How the City Deals With Its Surplus Properties, And Why It Doesn't Raze Empty Buildings

Categories: City Hall
WJeffersonFireStation.jpeg
Dallas Firefighters Museum, via The Portal to Texas History
The fire station built on W. Jefferson in 1945 is among the handful of city-owned buildngs currently up for grabs.
This morning I got that list of the city's surplus properties I asked for yesterday -- and it's not a long one, consisting of just four "improved properties" (meaning, they have buildings on them) and 19 vacant lots, several next to each other on, respectively, W. Laureland and N. Lancaster. Bonnie Meeder, who heads up the city's real estate division, says of course there are more than these that didn't make the list -- including that fire station-turned-canvas on Walnut Hill and the nearby library rotting away on Marsh. But for various reasons they aren't on the list, and right now they aren't for sale.

Take Ol' No. 35, for instance. As Meeder explains, it sits next to a Dallas Water Utilities pump station, and for years that was a single piece of property. But recently it was replatted and split into two parcels so the city could try to offload the crumbling structure. Matter of fact, says Meeder, there are folks presently eying the building, which is zoned residential: "We have two people now who've expressed interest in using it as an artist's studio with an apartment," she tells Unfair Park, "so it would be a residential use but somewhere an artist could paint."

You mean, on the inside this time.

"We're currently in discussion with those folks," she says. "We've taken them to view the building to see if it's economically feasible to rehab it. But that's in the exploration stage."

For the longest time we've talked about selling off the city's empty buildings and vacant lots. Mary Suhm told council a couple of weeks ago that revenue from that might help shrink the potential $50-million gap facing council as the city manager puts together the next budget. Walk me through what happens when a city-owned building is shuttered.

When the city has a property -- for example, an old fire station and the fire department no longer needs it -- they turn the keys over the real estate division. We'll ask other city departments if there's a need for the facility, and sometimes another department will take advantage of it. But frequently they aren't able to. If nobody's able to use it, we'll submit a request to the council and label it surplus, and then we'll try to sell it.

Many of the buildings on the surplus list are fire stations and libraries. And more will go empty as the city slowly builds replacement facilities. Like, the one near my house, on Marsh near Love Field ...

We've actually had a number of departments express interest over the years in the old Walnut Hill Library. The most recent is the Aviation Department, and we think they will be able to reuse that facility. What they're considering doing is putting in a satellite office for their real estate staff. They have staff that deals with leases at the airport, so we're currently under discussions with them.

Why not raze the empty buildings, especially the older ones that have fallen into such disrepair? The fire station on Walnut Hill, for instance, looks worse every day.

We have discussed that as well -- not just that one but we have some former libraries, like the Casa View branch, where it's the same situation. When the city no longer needs them and we can't find someone to reuse them, what do we do? That has been a topic.

Speaking of Casa View, I'd heard at one point there was an arts group interested in moving into that facility on Ferguson.

The arts groups interested in the old Casa View, apparently that did not pan out. We don't have anyone interested in that library or the Buckner branch. We had a lease till recently on the fire station [at 3303 W. Jefferson], a nonprofit. And our building at 5221 S. Westmoreland is a shell. We'd be happy to entertain lease options if someone's interested. But as you saw with the Walnut Hill library and the fire station, it become a maintenance problem People break in, steal the copper, and it become economically unviable.

So why not just tear 'em down, especially the longer they rot?

There's a cost to tearing them down, and we've had discussions internally about maybe there should be identified a pot of money for when these building outlive their useful life to demolish them, but we don't currently have that pot in place.

And, as Suhm has said before, you can't just sell them for cheap either.

We're required to sell them at fair market value, so that's also a dilemma. We can't just sell them for a nickel.

Well, thanks, Bonnie. This has been instructive.

Call if you have more questions. Or a check. Or a lease agreement. That would work too.

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17 comments
Rich
Rich

Good article and comments -thanks for the effort.     

Budikavlan
Budikavlan

The Dallas library has another money problem: their books are old and unread. When I moved up here from Austin, I had been working at an Austin Public Library branch, so I looked at several Dallas branch libraries to compare them. We used to go through our fiction collection once a year and weed out anything that hadn't been checked out within the year (to make room for the new books). But when I looked at the fiction sections of the Dallas branches, they had very few new books and thousands of copies of books that hadn't been checked out in many years.

Replay
Replay

HMMM.........interesting.........they usually rig the bidding so they can "give it away" to one of their buddies. I'm guessing that won't change. If you want proof, look at the Lone Star Gas/Atmos Complex of Buildings in Downtown Dallas. The city "gave" the property to a developer, so long as the developer promised to redevelop it. The property was worth nearly $7 million at the time of the transfer, 2006.

TMB
TMB

Robert --

Great piece. Very interesting how this works. 

Real quick - Spelling error on the question about the facility on Ferguson. Says "om" instead of "on". 

FrankDracman
FrankDracman

Report the derelict properties to Code Compliance using the 311 system.  That way the city can take the city to court to fix the properties. 

Montemalone
Montemalone

Have any of the geniuses at City Hall ever thought about properly maintaining these buildings in the first place so they don't require an expensive replacement be built on expensive newly purchased land while simultaneously creating a blight with an abandoned building that is not generating any tax revenue?

Robert Wilonsky
Robert Wilonsky

A very smart Friend of Unfair Park offers this thought on the subject:

"The problem is -- in my humble opinion -- the desire to sell surplus city property is always greatest when times are tough, which is usually when the value is at its lowest and no one at the city wants to sell.So they wait, and it gets put on the back burner, then is forgotten. They also ought to outsource all the selling to someone who will be aggressive -- someone working on commission. Hunger is a great motivator."

Oak Cliff Townie
Oak Cliff Townie

I thought that old fire station 26 was used by a charity  a few years ago maybe many but A large production was made about it .

Wylie H.
Wylie H.

[And, as Suhm has said before, you can't just sell them for cheap either.

We're required to sell them at fair market value, so that's also a dilemma. We can't just sell them for a nickel.]

No, there is no "dilemma." The very definition of "fair market value" is what a knowledgeable buyer would pay given a reasonable amount of time to complete the transaction.

What Mary Suhm should be doing is placing these properties on the market and selling them to the highest bidder--- THAT will determine the "fair market value."  By holding on to these properties, Suhm is engaging in land speculation--- something that is an inappropriate function for any city, but particularly a city that is broke.

Also, Suhm needs to consider the adverse impacts on surrounding property values by continuing to hold these blighted properties that are frequently out of compliance with the City's own codes.

Sometimes when I read the quotes of words uttered by people at City Hall, I have flashbacks to my college days-- reading textbook examples of errors in logical reasoning, mistakes in financial planning, etc.

NewsDog
NewsDog

You must be new around here. It's been done before. The City exempts itself from its own rules and codes.

mark zero (Jason)
mark zero (Jason)

Does make you wonder, especially cases where the replacement is very close, as in the case of the former Walnut Hill library. When the Audelia Road branch was outgrown, they just shut it down for maybe a year, and made it bigger, along with some other changes.

NewsDog
NewsDog

Robert,Can you post the list of the properties? Curious about W Laureland.

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Jasminesmith198714

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Joe L
Joe L

You are on to some thing.  I recently had a dispute with the City about 'fair market value' and was startled to gradually realize that I'm not sure there is any one in that department who completely understands what 'fair market value is' and the rules by which it is lawfully calculated.

You are right about the definition of market value.  The City has completely different criteria which they mistakenly insist is the law.  I sent the following note to Mr. Wilonsky.

Dear Mr. WilonskyI read your article with special interest as I and my neighbors have had a 40 year dispute with the City of Dallas about an easement that has recently caused me to deal with them.I live in a house I inherited from my parents that has an easement that was supposed to have been an alley.  The City decided not to build the alley, and told the residents they could fence the easement for security purposes.  The CIty changes its mind every few years and threatens me and my neighbors and tell us to tear the fences down.  There is a burglary problem here, and only houses without fenced easement have been burgled.I contacted the real estate department and told them I would like this resolved once and for all because it complicates selling property and removing the fencing invites crime.I am not making the following up, and have extensive documentation.The City, in the person of Mr Garett Murphree ordered me and my neighbors to remove fences despite our having documented permission from the City to have them.That, or pay them an average 30 some thousand dollars plus $5000 abandonment fee.  They misrepresented the $30,000 + as "fair market value".  Bear with me, this is somewhat tedious. Their formula was to take the value of the lot abutting the easement, which is valued as a unit, valued at $250,000 no matter the size or  other attribute of the lot.The real estate department told me that the "fair market value" of the easement was calculated by projecting the square foot value on the easement.  That is, in their view, a five foot wide strip of land on which no structure other than a fence can be built because it is a utility easement and construction otherwise disallowed pursuant to zoning and deed restrictions, is worth the same as land on which a house can be built.And get this:  NO ONE IN THE REAL ESTATE DEPARTMENT WAS EVEN AWARE THAT THE CITY DOES NOT OWN THESE EASEMENTS.The abutting property owners own the easement to the center line.  The CIty merely has what is called a "right of easement".The right of easement was originally given to the City for free with the understanding that an alley be built.  The City reneged on the alley commitment, and now wants to sell the easement the owners gave them for free, back to them for 30 some thousand dollars.There is no "fair market value" for an easement with no access to a public thoroughfare.  There is no market, and the CIty has no right to sell the property any way, It doesn't belong to them.Further, they tried to sell me the half of the property that abuts the property behind me which, of course, belongs to the owner of that property, not the City. THEY TRIED TO SELL ME PROPERTY THEY DON'T OWN.Further, they were insistent that their formula for calculation of fair market value was correct, which is without exaggeration, ridiculous.  Fair market value is legally defined in the United States by the Appraisal Foundation in Washington DC, and the City's calculation does not come even close to meeting their criteria, and is of course, not valid. (I have a couple of graduate degrees in relevant disciplines, as well as a real estate broker's license). The lawful definition of "Fair Market Value" can be easily be found with an internet search.  The principles are simple enough, but details are some thing lawyers can argue about.I tried to get information on the issue to sort it out, and called the City to find out how to access information through the Freedom of Information policy.  I spoke to City Attorney Warren Ernst, who was helpful, and urged me to contact my City Councilwoman, Linda Koop.  I finally had a meeting with Ms.Koop, Bonnie Meeder (mentioned in your article), Warren Ernst (the City Attorney), Theresa O'Donnell ("Sustainable Development") and another City Attorney, J. Arthur Hudman. Mr Hudman was contentious and not reasonable.  Ms. Koop had been given a great deal of misinformation. By coincidence Ms Koop has the same graduate degree as one of mine (MBA international business), so unlike some on the council, she is quite competent to discuss such issues.  Ms Koop asked the real estate department to desist from harassing us further, but the matter is still really not settled.  When City personnel changes, the problem could start up again.  This is a legal mess, and I don't think Ms. Koop really has it in her power to resolve it conclusively.The real estate department's Mr. Garrett Murphree told me there were situations like ours "all over Dallas", but I was not able to identilfy them.  I was concerned that the City had been defrauding property owners all over town, getting them to pay thousands of dollars needlessly.  I was especially concerned about elderly homeowners who might be intimidated by the City.Any way, what prompted my writing to you was the mention of fair market value.  In my experience, there seems to be no one in the CIty real Estate Office who completely understands that term and knows how to calculate it in at least our situation.The employees insist fair market value is dictated by a City rule.  I think that's possible, but I think it's also possible that there is not any one in that department appropriately trained and educated to deal with such things and they misinterpret.It might bear mentioning that the Dallas City charter dates from 1941.  A national standard for fair market value was not mandated by Congress until the 1980s.  In the Savings and Loan débacle of the 1980s it became clear that there was no national standard for fair market value, and one was needed to deal with massive property foreclosures throughout the country. It is possible Dallas does indeed have an invalid outdated official formula for calculating fair market value.  As I said, I think it is possible that the people in the real estate department just some times don't know what they're doing, which is complicated by their adversarial attitude toward the public.

Robert Wilonsky
Robert Wilonsky

Here you go: SURPLUS PROPERTYIMPROVED PROPERTIES (INCLUDES STRUCTURE)5221 S. WESTMORELAND (building shell)1125 BUCKNER (former library)3303 W. JEFFERSON (former fire station)10355 FERGUSON ROAD (former library) UNIMPROVED PROPERTY8414 FORNEY ROAD6701 WESTMORELAND 2317 LOWERY 7001 WHEATLAND6501 GREENVILLE 2911 MIKE  2127 WYCLIFF2203 WYCLIFF1229 DALVIEW 550 W. LAURELAND 562 W. LAURELAND 507 W. LAURELAND 511 W. LAURELAND 515 W. LAURELAND 531 W. LAURELAND 523 W. LAURELAND 512 N. LANCASTER404 N. LANCASTER400 N. LANCASTER

Mark
Mark

Joe, I'm currently going through the same thing with the City of Dallas. After spending $5000+ dollars for abandonment, I've been given a value of over $30K for the same type of alley that was never built. It's a narrow strip of land that can never be built upon due to utility easements. Yet it's appraised the same as as full size lot upon which you build a residence. I've had numerous meetings to discuss the inconsistencies in the process and have gotten no where. It makes no sense to me.The City has deteriorating alleys all over which they can't afford to maintain, plus these unused easements that don't generate any taxable income for the City . Logically, these should be sold at a reasonable price so that they are maintained, increase values, and increase income. It's a win-win for the City. The problem is trying to be logical in dealing with the City.I'd be interested in discussing more with you on your experience and if you found a solution.

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