There are landmark properties in literally every metropolis, but their rebirths haven't come without the usual headaches associated with such undertakings. Robert Shaw, now president of Amicus Partners Ltd. in Dallas, and Art Lomenick, the new president of Dallas-based WorkPlace Urban Solutions, probably have more adaptive reuse projects under their belts than most in the Dallas-Ft. Worth region and their expertise stretches as far south as Houston, where they did the 1913-era Rice Hotel when they were at Post Properties. Both concur that a limited building supply is the primary obstacle to renovation, restoration and adaptive reuse ever becoming a trend in the DFW region.

Plus many of the old structures simply are not suitable for retrofitting. Shaw estimates that some 20 million sf to 30 million sf in Dallas CBD "albatrosses" are just not economically feasible for rebirth. "The rents just aren't there to spend the money to bring the upgrades," he says.

The $27.5-million Rice Hotel project is a prime example of the ins and outs faced by developers attempting to revive a property that had been shuttered for two decades. Exposing one brick wall almost cost the project $5.5 million until it had been agreed to cover it with sheet rock, recalls Shaw, who is a leader at conversions into residential use. "The big question initially was would people want to live there," he says. The success story is that it's filled to the brim today and like nearly every other such project had required public-private partnerships to get off the drawing boards. Houston had kicked in some $6 million in tax abatements and incentives, according to news accounts of the day. Shaw says the Rice Hotel cost was kept in line with ground-up projects as a result of that public-private teaming and a complex financing arrangement.

Lomenick, also an urban redevelopment leader, says it costs about 25% more to save a building in comparison to starting from scratch and that's without coming across any "hidden conditions" that might skew original estimates. Despite the underlying cause for alarm, he sees more and more developers nationwide taking the initiative to redo older buildings and more and more cities taking a proactive approach to the proposals.

"Unfortunately in a place like Dallas, that's a young city, there's not a lot to save," he explains. And, there's that love of the new. "Dallas is a high-spirited city. It's always like new," says Lomenick. "But I don't think that is the case today." If there is a trend, it's that the "suburban experience" is no longer working for the population at large, giving rise to heightened interest in New Urbanism lifestyles sans lawnmowers and jumping into the car to get to the nearest store.

Still, this region has numerous success stories--from Sundance Square in Ft. Worth to the West End in Dallas. Today, all eyes are on Matthews Southwest, which has been working for four years on Dallas' South Side redevelopment.

Jack Matthews, president, had never considered razing the 1.4 million sf in 12 acres of turn-of-the-century buildings that he bought from Sears & Roebuck at 1409 S. Lamar, says Kristian Teleki, senior vice president. In all, the developer has 30 acres up and down the street, with 1409 Lamar being just the first step.

Teleki says the key to a successful project is to buy low and at the right time to offset high development costs and those "hidden conditions" inherent to adaptive reuse projects. He pegs costs at $55 per sf to $60 per sf. "I don't know that you can tear down something and build new for $55 to $60 per sf," he says.

But, Teleki quickly adds, it's a necessity to keep the end cost to tenants within reason, even though it might have cost millions just to get the project past the lead-based paint and asbestos abatement stage. Office space at 1409 Lamar is going for $16 per sf to $20 per sf and residential units range from 86 cents per sf to 87 cents per sf, both considerably less than its class-A counterparts. To assess class-A rents, says Teleki, would be foolish.

Michael Rareschide, executive vice president of Dallas-based Partners National Real Estate Group Inc., is a tenant rep for high-tech companies, some of which have opted for office space in redos instead of glass-and-granite high-rises. A final signing often hinges on the corporate personality of the space seeker as to whether it's a good fit between building and tenant. Some companies, though desiring CBD space at the lowest possible cost, simply aren't willing to settle into a turn-of-the-century structure. Sometimes, it's a question of image and other times, it's all about neighbors such as ample retail, restaurants and parking lots. He finds retrofitted space is more appealing to incubator businesses and fledgling firms than the Old Economy tenant.

There's also the vision factor, Rareschide says."You've got to get the tenant excited about it to see the same vision that you do. You just can't convert these things and hope they come," he asserts. "And, this kind of stuff will always be a tougher sell than the regular office building. These are things that you have to think out of the box for."