One of Dallas' most recognizable buildings not part of the city skyline is the American Airlines Center, an arena that pivots from being home to the NBA's Dallas Mavericks and the NHL's Dallas Stars to hosting major concerts on any given day of the year.
Now, the future of the 25-year-old arena with a seating capacity of more than 18,000 fans is uncertain as both the Mavericks and the Stars consider options outside of shared ownership of the arena following a legal dispute between the teams. The NBA and NHL teams are big entertainment draws, helped by developers adding hundreds of apartments within walking distance of the American Airlines Center just north of downtown Dallas.
After all, crowds need good real estate not only to cheer on teams, but also to have restaurants, retail, hotel rooms and apartments close to the stadium.
The Dallas Mavericks told the Dallas Morning News the team has narrowed down its real estate search to two sites, including one in North Dallas at a 110-acre site at Preston Road and Interstate 635 and one at the I.M. Pei-designed city hall in downtown Dallas. The city is having ongoing conversations on the future of city hall.
Mavericks CEO Rick Welts told the daily newspaper the team hopes to make a decision by the end of the NBA season around July 1. This is expected to include a new stadium and what Welts calls a 50-acre mixed-use hub surrounding the arena. The Mavericks did not respond to an emailed media request from CoStar News seeking additional details on its plans.
The Mavericks said the team has a lease commitment at the American Airlines Center through 2031.
The city of Dallas could help the Mavericks — and even the Dallas Stars — with potential incentives; however, discussions on a would-be deal have yet to be publicly disclosed. The city did not immediately respond to an emailed request for comment from CoStar News.
Reviving history
Before the American Airlines Center was developed, the owner of the Dallas Mavericks at the time, Ross Perot Jr., sought to create an urban destination surrounding the $420 million arena. He and his team transformed a site once housing an old power plant, railyard and grain elevator into a 75-acre mixed-use hub now known as Victory Park.
The development is considered a success, with Victory Park to be the home for Goldman Sachs' new $709 million campus, now under construction, which is expected to employ at least 5,000 workers. Scotiabank also plans to have a big U.S. hub in Victory Park.
The Mavericks are considering plans to build an arena on a massive vacant tract once housing Valley View mall that is within two miles of the new Netflix House at Galleria Dallas. The other finalist location is in downtown Dallas, which recently took a hit with telecom giant AT&T's plans to exit the district entirely in the coming years. The move is expected to take thousands of workers from a city center that's already been suffering as firms pack up and move to newer offices in nearby Uptown Dallas.
A possible "W" could go a long way for the city's business district, which is marketed by Downtown Dallas Inc., an advocacy group, which did not immediately return an interview request from CoStar News.
"The old Valley View mall site, if the price is right, makes the most sense," Steve Triolet, senior vice president of research and market forecasting for Houston-based Partners, told CoStar News. He has no direct knowledge of the site selection process but has tracked the Dallas-Fort Worth region's real estate market for decades.
"From a demographic standpoint, if you want to go after fans, it's 15 miles to downtown Dallas and 15 miles to the Legacy-West Plano perspective," Triolet added. "It's a good central location at an intersection of two major corridors."
The downside to the North Dallas site is that there's no access to mass transit, Triolet said. That's where downtown Dallas shines, with multiple light rail stations in the city center.
Beck Ventures President and CEO Scott Beck, who is one of four owners of the former Valley View mall site in North Dallas, confirmed the Mavericks have been touring the property.
"The community in North Dallas, as well as Beck Ventures, would be delighted to have the Mavericks at the old Valley View mall site," Beck told CoStar News. Beck Ventures is part of a joint venture that recently began construction on a new apartment project at the site.