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Originally Posted by skys the limit
Let's set one thing straight at the moment - the high vacancy rate in Downtown Dallas is primarily in old buildings of Class C and lower and some Class B, not the newer Class A buildings. The Class A buildings are generally 100% leased. There has been no new Class A office space in Downtown Dallas for years until One Arts was built, and I believe it is fully leased.
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Maybe... but 1 year ago the vacancy rate was reaching 30% and that 30% was primarily due to Class C and some Class B as you say?
http://dallas.bizjournals.com/dallas/stories/2009/09/28/daily10.html
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The Spire will be a Class A office project, along with residential components.
I am not privy to the actual masterplan for the project. It may call for portions of the plan to be built first, then others later. I really don't believe the developers would build all of the highrises at the very same time, but I do not know that for certain.
As an example, the Park 17 project in Uptown located at 1717 McKinney Avenue fronting Woodall Rogers Expressway was just completed. It is two highrise structures built at the very same time, one 20 stories and the other 24 with retail and parking. One of the towers is residential and the other is office.
Demand for Class A office space in Uptown has been very strong. I have an article that talks about how the Class A office construction in Uptown has largely been pre-leased up to 70% even before construction was started on a project. So there has been a strong demand for Class A office in the immediate area, Uptown, for some time.
There is usually a lagtime between a project's announcement and its actual construction, this provides more time to pre-lease and market the properties. That makes good business sense.
Just because The Spire announcement has been made doesn't mean it is being built tomorrow. Next year more than likely, next month not necessarily but I do not know that for sure either.
But the Arts District area is very hot. Downtown Dallas has had no new Class A office space built since One Arts, which is fully leased. So the prospects look pretty good that the project is viable based on the anecdotal and empirical data that is available.
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I would imagine that this sort of project would be built in phases. However, even with the Art District area being "hot" isn't there still a lot of new construction in the VP/Uptown area that isn't doesn't have a high occupancy? It seems like everywhere many projects get put on hold and canceled but this one is moving forward?
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