STRATEGIC PRIORITY: Growing
AGENDA DATE: August 27, 2025
COUNCIL DISTRICT(S): 2
DEPARTMENT: Office of Economic Development
EXECUTIVE: Robin Bentley
______________________________________________________________________
SUBJECT
Title
Authorize (1) designating approximately 2.9 acres of property currently addressed as 2601 Victory Avenue as the City of Dallas Neighborhood Empowerment Zone No. 23 (“NEZ No. 23”), pursuant to Chapter 378 of the Texas Local Government Code, to promote an increase in economic development in the zone, establish boundaries for the zone, and provide for an effective date for the zone; (2) an economic development incentive agreement with The Bank of Nova Scotia or an affiliate thereof (“Scotiabank”) to include: (a) a business personal property (“BPP”) tax abatement for a period of ten years in an amount equal to the City taxes assessed on ninety percent (90%) of the added taxable value of the business personal property resulting from the Project and (b) a Chapter 380 economic development grant in an amount not to exceed $2,700,000.00 consisting of: (i) an amount not to exceed $2,500,000.00 for job relocation and/or creation and (ii) an amount not to exceed $200,000.00 for fees associated with expedited permitting and soft cost expenditures, in consideration of the job creation and investment associated with Scotiabank’s establishment and operation of a new regional office at 2601 Victory Avenue in NEZ No. 23; and (3) the City’s nomination of Scotiabank’s Project for designation as an Enterprise Zone Project under the Texas Enterprise Zone Act, as amended by the Office of the Governor, Economic Development and Tourism division, through the Texas Economic Development Bank; in accordance with the City’s Economic Development Incentive Policy - Total not to exceed $2,700,000.00 - Financing: Public/Private Partnership Fund, and Estimated Revenue Foregone: $831,308.00 over a ten-year period (see Fiscal Information)
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BACKGROUND
Currently one of the five largest banks in Canada, Scotiabank is a global financial services institution founded in 1832 in Halifax, Nova Scotia. The company first established a United States (U.S.) presence in 1885 with a branch opening in Minneapolis, and it operates at scale across North America (Canada, U.S. and Mexico), including a small presence in Houston. Scotiabank’s U.S. headquarters is in New York, and the company is currently focused on allocating capital to support growth in North America. U.S. services include U.S. Global Banking and Markets, Global Business Payments, and Wealth Management business lines.
For the past several months, staff has been coordinating with Scotiabank representatives as the company has been looking across the southern United States for a location for a new large-scale regional office. After a thorough review of options, Scotiabank has narrowed the selection to two cities: Dallas or Charlotte, North Carolina.
Within the City of Dallas, Scotiabank has identified a potential site in Victory Park at 2601 Victory Avenue. The potential Project site is an existing 15-story (approximately 352,000 square foot) office building located in the Sports Arena TIF District.
If Scotiabank selects Dallas, Scotiabank is contemplating a long-term (10-15 year) lease of approximately 100,000 square feet in the existing office building located at 2601 Victory Avenue, which is owned by Hillwood Development Company. With this project (“Project”), Scotiabank anticipates: (1) making approximately $60 million in capital investment over three years, (2) relocating and/or creating approximately 1,026 new jobs with an average annual base salary of $140,000 over five years and operating as a best-in-class regional office. The estimated total investment of $60 million includes approximately $39 million in real property improvements (i.e. tenant finish-out improvements), $12 million in business personal property investments (i.e. furniture, fixtures and equipment), and $9 million in information technology expenditures. Positions to be relocated and/or created include risk analysis, auditing, human resources, information services, cash management, and other financial services duties.
The economic development incentive negotiated by the City staff and accepted by Scotiabank includes the following:
1) a business personal property tax abatement for a period of 10 years in an amount equal to the City’s taxes assessed on 90% of the added taxable value of the business personal property resulting from the Project; and
2) a Chapter 380 economic development grant in an amount not to exceed $2,500,000.00 in consideration of the creation and/or relocation of at least 1,000 jobs; and
3) a Chapter 380 economic development grant in an amount not to exceed $200,000.00 to reimburse actual expenses of any Q-TEAM fees, permitting fees, or other City fees related to the Project; and
4) nomination of the Project as a Texas Enterprise Zone project.
A Texas Enterprise Zone (“TEZ”) nomination, pursuant to Chapter 2303, Subchapter F of the Texas Government Code, would allow Scotiabank to apply for a TEZ designation from the Texas Economic Development Bank, part of the Governor’s Office of Economic Development and Tourism. If awarded by the State, Scotiabank would be able to apply for a refund of the state sales and use tax they have paid during the designation period on qualified expenditures, up to a maximum amount of $1,250,000.00.
Chapter 378 of the Texas Local Government Code (the “Act”) provides for the designation of Neighborhood Empowerment Zones. A Neighborhood Empowerment Zone (“NEZ”) is a flexible tool that a municipality can utilize to implement an economic development program or project in a particular area. Pursuant to the Act, a NEZ can be designated to promote any of the following: (1) creation and/or rehabilitation of affordable housing in the zone, (2) an increase in economic development in the zone, or (3) an increase in the quality of social services, education, or public safety for residents of the zone. To facilitate a tax abatement for this economic development Project at this location, staff is recommending designation of the City of Dallas Neighborhood Empowerment Zone No. 23 (“NEZ No. 23”).
An analysis of the direct economic impact of this Project results in an estimated $10,930,285.00 in net benefits ($7,594,417.00 present value) to the City over the term of the incentive agreement.
ESTIMATED SCHEDULE OF PROJECT
Start Construction: Q4 2025
Begin Operations: Q4 2025
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
The City Council was briefed on this matter in an executive session on August 20, 2025.
FISCAL INFORMATION
|
Fund |
FY 2025 |
FY 2026 |
Future Years |
|
Public/Private Partnership Fund |
$0.00 |
$0.00 |
$2,700,000.00 |
Estimated Revenue Foregone from BPP tax abatements: $831,308.00 over a ten-year period beginning FY 2028-29
OWNER/EXECUTIVE
The Bank of Nova Scotia
Nicole Frew, Executive Vice President and Co-Head, Global Banking and Markets U.S.
MAP
Attached