A New York-based investor that jettisoned a chunk of its office holdings last year has purchased its first property in Texas.
RXR Realty bought a 100-year-old building in Deep Ellum from Uplift Education, the Dallas Morning News reported. The two-story building, at 2625 Elm Street, measures 85,000 square feet and spans most of the block. Uplift Luna Prep moved its campus to Far East Dallas.
JLL’s Jonathan Carrier and Michael Swaldi brokered the transaction. The price wasn’t disclosed. The Dallas Central Appraisal District hasn’t assessed the building’s value since the nonprofit charter school system bought it in 2013.
RXR, led by CEO Scott Rechler, is a proponent of office-to-residential conversions and lists the Deep Ellum building as a residential development on its website.
The firm decided in February of last year to hand back some of its office holdings to lenders. About 10 percent of its office assets were outdated, and Rechler compared their usefulness to Kodak film.
The firm defaulted on its 33-story office tower at 61 Broadway in the New York Financial District in May, after it stopped making payments on a $240 million loan.
Yet RXR still scored the second-biggest commercial real estate loan in Manhattan last year, when it modified a $1.2 billion loan for an office building, 1285 Sixth Avenue.
Deep Ellum, a nightlife and entertainment district just east of downtown Dallas, has become a development hotspot in the past decade, with projects such as the Epic, an eight-acre mixed-use development from Westdale Properties and StreetLights Residential.
The neighborhood, which was the epicenter of the Texas blues scene by the 1920s, is no stranger to out-of-state buyers.
Chicago-based Sterling Bay Companies purchased a block near the former Uplift building in 2019 with plans for an office project, although it hasn’t moved forward, the outlet said.
Another Chicago firm, Equity Residential Group, bought the Novel Deep Ellum, a 231-unit apartment complex, in 2021.
And North Carolina-based Asana Partners bought more than 36 buildings in Deep Ellum in 2017.
—Rachel Stone
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