The site where Valley View Mall once stood now sits in shambles amidst a decade’s-worth of rubble, frustrating those who wish to see the site redeveloped into the supposedly forthcoming Dallas Midtown project.
Dallas Midtown is a $4 billion planned urban living and retail center comprised of a mixed-use, walkable neighborhood with a 20-acre park, apartments, restaurants, and entertainment venues.
The project is to be developed in the Valley View–Galleria area of Dallas. It would be bordered by Highway 635 on its south, Spring Valley Road to its north, Dallas Tollway to its west, and Preston Road on its east, according to a comprehensive plan presented to the City.
In an exclusive interview with The Dallas Express, Scott Beck, CEO of Beck Ventures and Dallas Midtown’s developer, said the project was primarily put on hold because the City refused to make the necessary upgrades to the area’s existing sewer line treatment.
To get the project back on track after a five-year standstill, Seritage Growth Properties, the site’s adjacent landowner, in conjunction with Beck Ventures, partnered to finance the required infrastructure upgrades.
“We completed construction on the sanitary sewer line treatment” a few weeks ago, said Beck.
Even though upgrades to the area’s sewage line are now officially complete, development on the site is still a long way off.
The repeated delays have not sat well with Stanley Hailey, chief marketing officer and project manager at Reardon Construction. Hailey said he has grown weary of looking at the undeveloped site.
“Beck has a giant unused plot of land that’s just sitting there wasting away,” Hailey told The Dallas Express. “I fail to see what is keeping this from getting built and generating tax dollars, especially with how fast the Collin Creek Mall was torn down.”
Collin Creek Mall in Plano was demolished and will be redeveloped into a planned $1 billion mixed-use community. The project will feature 400,000 square feet of retail space, 500 single-family homes, 2,300 multifamily apartment units, 1.3 million square feet of office space, and a 200-room hotel.
“By the time Beck starts developing his site, Plano will be done with theirs and already generating taxes from it,” said Hailey. The first phase of the Plano development is expected to be completed in mid-2024.
Beck claimed that once a couple of roadblocks are lifted, development on Dallas Midtown will resume.
First, he said, macroeconomic conditions must improve.
“It’s all about market timing at this stage, and now is simply not the right time to build,” he said, explaining that inflation and rising interest rates have made realizing a return on investment less feasible.
Second, apart from a tightening U.S. economy, Beck expressed frustration with Dallas’ comprehensive housing policy, which he says is a burden.
As part of Dallas’ housing policy, developers that receive funds from the U.S. Department of Housing and Urban Development (HUD) for their projects are required to satisfy “affordable housing” requirements, which typically involve building into their projects a certain percentage of “affordable” on-site units for low-income renters.
Even with HUD funding, the gap between a developer’s costs and the money a building is calculated to generate from low-income rents can stop “affordable housing” developments before they start, according to the Urban Institute.
“Local developers whose projects aren’t budgeted to handle the costs required to build affordable housing units are taking their projects elsewhere,” said Beck.
To provide developers with an alternative to building low-income housing, the Dallas City Council expanded the Mixed-Income Housing Development Bonus program and introduced a “fee-in-lieu” incentive. The incentive gives developers the option to satisfy “affordable housing” obligations without having to build on-site units.
The fee-in-lieu is normally paid into a housing trust fund and used to finance low-income housing developed off-site. But these days, even with a fee-based alternative, many developers still choose not to move forward with their projects.
With inflation running at a 40-year high and economists anticipating a possible recession within the next 12-18 months, Beck said he believes it is wiser to hold off on Dallas Midtown until conditions improve.
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When will the Becks actually do something? The property needs to be handed off to someone that can actually do the work.
That’s a little short-sighted. Seritage pulled out and is selling the property. It’s not just Beck. 3 developers at odds with the city.
This is not the Dallas we’re used to. The decline of that area will effect all of N Dallas.
And there is no doubt about it, the area will decline further if something isn’t done soon.
Pulled out because Beck can’t get investors.
Everybody in real estate hates the Becks. Always whining its somebody else’s fault. This project is way over their expertise. Building a retail building in Trophy Club does not qualify to develop a project of this size and scope.
Its doomed as long as the Beck’s own it
Frisco here we come.
This part of Dallas is doomed.
This will become a Large homeless encampment before long.