I’ve written about new developments in the Oak Lawn and Preston Hollow areas for a few years. Many of you have read about the PD-15 antics with the same hoary relish you watch a reality show. But as Dallas grows, and development reaches into more neighborhoods, there are lessons to be learned once you cut through the caustic tomfoolery.
By-Right vs. Zoning Cases
There are two kinds of developments – by-right and those requiring a zoning case. In a by-right situation, there’s not a lot you can do, it’s as it says on the tin, by right. A building permit is filed and they’re off to the races.
Construction requiring a zoning case is where the action is at. Whether large or small, any variance to a property’s underlying zoning requires the approval of that exception. Those cases are filed at City Hall and are then publicized in the immediate neighborhood – typically within 500 feet of the edges of the property filing the case. Those cases are taken up by and require approval from the City Plan Commission and the City Council. Between all that is the community wooing.
And if you’re going to be wooed by developers, there are some things you should know.
Engagement is Crucial
The larger the project and variance, the less a developer wants to seek city approval without a good proportion of neighborhood support. This is for a few reasons. Chief among them is the requirement of a three-quarters approval by city council should any variance generate opposition from more than 20 percent of the owners within 200-feet of the surrounding landmass who return the city’s ballot. Note: The city ballots within 500-feet, but 20 percent opposition within 200-feet is what trips the super-majority in city council.
The other reason is that most developers want to be decent neighbors and want local support for their plans. This also has a side benefit of greasing the wheels at City Hall if the neighborhood supports a change.
The third reason is that local neighbors will often have a more nuanced approach to the neighborhood that helps to improve a project. For example, StreetLights Residential’s recent proposal in Oak Lawn was originally a bland exterior until I challenged them to take inspiration from the original theater on the lot. The result is a building that StreetLights and neighbors like more (but who may dislike it in other areas).
In other words, a bit of a two-way street.
The problems come in when a neighborhood is either shocked or dumbfounded into staunch opposition, where there is simply no remedy. Sure, sometimes this is a valid response – a concrete plant in your backyard – but often it’s knee-jerk NIMBYism where the status quo is the only quo for them.
Organized Neighborhood Action
Dallas is growing and becoming denser. Land with extensive development rights is being grubbed-up for taller, more dense buildings. Twenty, 30, or 40 years ago, it didn’t make sense to build high-rises in Uptown, and yet in the past year, the Oak Lawn Committee has seen more than a dozen proposals – with more to come.
Unfortunately, neighborhoods outside the Oak Lawn Committee’s purview have no sanctioned neighborhood body looking out for them. Therefore when development comes, it’s met by neighbors unarmed and inexperienced in dealing with it.
The result is often either bumping along until the city sends voting ballots (at which point all hell breaks loose) or the most negative residents try to shut the whole thing down. Both responses are unproductive and unrealistic.
If an underutilized parcel of land is for sale, someone is going to buy it. Therefore, summarily kicking one developer out in hopes of shutting down a project only replaces one with another.
Tip 1: All deals, no matter how wild or unpopular must be taken seriously and negotiated to the end.
First, you can’t keep spinning the developer wheel until you win. Secondly, the developer always has the option of bypassing an unrealistic neighborhood and going directly to the city. After two years of fiddling with PD-15, ultimately decisions were taken from an unbending neighborhood and given to the city to make. The neighborhood is now left with chasing the elephants at the end of the parade with shovels.
Again, as I said above, developers want support, and residents should want to make a project better for their neighborhood. Do you think City Hall would have told StreetLights to rework their building to make it look better? No. Do I firmly believe that an engaged neighborhood could have negotiated a better deal from developers than the one they’ll likely now get from the city? Absolutely. They have virtually no leverage now.
Tip 2: The moon is not yours for the asking.
Developers are business people. They build for profit. That said, there is a slush of monies included in deals for neighborhood improvements designed to gain neighborhood support. The size of the slush depends on the size of the development and the zoning request.
So there are monies built in, but it’s not unlimited. This isn’t Oprah. A common ask in multi-family construction is underground parking. Fine, but it’s big-ticket and will likely require a larger or taller building to make the numbers work. Knowing the give and take, is it still worth it? Landscaping is pretty cheap and an easy give (and benefits developers equally by enhancing their streetscape). Another big-ticket can be exterior materials – changing stucco to stone isn’t cheap and again may require other concessions to the developer.
In the end, almost anything can be negotiated providing the neighborhood is willing to accept the changes that may be required of the project.
Tip 3: Time is of the essence.
Two years ago there were no Trump tariffs, immigrant construction workers were more plentiful, and Dallas was largely unconcerned with affordable housing. All three of those are likely part of any residential project while commercial projects still face tariffs and wage hikes. Two years have seen projects’ budgets tighten that reduce what a developer can offer the neighborhood for “free.” The Pink Wall’s PD-15 is a glaring example of the negative impact of stalling.
There’s also another kind of time. The construction cycle. Neighbors may be successful in delaying a project until the builder loses financing due to a coming construction slowdown. But here’s the thing, a construction slowdown is always replaced by a construction boom. The following boom will see more expensive land, labor, and raw materials and therefore will require a bigger building to make the numbers work. So delaying a seven-story building for five years might mean it needs to be 10 stories to economically get built.
In the case of fallow land, time is of the essence because deterioration harms the neighborhood. It took over two years, but the burned-out Preston Place condos’ parking slab along Northwest Highway was finally tagged with graffiti – and not the cool Banksy graffiti either.
Tip 4: Think of the future, not the past.
Too many people get caught up in maintaining the status quo. Around 500 B.C. Greek philosopher Heraclitus said, “Change is the only constant in life.” Clinging to a financially different past is unrealistic and filled with disappointment.
Tip 5: Think of property values.
Purely self-serving, but why not? It must be asked what will be the financial impact of new construction. Will it be quality? Will it enhance the neighborhood economically (aesthetics is sorta separate)? Will it enhance my property? Is it too out of whack with the neighborhood’s trajectory?
That last one might not be so obvious but it’s really important. If someone builds something worth $1 million next to your $100,000 home, the impact isn’t that your home is worth $1 million. It likely means your home would sell to a developer for lot value (which might be more than it’s currently worth). But it also means that such a huge disparity would create a neighborhood of teardowns.
In the reverse, it could also mean that the 12,000-square-foot house built in a 2,500-square-foot neighborhood would become a white elephant that no one wants to live next to, thus damaging your value.
Tip 6: Can it work?
If you approach new development with an open mind, you will either decide you can support it or not. But the process will have educated and informed. And if at the end of the day it’s decided a project can’t work – either by the neighborhood or the developer – it wasn’t because you didn’t try. The experience also readies the neighborhood for the next one – and there will be a next one. Education is never a waste.
The losing strategy is the one employed by the Pink Wall’s PD-15. It should be a textbook example of what not to do. Luckily, you can review that mess here on CandysDirt.com (bottle of Jack not included).
Remember: High-rises, HOAs and renovation are my beat. But I also appreciate modern and historical architecture balanced against the YIMBY movement. In 2016, 2017 and 2018, the National Association of Real Estate Editors recognized my writing with three Bronze (2016, 2017, 2018) and two Silver (2016, 2017) awards. Have a story to tell or a marriage proposal to make? Shoot me an email firstname.lastname@example.org. Be sure to look for me on Facebook and Twitter. You won’t find me, but you’re welcome to look.