Century old Deep Ellum building to make way for apartment tower

DALLAS — Read this story and more North Texas business news from our partners at the Dallas Business Journal A century old former factory in Deep Ellum that most recently housed a charter school for about a decade could be mostly torn down to make way for hundreds of apartments. New York based investment and development firm RXR Realty LLC plans to demolish at least portions, if not the majority, of the 85,000 square foot building at 2625 Elm St.

to build an apartment tower, its first project in Texas. The firm acquired the 2.25 acre site from Uplift Education for an undisclosed price on Dec. 27, county records show. Uplift operated a charter school there, Uplift Luna, for about a decade until the end of 2023, when the school moved to a new campus in East Dallas.

Constructed in 1924, the building originally held manufacturing facilities and later housed offices for Baylor Healthcare System. Dallas Business Journal has learned fresh details from RXR about the future envisioned for the prominent site. While plans are still being finalized, the project is likely to be a six to seven story building with about 300 units, parking and some ground floor retail, said Joseph Graziose, the company's executive vice president of development services.

"We really enjoyed what we saw, not only just in Deep Ellum, but on Elm Street in general," Graziose said. "The walkability, the proximity to the DART [rail], the proximity to nightlife, restaurants, and then also, the fact that Deep Ellum has really emerged as a center for new creative office development too." The project is still in the design phases, so details may fluctuate.

The developers may demolish most of the building and leave the front facade along Elm Street to make way for the apartment tower, Graziose said. The team also plans to build a new structure on the adjacent parking lot, which was included in the deal. "The Uplift school provided us a great opportunity to have a sizable footprint on Elm Street that allows a lot of flexibility from a design standpoint, to ensure that not only could we develop a project of size and scale, but a project that could also deliver community benefit as well, whether that's new retail or additional parking in an area of Dallas that really has a parking need," Graziose said.

Graziose said a key design consideration is to embrace the existing masonry facade, preserving key components of the existing design such as the brick masonry and windows, and incorporating that aesthetic and history into the project. The school's front doors to the project along Elm Street could serve as the front doors to the new development.

"We wanted to ensure we're preserving that culture and that rich history, particularly the facade of this building," Graziose said. "So while we're not necessarily required to preserve any of it from a historic standpoint, we'd like to, just given the continuity on Elm Street with the surrounding buildings and adjacent buildings." Graziose said the firm intends to spend most of 2024 on design but could begin construction by the end of the year or early 2025.

Demolition, he said, could begin sooner. "That being said, as it stands today, we're intending to keep the building intact until such time that we're ready to start construction." RXR has not yet decided whether it will try to take advantage of federal or local tax incentives such as those tied to sustainability or affordable housing.

The firm has been working with Dallas based architecture firm GFF Inc. on the project. GFF has worked on prominent recent projects such as the 23Springs office development in Uptown. RXR, which historically has focused in and around New York City, has in the past two years expanded its presence nationally.

Executives aim to diversify their portfolio with a focus on places people have been moving to in the post pandemic era, like Texas and Florida. "What we wanted to do for our investments is take advantage of that trend," said Eric Clement, a senior vice president and fund manager for RXR. The investment is being made out of RXR’s second qualified opportunity zone fund, which targets areas identified through a federal program established under the Tax Cuts and Jobs Act of 2017, providing tax benefits to investors in low income neighborhoods.

Uplift Education opened the Deep Ellum school in 2013. Initially, the school faced opposition from restaurants, bar, and other property owners who worried that locating a school near existing businesses in the entertainment district would restrict expansion and prohibit new businesses because of a city ordinance that prevented bars from operating within 300 feet of a school.

The nonprofit school worked with the property owners and the Dallas City Council to have the Deep Ellum area exempted from alcohol spacing requirements. The opening of the Uplift school didn’t affect Deep Ellum negatively or positively, Barry Annino, former president of the Deep Ellum Foundation, previously said.

"It’s just like any other tenant," he said. Uplift has 45 public charter schools in the Dallas Fort Worth area with more than 23,000 students in pre K through 12th grade, mostly low income and minority students who would be the first in their families to attend college. Uplift Luna included the sixth to 12th grade Deep Ellum secondary school location, as well as a primary school along Lamar Street in the West End in a space leased on the ground floor of a parking garage.

As developers have revitalized properties throughout Deep Ellum over the last several years, the school has been receiving lots of inquiries about the property, according to Deborah Bigham, chief external affairs officer for Uplift Education. “There was lots of interest in our property, and so our board just decided that we need to take advantage of the interest,” while looking to sell and move the school closer to its feeder school, Uplift White Rock Hills, off Ferguson Road.

Uplift just opened a 17 acre Uplift Luna campus , near the intersection of Interstate 30 and Highway 80 about 8 miles east of Deep Ellum. It consolidated the West End and Deep Ellum locations into a pre K to 12 campus with soccer fields and a UIL regulation gym. “Those kiddos really did not have playground space and all of that," Bigham said.

"While it was great to start in a true urban environment when we had the opportunity to provide a more traditional school experience for the kids, we thought that that would be best. “We think it’s a win win for the city of Dallas. We got to move our school to this huge property, and now there’s additional tax revenue that’s happening for the city of Dallas that’s different than when a nonprofit school is operating.” The new owners are unlikely to face obstacles in tearing the building down.

Deep Ellum as a whole and most of the properties in the neighborhood were added to the National Register of Historic Places in 2023, though this doesn’t place restrictions on what owners can do with their real estate. That would have to be done on the state or local level. It does, however, clear the way for federal and state tax credits for redevelopment.

The former school falls in a demolition delay overlay district, but that doesn’t prevent demolition either. It just requires property owners to wait 45 days and participate in a public meeting to discuss alternatives. "It's such a beautiful building. It's one of the largest, most intact buildings in Deep Ellum, and it's right in the core of the most important part of Deep Ellum," said Jason Harper, a board member and past president of Preservation Dallas.

“It'd be a shame to lose it. I mean, it's an entire city block." His preference would be for the building to be renovated and converted into apartments. "There are great buildings of similar nature in Deep Ellum that were converted to lofts years ago that have been successful and still contributed to the quality and integrity of the historic neighborhood.".