UPDATED 11/6/25 10:30am
If reality is usually worse than the fantasy, in downtown Dallas, the real thing is actually better. Up in the suburbs, they are sure downtown’s streets are dangerous and dirty, yet when developer Tanya Ragan tours out-of-state investors around, they sing a different song: it’s much cleaner than their central business districts back home, they tell her.
“I live in two worlds,” said Ragan, one of downtown’s loudest cheerleaders.
But as tenants like AT&T look to relocate to the white-hot DFW suburbs, the potential of downtown’s downfall stands to block a revival — whatever the truth.
The telecoms giant has been scouting a new office in Plano or Richardson since the summer, threatening to vacate its 1 million-square-foot downtown footprint, which represents 4 percent of all office space in the submarket.
Of course, AT&T isn’t the first to eye a switch. Tenants have been leaving for Uptown and the suburbs for the better part of two decades. AT&T’s potential departure comes as Dallas’ NBA and NHL teams run up against their leases at American Airlines Center. (The arena isn’t technically downtown; it’s across Woodall Rodgers Freeway in Victory Park, but it’s a lot closer than rumored new destinations like Plano, Irving and Arlington.)
Downtown has plenty of local boosters pushing to renovate office buildings or convert them to residential, and the revamped convention center set to debut in 2029 is already booked. There’s funding. Still, momentum is lacking. In the story of flight-to-quality in the office market, downtown Dallas is the origin city, not the destination.
To be sure, maintaining the perception that downtown is undesirable may benefit suburban office owners and tenant rep brokers, who stand to gain when downtown tenants head elsewhere, according to Pacific Elm Properties’ Jonas Woods and Billy Prewitt.
“There’s a serious financial incentive to push tenants to more expensive buildings,” Woods said.
Somewhere between the vocal critics and cheerleaders lies the real story of the urban core, where political leadership tends to get in its own way and investors waiver on the material odds for a comeback built from the rubble of its office market collapse.
Start today for only $1
Downtown’s problem
Everyone’s in at least one Facebook group that traffics in nostalgia with grainy, washed-out photos of a city’s downtown in a heyday that didn’t last that long.
Old photos of Dallas show a town on the come-up in the mid-1970s: busy downtown streets, now-vintage neon lights advertising iconic spots like The Adolphus Hotel. Reunion Tower — the landmark topped with a three-story observation ball — was completed in 1978, the same year the I. M. Pei-designed City Hall would open. The skyscrapers that define the city’s skyline went up to house the burgeoning financial services industry.
The savings and loan crisis of the late 1980s hit the rising financial center hard. By the late ’90s, downtown Dallas was famously home to fewer than 500 people. The pandemic also ravaged the city center, emptying office buildings and driving up violent crime.
The perception of downtown as unsafe belies the fact that violent crime is on a downward swing; it dropped nearly 20 percent between 2024 and 2025. Violations related to homelessness, like sleeping in public and solicitation have decreased almost 35 percent in the same time frame, data from the Dallas Police Department shows.
Still, there has been violence. Two shooting deaths on Dallas Area Rapid Transit trains within six days of each other this fall renewed pressure for public safety measures. Longtime downtown tenants cite security as the primary reason to relocate.
The relocation game
In 2012, Klyde Warren Park paved the way for an office exodus. The 5-acre deck park covers Woodall Rogers Freeway, connecting downtown to Uptown.
Kelcy Warren, the son of the park’s billionaire namesake, donated $10 million to the development project. In addition to private donations, the project was funded with $20 million in bond proceeds, $20 million from the federal government through TxDOT and $16.7 million in federal stimulus funds.
In a city short on natural resources, the park is an active outdoor space with community events almost daily. At lunchtime on weekdays, suits pour out of office buildings on Woodall Rodgers Freeway to grab lunch at the food trucks lining the edges of the park.
Accounting firm Pricewaterhouse-Coopers ditched its 144,000-square-foot downtown footprint at Trammell Crow Center in 2017 for Park District. Invesco also left its spot at the 1.2 million-square-foot skyscraper at 2001 Ross Avenue. A brigade of law firms followed suit, ditching their downtown addresses and landing in flashy trophy office buildings on Field Street and McKinney Avenue.
“I don’t like to use the word ‘revitalization’ because I feel like we’re past that.”
The exodus to Uptown will reach a fever pitch when Goldman Sachs and Bank of America depart for their built-to-suit trophy towers on Y’all Street.
Goldman Sachs’ move to the 800,000-square-foot campus at Hunt Realty’s upcoming development NorthEnd will leave a 300,000-square-foot swath of empty office space at Trammell Crow Center.
Bank of America is ditching its namesake downtown tower for Parkside Uptown, the 500,000-square-foot project being developed by Pacific Elm and KDC.
That’s without adding in the firms heading to a different municipality, like Plano, Frisco or Richardson. It can be lucrative to play the corporate relocation game outside the city, Partners Real Estate’s Steve Triolet said, as the popular northern suburbs are known to lavish incentives on companies that sign leases in their domains.
The trend has saddled downtown with a mountain of empty office space. Of Dallas-Fort Worth’s approximate 172 million square feet of office space, downtown Dallas accounts for almost 7 percent, according to data from Partners. The overall market has a vacancy rate of 25 percent; in the central business district, it’s 33 percent.
“Those downtown buildings are kind of Swiss cheese,” Triolet said, rattling off a list of properties: Harwood Center, Bank of America Plaza, Fountain Place, Trammell Crow Center, Chase Tower, Ross Tower and St. Paul Place.
The conversion conversation
What to do with downtown’s core glut of outdated office space? Downtown’s most ardent champions swear by adaptive reuse.
Shawn Todd’s Todd Interests turned the 50-story First National Bank Tower built in 1965 at 1401 Elm Street into The National, a mixed-use tower with a luxury hotel, 324 multifamily units, 37,000 square feet of office space and 43,000 square feet of retail. The firm also revamped Energy Plaza, at 405 North Ervay Street, into The Sinclair.
Pacific Elm’s Woods and Prewitt bought Thanksgiving Tower in 2013 and have been fixing it up ever since. Now known as Santander Tower, the 50-story former office building at 1601 Elm Street is home to a hotel, 228 multifamily units and 756,000 square feet of office space. The office space is currently 85 percent leased, Woods said. Pacific Elm is about to start construction on the conversion of Bryan Tower.
The redevelopment of The National and Santander Tower, which are about a block from each other, has activated a stretch of Elm Street with ground-floor food and beverage concepts.
Woods believes adaptive reuse is the key, “the most productive thing we could do to dramatically change the existing dynamics” of downtown Dallas, he said.
Developers have been revamping office buildings in the urban core for decades, Prewitt said. But the current stock — albatrosses constructed in the ’80s — makes this cycle particularly challenging.
The government could help ease the process, Triolet said. The Texas Legislature, in its most recent session, passed Senate Bills 2477 and 840; both aim to streamline the conversion process.
Still, the cost-intensive nature of a residential conversion makes these deals hard to pencil, even with incentives from the city.
At the moment, all eyes are on Mike Hoque and Mike Ablon. The heads of Hoque Global and Pegasus Ablon have teamed up to take a $409 million swing at rehabbing Dallas’ tallest building, Bank of America Tower. The pair secured a $103 million incentives package to convert part of the 72-story skyscraper at 901 Main Street into a hotel.
Downtown stakeholders are eager to see the project succeed, but Hoque’s redevelopment dreams are still mostly unproven. Project delays have led to skirmishes between his firm and the cities of Dallas, Fort Worth and Mansfield.
Second-wave revitalization
Tanya Ragan earned the title of Downtown Dallas champion when she spruced up the Dallas Farmers Market a decade ago, breathing new life into the eastern edge of downtown. Her coalition, which included Dallas-based Spectrum Properties, turned four neglected sheds sitting on 17 underused acres into an open-air pavilion, a food hall, retail and multifamily.
Today, a couple thousand people, including Ragan, call the neighborhood home. It’s vibrant and walkable, with a slate of neighborhood restaurants. It also serves to connect downtown to nearby Deep Ellum.
“I don’t like to use the word ‘revitalization’ because I feel like we’re past that,” she said.
Another wave of investment is on the way, this time on the southern and western edges of downtown. Stakeholders believe it’ll be game-changing for the urban core as well as under-developed southern Dallas.
The city of Dallas, whose city manager didn’t respond to requests for an interview, has 75 conventions already booked for its new convention center set to be delivered in 2029. The $3.7 billion project will overhaul Kay Bailey Hutchison Convention Center so that it features 750,000 square feet of exhibit space, 180,000 square feet of meeting rooms and a 105,000-square-foot ballroom. Dallas-based developer Matthews is doing the project.
The project is breeding optimism.
“I’m just hoping that people hang on and weather the storm,” Craig Davis, president and CEO of VisitDallas, said.
Just a few blocks north, Hunt Realty is pursuing a $5 billion project to redevelop downtown’s quintessential Reunion Tower. The project could include up to 3,000 multifamily units, a 600- to 1,000-key hotel, 150,000 square feet of retail and up to 2 million square feet of office.
Behind City Hall, Mike Hoque has also been assembling a 20-acre swath of land for a development he’s calling Newpark, a mixed-use hub with an education and technology focus, according to plans.
But the ghosts of aborted and stalled projects haunt the road to downtown Dallas, and attempts to revitalize haven’t always turned out. The Spire, a mixed-use district, was supposed to bloom on 11 acres at the corner of Ross Avenue and Routh Street but never did. Field Street District, another development planned for south of Woodall Rodgers Freeway, didn’t get built yet either.
Where’s Waldo?
In the story of downtown’s troubles, the city’s political leadership usually gets cast as villains.
Some of it is earned. The closure announcement of the flagship Neiman Marcus store, like the threat of AT&T leaving, seemed to have Dallas political leadership making decisions out of desperation. The city can mobilize, as it did with a series of press conferences putting pressure on Neiman Marcus’ New York-based owner Saks Global, but it’s been caught playing defense with both of these announcements.
Meanwhile, Mayor Eric Johnson gets flak for his absence. The city’s formerly Democratic leader (he switched parties mid-term) has missed so many city council meetings that it’s prompted local news coverage. This combined with behavior like declaring Dallas a “Sanctuary City from Socialism” has the editorial team at the Dallas Morning News concluding that he “seems like the mayor of Somewhere Else.”
Prewitt said downtown dysfunction has more to do with the structure of city governance than leadership itself. The city has a “weak mayor” structure, which tips the balance of power to City Council, where Downtown is just a district with one vote, represented like any other slice of Dallas, despite its economic centrality.
As a result, the non-elected position of city manager gets elevated. Kimberly Bizor Tolbert was appointed to the role this year after serving as interim city manager since 2024. Developers and downtown stakeholders like her, praising her success in cutting the permit backlog and noting that she actually lives downtown.
The balance
Ragan, Woods and Prewitt suspect that AT&T’s possible departure is more public relations spin than done deal.
“If you’re the head of real estate, the smartest thing for you to do would be to put as much leverage on the city as possible to make the city that you’re going to be staying in as good as possible,” Prewitt said. “The best way to do that is to convince them you’re leaving.”
Woods and Prewitt have quite a bit of skin in the game; they own the 1-million-square-foot building AT&T fully occupies.
Picking on the city’s problem child gets results. Ray Washburne, the developer who owns Highland Park Village, threatened to plop a data center in the middle of downtown in February to get the city to pay a premium on the old Dallas Morning News building, which is adjacent to its convention center project.
The city caved, agreeing to buy the property in April for $45.1 million, a 61 percent premium on the $28 million Washburne paid in 2019.
Triolet thinks downtown champions will be correct, at least in part. He predicts AT&T will nab some space in the suburbs (it already has 186,000 square feet in Richardson) but will also keep a big chunk of office space downtown.
Ragan gets teased by her developer peers who claim her cheerleading for downtown is just a ploy to sell the Purse Building, an adaptive reuse project she listed recently for $12.5 million after priming it for eight years.
If Ragan’s boosterism has the sheen of a sales pitch, it’s for a product she’s bought. After redeveloping the Farmers Market, Ragan bought a condo in the area, and her office is downtown across from Dealey Plaza.
She has words for the haters: “I would say a lot of those people don’t spend a lot of time down here anyway,” she said.
This story originally included a reference to future office vacancy in downtown Dallas that has been removed.