School Closures Present Opportunity For Developers To Buy Prime Land In Built-Out DFW Cities

Despite years of booming populations, several of Dallas-Fort Worth’s older school districts have closed schools and reassessed their real estate amid shrinking enrollment and budget constraints.

Grapevine-Colleyville Independent School District, Plano ISD and Richardson ISD have each closed schools within the last 24 months, opening up large tracts of land in largely built-out cities. Carroll ISD and Grand Prairie ISD also plan to or could choose to close schools soon. Those shuttered school sites hitting the market present an opportunity for developers to build in communities other than the emerging suburbs like Prosper and Celina, which are home to the metro’s largest population booms. 

However, the opportunity for developers largely depends on the characteristics of each property and its surrounding area.

“It's all about location,” Matthews Southwest Senior Vice President of Development Kristian Teleki said. “A school that you want to repurpose into something other than a school in the wrong location doesn't work.”

Teleki oversaw Matthews' redevelopment of the 107-year-old former Dallas High School building a decade ago. That project turned the historic 105K SF Downtown Dallas building into a mixed-use project with office and retail space.

While mixed-use projects have proven particularly popular in DFW, most of the 12 schools closed in those districts over the past two years were elementary schools tucked away in residential neighborhoods. With an attached sports field, those sites could range from 5 to 15 acres, Teleki said. 

That likely makes them a better fit for multifamily or workforce housing projects than a mixed-use development that needs to be located on a major thoroughfare, Cushman & Wakefield Managing Director Brett Arabie said. 

That large a footprint will entice residential developers, as the lack of new homes and medium-density housing in older cities such as Plano and Richardson has contributed to their school districts’ shrinking student populations. Families with young children often have to travel farther north to emerging suburbs such as Prosper to find housing.

School District Challenges

Richardson ISD’s 2024 decision to close five elementary campuses came as the district faced a $28M budget shortfall, marking its fifth consecutive year with a significant deficit. The district was experiencing declining enrollment, rising repair costs for its aging infrastructure, and state funding that hadn’t changed since 2019.

The five campuses closed as part of Richardson ISD’s Project RightSize accounted for only about 12% of the district’s total elementary campus stock, yet they were operating at or below 60% capacity.  

Plano ISD made a similar decision later that year amid similar issues with enrollment, facilities and funding. It opted to close two of its more than 40 elementary campuses and two of its 13 middle school campuses. 

Grapevine-Colleyville ISD officials announced in December that two of its elementary schools would close to prioritize the district’s long-term sustainability. Those two schools account for nearly 20% of the district’s elementary campuses.

Officials in Grapevine-Colleyville ISD and Richardson ISD declined Bisnow’s requests for interviews, while Plano ISD didn’t respond. 

More shuttered schools could soon hit DFW in Carroll ISD and Grand Prairie ISD. 

In January, Carroll ISD decided to close Durham Intermediate School next year, one of only two such campuses in the district. In early February, Grand Prairie ISD officials recommended that the district shutter two of its 19 elementary schools and its language academy at the end of the year.  

Whether those districts decide to sell their closed schools or repurpose them remains to be seen.

School Site Options

Once a campus is closed, districts can monetize the property, reuse it or lease it out, according to Arabie.

Workforce housing has emerged as the most popular use for former school sites, which he often works with in Austin ISD. That is because teachers and other service professionals, such as nurses, firefighters and police officers, frequently can't afford to live in the municipalities they work in, he said.

Many of those workers have faced similar issues in the same DFW suburbs where schools have closed. That is why multifamily, workforce housing and single-family rental developers are often in the mix when former school sites hit the market, according to Arabie. 

“They can hit a lot of neighborhood goals as well as pushing for profitability,” Arabie said.

However, developers may also encounter strong emotions from families of children who attended the former schools. As most projects will require rezoning, Arabie said developers should have early conversations with neighborhood groups to gather input before the public zoning process begins.

While that can be a challenge for developers, districts facing financial hardship can benefit from the one-time financial boost from selling their shuttered school properties. 

Cushman & Wakefield worked with Lewisville ISD in 2018 to sell 11 properties totaling over 250 acres for more than $70M. At least four of those properties were sold to Arcadia Realty and David Weekley Homes in 2020 for redevelopment into residential subdivisions. 

After Plano ISD demolished the four schools it closed in 2024, the district sold three of the former campuses to the city the following year for $16.5M. Those sites totaled more than 33 acres.

“It's a great idea that we bring in more acreage that we don't really have in Plano and utilize them to create a better environment for our residents,” Plano Mayor Pro Tem Maria Tu said of the city’s purchase during a council meeting last year. 

As is standard when school sites are sold or leased, deed restrictions on those Plano properties prevent future property owners from competing with the district with another type of school or childcare facility.

Grapevine-Colleyville ISD officials plan to follow Plano ISD's lead, announcing plans to sell up to four properties and close its two elementary schools. 

Richardson ISD didn’t sell any of the five campuses it closed through Project RightSize, instead opting to repurpose the properties. That helped the district save nearly $11M in annual operating expenses.

“Unfortunately, our financial realities are clear, and this is one of several necessary steps to ensuring our district can continue to educate, serve, and academically grow students moving forward,” Richardson ISD Superintendent Tabitha Branum said in a statement at the time. 

Historic Renovation

While none of the schools in those districts are likely to meet historic preservation standards, it is often a factor developers must consider when evaluating purchases of these properties. Arabie said most schools are demolished once they are no longer in use, unless they have a historic designation.

“Some of these schools were built in the ‘40s, in the ‘30s even, and they have some amazing facades on them,” Arabie said. 

Matthews enjoys working with historic buildings, Teleki said, though they often present their own challenges. The structural limitations of the former Dallas High School site proved a challenge in redeveloping it for office use. 

But the extra effort was worth it due to the site’s Downtown Dallas location just off Interstate 45, he said. 

The mixed-use office building is part of the National Park Service’s National Register of Historic Places and attracted architecture firm Perkins & Will as its lead tenant. That project wouldn’t have worked in a residential neighborhood, Teleki said.

“The high school worked really great in Downtown Dallas because it came with 5.4 acres,” Teleki said. “A school that's got a small footprint because it didn't need all the parking maybe 100 years ago, that will be a tough road to hoe for somebody that wants to redevelop it.”