Big Bucks and Blacktops

D Magazine, Oct 01, 2003 by Postrel, Virginia

Michael Anderson is a monomaniacal downtown booster. He serves on the Inside the Loop Committee. He heads a task force on the homeless. He decorates his office with large, nostalgic photos of downtown in the 1940s. He even does his shopping downtown, boycotting Home Depot's gardening department in favor of the Farmers Market.

As general counsel for Chavez Properties, Anderson has been buying downtown real estate since the mid-1980s. The company is now the largest private landowner in down, town, with 26 acres waiting for the right deals to come along. When the Adam's Mark needed space for a ballroom, when the city wanted to expand the Dallas World Aquarium, and when Chase Tower decided to add a parking garage, they all turned to Chavez Properties for land.

While waiting for its land to appreciateawait that can easily run a decade-the company earns a steady return using the property as parking lots, under the Star Parking name. (It runs lots and garages for other owners as well.) So Anderson, it turns out, is not only a downtown booster. He's also a parking lot magnate-which, he admits, "is not a very sexy business."

Nor is it popular with Dallas-opinion leaders. The Powers That Be consider parking lots blights on the grandeur that could be downtown Dallas. The Dallas Morning News has opined that street-side parking would be preferable, because drivers struggling to parallel park or back out of slant parking would slow traffic (as if driving in downtown weren't confusing and stressful enough). The Inside the Loop Committee and the Central Dallas Association want a new ordinance to require fences (wrought iron and at least 42 inches high) and landscaping on all surface lots. And they want to prohibit new lots altogether.

Dallas needs more parking lot regulation, says CDA head Larry Fonts. "We're confronted with the situation where we have some very good lots indeed, some not-so-good lots, and some that are very, very ugly."

Michael Anderson hates the ugly parking lots. But he hates the idea of new regulations more. "I don't like to be pulled by a choker chain by somebody who doesn't know what they're doing," Anderson says.

To make his point, he takes me on a tour of some of downtown's ugliest, most

pothole-ridden lots, including one 50-cent lot whose highlight is a battered Coke

machine wrapped in a rusty chain. The asphalt of another lot has crumbled into

the sidewalk, leaving a giant bite of missing blacktop. "Idn't this I great?"

Anderson says sarcastically, his accent making him sound like Ross Perot. "It's

just gross."

We don't dare enter the lot at Main and

Field streets because the potholes are so huge. Overhead wires are everywhere, the signs clash with each other, and, to complete the eyesore, there's a long-closed Bo's Chicken Shack in the corner. "You know that show Extreme Makeover?" Anderson says. "You've got the poster child for 'before."'

Star Parking lots, by contrast, aren't so bad-buried power lines, attractive lighting, good drainage, smooth pavement, brightly painted numbers--and they're getting better. Anderson is planting trees and bushes in the dead comers of his lots and, in some cases, around the perimeters. He spent $20,000 to fence and landscape the 168-space lot at old Griffin Street and McKinney Avenue. Each comer features an array of colorful plants, including yuccas and Chinese pistachios, and the landscaping continues along the sidewalks next to the two main streets.

"I know that nobody's going to say, 'I come downtown so I can park on Michael Anderson's real clean lots,"' he admits. But he hopes that over time, better parking lots will make coming downtown more pleasant and, in turn, raise the value of Chavez Properties' land.

Mandates, however, won't work. Requiring specific, expensive improvements for every downtown parking lot-even those that might be soon sold-ignores the realities of the market. If parking lot owners have to spend more on their properties, they'll try to pass along the cost to customers.

Parking is as sensitive to changes in supply and demand as any economist's blackboard diagram. For instance, Anderson says, when SBC turned a downtown garage into employee parking, taking 250 spaces off the public market, parking rates shot up by a third in adjacent blocks. "Even modest tweaks in the marketplace are like dropping bowling balls in the bathtub," he says.

If parking rates go up, commercial rents will have to go down. Dallas has plenty of alternatives to downtown. The real estate market, including that for tiny plots called parking spaces, tells us something through its prices: people value visiting or working downtown only so much, and not a penny more.

I suspect, in fact, that downtown has so many parking lots because its boosters overestimate the value of downtown land and because they constantly concoct grand improvement plans that crowd out immediate, smaller-scale commercial investment.

Land in central Dallas sells for $50 to $100 a square foot, compared to $25 to $30 in the suburbs and no more than $50 in the booming neighborhoods north of downtown, says real estate appraiser Chuck Dannis, president of Crosson Dannis. Many downtown landowners are hoping the real estate bubble of the early 1980s will reinflate. "People are waiting for the $300 per square foot to come back, Dannis says.