But in the last few months, University Gardens has become a real estate war zone. A secret buyer began gobbling up units as soon as they came on the market, amassing such a large quantity that the buyer was on the way toward controlling the property's future.
The residents eventually unmasked the absentee owner who threatened their erstwhile housing haven. They have seen the enemy, and it is SMU.
Although the residents recently voted to limit single ownership to no more than 10 percent of the entire complex, SMU exceeds that limit and shows no sign of slowing down. As a result, the residents have taken to the streets in protest, picketing on Hillcrest on Saturdays during the last several weeks. Carrying placards alleging that SMU stands for being "sneaky," "manipulative," and "underhanded," the residents promise to keep picketing until the university backs down.
University Gardens is, by all accounts, a sweet piece of prime real estate, 11 acres hard by the newly completed Central Expressway and DART rail line. A perfect place for yet another shopping plaza and high-rise office building. It is also a perfect place for the neighboring, land-locked university to expand into. A few years ago, Lincoln Properties, the folks that just developed the Caruth property south of NorthPark on Central, made an offer to buy the condominium complex. In order for the complex to be sold outright, 75 percent of the owners must agree to the sale. It turns out that Lincoln wasn't offering enough money. But the owners decided to see whether there were any more takers. They hired the Weitzman Group to market the property, but they were asking for too much money. And at the time, only about half the owners expressed an interest in selling out.
Last April, a company called Peruna Properties Inc. began buying up the two-story attached townhouses off Dublin Street just north of Mockingbird Lane. The properties were changing hands, but the contracts were not being posted in the complex's management office as dictated by the condominium's declaration. Residents grew concerned and discovered that Peruna Properties was a nonprofit corporation owned by SMU. What's more, Weitzman, armed with a list of the owners who were interested in selling out, was now working as the purchasing agent for SMU. The residents were in an uproar.
"We didn't know SMU's intentions," says Kim Pierce, a single mother who bought into University Gardens in 1996 so her daughter could go to Park Cities schools. "We were afraid they would ruin our property values and the quality of life by turning the place into dorms."
Only about 35 percent of the owners actually live in the complex. And 20 percent of the residents happen to be SMU students. But the complex has conduct rules that say you cannot disturb your neighbor, and you'll be fined if you do. Still, the residents didn't want to see the place overrun with college students.
The president of the condominium board wrote a letter to SMU President Gerald Turner asking the university to level with the frightened residents about the school's true intentions. Leon Bennett, vice president of SMU legal affairs, invited the board to a meeting, where he came clean about what the school wanted, which scared the residents even more.
SMU wanted to purchase at least 26 percent of the units, Bennett said, the number required to block the sale of the entire complex to a developer. The university didn't want to see a high-rise go up on the property, although the present zoning would prevent such a development. SMU's intentions were clear: They wanted to be in a position to own the land themselves some day -- not necessarily to use as dorms, but for future campus expansion.
But Bennett insisted the school wanted to continue to be a good neighbor and promised it would give first preference in renting its units to people not affiliated with the school. If there were no takers, the school would next consider staff and faculty, then graduate students, followed only by juniors and seniors, provided their disciplinary record was clean. Bennett also promised to start posting the contracts. The school hadn't done so, he says, because other owners had stopped doing so, and they were simply following custom. As for the allegation that SMU had been buying the units clandestinely by hiding behind Peruna Corp., he explained to the board -- and the Dallas Observer -- that the company was a way to distinguish itself from the student housing operation.
But the meeting with Bennett only further agitated the residents, who were more dedicated than ever to stop SMU from controlling their fate. They wanted to limit SMU's ownership to 10 percent, which required a change in the declaration to be passed by 67 percent of the complex's voting members. But when the vote was held in late September, only 55 percent of the owners voted to limit single ownership -- not enough to amend the declaration, but enough to pass a bylaw. At the time, SMU owned about 12 percent of the units and the new bylaw did nothing to stop them. The school continued its buying spree, and by November they owned 45 units -- almost 14 percent of the total.
SMU has made it difficult for anyone else to buy available units. According to a Park Cities mortgage banker, if a single owner owns more than 10 percent of a condominium complex, lending rates for future buyers are increased by a percentage point, and/or the required down payment, usually around 5 percent, increases to as much as 20 percent. If SMU scares off all other buyers, then it ultimately controls the price of the condominium units, which residents claim have begun to decline. Residents say some units have sold as high as the mid-$80s in past years.
The residents consider SMU's insistence in flouting the bylaw by continuing to purchase units the height of arrogance. They sent a cease and desist letter demanding they stop buying units and divest back to the 10 percent ownership limit, but SMU kept on buying. Now the board is deciding whether to impose a monthly fine on the school for defying the bylaw.
Leslie Davenport's divorced parents own units they live in, and she's afraid they will be forced to sell. "My parents watched their money their whole lives," says Davenport. "They scrimped and saved for their retirement years. They have this money to take care of themselves. If they had to move and use that money, it would cause a great hardship -- emotionally, physically, and financially.
"SMU doesn't care about what the majority of owners of University Gardens want," Davenport adds. "The way they are ignoring the new bylaws is atrocious and unconscionable. It has created a lot of anger. We don't want one entity to decide our fate."
Davenport's mother agrees. "Had they come to us in the beginning and told us they wanted right of first refusal on the land if and when we were ready to sell because they wanted to buy it, we could have co-existed peacefully," says Pat Davenport.
Says SMU's Bennett: "Our goal is to be sure the campus is not diminished by what might happen to this land. We're not imagining we'll own it in the next few years. We don't have that kind of money, and we're not in it for the development opportunity. Our time horizon is 20 years or longer."
As for SMU flouting the recent bylaw amendment, Bennett says that as the university understands laws applicable to condominiums, the declaration governs unit ownership, and "the bylaws are intended to cover building operations."
That is not always the case, according to several legal experts contacted by the Dallas Observer. Whether this particular bylaw is enforceable may ultimately be up to a court to decide. Until then, the residents will continue to picket every Saturday, except Christmas and New Year's, come rain or shine.
"The one power card we have is, we know SMU is sensitive to publicity," says Pierce. "In their arrogance, they haven't given us much credit to oppose them. They've underestimated our determination."
