News Article | 6/21/2006

Uptown’s Victory in the making

Five years ago Victory Park was on life support, a casualty of 9/11, the tech bust and investor hysteria about both. Hotels pulled out, retailers fled – a stampede and a nightmare all in one.

“It shot everything down; the whole program died,” recalls its developer, Ross Perot Jr. “All we could do was hunker down and wait it out.”

The strategy worked. Victory Park, which includes American Airlines Center, is now a 75-acre boomtown, with a 251-room superluxurious W Hotel, opening today, plus condos, restaurants, shops and bars sprouting like mushrooms after a spring rain. There is $850 million in construction at the moment and a projected $3 billion in the next decade.

The W, a one-letter code for hip, will feature the famed Ghostbar on the top floor.

Sitting jacketless in the Victory Park marketing center, starched shirt and American-flag lapel pin catching the light from a nearby window, Mr. Perot is taller, blockier and more guarded than his twangy quote-machine father. His tight smile says, “Glad to meet you” and “I’m in charge.”

He calls Victory “an urban neighborhood,” and an extremely upscale one at that, with small condos starting around $200,000 and grown-up versions, such as Mr. Perot’s own aerie plus heliport in the W, topping out at $6 million.

“We wanted to create a place where people can live, work and play and never have to use an automobile,” he says. “Texans will never give up their cars completely, of course, but we’ve tried to create an attractive environment. No question, it’s going to be on the high end. Even if you rent, you’ll have to be a professional to live here.”

The vision

Victory is the latest and largest chapter in the Uptown development saga, though it is more west than north of downtown and far denser and more contemporary than its neighbors.

Implausible as it seems, Victory is the offspring of American Airlines Center, the retro red-brick hulk that is home to the Dallas Stars and Dallas Mavericks. Opened in 2001, AAC is being surrounded by slick metal and glass buildings and by the time Victory is finished may be totally camouflaged.

This has prompted speculation that between then and now Mr. Perot had an architectural epiphany and that if he could figure out a way he’d airlift the arena to a remote corner of the site.

He says no, that if he had it to do over again he’d hire the same architect, David Schwarz, and embrace the same art-deco-cum-airline hangar design.

“I like the comfortable feeling you get when you’re next to it,” he says. “Even when there isn’t an event, it’s a pleasant place to be. You can’t say that about a lot of modern buildings.”

He likes all kinds of architecture, he continues, from the futuristic control tower at Fort Worth’s Alliance Airport to the vintage mill house he and his family – wife Sarah and four children – occupy in London. The design competition for AAC, he points out, also included I.M. Pei, Helmut Jahn and Ricardo Legorreta, all card-carrying modernists.

“Ross is a businessman, not an architecture critic,” says Jonas Woods, president of Hillwood Capital, which oversees Victory. “He could see that the whole Dallas market was starting to go modern, and he wanted to create a project for his new city within a city.”

Transformation begins

American Airlines Center made Victory viable by changing the public’s expectations about what could be done with a polluted site on the edge of a 12-lane freeway.

“It went from being a blighted area to a place where you could go see the Stars and Mavericks and spend several hundred dollars in a night,” says Mr. Woods.

But the transformation wasn’t quick or easy. All development is at least half politics, and in the early 1990s it was all politics all the time.

“Those were the toughest negotiations I’ve ever been involved in,” says former Dallas Mayor Ron Kirk. “The egos were huge; there were times when we didn’t think we could get Ross and [Stars owner] Tom Hicks to agree on anything. But in the end, they buried their differences and we got a deal.”

Dallas officials were apoplectic about all the high-dollar, high-tax revenue development that was moving west toward Alliance Airport, including Federal Express, Intel, Texas Motor Speedway and American Airlines. They reminded Mr. Kirk that Fort Worth had a vibrant downtown because the Basses were pouring money into it, whereas Ross Perot Jr. was punting. Maybe he’d like to do something for his hometown, too. A splashy civic project, an arena perhaps.

Although Mr. Perot cared little about ice hockey and basketball, he saw at once that an arena was a tool for leveraging a major downtown land deal. “It was my anchor tenant to attract several million people a year to the development.”

Yet to build an arena you need a team, so Mr. Perot bought, then subsequently sold, a majority interest in the Mavericks. And then he turned his attention to acquiring the 75-acre brownfield that TXU wanted to dump and that the city was willing to subsidize with $135 million in bond money.

“It was the kind of big, one-off project that Ross likes to do,” says Isaac Manning, a longtime Hillwood associate and now president of Trinity Works in Fort Worth. “He works hard, he’s very methodical, and he doesn’t like to repeat himself. It was perfect.”

Mr. Manning was his fraternity brother at Vanderbilt from 1977 to 1981, spending summers waiting tables and digging ditches while Mr. Perot fulfilled his ROTC obligations with Navy cruises, jump-school training at Fort Benning, Ga., and Marine officer candidate school at Quantico, Va. He later flew F-4 jets for the Air Force and in 1982 completed the first round-the-world helicopter flight.

The military has shaped Mr. Perot’s view of the world, from his methodical approach to development (long lists, weekend team meetings) to the names of his projects (Victory, Alliance) to the way he runs his life.

“It gave me confidence and discipline. You have to know a lot of engineering to be a pilot, and to think out front of a problem because of the speeds you’re traveling at. Plus the world looks different from up there. Much smaller,” he says.

Friends add that the military was his own form of grounding, a way of staying connected to the real world while living in the shadow of an eccentric billionaire father.

Turning to real estate

Ross Jr. grew up watching his father turn EDS from a backyard computer service company into a high-tech behemoth with a global reach. He planted trees at the former company headquarters on Forest Lane, camped out there with the Boy Scouts, and when his father and his partners sold the company to General Motors for $2.6 billion in 1984 became an instant real estate tycoon.

“I had four sisters, an aunt and a grandmother,” he says, “so literally it was just Dad and me looking for something to do together. Now computer service is pretty complex for a young guy. But we both liked real estate, and it was much easier for a father and son to work on.”

So in the 1980s they began buying thousands of acres of undeveloped land in Plano and other suburban communities, just as the real estate market was crashing.

“If the market hadn’t turned down, we would never have become developers,” he recalls. “We spent a lot of time in bankruptcy court.”

They developed Legacy in Plano, Circle T Ranch in Westlake and several more residential developments.

Twenty years later, Alliance Airport is still only 25 percent complete, while Victory Park will take 15 more years to finish. Yet Mr. Perot is looking for new projects. He’s starting a hotel company in India, is “watching” Dubai, and at the request of the royal family may take a second look at Abu Dhabi in the United Arab Emirates.

Suddenly he tips back in his chair and stares at the ceiling, as if trying to picture working in such far-flung outposts. Then, just as suddenly, he’s back in Texas, in the ozone this time. He says he hasn’t been able to ride his bike lately because of all the red and orange alerts.

“Our big issue here is going to be air quality,” he says. “We’re in trouble. I’m shocked that the citizens of North Texas don’t push environmentalism more and that our political leadership hasn’t forced us to clean up the air.”

He says that the new W is going to be “pretty green” and that Hillwood is building green warehouses at Alliance. “We’re doing OK, but we could be doing better.”

Time is running out, and there’s still a photo to take. He points toward a black Hummer in the parking lot and slips behind the wheel for the 300-yard trip to the new Victory Plaza, a grand public space with some of the qualities of a pinball machine.

From here, the shape of Mr. Perot’s “city within a city” starts to come into focus: Victory Park Lane, lined with condos and apartments, curving toward Reunion Tower in the distance, the ball sitting atop its stem like a gigantic cocktail onion. And in the other direction, the W, its helipad peeking over the edge like an eyebrow, lines up regimentally with other downtown skyscrapers, as though Victory were just an extension of an established pattern.

“Come back to Dallas in 10 years and it will be a whole new city,” he says confidently, as though he’s already got the plans in hand. “With the price of gas and the increase in congestion, it is going to develop an East Coast, European lifestyle. People will have a place in Victory, walk back and forth to work during the week, then go out to the country for the weekend. I can see it.”