The Dallas City Council on Wednesday approved a massive $18.5 million incentive package for Morgan Stanley’s proposed $1.33 billion office building in Uptown.
The big question now is whether it succeeds in luring the banking giant, which is also considering a Georgia suburb for the project.
Morgan Stanley proposed a 700,000 square-foot office on McKinney Avenue that it would occupy for at least 16 years, bringing about 3,800 jobs before the end of 2035. The new office wouldn’t be far from competitor Goldman Sachs’ new 800,000 square foot complex that’s expected to be finished by 2027.
The Morgan Stanley office would add momentum to “Y’all Street” — what city and state officials have dubbed Dallas’ rapidly-expanding finance sector.
“Morgan Stanley’s engagement with Dallas speaks to the strength of our financial services ecosystem, and I look forward to welcoming the firm to Y’all Street,” Mayor Eric Johnson wrote in a statement. “We have worked hard to make Dallas America’s most pro-business city.”
But the deal hasn’t been finalized yet. Morgan Stanley is also considering the City of Alpharetta, a suburb outside Atlanta where the firm employs more than 3,000 people. Dallas has been negotiating with Morgan Stanley for months as the company looks to build a new hub outside its global headquarters in New York, according to city documents.
KERA reached out to Morgan Stanley for comment and will update this story with any response.
If the company chooses Y’all Street, the project would be built out in two phases.
The first phase would see Morgan Stanley sign a four-year lease for 255,000 square feet of office space at Fountain Place in downtown Dallas while the new tower is built. The firm would invest $97 million in Fountain Place by next year and bring about 1,500 jobs by 2031 — a much-needed boost to a downtown economy that has seen companies flee for the suburbs and other parts of the city in recent months.
Morgan Stanley would invest $684 million into the McKinney Avenue office in the second phase. The developer would put down $650 million, bringing the total project cost to $1.33 billion. Morgan Stanley would bring 3,800 jobs to the new location by 2035 with the possibility of an additional 1,000 jobs by the end of 2039.
The incentive deal requires the jobs have an average annual wage of $110,000. The deal would also require Morgan Stanley to offer internships or similar opportunities to Dallas College and one other educational institution in the city.
Morgan Stanley would also get a 90% tax abatement for five years on the phase-one project, and a 10-year 90% abatement for the second phase. The city estimated it will lose out on about $4.8 million in tax revenue. That’s in addition to the $18.5 million worth of grants and reimbursements the city approved.
The deal would also require Morgan Stanley to offer internships or similar opportunities to Dallas College and one other educational institution in the city.
City officials also nominated the new office space as a “triple jumbo enterprise project.” That makes it eligible to receive the highest amount of state sales and use tax refunds through the Texas Enterprise Zone Program, which is designed to encourage investment in “economically distressed areas of the state.”
The property on which the new office would be built is occupied by a seafood restaurant — Truluck's Ocean's Finest Seafood and Crab — and a shuttered gym in an affluent area of Uptown Dallas.
Dylan Duke is KERA's Breaking News Reporter. Got a tip? Email Dylan Duke at dduke@kera.org.
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