Located just south of downtown Fort Worth is an area know as Near Southside. Once a prosperous neighborhood surrounding the medical district, the area had fallen into decline. With many vacant buildings, it had become a blighted area to the point that several of the 5 major hospitals in the district were considering moving to their main campuses to other parts of the city.
In 1996 an organization was founded committed to the revitalization of Near Southside based on the two-fold recommendation of Sasaki Associates. The Boston company believed that there was a need to 1) to create an organization to work daily on revitalization and 2) to work with the city to create an economic development tool to encourage development in the area. Fort Worth South, Inc. is a non-profit organization with the mission to promote the redevelopment of Fort Worth’s Near Southside as a vibrant, urban, mixed-use neighborhood. The mixed-use element meant they would need to attract new residents and businesses and create a sense of community that was non-existent. Mike Brennan, Planning Director of FWSI, talked about the vision and challenges of recreating Near Southside.
One of the primary problems with the area was that it had become a cut-through rather than a destination. Interstate highways created a psychological barrier from downtown. Widened streets encouraged moving through rather than looking around. All of this would have to change if Near Southside were to develop a new identity. Magnolia, the main street through the community, was designed to be a walkable or complete street - welcoming not only automobile traffic, but pedestrians and cyclists as well. The group was also committed to making the area a unique collection of local businesses while supporting economic anchors that already occupied the area. As a result they have attracted an eclectic variety of restaurants and small businesses and developed a growing sense of individuality not seen in other parts of the area.
The other role of FWSI was to market the area with the goal of changing perceptions of the neighborhood. In addition to attracting businesses and residential development, the organization strives to invite those outside the neighborhood to events such as Friday on the Green, Art Goggle, and other events to help them experience the unique culture of Near Southside.
The formation of Tax Increment Finance District #4 (TIF District) has also played a major role in the improvements and development of the area. Working with the city, the committee developed a redevelopment plan that included updating rules to allow for the type of mixed-use development they desired. (Prior to these changes it was illegal to have businesses and residential in the same building in this area.) It also offered financial incentives to support projects that met the goals of the redevelopment plan.
While the project has experienced much success, not everything they hoped for has come to fruition. One goal was to create a user-friendly access to the area through a modern street car. Plans were made for initial phases and the project even received $25 million in federal funding. Unfortunately, a close vote by the city council voted the project down and resulted in several developers pulling their projects from the area.
Despite political hurdles, New Southside has continued to grow and develop. Their community events attract people from outside the neighborhood and the area is quickly gaining a reputation of having a friendly and eclectic culture. One of the goals of Near Southside is to create a sense of authenticity. While they use this as an acrostic, the word really sums up the atmosphere of the area. Not only is it full of wonderful architecture, there is a sense of truth in the community and that is always a good thing.
Fort Worth is steeped in the history of the cattle and oil businesses. From its beginnings as a frontier outpost, Fort Worth grew to a booming cattle town and now has grown to a corporate center. Fort Worth's pride in its history is evident in many areas, including its architecture. Re purposing old buildings is part of what lends the city its historic flavor and gives Fort Worth its distinctive character. Here are some examples of adaptive reuse in downtown Fort Worth:
Texas & Pacific Lofts: Located on the south boundary of the downtown Fort Worth area is the Texas and Pacific Railway Terminal. Originally built in 1931 as part of a 3 building complex, the building (pictured on the left) was also envisioned as a dirigible station with a tethering anchor on one of the four columns at the top of building. The buildings continue to serve as a pass through to the train, but a significant portion of the building has been converted into urban lofts. The art deco style is evident both inside and outside the building and the re purposing has kept a beautiful building as part of the Fort Worth community.
714 Main & W.T Waggoner Building: Two other example of restores and re purposed architecture in downtown Fort Worth are 714 Main Street and the W.T. Waggoner (pictured on the right) building on Houston and currently owned by XTO Energy. Each of these structures, along with a number of others, shows a commitment on the part of businesses and developers to use existing buildings in new and creative ways. The result of this effort is a downtown area with a sense of history and a character that is reflective of the early settlers who traveled west.
For more information on the history of downtown Fort Worth's architecture click here.
Many old buildings are repurposed into related uses, but there is a growing trend to take industrial buildings and breathe new life into them as urban residential living spaces. The open space provides a blank canvas for creative thinkers like Eddie Vanston to develop unique apartment homes. Eddie's creativity does not stop there as he has developed an approach to financing that has allowed him to repurpose a number of buildings in south Fort Worth. He has used historic tax credits to help fund his projects. While this funding avenue has very specific restrictions and expectations, Vanston has developed relationships that have allowed him freedom and success. His personal passion for reuse has led him to educate himself about the process of gaining tax credit approval and the details that make this type of project successful. His office, on S. Main Street just south of downtown Fort Worth, has several apartments on the second floor. Vanston shared some of the challenges of working within the expectations of the historic tax credits - such as the challenge of locating period glass when a window breaks - but clearly he enjoys the process of breathing new life into old buildings while maintaining a level of historic integrity.
Just around the corner are the Miller Lofts(pictured above right) , a project Vanston is justifiably proud of. The project is an adapted warehouse that is now home to several unique apartments. Built in 1910, this building was home to the Miller Manufacturing Company and has been transformed into 16 lofts. While this area is experiencing some revitalization, it is still primarily vacant warehouses, and therefore benefits from the gated parking lot. One nice surprise when the wood and iron gate opens is the city garden (pictured on the right) that welcomes you to the community. The interior of the building is basic and has an industrial feel, but the community that has been created is far from cold. The residents seem connected in a way that no doubt stems from the unifying factor of each choosing to live in a unique residence - a live and let live attitude that does not only accept diversity, but embraces it. The art work (pictured on the left), commissioned by a local artist, in one of the hallways illustrates this idea in vibrant color. This is a unique living environment and a wonderful example of adaptive reuse.
Vanston is currently working on a new project just around the corner from Miller Lofts. He has just beugn repurposing the old Supreme Golf Warehouse into a mixed-use development with retail/office space, a beer garden and restaurant, and loft apartments. The challenges of balancing the historical expectations associated with the tax credits and meeting the market demands is sometimes challenging financially, but Vanston seems energized by the challenge. He has opted to keep much of the existing finish out, even talking frankly about the possible need to "rough it up" because, despite its age, it looks too clean and new. The plan includes large lofts and the addition of windows to open up storage spaces. The challenge with this otherwise straightforward adition is that the windows must maintain the historical integrity of the project as required by the tax credit guidelines. Vanston also plans to use the storage rooms as entry ways or closets, incorporating the weighted pulley door system. There will also be a beer garden (pictured on the left) and event hall as well as ground floor office space. As you walk through the project with hime, Eddie Vanston talks about the project with excitedment and confidence - clearly two of the qualities that have led to his strong investor base.
Welcome to The Live Oak Lounge in Near Southside. It is not often you see a music hall and lounge with a mission statement, but The Live Oak is no ordinary venue. Simply stated, Live Oak's goal is to foster community and to affect community and even before they open next month they have achieved this objective. You might think it is impossible that a music bar could have that kind of impact, but that is only until you meet founder, Bill Smith. Bill is in the process of transforming the circa 1952 Lion's Club building on Lipscomb into a first-class bar, restaurant, and music venue. But his vision does not stop there. He sees this project as a catalyst for bringing people and neighborhoods together to benefit others through such functions as fundraisers, youth mentoring sessions, and rallying to causes that impact the district and city. Even before crossing the threshold of The Live Oak, it is clear that the endeavor is much more than meets the eye.
Bill Smith is a guy with a dream and now (almost) a dream come true. His vision for a place that brings people together to enjoy good food, good drinks, and good music is almost a reality. His path to this place has not been an easy one, but to listen to him talk there is little to nothing he would do differently. He is quick to acknowledge that each bump and turn has been an integral part of the journey. Bill has not left this dream to chance either; he has learned about financing, marketing and even construction as he and his wife have had a hand in every part of this project. His decision to raise capital by selling units in a LLC, his research on how to use TIF funds (tax increment financing), and his willingness to actively participate in the construction and marketing show his commitment to the success of this endeavor. His candid transparency has also made him not only a welcome business partner, but has allowed him to captivate the support of the neighbors both business and residential. He is truly building community.
The financing part of the project had three phases. The first promotional phase was an opportunity to express his vision and pique curiosity. His business plan incorporated financial analysis and was the result of extensive research on the managing of a bar/restaurant. The final phase was a memorandum. He offered 100 units, each valued at 1% of the company. With a start up cost of $1.2 million, each share sold for around $12,140. These single units were purchased by investors and even people working on the project. In November, the price of each unit went up to ~$27,000. He has a maximum of 30 investors, so he is exempt from SEC regulations and he and his wife intend to hold 35-40% interest.
The entry/dining room of The Live Oak gives immediate tribute to the attention of detail found in the physical project. The acoustic panels or "clouds" are made from imported mahogany, many of them hand cut by Bill. These panels will not only offer an aesthetic element, they also serve as acoustic barriers. Bill told us the the dining room would be an intimate place to enjoy exceptional food and would not be directly connected to the music venue. Guests will be able to enjoy a formal dinner before a show or come for a different menu in the music hall or on the roof top. He has spared no expense on the soundboard, purchasing the same board that Bass Hall is still waiting to have installed. "We just ordered ours first," Bill smiled. The Music Hall will be an intimate experience offering fans and artists a unique venue in which to share music. As part of its mission, Live Oak will also offer music lessons and host fund raisers in the hall.
The finishing touch to this venue is the expansive roof top patio. Accessed by an outside staircase, the patio overlooks not only the Near Southside, but downtown Fort Worth. It will be lit by ambient lighting coming from the two namesake oak tress at the front of the lounge and reaching over the rooftop of the building.
Bill Smith has been dreaming about this project for many years - that is why he has such clarity. He has visited music venues and bars critiquing what works and what he would change. His hope is that if each person builds on what came before, "one day we'll get it perfect". The wonderful thing about Bill is that he did not let obstacles stop him form achieving his dream. He educated himself on the process of raising investment capital, he has allowed his personality and transparent nature to gain the support of the neighbors and community. He found a building that had the right feel and negotiated a lease that predisposed him to success and repurposed it to meet his needs. Bill has allowed himself to be excited about the project and use that energy to work hard to make it a reality, most often seven days a week. The Live Oak Music Hall and Lounge opens next month and not only does Bill get to see his dream come true, we all get to reap the benefit and enjoy it as well.
This project was given to us with the assignment of evaluating and developing a creative use for the property. While the developer has gone ahead with his project, we were challenged to think outside of the box and come up with an end-user for the vacant space.
3 Buildings on Property
The Property: The property is comprised of three buildings with two of them being predominately leased. Our focus will be on Building 2. Building One is home to a number of retail businesses including a restaurant, yoga studio, art supply store and vintage clothing boutique. Building Three is located behind Building Two and is fully leased by 1 restaurant/bar and 7 office tenants. Both buildings are currently leased for $14.50/SF, NNN.
Building 2
Building Two was formerly leased to a single tenant metal fabricator who vacated on 12/31/2012. They paid approximately $2.50/SF gross for their 80,000 SF space. There is approximately 4,500SF of old office space at the southeast corner. The building is cast in place concrete construction with dock high finished floors, built in 1948. One concern is the flat roof that holds water after rains.
The Market: The three buildings are located on the southeastern edge of the So7 mixed-use development in close proximity to Trinity River Park. This area is sided to the east by Trinity Park and is located just west of downtown Fort Worth. Recent redevelopment has led to high levels of activity since 2007, attracting retail, dining, and residential developments. There has also been an increase in office space. Based on information provided by the developer, lease rates as of 1/1/11 ranged from $30-45/SF, NNN for retail and $25,26/SF for office. In 2008, Cypress Equities bought the land that now houses W7th project at the high water mark of approximately $42/SF. Other sites have brought $30-35/SF with sales stopping around 2009. There has been continued addition of multi-family and rents were approximately $1.40-$1.50/SF and rising as demand has continued to increase.
The Decision Point: On January 1, 2011 the investors faced a decision point. Building 2 was completely vacant and while the partnership formed around Blgs. 2 & 3 would break even based on the occupancy of Building 3, the property tax bill was due at year end. The partners recognized the value of the property and knew it would have future value, but were not interested in "feeding" the project until that occurred. The questions being considered included redevelopment versus demolition? Use of tax credits to develop? Creating a way to effectively 'mothball' the project until the market improved? Our assignment was to develop a plan that would address these concerns.
The Project:
5-7 Year Outlook for 7th Street Corridor:
Multi-family demand will diminish. Currently there is a solid demand and ample supply with more multi-family developments already in the pipeline.
Retail activity will remain strong, but new projects such as Trinity Uptown will draw traffic away fromSo7 just as So7 has drawn traffic away from Downtown.
There is a need to create a venue in So7 that has regional appeal as many of the other stores and entertainment venues can be found elsewhere in other developments.
A venue that capitalizes on the inherent strength of the area is needed: one that coexists with the Trinity River Park and Trail System.
So7 will continue to draw people who are active and want a lifestyle where they can live, work, and play.
Development Summary:
Our proposal is based on the notion that Foch Street is unique given its location in the heart of the So7 development. Additionally, this property is unique because of Building 2's size, approximately 80,000SF. The fact that it has basically no finish-out gives the owner a tremendous opportunity to do something that is completely innovative and out-of-the-box. Although there are many questions that must be answered to determine the ultimate viability of our proposal, the idea capitalizes on the strength of the area's demographic and its location. It also utilizes the most important quality of every real estate project - scarcity.
The Proposal
What if you could build something where a strong demand existed and where there were only two of its kind in the US?
How far would people travel to your site in order to use your product or service?
What if you could set yourself apart in a billion dollar industry and your competitive advantage was very dominant?
Would you be interested? Most real estate developers would be!
The idea is simple: Develop a large facility that caters to serious athletes, especially the subset of serious athletes who are cyclists, marathoners, swimmers, and triathletes. With the existing 80,000SF building you could redevelop the former warehouse into an indoor velodrome, running track and Olympic size lap pool. The velodrome or banked cycling track, would allow cyclists to practice in a safe, climate controlled environment. It would enable them to "squeeze" a ride into their busy schedules and collect miles and times necessary for competitions. By combining this unique facility with a 250m running track and 50m lap pool you will have created an opportunity to cross train or to prepare for Ironman or triathlon competitions in one convenient location. This type of venue would attract amateur and professional athletes from miles away. In addition to membership and member use, you could attract swim clubs and school athletic programs and clubs from across DFW. There is a growing need for this type of exercise/training facility in DFW
This type of facility, modeled after Boulder Indoor Cycling, allows clients to continue their training and exercise in bad weather and in the dark. Imagine a place where a triathlete can train for all three events in an hour, perhaps even minutes from work and home. In one hour, he or she could swim, cycle and run under one roof. This facility would also become a magnet for other athletic retailers, even medical sports offices.
Fe workout facility logo
Our concept for this facility, named Fe after the atomic symbol for iron, shows how this empty warehouse on Foch Street can be re-purposed into a place where a serious athlete can become like iron. The facility will offer membership as well as race opportunity and facility rentals. It will have space for offices and a retail/snack bar space. The option of renting and storing bikes is another source of proposed revenue.
Proposed layout for Fe
While parking is somewhat limited on site, the aerial below shows an adjacent public lot within easy distance of the facility. If need be, arrangements could be made to use that space for parking. The aerial also show the close proximity of Trinity Park and Trails, another huge advantage of the site.
Aerial of Fe and surrounding parking and proximity of park
While additional research would need to be done on the project, it offers the developer a unique opportunity to create a regional draw and develop an ongoing income source. While the full project offers the most complete facility for cross training, the pool could be sidelined making the project even more affordable. While there is every expectation that Fe would be successful, this project also offers the owners the flexibility to use the site for this purpose while maintaining the option of changing its use or even demolishing it in the future. While this project does not lend itself to tax credit financing, there is a possibility that funds could be raised by forming a 501c3 that would create training opportunities to underprivileged kids, helping both the developer and the community.
In 1996 an organization was founded committed to the revitalization of Near Southside based on the two-fold recommendation of Sasaki Associates. The Boston company believed that there was a need to 1) to create an organization to work daily on revitalization and 2) to work with the city to create an economic development tool to encourage development in the area. Fort Worth South, Inc. is a non-profit organization with the mission to promote the redevelopment of Fort Worth’s Near Southside as a vibrant, urban, mixed-use neighborhood. The mixed-use element meant they would need to attract new residents and businesses and create a sense of community that was non-existent. Mike Brennan, Planning Director of FWSI, talked about the vision and challenges of recreating Near Southside. 
