Estimated to cost almost a half billion dollars, Goldman Sachs’ tower planned just north of downtown Dallas will be the largest and most expensive such project in decades.
The Dallas City Council is set to vote later this month on financial incentives for the huge office project, which would house thousands of workers for the New York-based financial giant. Goldman Sachs has been working for more than a year to create a new office campus to house one of its largest U.S. workforces.
The Wall Street firm already has almost 4,000 employees in North Texas, including in the Trammell Crow Center in downtown Dallas and Galatyn Commons in Richardson.
Goldman Sachs “anticipates leasing a minimum of 800,000 square feet of office space in a newly constructed office building” on Field Street north of downtown, according to documents filed with the city.
The planned high-rise would kick off construction of Hunt Realty’s 11-acre North End development, which is located next to the Perot Museum.
The massive project is planned to include offices with as many as 80 floors plus residential and hotel towers and retail space just north of Woodall Rodgers Freeway.
The Goldman Sachs office would cost more than $480 million, according to the filings with the city. That would make it the most costly real estate project in central Dallas in decades.
The planned development would be even more expensive than Uptown Dallas’ landmark Crescent complex, which cost around $400 million to build in the 1980s.
“It is a huge deal for Dallas and the Field Street district,” said Jonas Woods, CEO of Dallas’ real estate developer and investor Woods Capital Management. “This will be the largest office investment in the history of downtown or Uptown in terms of gross development costs.”
Woods Capital is a partner in another big office development — the Field Street District — proposed on Woodall Rodgers Freeway.
Goldman Sachs’ planned offices will be of a greater magnitude than any of the other new offices on the way north of downtown.
Developer Trammell Crow Co.’s office high-rise on the way at McKinney Avenue and Maple Street will have about 670,000 square feet of offices in 27 stories.
And Granite Properties’ 26-story 23Springs office tower that’s about to start construction on Cedar Springs Road near the Crescent will have about 626,000 square feet.
Lincoln Property has proposed a 525,000 square-foot office tower on Cedar Springs Road at Fairmount Street that would be part of a larger mixed-use development.
Few of the office towers built in Dallas in the last couple of decades have been on par with the huge high-rises of the 1980s.
The two last true Dallas office skyscrapers were the 1.3 million square foot Chase Tower, which was completed in 1987, and the 1.4 million square foot Cityplace Tower, which opened in 1988. Each of those high-rises cost about $300 million in 1980s dollars.
“Goldman Sachs will represent a new watermark for office investment with a total project cost of $670 million or more,” said Andrew Matheny, research manager with commercial property firm Transwestern. “The incentive agreement doesn’t include the value of the land.”
Matheny said the land for the project — based on recent sales prices in the area — could cost about $190 million.
“We also expect Goldman’s campus to bring a wave of office demand, just as companies followed Toyota North America’s relocation to Plano,” he said. “This may create a knock-on effect where rents and property values in existing buildings are repriced higher.”
Goldman Sachs is now the largest office tenant in the 50-story Trammell Crow Center tower on Ross Avenue, which just sold for more than $600 million.
The City Council last year approved zoning for Hunt Realty’s Field Street site that will eventually allow construction of more than 3 million square feet — giving Goldman Sachs and other businesses plenty of room for future growth.
The complex of towers would replace the North End Apartments, which were built in 1997. The new buildings would surround a 1.5-acre central park.
New York-based architecture firm Kohn Pedersen Fox Associates is designing the mixed-use development, which is expected to start construction later this year.
So far, Hunt Realty and Goldman Sachs officials aren’t talking about the planned office tower.
“We continue to grow our presence in the Dallas area, but cannot comment at this time on our future expansion plans,” a Goldman Sachs representative reiterated in a new email.
Based on the minimum size of the space, real estate brokers say the new building the City Council is being asked to support could house around 3,000 workers or even more.
Hunt Realty has a track record of building some of North Texas’ landmark real estate projects.
In the 1970s, the company constructed the Reunion Tower and the Hyatt Regency Hotel, which forever transformed Dallas’ skyline.
And Hunt Realty is currently a partner in the $10 billion, 2,500-acre Fields community in Frisco, which will bring more than 14,000 homes and apartments plus millions of square feet of commercial space.
“A Goldman Sachs expansion in the downtown area would be another major win for the urban heart of our city, solidifying our standing as one of the most desirable places in the region to do business,” Jennifer Scripps, Downtown Dallas Inc president and CEO said in an email. “We now have more than $4 billion in planned and ongoing developments, including transformative projects on all sides of downtown that will strengthen connectivity and walkability and bring with them a host of new amenities for workers, residents, and visitors.”
