Dallas Police & Fire Pension Fund "Would Look Very Hard At Investing in Dallas Again" After Museum Tower, Administrator Says
Museum Tower and the Nasher Sculpture Center have been in mediation for months now to try to hammer out the Case of All That Incredibly Reflective Glass. In an interview with The Dallas Morning News today, Nasher architect Renzo Piano harshly criticized Museum Tower's owners and developers, saying that in this situation, "You have an aggressor and you have a victim."
It all looks so peaceful and non-shiny in the renderings, doesn't it?
The owner of the $200 million tower is the Dallas Police and Fire Pension System (DPFP). They're not too happy either. Staff at the $3 billion pension system said earlier this week that after the Museum Tower debacle, they thought it would be hard to persuade the pension fund's board of trustees to agree to invest in Dallas-based properties again. (The Nasher complains that light reflecting off the tower is damaging the ambiance of the sculpture garden.)
Richard Tettamant, the administrator of the pension system, sat down for an interview earlier this week. He also brought along a few other people: DPFP's general counsel, their press officer, the chief financial officer and the chief investment strategist. ("That sounds like it wasn't at all uncomfortable for you," my boss remarked cheerily as I staggered back to the office.)
Tettamant wouldn't comment on the Museum Tower situation in much detail, because of the gag order imposed by Tom Luce, the Dallas attorney who's mediating the discussions between the two sides. But someone familiar with the negotiations says that the two sides have essentially been discussing three options: fixes that Museum Tower could make to its own building, fixes the Nasher could make, or some type of structure or barrier that falls between the two buildings.
But Tettamant did say that he thought the incident might affect the board's investment decisions going forward.
"I think the board would look very hard at investing in Dallas again." Which is sad, he added, as Dallas is "a vibrant local economy." (However, in a board meeting earlier this week, one trustee remarked that all things being equal, he'd prefer to invest in Dallas-based properties, which may suggest something of a disagreement between the trustees and staff.)
Tettamant added though that he's "still confident about Museum Tower." He said sales activity on the $1 million condos "declined for about one month" when news of the dispute first became public. After that, he said, "our sales team has been working very hard" again, though he still wouldn't comment on how many units have actually sold.
Rebecca Shaw, the system's communications director, said she would "strongly disagree" with anyone who implies that Museum Tower will become a costly white elephant in the heart of the district.
"Come back in three years," Brian Blake added, the fund's chief investment strategist. "This doesn't happen overnight."
Tettamant also brushed off criticisms from Bloomberg and The New York Times that the system has taken on an unwise amount of risk by placing 51 percent of its assets in alternative investments, include some 24 percent in real estate. He said the fund was "well-diversified," and argued that in this economy, "our allocation is more conservative than just being invested in stocks and bonds."
The critics, he said, "are not fairly assessing our health as a pension fund."
The staff has a realistic view of investing, he added. "You're not going to have 100 percent home runs. We're just trying to hit singles and doubles."