Dallas is seeking to sell the troubled office building at 7800 North Stemmons Freeway after years of issues and significant taxpayer expense. The 11-story, 228,300-square-foot property has cost the city at least $29 million since its purchase for $14.1 million. CBRE is marketing the site as an “outstanding redevelopment or owner-user opportunity,” according to the Dallas Morning News.
The building, constructed in 1981 and renovated about ten years ago, was intended to house the city’s permitting office. However, City Manager Kimberly Tolbert stated in an April report that the structure was so unsound that it could not receive a certificate of occupancy. Despite spending an additional $15 million on repairs, the building remains uninhabitable and staff had to return to their previous location on East Jefferson Boulevard.
Following Tolbert’s report, Dallas suspended new public real estate purchases unless already approved by the City Council. The city also began reviewing its agreement with CBRE and moved forward with plans for a comprehensive real estate master plan.
Maintaining the property continues to be expensive for Dallas, which spends about $73,000 each month on security and upkeep. Recently, permits totaling nearly $650,000 were pulled to install a new fire alarm system even as efforts to sell the property proceed. The listing highlights features such as a five-acre site, flexible zoning, and proximity to the Medical District; however, it is being sold without a listed price and strictly “as-is, where-is.”
The decision to buy the building in 2022 was made under former City Manager T.C. Broadnax after what Tolbert described as “only a surface-level review” by JLL.
Council Member Chad West said that officials only learned of the property’s market listing after media inquiries. Patrick Benoist of CBRE declined comment due to client instructions from the city. Offers are expected within three weeks before private council review.
Commercial brokers believe demolition is likely given both condition and location along Stemmons Corridor. The city aims to limit further losses by selling what has become a cautionary example of municipal real estate investment.
