DALLAS — A 125-year-old building in the West End district of downtown Dallas is being redeveloped into a mixed-use residential and retail destination, supported in part by property assessed clean energy financing through the City of Dallas PACE Program, according to the city.
The property, addressed as 501 and 509 Elm Street across from The Sixth Floor Museum at Dealey Plaza, is listed on the National Register of Historic Places. The approximately $50 million redevelopment is being led by 3L Real Estate, which acquired the property in 2021 and is converting the building into roughly 120 multi-family units alongside 29,321 square feet of ground floor retail space.
3LRE CEO Joseph Slezak said reactivating historic properties has always been the company’s focus, particularly at premier downtown locations, and called the project an honor to complete alongside America’s 250th anniversary. Slezak said the redevelopment brings housing and active ground-floor retail to the area while incorporating energy enhancements into a building previously used as office space.
According to the city, twenty multi-family units have already been converted, and the ground floor retail space has been leased to the Museum of Money.
The project combines state and federal historic tax credits with PACE financing, a tool that funds eligible energy and water efficiency upgrades at a lower cost. Dallas City Manager Kimberly Bizor Tolbert said projects like 501 Elm show how innovative financing can create new housing and retail opportunities while supporting long-term economic impact for downtown Dallas, adding that the city’s Office of Economic Development is proud to facilitate investments strengthening the West End and the city’s urban core.
Through PACE financing, the project will fund approximately $16 million in eligible energy and water efficiency improvements, including upgraded lighting, HVAC improvements, domestic hot water upgrades, and additional water efficiency measures.
Christopher Ellis, senior director of originations at Nuveen Green Capital, said the financing partnership allowed 3LRE to bridge the gap between senior and historic tax credit financing while also funding required reserves, reducing the equity needed for the project. Ellis said the deal illustrates how PACE financing can help fund office-to-residential conversions cost-effectively.
According to the city, the PACE-financed improvements carry a savings-to-investment ratio of 3.71, and are expected to generate long-term utility savings while improving the building’s performance. The city noted the financing comes at no cost to the City of Dallas itself.
