Dallas Tower Secures $133M for Partial Office-to-Resi Conversion
The new funding capitalizes the development of more than 100 new apartments.
Pacific Elm Properties, a subsidiary of Woods Capital, is moving ahead with the second phase of a partial office-to-residential conversion at the 50-story Santander Tower in downtown Dallas after closing on a $132.5 million whole loan to recapitalize the mixed-use high-rise.
The loan for the property, located at 1601 Elm St., was provided by CIM Group’s CIM Real Estate Debt Solutions business on behalf of a CIM-managed fund. The financing will support construction of an additional 105 apartments at Peridot Residences for a total of 396 residences upon completion in late 2026. The stabilized first phase of the luxury residential conversion delivered 291 units in 2023. The Peridot was co-developed with Mintwood Real Estate.
Residential units at the tower are located between the 18th and 25th floors, as well as the 37th and 39th floors. They feature one- and two-bedroom floorplans with high ceilings and designer interiors. On-site amenities include a resort-style pool deck, outdoor grills and fire pits as well as a resident lounge, pickleball court, sauna and access to the private Tower Club on the 48th floor.
Stages of conversion
Woods Capital acquired the 1.4 million-square-foot office tower built in 1981 for $57.4 million from Commercial Mortgage in 2013, according to Yardi Research Data. In 2020, Pacific Elm Properties converted office space on the 49th and 50th floors to 60 extended-stay units as part of the Mint House luxury hotel.
Once the second phase of the multifamily development concludes, the tower will have approximately 858,737 square feet of Class A office space remaining. The property also features the private Tower Club, ground-floor retail and parking for the office tenants and Peridot residents.
READ ALSO: How the Nation’s Largest Office-to-Residential Conversion Came to Life
Since the launch of the Peridot conversion, approximately 350,000 square feet of office leases have been signed at the tower, demonstrating the positive impact of the building’s repositioning, according to CIM Group. In July 2024, anchor tenant Santander Consumer USA renewed its 211,087-square-foot office lease at the high-rise that has been called Santander Tower since 2020, according to Commercial Property Executive. At that time, it was the biggest lease office lease renewal in downtown Dallas in five years. More recently, New York-based law firm Wilson Elser relocated its Dallas office to the building’s 26th floor, where it is leasing 19,443 square feet, Dallas Business Journal reported.
Tailored financial solutions
Los Angeles-based CIM Group is an owner, operator, lender and developer that has delivered more than $60 billion in real estate and infrastructure projects since 1994. Through mortgage and mezzanine loans, affiliates and managed funds, CIM Group provides bridge and construction financing to commercial real estate owners and developers across the U.S.
The CIM Real Estate Debt Solutions business provided a tailored financing solution to Pacific Elm Properties for the complex office-to-multifamily conversion midway through its construction that involved maintaining a Class A office environment, creating residences across multiple non-contiguous floors and adding residential amenities. CIM Group noted that the transaction signifies the firm’s support of repositioning office properties to better serve communities and adapt to changes in demand.
Last October, CIM Group sold one of its multifamily investments – Arioso Apartments, a 201-unit community in Cupertino, Calif., to Pacific Urban Investors for a reported $123.8 million. CIM Group had owned the property since 2005 and had made numerous indoor and outdoor upgrades at the site, including a full renovation of the gym and clubhouse.
