Case Study: Iconic Dallas Building the Centerpiece of Forest City’s Mercantile Block Redevelopment

Jim Truitt, vice president, Forest City Residential Group, and Gary Pitts, AIA, design studio partner, BGO Architects, discuss the Mercantile Building (“The Merc”), the first phase of Dallas’ four-building, 1.1 million-sq.-ft. Mercantile Block redevelopment. Once the tallest building west of the Mississippi River and the only skyscraper to be completed during World War II, the Mercantile Building—home to the Mercantile National Bank—t the new site will also include retail space, a parking garage and a new 16-story residential tower, called The Element.Truitt and Pitts talk to MHN Associate Editor Erika Schnitzer about the aesthetic objectives, how the design sets the project apart from its competitors, and the challenges they faced to reconcile the disparity between the development’s cost and its overall value.Name of Project: Mercantile Place on Main, Dallas, TexasDeveloper: Forest City Residential GroupArchitect: BGO ArchitectsGeneral contractor: Hensel-Phelps Construction Co.Financing: Total project budget: $141 million Source of Funds: City of Dallas Tax Increment Financing Proceeds: $58 millionCity of Dallas/Dallas County Property Tax Abatement (10-15 years): $5.5 million Construction Loan (Bank of America, LaSalle Bank and Wachovia): $48 million; Forest City Equity: $29.5 millionOverall site size, square footage of primary buildings:Site size: 80,000 square feet Mercantile Tower Apartment Building: 352,896 sq. ft. (213 units and 12,000 sq. ft. of retail) Element Apartment Building: 198,123 sq. ft. (153 units and 6,500 square feet of retail) Jewel Building, the main entrance and marketing/leasing center: 10,000 square feet MHN: Briefly describe the project.Truitt: Historic preservation/adaptive reuse, mixed-use. An essential requirement of this adaptive reuse was that the historic edifice had to be faithfully restored to its 1942 design intent, but the building’s existing interior spaces were completely demolished. Due to the highly secure nature of the residential tower, an internalized main building lobby was created on the first floor. This new lobby pays homage to such notable Moderne interiors as the GE and RCA buildings in New York City, with similar marquee designs and terrazzo floor patterns. The other three structures that occupied the block along with the Mercantile Building were razed for new Mercantile Place on Main apartment buildings and amenities, such as a swimming pool and deck that are part of the community.MHN: What were the client’s aesthetic and functional design objectives?Pitts: The design team responded to the Art Moderne architecture of the original Mercantile Building and yet kept the furnishings current and fresh. The design team’s intent was not to do a period piece but to furnish the spaces in an appropriate way to complement the architecture and yet be contemporary so that potential residents would be able to relate to the interior furnishings and finishes, and see themselves as residents.Ample research and numerous black-and-white photos provided suitable inspiration for the design of the interiors of the upper floors, but the design intent of these interiors was new and fresh with a hip and sophisticated allure. The designers embraced the notion of a “machine for living,” which was a popular mantra of the modern era. The new residential kitchens and baths followed a sleek, machine-like aesthetic, with exposed stainless steel cladding on the casework and white glossy finishes. The upper-floor public spaces recall the marquee design of the first-floor lobby and employ seamless vinyl flooring in the elevator lobbies, another popular material of the Moderne era.MHN: Describe the target demographic.Truitt: Young professionals–both singles and married–who seek an upscale urban lifestyle. We expect that many, if not most, of the residents will also work in downtown Dallas. The consumer segment referred to as “In-the-Know” is the primary target market. This primary segment values impressing others, showing off overt symbols of success, and embracing a main goal of high status; therefore, the high caliber of the public spaces will be especially appealing to this group. The secondary target market is the Explorer segment, which is expected to place a lower value on traditional amenities. Instead of status, this group is driven by history, resulting in less importance placed on the public spaces. MHN: What design features make this project stand apart from others in the market?Truitt: Located across the street from the Neiman Marcus flagship store, the 31-story Mercantile National Bank Building has a strong history and urban character that is unique in the downtown area and all of Dallas. The building was completed in 1942 and was the centerpiece of what later became four distinct structures comprising the Mercantile National Bank Complex. Renowned for its Art Moderne styling from the Art Deco era, the famous edifice features a number of setbacks that culminate in a stately clock tower, which is capped by a 115-foot-tall ornamental spire (545 ft. total structure height). The Mercantile Tower was the tallest building in downtown Dallas in its day and is still an iconic landmark today.The developer and design team were farsighted in that they salvaged some of the existing elements from the original building prior to demolition. The refurbishment of these artifacts, some of them displayed and installed in a completely different way than they were originally, give the spaces an air of authenticity that would have been impossible to achieve otherwise. The new finishes integrate seamlessly with the original architectural elements, such as the beautifully refurbished elevator doors. The client also had photography done of the space before demolition, which we enlarged and used as artwork in all of the elevator lobbies.MHN: How does the architecture and design of this project help the client be more competitive in the marketplace?Pitts: This iconic building was preserved and transformed into 213 residential units over ground-floor retail and epitomizes the trend in urban living. It is a landmark structure with a rich history that is closely tied to the growth of Dallas into a major city. New construction includes below-grade parking, a new 16-story residential tower, a two-story connector building, and a lavish amenity deck with pools, waterfalls and landscaping to be shared by residents of both apartment buildings.The amenity features of this project also set it apart in the downtown Dallas market. The swimming pool and spa are designed to be a social hub for the apartment community’s residents. The linear swimming pool is surrounded by the spacious elevated pool/sun deck populated with chaise lounges. A private outdoor kitchen/grilling area complete with barbeque grills, bar-style seating, and tables and chairs is nestled within groves of trees and wood decks. A partially enclosed private dining area with a double-sided fireplace and linear banquet-style tables is perfect for resident gatherings. A spa at one end of the pool provides residents with dramatic views to the future city of Dallas Main Street Garden Park. A rain curtain separates the pool and spa and is illuminated at night with colorful lights. A state-of-the-art projection system enables films to be shown against the water wall.The indoor cabana lounge features floor-to-ceiling glass windows looking out onto the elevated pool and sun deck with a great view of downtown Dallas. The cabana features contemporary furnishings that offer residents many options to relax, unwind, mingle, work, or socialize all in a comfortable environment with a chic ambience.The fitness center features state-of-the-art equipment by Lifestyle Fitness. The 1,750-sq.-ft. workout room will offer premium treadmills and elliptical machines with personal viewing screens, circuit training stations, strength-training machines and free weights with adjustable benches and mirror. Other amenities include a 24-hour doorman, concierge services and welcome center, on-site resident and guest parking, a sports bar, poker room and TV
lounge with billiards table, a community room and private screening room, dining/conference room, a living room and catering kitchen, and the 14th floor R.L. Thornton Club Room with outdoor terrace. The late Robert L. Thornton, Sr. was the founder and owner of the Mercantile National Bank, and was a highly regarded Dallas civic leader and former mayor. MHN: What were the challenges of this project and how did you resolve them?Truitt: Cost/Value Disparity: Due to the functional obsolescence of the original Mercantile Complex, significant costs were incurred to turn a site with 1.1 million sq. ft. of vacant office space into two modern apartment buildings (one existing and one new) that contain 366 units with upscale amenities that would attract urban renters in a newly revitalized area. Ten thousand sq. ft. of the 80,000-sq.-ft. site was encumbered by a ground lease; Forest City bought out the ground lease to incorporate the land into the project. Also challenging was the demolition of 800,000 sq. ft. of vacant office building structure adjoining the Mercantile Bank Tower, all taking place in a dense, urban environment. Buildings were demolished floor by floor and much of the construction debris was sorted and recycled.MHN: Describe the overall housing trends that this project is affecting.Truitt: Mercantile Place on Main is one of several new residential projects existing or being developed in the Dallas Central Business District (CBD). City government is in support of the redevelopment and revitalization of the CBD and has made a significant financial contribution toward redevelopment activities and programs, including Mercantile Place on Main. Downtown Dallas has a very small resident base, but it is currently experiencing a robust rate of growth in terms of population and household expansion. In addition, when compared to the three- and five-mile primary market area (defined as the area north of interstate 30), the CBD exhibits much higher average and median household incomes, as well a high concentration of rental housing.MHN: Describe any innovative materials or construction methods.Truitt: The contractor rehabbed a classic 1940s skyscraper with all new state-of-the-art building systems (elevators, high-efficiency pumps, motors, cooling towers and boilers); restored the historic clock tower and “weather beacon” spire; demolished three existing buildings totaling 800,000 sq. ft.; excavated existing basement levels to add one additional level of parking; built a new 15-story post-tensioned apartment tower (The Element); and amenity/pool deck above the new three-level underground garage.MHN: Is there anything else you’d like to add?Truitt: Originally designed by notable architects Donald Nelson and Walter Ahlschlager in 1942, the Mercantile National Bank Building once stood as the tallest building in Texas (1942-1954) and has been a compelling component of the Dallas skyline for decades. The Mercantile Building was the tallest commercial building constructed during WWII. However, despite its prominent setting on Main Street in Dallas’ Central Business District, as well as its striking mid-century Moderne architecture, the Mercantile stood vacant since the early 1990s. Developer Forest City Enterprises, in collaboration with architect of record, Beeler Guest Owens Architects Inc., redeveloped the Mercantile complex, a full city block in the heart of the CBD, into a vital mixed-use development that will help spur revitalization in downtown Dallas.Photo courtesy of Forest City/Mercantile Place on Main.