Fort Worth: New Apartment High-Rise Eyed for Downtown
Featured Photo (above): The upside down T-shaped residential development is what MWG Enterprises seeks to build over two lots on the western edge of downtown Fort Worth. Image: MWG/City of Fort Worth
by Edmond Ortiz
Fort Worth (Tarrant County)–Fort Worth officials are weighing a proposed Chapter 380 economic development agreement that envisions the construction of a 19-story, 310-unit residential building on the northwestern edge of downtown.
Fort Worth-based MWG Enterprises and Houston-based Transwestern Development Co. are partnering on this venture, which if approved would be the first new residential, non-senior citizen high-rise construction project in downtown Fort Worth in 30 years, city officials said.
Michael Hennig, the city’s business development coordinator, briefed the City Council in an Aug. 20 work session about the project. He said the developers are also considering adding a commercial section to their new residential building in the future.
Although new residential construction remains strong across Fort Worth, the city has not seen new multi-story residential projects in the central business district because the area is not a proven viable market for such developments, Hennig told the council.
“As such, that carries with it a perception of risk,” Hennig added, “that investment in this kind of product is a risky investment.”
Hennig said that, as a result of such hesitancy, developers tend to wait until they see comparable metrics that become more favorable to them and their prospective project. Or, in other cases, a developer may finance a project with higher rents or scale down the project.
To be sure, Fort Worth’s economic development strategy encourages increasing residential density in downtown and surrounding urban districts, including developing more residential high-rises and redeveloping surface parking lots. Hennig said more residential density in the urban core would entice more companies to relocate to Fort Worth.
The property targeted for this project is five blocks northeast of the West 7th Street bridge over Clear Fork Trinity River and it currently consists of two city blocks containing surface parking lots and small office buildings. North Lexington Street bisects the two lots.
Google Earth map of the MWG Enteprises/Transwestern proposed high-rise project.
Hennig said the developers are proposing the following commitments:
Invest at least $75 million into building a 19-story, 300-unit residential tower by June 30, 2022;
Ready and submit plans by Dec. 31, 2020, for an adjacent commercial component;
Contracting with certified local minority/women-owned businesses on at least 15% of hard and soft construction costs;
Ensure 20% of the units are affordable (10% of 80% of Area Median Income or AMI, and 10% at 60% AMI); and
Have a minimum of six full-time employees working at the development starting Dec. 31, 2022.
No project rental prices or name for the residential development have been provided yer.
In exchange for fulfilling these pledges, the developers are asking the city for incentives, including a 10-year Chapter 380 pact that would reimburse up to 80% of city property taxes generated by the new development. This would be capped at $4.5 million total.
Also, the downtown Tax Increment Financing (TIF) District board has approved an additional $2.8 million reimbursement for improvements that the developers would apply to utilities and other infrastructure elements around the project site.
The development agreement would also have provisions to allow the city to terminate the deal early if the new project’s performance is in line or exceeding the
developers’ market expectations.
The city projects receiving a total of $1.59 million in new property tax revenue from the development over 10 years.
The developers previously proposed building a five-story, 240-unit residential structure at the same site. In that case, the developers would invest half the money it would commit to spending on the 19-story building and the city would be able to fully collect property taxes on the development.
Hennig said the proposed development agreement for the taller structure is meant to decrease risk for the developers and to help create metrics, or comps, that could spur more downtown-area residential projects down the road.
MWG, according to its website, now operates from the building at 1000 W. Weatherford, the former home of Intelitrac, a small government defense contractor.
A pharmacy once operated from a now-vacant commercial structure on the neighboring lot across North Lexington.
Underused lots between the 900 and 1000 blocks of West Weatherford Street are eyed for a large-scale residential development. Image: MWG/City of Fort Worth
MWG has commercial and high-density residential properties in several metropolitan areas. The company also provides consulting services such as healthcare information technology solutions, government contracting and procurement, general operating and management development, and short-term enterprise funding.
Transwestern has developed numerous multifamily, office and industrial properties, mostly around Texas, including the RiverVue apartments at Waterside, a Fort Worth mixed-use project along the Trinity River.
The council is set to consider the agreement at its regularly scheduled Aug. 27 meeting.
Edmond Ortiz is a lifelong San Antonian and a 20-plus-year veteran in local journalism, He previously worked full-time at the San Antonio Express-News, and has been freelancing for outlets such as the Rivard Report.