthand way to say, "You know, that area past Neiman Marcus with those empty buildings."

John Crawford, president of DowntownDallas, conceded that the Chop House is at "an end of downtown that has not seen as much traffic."

 That began to change in 2005 when Cleveland-based developer Forest City Enterprises struck a deal with the city to convert the Mercantile Building on Main Street, known for its clock tower, into high-end apartments. The Dallas apartments opened in March 2008, following a city subsidy of about $60 million and an investment of "substantially more than $60 million" by Forest City, said Jim Truitt, vice president of the company's residential development arm in Dallas.

Since October, the Dallas City Council has approved more than $25 million in tax-increment subsidies and federal housing loans for Forest City to restore the vacant Continental Building, also on Main Street.

The revived Merc, across the street from Comerica, is one of the biggest examples of the city's effort to boost the number of downtown dwellers.

Since 2005, the city has directed more than $100 million in public money and subsidies toward reinventing the three blocks on which the Mercantile Building, the new Main Street Garden and a future University of North Texas law school sit.

The hope was that more wallet-bearing residents would lure retailers and restaurateurs.

"It's just now that the eastern end of downtown ... can justify more restaurant activity than what we've seen in recent years," Crawford said. "In the past two ... years, the Merc alone and the [adjacent] Element added 350" apartments.

Hoque has noticed.

"People are moving into downtown," he said as he showed off the Himalayan sea salt (used to dry-age beef) and the leather-clad walls in his 5,700-square-foot steakhouse.

With the Main Street Garden park coming in, also across the street, "we cannot go anywhere but forward in this area," he said.

Only paces away from the Chop House is Hoque's Dallas Fish Market, where this year's sales are running 7 percent higher than last year's.

More than a third of sales at the Dallas Fish Market, which opened in 2007, are convention-driven, he said. He thinks the ratio at the Chop House will be higher because it will attract visiting beef eaters looking for a Texas experience. They'll find selections from executive chef Kenneth Mills such as prime strip steak and crawfish Maque Choux, served beneath Italian chandeliers and cattle-themed artwork from Fort Worth's James Spurlock.

The heavy metal restaurant – metal railings, metal hostess stand, metal art work – also is expected to draw heavily from the 3,200 workers in the Comerica Building, the bank's corporate headquarters. Babb, who has worked in the building since the 1990s, can hardly wait.

"We think it's a great idea," said Babb, an administrative assistant with Andrews Kurth, one of a dozen law firms in the building. "Our attorneys will have a place to take their clients. It's convenient. ... It's a nice place to get away from the office."  Shane Baggett, senior property manager for the building, said he didn't think there had been a restaurant in the 60-story building since the early 1990s. The previous owners wanted to attract a restaurant, he said, "but couldn't get it done."

Most restaurateurs who were approached "were afraid they'd get no night business," he said. "With the Merc and UNT coming in, there's going to be so much more night traffic. It makes sense for a restaurant to be here now."

Not all the traffic streaming into the area is sought-after.

Rich Goza is general manager of the Press Box Grill, at the base of the historic Wilson building at the corner of Elm and Ervay, one block north of Main.

Recent upgrades to Elm – new streetlights, sidewalks and greenery – have improved the look, Goza said. But he said nearby stores selling alcohol and cigarettes often attract the homeless.

"We get a lot of homeless traffic up and down Ervay," he said. "We've had minor fights and issues with them trying to come in" to solicit change.

A year ago, he said, a panhandler came into the restaurant and rebuffed attempts from a manager to get him to leave.

The man "just reared back and slapped her," Goza said. "It was not a good scene."

Crawford conceded that the area faced challenges with panhandlers a "couple of years ago." Since then, Dallas police and his group's own safety patrol have beefed up their presence, he said.

A problem now, he said, would be "a very isolated incident."

For Hoque and other restaurateurs to succeed, that message will need to get out.

"My goal is to bring people downtown once again," he said. "If we do a good enough job, people will come."

New Neighborhood Taking Shape In Old East Dallas

Dallas Morning News

When developer Mark Culwell chatted with his general contractor at the corner of Belmont and Bennett avenues a couple of years ago, the construction executive kept looking over his shoulder.

"He didn't feel safe standing here," said Culwell, senior vice president of development at United Dominion Realty.

There's no fear factor now. The jumble of run-down rental units and ramshackle houses is long gone from the Old East Dallas intersection.

In their place, developers have built an urban neighborhood that would be at home in Dallas' hot Uptown district.

So far, prospective renters don't seem to have any trouble migrating to Dallas' newest rental enclave.

"Most of them are coming from Uptown and downtown," said sales specialist Karly Kuby. "And we've had a few who are moving from out of town.

"We just moved our first resident into the project," Kuby added.

With 465 units, UDR's new Belmont apartment community occupies almost four blocks between Fitzhugh and Henderson avenues just east of North Central Expressway. Next door, another developer – Phoenix Property Co. – has just finished 182 apartments in its Eastwood on Henderson complex.

Together, the developments represent the biggest block of new housing constructed in the area in decades.

So how's all that working out with the recession?

"Our leasing traffic has been good," said Culwell, who's spent almost three years working on the project.

"We've been kind of holding our breath – it's not the perfect time of year to be opening a project like this," he said.

Or the perfect economic environment.

But on a recent Friday morning, potential tenants lined up to tour the new apartment buildings, which have the latest in architecture and – on the upper floors – killer views of downtown Dallas.

A month's rent will run between $800 and $2,000, depending on the unit's size and location.

Attractions

The apartments offer three price levels of interior finish – from laminate countertops and carpet to granite in the kitchen and hardwood floors.

"So hopefully, we won't lose anyone because of our price points," Culwell said. "We want to have something for everyone."

To sweeten the deal, the landlord is throwing in a 42-inch HDTV as part of the appliance package in every unit.

"We are doing it in our apartments everywhere in the country," Culwell said. "We are buying a lot of TVs."

UDR has more than 150 apartment projects stretching across the county. Along with the Belmont project, the publicly owned developer is also building a large rental community in Addison.

To make the East Dallas project appeal to new urban residents, the developer added wide sidewalks along the streets, lush landscaping and streetside patio areas.

"This is not a retail location," Culwell said. "But we wanted to make the outside inviting and encourage people to walk. "We are just a couple of blocks away from all the new restaurant activity on Henderson Avenue," he said.

Mostly welcome

Phoenix Property's new Eastwood apartments next door are at the busy intersection of Belmont and Henderson. The seven three-story apartment buildings are designed in what the developer calls "mid-century architecture."

The first residents have already moved in.

Homeowners in the nearby Cochran Heights neighborhood between Henderson and Fitzhugh are mostly pleased with the dramatic transformation.

"The Dallas apartments have cleaned up that strip and are a nice asset to the area," said real estate agent Mitch Deshotels, immediate past president of the Cochran Heights Neighborhood Association.

Arlene Colbert, a longtime resident of the area, says the apartments are welcome for the most part.

"The apartments definitely improved the looks of the area, even though the apartment buildings are rather stark-looking," she said.

"We are worried about the traffic, particularly in the first two blocks of Henderson, east of Central.

"It is already really bad with no solution in sight."