Visitors to shows, shops and restaurants in downtown Fort Worth will still be able to park for free on nights and weekends at four key garages through 2025 after approval of new leases that provide lower subsidies.
The Downtown Tax Increment Finance board unanimously approved the leases with Sundance Square and Cousins Properties, but not without warnings that they will come at a cost to other downtown projects over the next decade.
The Sundance lease covers 2,311 spaces in garages at 215 Commerce St., 400 Jones St. and 420 Throckmorton St., and the deal with Cousins covers 1,000 spaces in its garage at 777 Main St.
The Cousins lease was expanded and now allows for more spaces as well as free night and weekend parking. Previously, it covered free parking only for patrons attending Bass Hall events.
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Tarrant County Commissioner Roy Brooks, a TIF board member, said the new leases are “a much better deal for the TIF than where we were before. Our cash flow is a lot friendlier.”
The leases will extend through December 2025, when the TIF — which collects tax revenue within a certain area to fund improvements there — will expire.
Jim Johnson, the TIF’s director, said he received more than 2,400 emails and dozens of letters and phone calls on the issue, mostly in support of continuing free parking. Many letters were sent by Bass Hall patrons, including several elderly people who said they would have to stop attending events because they could not walk from garages farther away.
The Cousins lease increases the number of spaces to 1,000 from 700, and it covers free parking from 6 p.m. to 1 a.m. Monday through Friday and from 10 a.m. to 1 a.m. Saturday and Sunday. The lease begins Friday.
Cousins will be responsible for operating the garage, but the lease gives Performing Arts Fort Worth the option to provide attendants during major events such as the Parade of Lights and the Main St. Fort Worth Arts Festival to give priority to ticketed Bass Hall patrons.
Cousins will receive $250,000 in each of the first five years of the lease, with payments adjusted slightly for inflation annually after that. Atlanta-based Cousins Properties, which bought the office tower in July 2013, and its prior owner, Crescent Real Estate Holdings, had been receiving $520,000 annually under the lease that expired at the end of August. On a per space basis, the new lease is for $250.
Cousins has the 40-story 777 Main office tower on the block. If the building sells, the parking lease would be assigned to a new owner.
Johnson said Sundance Square “offered a generous deal.” Sundance had four years left on its lease with the garage connected to the Chase Bank Building and would have received more than $2.5 million. But it has agreed to stretch that over the next 11 years. Sundance is basically throwing in the other two garages for free, he said.
Under the new lease, Sundance Square will provide 1,545 spaces at its garages connected to the D.R. Horton and Wells Fargo towers, up 425 spaces from the prior lease. At the Chase Bank parking garage, Sundance will continue providing 64 spaces for library patrons during the day, but it reduced its night and weekend spaces by 10, to 766.
Free parking will be offered from 6 p.m. to 3 a.m. Monday through Friday and all weekend.
For the two office towers, Sundance had been paid $150,000 annually until that lease expired in August. The Chase Bank lease wasn’t set to expire until the end of 2017. Sundance was being paid $660,000 annually for it.
Under the new lease, Sundance will be paid $231,145 annually for the three garages, to be adjusted for inflation after five years. On a per space basis, the new lease is for $100. It begins Dec. 1.
But, according to the term sheet between the TIF and Sundance Square, the new lease was contingent on approval of the new terms with Cousins Properties.
Tracy Gilmour, Sundance Square’s marketing director, said Sundance is pleased with the new leases. It already offers free parking at its garages and surface lots with a validated parking ticket from its shops and restaurants.
“It was critical to us that this all come together,” Gilmour said. “It’s a good deal for everyone. Free parking is a great hook. Other cities envy us because of that.”
Fort Worth Councilman W.B. “Zim” Zimmerman, who chairs the TIF board, said it’s significant that the leases go through 2025.
“The parking garages go back in play with some additional benefits,” he said. “We may have hit on a solution everybody likes.”
Board member Charles Boswell expressed concern that the cost of the leases will affect the TIF budget, allowing fewer dollars to be spent on other downtown projects.
Johnson told the board that the money for those potential projects will be reduced by about $3.2 million.
Last year, the TIF board extended its cap to $100 million, from $72 million, and set preliminary guidelines for spending an additional $30 million in unobligated funds. That included $7 million for affordable housing, $9 million for residential parking incentives, $11.7 million for infrastructure and transportation, and $1 million for a science, technology, engineering and math school downtown.
Moreover, the TIF will now have to offer better terms to Tarrant County, which renewed its lease for 250 spaces at its garage at the Family Law Center last year. That $25,000 lease is for $100 a space. The county will likely consider accepting $145 per space, a blended average of the new Sundance Square and Cousins Properties leases, for an increase of $11,250 annually.
Councilwoman Ann Zadeh, whose district includes downtown, said the new leases are “a great compromise,” but she reiterated that free parking will not last forever. She said she has been disappointed by some correspondence that suggested downtown would not thrive without free parking.
“Downtown is strong and thriving,” Zadeh said, and could continue to be without free parking. “We all know it’s going away. This gives us time to look forward.”
Dione Kennedy, president and CEO of Performing Arts Fort Worth which owns and operates Bass Hall, said the group “was greatly appreciative.” More than 40,000 patrons parked in the 777 Main garage last year.
The Downtown TIF also has leases with the owners of the City Place parking garage at Taylor and Weatherford streets, and The Tower at Fifth and Taylor streets. Those expire in 2018 and 2016, respectively.