Gentrification Threatens West Dallas. Maybe It Can Save the Neighborhood Instead.
Illustration by Mario Wagner
In Dallas, gentrification has always arrived riding a bulldozer. Poor people get kicked out of their homes and their communities are scraped off the face of the earth. Nobody even asks where they went.
But a new idea is afoot in West Dallas, the city's latest gentrification battleground. In this scheme, the poor neighborhood surrounding the gentrification would be stabilized instead of displaced. All kinds of people would wind up occupying the same region in peace and prosperity.
This idea rises from a whole new generation of players, younger leaders as opposed to an old guard whose entire philosophy of city-building sometimes seemed to amount to, "We're white, and we're afraid to go downtown."
Right now, at a time when nobody knows what to expect from Washington, the rapidly gentrifying area of West Dallas at the foot of the Margaret Hunt Hill Bridge across the Trinity River could even turn decades-old national desegregation policy on its head. For a half-century, the goal of federal policy has been to pluck up blocks of poor minority renters and insert them into more affluent, less segregated areas — something the less segregated areas have been overwhelmingly successful at resisting.
The question being asked in West Dallas — surprisingly by some of the people city officials have labeled "slumlords" — is this: Instead of trying to cram desegregation down the throats of people who are really good at fighting it, why not leverage things the other way around?
If thousands of Gen-X to millennial professionals are hungry to live in the gritty city, why not use them as the army of desegregation? Instead of waging endless and largely fruitless social war over what ought to be positive — more affluent better educated young people who want to invest and live in the city — Dallas could harness that force to salvage and protect the poor people whose territory they are entering. Why does it have to be a hostile takeover? The end result, mixed-income, mixed-ethnicity integration, is what all that national policy was supposed to be seeking all along. This way, everybody's a volunteer.
A condo development under construction across from Trinity Groves in West Dallas.
Using gentrification as a way to create mixed neighborhoods hinges on the hope that the incoming gentrifiers can and will coexist in the same neighborhood with non-affluent occupants, provided a certain level of security and basic social comity.
That might sound like a tall order of kumbaya in a city that saw generations of white people flee desegregation like a wild fire for the safe homogeneity of the suburbs.
But that was then. Now may be better. At least some people think so.
Six-term Democratic state Rep. Rafael Anchia, whose 103rd District picks up some of West Dallas, is a lawyer with Haynes and Boone. He is often mentioned as a possible mayoral candidate. He says he moved into his neighborhood in North Oak Cliff 20 years ago when it was still much more diverse than today — an act of relative eccentricity at the time. But now he sees people younger than himself moving into diverse areas of the city all the time and not blinking an eye about it.
"The preference for that kind of environment or milieu is even much stronger among millennials," he says. "They totally dig it. That's what they want. They don't want to live in strip-mall heaven. They want an interesting place with texture and culture and creativity and grit and diversity."
Harnessing that energy, Anchia says, is exactly what the city should be doing. "We need to be using every idea and every tool that we have to promote mixed-income and diverse communities in Dallas. That's it, period, full-stop. That's it."
The other side of the question, of course, is whether any of the original inhabitants could or would stay after being invaded by shorts-wearing, phone-gazing, cappuccino-carrying dog-walkers. David Spence, a pioneer developer in the immensely successful Bishop Arts District in North Oak Cliff, says that can happen, too:
"We've got lots of Mexican-American families around Bishop Arts who have decided to stay or at least to stay for a while," Spence says. "They are enjoying all of the benefits — more jobs, safer streets, better schools, etc. — because of the gentrifiers."
The immediate problem in West Dallas is that much of the rental housing stock is in such poor condition that some landlords say it cannot be brought up to new tougher city housing codes. When one company, HMK Ltd., facing pressure from the city over the quality of its properties, said it wanted to take 250 old, very small houses off the rental market and demolish them, the threat of 250 evictions brought down the wrath of City Hall. Mayor Mike Rawlings denounced the company as unprincipled and predatory — harsh criticism, indeed, from a man who was once a major player in the payday loan business.
HMK insisted the houses could not be rebuilt, only replaced with new structures. HMK said it had the capital to do that, but, in order to make the new houses profitable as rental properties, HMK would have to charge higher rents than the neighborhood could command for single family homes.
Given the new building standards, the only viable form of decent affordable housing for poor renters in West Dallas, HMK told the mayor, is multi-family. HMK offered to develop low-rent apartments in West Dallas but asked the mayor and City Hall for help getting the federal subsidies that make such housing possible.
The mayor replied that the U.S. Department of Housing and Urban Development (HUD) has directed Dallas not to put any more subsidized housing into areas already heavily afflicted by poverty and segregation. That's true.
The new federal directives came about as a direct result of the protracted litigation from a pair of developers who exposed deliberate practices of racial segregation carried out for years by City Hall, especially in the placement of subsidized multi-family housing in poor, already segregated areas.
Those two developments — the tougher housing standards and the new HUD directive — have created a classic rock and hard place dilemma for poor neighborhoods. The shabby little houses poor families have been able to rent for $300 to $500 a month in West Dallas and other poor areas of the city are now basically illegal or at least no longer economically viable.
But HUD has slammed the door shut on subsidized housing for those very areas, for entirely legitimate reasons. How could HUD, whose mission is supposed to be fair housing, allow Dallas to keep spending federal money to socially engineer ever greater segregation and ever greater economic disparity?
The resulting picture can be bleak. If private sector rental housing stock must dwindle and cannot be replaced with subsidized housing, then the ground would seem to be cleared for total erasure and takeover. That's exactly what has happened in the 1980s when waves of gentrification like Uptown/Oak Lawn and Old Little Mexico northwest of downtown.
Landlord Dennis Topletz talks in his office.
Resolving the dilemma brings us to the core idea being proposed in West Dallas — the secret sauce — and the surprising matter of who's doing the proposing. A coalition of landlords led by HMK is urging City Hall to look at gentrification in a whole new way.
Instead of viewing the vast new developments rising up at the foot of the Margaret Hunt Hill Bridge as a hostile invasion, they argue, City Hall should view them as the vanguard of integration.
The coalition of HMK Ltd. (the Khraish family), Topletz Properties (Dennis Topletz) and First Orion Properties (John Carney) argues that the arriving affluent demographic, coupled with better schools and reduced crime, should be presented to HUD as evidence that West Dallas is becoming exactly the kind of "opportunity area" in which HUD says it wants new affordable housing to be placed.
Instead of moving the poor people to the area of opportunity, as everyone assumed had to be done under the old social realities, this scheme would harness the opportunity that is already moving into poor areas voluntarily.
Failing to harness that energy, allowing the kind of gentrification taking place now at the foot of the bridge to proceed untended and according to its own devices, is its own important policy decision, not necessarily benign. Democratic state Rep. Eric Johnson, an attorney who is of counsel at Andrews Kurth law firm, represents West Dallas, South Dallas and parts of East Dallas. He says rising property values and resulting higher taxes in areas surrounding the rapid gentrification at the bridge will eventually create a kind of slow smoldering conflagration.
"I don't want to see involuntary displacement of those folks à la what happened in Uptown, not on my watch." A favorable outcome, he insists, "must be predicated on being able to keep the current residents, the low-income residents that are there now, there.
"Otherwise, it's just a scrape. Otherwise, it's a massive displacement, your classic gentrification scenario, which you've seen play out across the United State."
Johnson, a third-generation native of West Dallas, says the "scrape" scenario is very much on the minds and in the hearts of West Dallas residents. "I know that community like the back of my hand. I'm there all the time. I've still got family there. Church is still there. Friends are still there. Everyone is very concerned about involuntary displacement, and that's what I'm concerned about, too."
Johnson will author a bill in the upcoming session of the Legislature, tailored or "bracketed" to apply specifically to West Dallas, to protect low-income homeowners from soaring property taxes.
"You have to prevent people from losing their homes involuntarily through skyrocketing property taxes," he says. "That's the classic gentrification scenario. People get tax foreclosures because they can't pay the property tax.
"The bill I am writing is going to explore a couple avenues. It's going to be something along the line of some sort of tax freeze or a tax abatement."
Texas state Rep. Eric Johnson, a third generation native of West Dallas, wants laws to protect low-income people from spiraling property taxes.
Johnson's bill is not related to the HMK proposal, which Johnson says he has not read. His main focus is on protecting homeowners, although his bill would also require Dallas to establish a relocation fund for renters displaced by policies like the new more stringent building code.
But Johnson's thinking does share a key element with the HMK proposal. Instead of viewing the new high-end development taking place in West Dallas as the enemy, Johnson also would like to enlist that development as an ally or at least a piggy-bank.
He points to the existence of a special city tax district called the Sports Arena Tax Increment Finance District or TIF, already providing $100 million in subsidy to the new developments in West Dallas being carried out by Trinity Groves, headed by restaurateur Phil Romano, and by a real estate partnership of former Dallas Cowboys Roger Shaw and Roger Staubach.
There is nothing sacrosanct about the boundaries of the TIF, Johnson says. The City Council can redraw the map of the TIF by a simple vote, immediately rendering some of those hundreds of millions in tax subsidy available to surrounding homeowners to allay the higher tax bills inevitably caused by the TIF.
"Instead of having all that money go to Trinity Groves and Roger Staubach's people and Phil Romano's folks," Johnson says, "some of that could go toward abating the taxes or freezing the taxes of the folks who stand to lose their property when they can't keep up with their property taxes as they go up and up."
All of these ideas — using the new development to persuade HUD to allow subsidized low-income housing, freezing or abating property taxes for longtime residents, expanding the TIF — can only work if they're put into place before the smoldering heat of gentrification bursts into flame.
"Ideally," says Spence, the Bishop Arts developer, "you would catch it right at the turn.
"Looking at it in West Dallas, the idea would be to build a low-income apartment complex just as soon as you have got the numbers to justify that this isn't an all-minority poor area but before the gentrification really happens, so that the land value is reasonable."
HMK’s Khraish Khraish (center) talks with Thomas Bailey (left) and Starr Shirlee Jones (right) about the houses they are buying from HMK.
The landlord alliance — or slumlord group, as City Hall would have it — has been pushing hard for a meeting with Mayor Rawlings and West Dallas City Council member Monica Alonzo. To make an effective argument to HUD, even to make a credible application for funding, the landlords say they would need strong City Hall backing, something that seems unlikely according to the responses they have received so far.
Carney, a member for the landlord group, has asked repeatedly for a meeting with the mayor to discuss the new concept and has been told no. Mayor Rawlings told me that Carney is welcome to ask for any new zoning he wants or apply for any funding he pleases, but Rawlings is wary of any arrangement with him that could appear to be a quid pro quo or appear to lend the imprimatur of City Hall to his plan.
Rawlings says he declined to meet with Carney because he didn't see any productive outcome from the meeting: "I just felt net-net that all I would be able to do is sit there and say nothing, and that's probably not what he wants. He wants to engage in some sort of negotiation, and that needs to be done through the process."
Council member Alonzo is willing to leave the door open a bit more than the mayor but not much: "Any idea has value if it provides the families of West Dallas opportunities to live in their historic neighborhoods in safe, decent, affordable housing," she says.
"I don't know if HUD would agree to change their rules for Dallas in order to make low-income housing subsidies available in West Dallas, but I believe we should have that conversation."
In the meantime, Khraish Khraish, the younger of the father-son team that runs HMK, has been meeting with community leaders in West Dallas to sell them on the HMK plan. He proposes that his group would build 250 units of multi-family housing targeted to poor families and 100 units of senior and assisted living. His firm would sell 120 house lots to Habitat for Humanity.
His company and Topletz Properties would pledge to sell 400 rental houses to current occupants or other willing buyers. They would build 200 market-rate homes or townhomes in West Dallas. They would delay demolition of 250 substandard properties and make them available to the city at no cost as temporary shelters for the homeless through the winter.
Marcos Ronquillo, a pillar of the local legal establishment and a former mayoral candidate, has met with Khraish. He came away impressed.
"I would be on the side urging the city of Dallas to support this kind of initiative," he says. "I have no problem seeking support for this project. This proposed plan is not perfect, and what plan is? At least it's a starting point."
Ronquillo says he was aware that some voices at City Hall have raised questions about "this whole issue of credibility and sincerity. Well, if somebody's putting up their land and their personal resources, wow, that goes a long way with credibility and sincerity in my book.
"To be honest with you, I'm kind of excited and very supportive of that kind of initiative or any other initiative of like mind for the community in West Dallas. It beats evictions, and it beats displacement, and at least somebody is trying to do something."
Longtime Hispanic activist Rene Martinez says he and several other community leaders have met with Khraish: "He hasn't shown anything that he has not been honest about with us. Every day he is gaining more and more community support. He is meeting with quite a few people one-on-one."
Martinez told me the same thing Ronquillo and Rep. Johnson did about deep-seated fears of displacement in the community: "What happens to that elderly Latina, the multi-generational Hispanic whose family has been living in a house for two or three generations?
"Her kids are gone. All of a sudden her taxes are going to skyrocket when the new appraisals come up on all these buildings. How is that elderly lady or man on fixed income going to pay their taxes?"
Martinez fears that displacement caused by rising taxes is exactly what the new developers at the foot of the bridge may want to see, so that they can expand their holdings westward into the community. Many residents, Martinez says, would like to stay where they are until they die. "I don't think those guys are that patient," he says.
Hilda Ramirez Duarte, president of the League of United Latin American Citizens Council 4782 and a well-known activist in West Dallas, says she has met with Khraish, has examined his plan and is an enthusiastic supporter: "I wholeheartedly believe that the city should view the [HMK] plan as an opportunity to right a wrong.
"I don't see the city coming up with a better plan. Actually, no plan at all has surfaced. They want the residents out. The council members recently voted down vouchers for affordable housing. This tells all. How is this helping the poor?"
City Council member Scott Griggs represents neighboring North Oak Cliff, not West Dallas. As chair of the council's housing committee, Griggs has led the effort to develop a new comprehensive citywide housing policy and probably knows the issues better than anyone else.
He suspects the notion of using the new development to redefine West Dallas as a so-called high opportunity area is premature, if well intended:
"An 'area of opportunity' is a defined term, a term of art that has specific meaning," Griggs says. "I haven't analyzed the census tracts over in West Dallas, but my sense is that they are not areas of opportunity, even with the new development."
He says the issue of opportunity for children is most pressing and leaves little room for delay:
"With children, you only get one chance to get it right. They can't sit around and wait for it to become an area of opportunity, because that's impacting their education."
But he thinks Rep. Johnson's idea, sharing some of the wealth from the TIF, is a solid one: "I think he has some excellent legislation in mind. The issues with West Dallas can be put in three groups. One is that with the growth in West Dallas, we don't want everyone to get taxed out.
"The second issue is infrastructure. So much bond money and TIF money are going to that area over there. You want to see that reach the neighborhood and the people, and that doesn't seem to be happening."
The third, he says, has been a misapplication of the new more stringent building standards to put pressure on specific property-owners: "That was never meant to be used as a weapon against particular owners where you'd end up with collateral damage being the residents who lived there."
Griggs' last point is echoed by Omar Narvaez, who will run against Alonzo for the West Dallas council seat in the next election: "The basic issue is that [the new housing code] was never meant to turn people out of their houses or bludgeon landlords. There is no way to keep these people housed without the cooperation of the landlord.
"This is a perfect opportunity for the city to develop a protocol for dealing with landlords," he says, "but instead they've been instructed by the mayor's office to play hardball with the lives of West Dallas residents in the balance, all while Monica Alonzo is asleep at the wheel."
Butch McGregor, a principal in West Dallas Investments, the real estate arm of Trinity Groves, says his company and the interests he represents in Trinity Groves have no territorial ambition outside their current property boundaries. I did find a few residential properties west of the current footprint of Trinity Groves owned by West Dallas Investments, but McGregor says his company acquired those lots only because they had to buy them in order to acquire other properties from owners who would sell only in an all-or-nothing package.
McGregor says he is selling off those properties as he can. He insists his company has no interest in acquiring property owned by HMK or Topletz Properties. "We have more to do here than we can say grace over," he says.
McGregor says he is not familiar with the HMK proposal. "I've never heard of it. I haven't seen or heard anything about it." But he says his company has no objection to seeing more low-income housing developed in the vicinity.
"I think it's fine. You need it. I think they should go for it, if that's what they want to do. That's their business. I don't have an issue with it, no."
The veteran player in all of this is Dennis Topletz, second-generation head of a company that has owned many hundreds of properties in poor neighborhoods for decades. Topletz owns some properties in West Dallas but is a bigger player in South Dallas.
He has lived through gentrification wars in the past and agrees with Rene Martinez on one score: City Hall, he says, has used soaring property tax appraisals in the past as a battering ram to push homeowners out of the way so that bigger, better-connected players can take over.
"I've seen this before," Topletz says. "This is really textbook what you do if you want to clean out an area. In Uptown-State-Thomas [1980s] and the Baylor Hospital area [2000s], when you want gentrification, you don't promote home ownership."
With the jaded view of one who has seen this play too many times already, Topletz sees the HMK plan, in which he and Carney are partners, as a splendid way to call the mayor's bluff:
"You are going to find out in short term if this mayor really wants to have home ownership and this mayor really wants to help the community or [if] it's all about gentrification.
"If this doesn't fly, then there's no reason to think this is anything but gentrification. And damn the torpedoes."
But he insists if it does fly, his company will perform on every promise in the plan, from selling hundreds of rental houses to their occupants to building new market-rate housing on bare lots. "Absolutely," he says. "Every bit of it."
A condo development is under construction across from Trinity Groves in West Dallas.
There are a million reasons to predict there will only be real estate war, a zero sum campaign of strife, dominance and defeat between the forces of gentrification and the neighborhoods, with an all too predictable and dismal outcome for a poor community pitted against rich foes. In this city, when have the poor ever won?
Then again, there is real change in the city now. These are new days. Anchia is right. The reason those prospective renters are even thinking about spending $1,000 to $3,000 a month to live in West Dallas is because they do not want to live in the homogeneous sensory deprivation chamber of strip-mall heaven. They want to live in a city. This city.
They do not want to live in urban hell, of course. Neither do people like Eric Johnson's family, who have lived, gone to church and raised kids in West Dallas for generations.
Making West Dallas a stable lovable home for all these people would require fixing a lot of things like schools and basic infrastructure, getting a lot of things right like those tougher building standards, and doing all of it without kicking every single Joseph and Mary in West Dallas out of the inn.
What's really new are the ideas. Even if they conflict in places, they all add up together to a wonderful storm of creative thinking devoted to a profoundly important and difficult challenge — to build a new city that respects what is old, a city that values all of its citizens and knows what the word, community, really means.
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