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Why does the Houston market support high rise towers and Dallas market does not? I have not heard this claim before nor can I imagine any basis for it. Thanks
At one time, Dallas had more businesses located within the city than any other place in the world. I don't know if that is still true, but it demonstrates the city's diversity. I've read that Las Colinas has 10,000 companies based there. The Telecom Corridor has between 5 and 6 thousand.
Traditionally, these smaller companies grow faster than major corporations, pay their employees more, and pay more into taxes. So, when the economy is going good, massive amounts of office space is absorbed.
So, really, those little single story office buildings are a blessing. Over time, a few of those will grow into major corporations.
In the past, most of the tall buildings in downtown Dallas were utilized by the three major banks the city had based downtown: First National, Republic, and Mercantile bank. All those went belly up during the oil depression of the late eighties. At the same time, a lot of those skyscrapers downtown also had oil companies based in them. Arco and Diamond Shamrock were based in two of them. One of the Hunt oil companies had another one of them built.
Way back even in the sixties, Texas Instruments was already based in a huge campus. High tech companies need high quality space of a similar variety that Texas Instruments utilizes.
So, yes, the office buildings in Dallas - Fort Worth area tend to be shorter. This has long been true. Still, the large buildings still find a way of getting built. Here are examples of what is planned in Uptown:
this has nothing to do with it. First of all, lets get some of the myths out of the way for once and for all. DFW is a much larger office market. I'm talking about 200,000,000 sq/ft in Houston metro vs 350,000,000 million in DFW. Now that either means Houston is decidely more blue collar or DFW is decidedly more white collar. Also, as much as vacancy rates are teased in Dallas, the two metros have very similar vacancy rates. Houston's market is always low on inventory in the same way Fort Worth proper is. Its impressive that its filled, but if you look at the space discrepency, Houston is underbuilt as a metro, and has likely stayed that way because of its significant blue collar workforce.
Where are you getting this info from? I'm looking at CB Richards quarterly reports, and DFW is at 19% vacancy and Houston is at 12%. Can you provide a link to your office space claims, because I'm not buying that DFW has 150M more square feet of office space than Houston. One drive through the two metro areas would dispel that. DFW does have more retail and industrial space than Houston, but not office last I checked.
Okay, CBRE has DFW at 226M and Houston at 190M, with DFW having much higher vacancy. The blue-collar/white-collar argument between Houston and DFW is vastly overrated. The eastern Houston metro is about as blue-collar as the FW side of the metro.
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Here is where the kicker comes in for the difference between the two markets:
1.) Houston has for a long time been able to stave off significant suburban office and medical development because of their spatial dominance of that metro, while DFW has not. This has made a significant difference in office prices in Houston suburban space vs downtown space, while DFW's prices are very even around the metro. As you have seen significant construction in the Energy Corridor and Spring/The Woodlands, that has caused the two to sprint towards each other each year. Because these land prices are higher in central Houston, if a developer wants to build, they build up. The need for zoning in this situation is not so much needed, as you're often seeing development a block at a time. Not to mention you rarely see large, contiguous blocks purchased. The advantage to this for a CBD is that you get more large contiguous space opportunities when a tenant is lost because the buildings are bigger. But it also means, if there is no zoning elsewhere, you get some random towers. And please don't tell me there's one random tower in Houston. Even in Uptown, most of those towers are random as hell. As time has gone and more towers are built, they feel less random, but they are still just built with no context to their surroundings at all. Its like HEB, strip center, tow lot, street of single family homes, tower. I think the above give Houston its highrise mystique that makes people think of it as high tech, and a bigger, more powerful city when driving the freeways. The real exception in Houston is the Medical Center. Sorry, but places like Greenway Plaza are random as hell. On the freeway side it makes sense, but then it falls away immediately to small strip centers and residential neighborhoods immediately. Compare it to the towers along Dallas north tollway or Central Expressway and there are generally built space barriers and clustering in mass. If you make the comparison in that way, those towers are random as hell and some are just in the middle of nothing resembling them. That's a pricing and zoning issue. This is rapidly changing as i said earlier. As much as you are hearing about construction in inner-city Houston, it pales in comparison to the millions of sq ft under construction in the Energy Corridor, Spring and The Woodlands.
The Energy Corridor has been around since the late 70s, so I'm not so sure about that one. The only suburban office markets that have came on has been The Woodlands, and to a lesser extent, Sugar Land. The Energy Corridor is doing what it has always been doing since the 70s. It's just that now, there are ton of buildings due to 40 years of growth.
As for Uptown, it is more like: upscale strip center, midrise apartments, tower, tower, midrise apartments, strip center, tower, townhomes, tower. The reason why you don't see large continuous blocks purchased in Downtown Houston is because there aren't large continuous blocks available for purchase. That's why you see all of these new 40+ story towers being proposed now. And how random is Greenway Plaza really? I mean it is right on the freeway, and has midrise/mixed-use apartments lining the roads and all the buildings are together. It looks like the Dallas Galleria area.
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2.) Dallas proper is a smaller entity in land. It is surrounded by a larger suburban corporate presence and population. It has for a long time competed with huge suburban upscale office complexes with millions of square feet that give huge tax breaks. This has resulted in a more equalized market in DFW. So Uptown and downtown are similar in price. But building high rises is expensive if you don't have to, plus you don't have to deal with filling a building and suiting space within that building to different clientele. Instead if you own all of the land along Harwood St instead of one block downtown, you can build what's equivalent to 3 or 4 much taller buildings spread out over 10 or so cheaper to build buildings that can be built in phases. This is much harder to control as far as neighborhood integration(10 buildings vs 3 or 4), so you pretty much have to have much stricter zoning in this case. So when clients come looking for space, you have a really attractive option of their own building or almost their own with few other clients, which is traditionally something you see in suburban areas. That's why you are seeing so much inner-city construction in Dallas. These areas were highly controlled by single owners who can dictate that whole experience to potential customers much more affectively than they can in the larger towers in the cbd that constantly have to move their clients around to make contiguous spaces for new clients. In other words, the stable pricing throughout the metro simply gives less incentive to build tall, and developers in Uptown have basically been able to follow more suburban models(lots of land, shorter towers) thanks to the more stable inner-city prices. Does that mean there's doom for the CBD in Dallas? Not really. DT Dallas needs to continue to improve the streetscape and build more residential. Reuse abandoned buildings instead of leaving them on the market even when they are abandoned. And don't overprice these units. Retail will follow. You will have an attractive place with rising land prices, and more incentive to build there.
So the ultra powerful suburbs are what killed chances for Dallas, for the time being, to have highrise towers built in the core? I guess you take what the suburbs give you, and only build smaller towers for the time being.
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Which method is better? I dunno. I like all of the tall towers around Houston, but its not stopping the corporate suburban building spree that happened to DFW in the 80s. Its like the two metros are doing the same things in opposite directions.
I'm not seeing it. There is still more suburban office growth in DFW. I mean yeah, you have Exxon going against the trend and building a campus in the Houston ETJ of Spring, but then you have Chevron building a 50-story tower downtown. And its not like there aren't residential projects under construction in Downtown Houston either. The suburban building spree between Houston and DFW is not comparable, IMO. Westchase and the EC have been doing their thing for 30 and 40 years respectively. Only The Woodlands has become a strong suburban office market. In DFW, it's Irving, Plano, Richardson, Addison, and now Frisco is entering the game. That's a lot of cities to compete with.
There is a reason why office vacancy in Downtown Houston is so low compared to the high vacancy rates of Downtown and Uptown Dallas. And Downtown Houston has more space than Downtown or Uptown Dallas.
I thought there were height restrictions in Uptown because of flight patterns and that was partly to blame for so many midrises rather than high rises. Is that real or myth? I'm personally not bothered either way. The importance of skyscrapers are overblown on this site, and you don't need high rises to be urban. Washington, D.C. is exponentially more urban than any city in Texas with zero high rises. And Uptown is a better urban experience than Downtown without them.
And there is way more new construction in Dallas than any suburb. I don't have a link, but it's obvious to anyone who lives and drives around this metro on a daily basis. Cranes are constantly everywhere in Dallas, mostly centered around the core. There is nothing like it in Richardson, Plano, or Irving.
My thought about buildings either downtown or up the 75 or DNT corridors is... If it doesn't break the existing ceiling, DON'T BOTHER! Just sayin'... This is TEXAS, dammit!
I thought there were height restrictions in Uptown because of flight patterns and that was partly to blame for so many midrises rather than high rises. Is that real or myth? I'm personally not bothered either way. The importance of skyscrapers are overblown on this site, and you don't need high rises to be urban. Washington, D.C. is exponentially more urban than any city in Texas with zero high rises. And Uptown is a better urban experience than Downtown without them.
And there is way more new construction in Dallas than any suburb. I don't have a link, but it's obvious to anyone who lives and drives around this metro on a daily basis. Cranes are constantly everywhere in Dallas, mostly centered around the core. There is nothing like it in Richardson, Plano, or Irving.
Indeed, but if central Dallas doesn't figure out a way to allow a reformulation of the shopping that dissolved away in downtown beginning back in the early seventies, then expect downtown itself to reform somewhere else more willing to allow it. Namely these places would be in the old Texas Stadium area southeast of Las Colinas, within the Telecom Corridor, or in the recently announced Midtown redevelopment of Valley View.
My thought about buildings either downtown or up the 75 or DNT corridors is... If it doesn't break the existing ceiling, DON'T BOTHER! Just sayin'... This is TEXAS, dammit!
Many of the tall buildings built during the late eighties were built as a result of the crazy Canadian theory of over building. In other words, long after everyone had decided that downtown Dallas was way over built, then came these crazy Canadian companies fleeing Canadian taxation to add even more glut to the absurdity.
Look, you go ahead and build your office buildings from the top down. I'm going to build mine from the bottom up, beginning with all those single story and low rise office buildings you see so much in Dallas, and not only is my economy going to eat you alive, but those tall office buildings will still get built on occasion.
Like I once said in here, in downtown Houston, it has gotten so dense that any new kleenex box inserted among the zillions already there becomes insignificant.
In contrast, in Uptown Dallas, the new downtown of Dallas, there are still skyscrapers planned that will be more spaced apart. After all, density isn't only tall buildings, but a mixture of museums, parks, trails, retail, residential, and office.
Immediately across Stemmons from Victory Park is a whole other world of the Dallas Design District. It is designing a whole other type of building to suit itself. It wouldn't surprise me if the office venue of choice built in this area end up being the mixed use campus type that are now being built in the Telecom corridor and like the ones already built in downtown Fort Worth.
In my opinion, of all the downtown areas in Texas, the one in Fort Worth has the most potential to be the most beautiful.
And north of Uptown is this unique office development by Crow:
Really, there are five office markets in the central core area of Dallas with those being downtown, Uptown, the Dallas Design District, Turtle Creek, and the Stemmons Corridor. You could argue there are actually six in that CityPlace is distinctly separate from an area many have isolated as LoMac for Lower McKinney.
I just think that with all the growth that has happened since the last "major" building was built in Dallas, it's kind of crazy that it has been SO long since the last 30+ story building has been built. I mean, fewer, taller/larger buildings is just EFFICIENT and a better use of the land, IMHO.
I just think that with all the growth that has happened since the last "major" building was built in Dallas, it's kind of crazy that it has been SO long since the last 30+ story building has been built. I mean, fewer, taller/larger buildings is just EFFICIENT and a better use of the land, IMHO.
There's not a demand for tall buildings in Dallas. Since, Downtown is one of the only places where you can build a tall building, there has to be a high demand for office space. There isn't, but there is in Uptown.
The only way I can see Dallas building a new skyscraper, if AT&T decided to build a new HQ.
I just think that with all the growth that has happened since the last "major" building was built in Dallas, it's kind of crazy that it has been SO long since the last 30+ story building has been built. I mean, fewer, taller/larger buildings is just EFFICIENT and a better use of the land, IMHO.
Those developers who built the Harwood, Crescent, and CityPlace developments in Uptown in the early to late eighties were visionaries. Look at each of these as they stand now. Harwood sits about at the middle of what is the developing core area of central Dallas. The Crescent sits on the other side of a park built over a submerged freeway right across from the Dallas Arts District. CityPlace sits at a crossroads itself with the Katy Trail nearby, both a DART light rail subway and trolley line serving it, Love Field to the Northwest, the Fair Park to the southeast, Uptown and downtown to the Southwest, and Northpark and a huge amount of retail located towards the north.
Looking at East Dallas today, another visionary might pitch a stack at the intersection of Haskell and Gaston. Why? Well, CityPlace is located to the norhtwest, Lakewood is located to the northeast, the Fair Park is located to the southeast, the Baylor Medical Center and downtown to the southwest, and Uptown to the west. This dynamic range of Dallas is why I like the area. Houston could have this range but it is too poorly connected in comparison.
I think Dallas has outgrown the grid. Stop thinking in terms of skyscrapers and square Main Street type grids. Instead, start thinking of the eight sides that have been transitioned into downtown Dallas. By transitioned, I mean serious forty years worth of work has been done on the infrastructure by the city that now help the developments in the core area survive through economic downturns. That is what Houston doesn't know anything about because of its long tradition of relying on no zoning. Rather than gentrifying by way of transitioning as is the way in Dallas, Houston continues the process by remaining full blown native Bohemian.
There's not a demand for tall buildings in Dallas. Since, Downtown is one of the only places where you can build a tall building, there has to be a high demand for office space. There isn't, but there is in Uptown.
The only way I can see Dallas building a new skyscraper, if AT&T decided to build a new HQ.
The skyscraper isn't the way even in Houston. Most of what is being built in the area is of the campus variety. Did you know that Brown and Root built a campus like development east of downtown Houston over forty years ago? It now sits almost abandoned. Where is Brown and Root now? In another campus in west Houston. And what did Chevron call its new complex of skyscrapers in downtown Houston? Why, they called it a campus.
Skyscrapers will still be built in and around the downtown area of Dallas the way they should be. Just on occasion and in spirts.
I can see ATT building a rather small headquarters in downtown Dallas or in Uptown and a rather large campus out in, well, the Telecom Corridor.
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