This morning’s panel discussion on Oak Cliff: Challenges + Opportunities for the Urban Neighborhood was a strikingly honest — almost uncomfortably honest — conversation, both between the panelists and in the Q&A. The panel brought together two well-established Oak Cliff developers — David Spence of Good Space and Monte Anderson of Options Real Estate — and two newer developers — Michael Nazerian of Exxir Capital and Wade Johns of Alamo Manhattan. The DFW REimagined breakfast seminar was hosted by one of Munsch, Hardt, Kopf, & Harr’s recent additions to their law team, Angela Hunt, who is overseeing zoning and development regulations.
Conversation cues were well-curated. We learned of Anderson’s “gentle-fication” process, Nazerian’s pivotal “ah-ha!” moment in the West Village, and the stark contrast in development processes Johns has experienced in Seattle and Portland versus Dallas.
They all seemed to agree that “Developers create the canvas for people to bring the place alive,” as Nazerian put it. And that even developers with good intentions can get “pushed around by the market,” Anderson said.
The agreement began to unravel when Hunt started asking about gentrification, which resulted in one of the most educated discussions on this topic as I’ve ever heard. Many who think of developing in Oak Cliff imagine the pushback from engaged citizen activists, such as those who attended the first community meeting with Alamo Manhattan in the Second story of Eno’s years ago.
But those are a minority of the residents in Oak Cliff, Spence reminded the audience, many who arrived within the last 5 years. Many more neighborhood residents simply want jobs and opportunities for their kids. In 2010, 56 percent of homes in the 75208 zip code were owner-occupied — slightly higher than the 53 percent Dallas average — and in 2010, 73 percent of the population was Hispanic or Latino.
“Poverty relief is about building net worth. Putting money in pockets.”
Much of the anecdotal evidence supports this theory that those who have left Oak Cliff were able to cash-out. In Anderson’s “gentle-fication” model, this is success. As the wealth gap grows, we need to be teaching how to build wealth. To take it one step further, we need to be teaching locals how to start businesses in cheap spaces, start small, focus on the details, and fix up their little corner of the neighborhood.
“If we help local businesses to purchase their own building, we naturally slow down the rate of change in a neighborhood,” Anderson said. Owners are invested in keeping their building and their business as they contribute to improving the value of the neighborhood. As Anderson pointed out, the problem is that locals often aren’t taught about wealth-creation and don’t get rich in the process. “There is no ripple effect from government-funded projects,” Anderson said, “You need local entrepreneurs.” And they need to get in early.
For Spence, the process of change we’re seeing in Oak Cliff isn’t as dire as it’s portrayed.
“Do you know what propels people from the socio-economic bottom 20 percent to the top 20 percent? Proximity to people in the top 20 percent.” And that’s what he sees happening in the neighborhood: reversing the effects of desegregation decades ago. Creating this kind of neighborhood diversity is on the forefront of Affordable Housing and Wealth Gap conversations around the country.
Neighborhoods evolve. A place is either growing, changing, and hopefully getting better, or it’s dying.
Key: Incentivizing Long-Term Investment and ‘Good Design’
Neighborhood redevelopment and revitalization is a much less resource-intensive mode of real estate development than greenfield development (especially in up-front costs in infrastructure, for both cities and developers.) But the designing, permitting, financing, and leasing of infill projects is often much more difficult.
The Nazerian experience, assembling 40-plus parcels over 11 years, is not the way institutional commercial development is done. And Anderson’s business model is characteristically unconventional as well, relying on brokerage deals to fund his development, often planning to spend 10, 15, sometimes 25 years slowly bringing a project to fruition. These slow, organic processes keep the neighborhood culture from going into shock suddenly.
That’s David Preziosi’s biggest concern. He’s executive director of Preservation Dallas and active in the Old Oak Cliff Conservation League. Large-scale development puts a lot of pressure on the small-scale buildings that have defined the character of the neighborhood, often being replaced by “anywhere architecture.” Only time will tell whether and how the character of Oak Cliff will change.
Alamo Manhattan has a slightly different model than Nazerian, Anderson, and Spence. They were surprised to see so many apartments and mixed-use projects in Dallas that wrapped structured parking. In Seattle and Portland, where they cut their teeth, land is at a premium. Everyone builds underground parking. This has enabled them to develop on smaller, more expensive parcels in great neighborhoods. Their left coast properties have an average apartment size of 550 square feet. When they arrived in Dallas, they were seeing an average of 950 square feet. For their Bishop Gate project, the apartment size average is 750 square feet.
“People love great locations, amenities, and lower price tags.”
We’re seeing this more in European cities where apartments are small, while the real the value is in the outdoor living room.
“Transit is key. It’s radically changing the way people get around in Oak Cliff. In Portland, there are minimal parking requirements. It’s the bike parking requirements everyone pushes for. There are bike valets where you’ll see 800 bikes parked.” Needless to say, they’re delighted to have the Bishop Arts Streetcar stop at their front door. Johns said they’re planning a more elaborate covered waiting area at the stop and giant steps and outdoor seating in the 7,000-square-foot plaza. They’re also allowing retail tenants to design their own storefronts.
“This is the most expensive design we’ve done, in the lowest-rent neighborhood. But we’re getting a high-level of interest from everyone — even turning down some national chain-type retailers — and hearing from some talented locals.”
Although the Alamo Manhattan team at first faced intense scrutiny from the community, they adjusted their design to the feedback they received and are confident they have a much better project now. “The cities where we’re used to working in require a Design Commission review before you can even pull a permit.” In Dallas, there’s only a Design Review board if you accept incentive funding in a TIF District. The neighbors, instead, have become their own watchdogs, sometimes knowing their specific PD requirements better than city staff.
Developers and neighbors across the country are no stranger to these types of issues. Even in Dallas, this isn’t the first neighborhood facing these challenges. As we continue this dialogue with all the sensitive issues that arise, may we continue to listen and learn from one another.