PILLAR: Growing
AGENDA DATE: October 22, 2025
COUNCIL DISTRICT(S): 2, 14
DEPARTMENT: Office of Economic Development
PRIORITY: Targeted Economic Growth
______________________________________________________________________
SUBJECT
Title
Authorize a tax increment financing (“TIF”) development agreement with 901 Main PAHG Partners LLC, a Texas limited liability company and/or its affiliates (“Developer”) in an amount not to exceed $103,000,000.00 (“TIF Subsidy”), payable from current and future Downtown Connection Sub-district funds in the Downtown Connection TIF District (“TIF District” or “Zone”), in consideration of the Developer’s design, engineering, financing, and construction of the 901 Main Street Redevelopment Project (“Project”) currently addressed as 900 Main Street, 901 Main Street, and 909 Commerce Street - Not to exceed $103,000,000.00 - Financing: Downtown Connection TIF District Fund (subject to current and annual appropriations from tax increments)
*In alignment with Economic Development Incentive Policy.
Body
BACKGROUND
Since the COVID 19 pandemic, urban centers and central business districts have been adapting to changes in work patterns, with several buildings experiencing decreased office tenant demand and occupancy, causing building owners to examine adaptive reuse and/or conversion to increase building occupancy, net operating income, and vibrancy.
Several months ago, 901 Main PAHG Partners LLC submitted an application for a development incentive to the Office of Economic Development for gap funding to support the proposed 901 Main Street Redevelopment Project (“Project”), a proposed transformation of the iconic Bank of America Tower into a vibrant mixed-use property. Bank of America tower, a 72-story office building originally constructed between 1983 and 1985, is the tallest building in the city of Dallas and contains 1,852,482 square feet. The Project includes reducing the amount of office space in the building and adding a 280-room hotel and hotel amenities. In addition to redevelopment of the existing office tower, the Developer proposes replacing the sunken concrete garden currently adjacent to the tower with the construction of a new sculptural glass and steel structure that will house the hotel lobby as well as meeting facilities on the concourse level of the tower. Additionally, a new parking garage will be constructed on a portion of the Project Site currently addressed as 900 Main Street and 909 Commerce Street directly across Main Street from the proposed new glass pavilion to provide parking for hotel guests. The two structures will be connected by an elevated pedestrian walkway. The Project will be constructed on property currently addressed as 901 Main Street, 900 Main Street, and 909 Commerce Street (collectively, the “Project Site”).
Upon completion, the Project will consist of:
1. approximately 1,517,813 gross square feet of office space;
2. approximately 336,059 gross square foot full-service hotel with approximately 280 rooms on approximately 10 floors, including penthouse and restaurant on floor 69;
3. new ground-up construction of a glass and steel structure adjacent to the tower that will house the hotel lobby above the hotel ballroom and meeting rooms located on the concourse of the tower; and
4. new ground-up construction of an 8-level parking garage across Main Street with approximately 1,115 parking spaces, approximately 15,000 square feet of street level retail/restaurant space, and an elevated pedestrian walkway over Main Street.
The Developer’s estimated total Project cost at substantial completion is approximately $409,086,740.00 and is comprised of the following components: (i) land acquisition costs of approximately $165,800,000.00 (as-is appraisal value $158,000,000.00); (ii) professional fees and soft costs of approximately $32,658,228.00 (includes $8,733,666.00 in developer fees); and (iii) hard construction costs of approximately $210,628,512.00 (includes $54,646,784.00 in parking structure costs).
Based on a comprehensive review of the development incentive application and extensive consultation with the City’s independent outside underwriter, staff offered a TIF development agreement and associated TIF Subsidy in a total amount not to exceed $98,000,000.00 as gap financing to make the Project financially feasible. On September 16, 2025, the Developer accepted the proposed incentive and the associated terms and conditions in an executed Letter of Intent. The Resolution accompanying this agenda item contains the detailed terms and conditions of the proposed incentive and TIF development agreement.
At the September 30, 2025, meeting of the Downtown Connection TIF District Board of Directors (“TIF Board”), the TIF Board expressed a desire to ensure that the proposed Project supports the Downtown Dallas 360 Plan as it specifically relates to the proposed parking garage. As a result, the TIF Board recommended approval of staff’s recommended terms and conditions of the TIF development agreement for the Project with an additional requirement for the Developer to design and construct the parking garage to support a design load equivalent to 200 residential units or 200 hotel rooms (to enable the potential construction an additional hotel or apartment building on top of the parking garage in a future development phase). The TIF Board also recommended a $5,000,000.00 increase in the TIF Subsidy from an amount not to exceed $98,000,000.00 to an amount not to exceed $103,000,000.00 to support additional Project costs resulting from the new requirement. The TIF Subsidy shall be payable upon completion of the Project, upon Developer’s satisfaction of all terms and conditions of the TIF development agreement, and in accordance with the TIF District Increment Allocation Policy.
The certified 2025 taxable value of the Property is $133,220,900.00 (Dallas Central Appraisal District). Upon completion and stabilization of the Project, the taxable value of the Property is projected to be approximately $728,987,020.00.
The Project was reviewed by the City’s Urban Design Peer Review Panel (“UDPRP”) on January 17, 2025, and the Developer made changes to the Project’s design to accommodate recommendations by the UDPRP.
ESTIMATED SCHEDULE OF PROJECT
Start Construction September 2029
Complete Construction September 2032
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On June 8, 2005, the City Council authorized the establishment of the Downtown Connection TIF District by Resolution No. 05-1779; Ordinance No. 26020, as amended.
On August 29, 2005, the City Council authorized the Project Plan and Reinvestment Zone Financing Plan for the Downtown Connection TIF District by Resolution No. 05-2544; Ordinance No. 26096, as amended.
On September 30, 2025, the Downtown Connection TIF District Board of Directors recommended approval of staff’s recommended terms and conditions of the TIF development agreement for the Project with an additional requirement for the Developer to design and construct the parking garage to support a design load equivalent to 200 residential units or 200 hotel rooms (to enable the potential construction an additional hotel or apartment building on top of the parking garage in a future development phase). The TIF Board also recommended a $5,000,000.00 increase in the TIF Subsidy from an amount not to exceed $98,000,000.00 to an amount not to exceed $103,000,000.00 to support additional Project costs resulting from the new requirement.
The Economic Development Committee was briefed by memorandum regarding this matter on October 6, 2025. <https://cityofdallas.legistar.com/View.ashx?M=F&ID=14824166&GUID=AF00E6CC-B5D7-4663-99B5-44FA7D5681A9>
The Economic Development Committee voted to forward this matter to the full City Council on October 22, 2025 with a recommendation of approval, including acceptance of the TIF Board’s recommendation to require the Developer to design and construct the parking garage to support a design load equivalent to 200 residential units or 200 hotel rooms and to increase the TIF Subsidy by $5,000,000.00 from an amount not to exceed $98,000,000.00 to an amount not to exceed $103,000,000.00.
FISCAL INFORMATION
|
Fund |
FY 2026 |
FY 2027 |
Future Years |
|
Downtown Connection TIF District Fund |
$0.00 |
$0.00 |
$103,000,000.00 |
DEVELOPER
901 Main PAHG Partners LLC
Michael Ablon
MAP
Attached