Howard Hughes Restructuring Means Allen’s Monarch City Project Is Up In The Air
The future of Allen’s 261-acre Monarch City mixed-use development is in a state of flux with its developer, Howard Hughes Corp., announcing a major corporate overhaul Monday that names Monarch City a non-core asset subject to possible liquidation.
The Monarch City plan called for 10M SF of mixed-use space for office, urban residential, retail and hospitality alongside parks and connecting walking trails. Howard Hughes has identified the project as non-core and said it intends to sell the site as part of a $2B disposition strategy.
Howard Hughes Chief Financial Officer David O'Reilly said while it is difficult to predict the eventual outcome for Monarch City during or after Howard Hughes’ restructuring, he remains confident in the viability of what the company planned for Allen.
O’Reilly said it is possible top development firms will want to latch onto the existing Monarch City concept — as well as Howard Hughes' recently approved city zoning for the comprehensive site.
“We would love to see it get into some great hands,” he said. “There are a lot of other wonderful developers out there besides the Howard Hughes Corp. that I think could do wonderful things for Allen and Monarch City. Hopefully, as a result of this process, that property will end up in one of those hands.”
The Allen City Council approved Monarch City’s complex zoning over the summer and promoted the project as a catalyst for change in the North Texas suburb.
“I think it is unlikely that we would break up the property,” O’Reilly told Bisnow when asked if the Monarch City asset could be parceled out and sold off in pieces, negating the concept of a unified Monarch City.
Of course, any decision made outside the hub of Howard Hughes is subject to whether the land is ever sold or not. Nothing is definitive at this point, according to O'Reilly and the Allen Economic Development Corp.
“We are still in the very early stages of bringing that project to market, so it’s difficult for me to say what will be the eventual outcome and what will happen to Monarch City as a result of this process,” O’Reilly said.
O'Reilly said a buyer could possibly take the existing zoning, project name and concept to build out virtually the same development. But, he said, “I wouldn't speculate in terms of what the eventual outcome is, we are a long way from there.”
The Allen Economic Development Corp. is in wait-and-see mode after Howard Hughes' announcement, but the agency expressed confidence Tuesday in future development on the Monarch City site.
“It remains true that Monarch City is one of the best development sites in Collin County with fantastic entitlements and easy highway access,” AEDC Executive Director Daniel Bowman said. “We will continue to monitor the situation and work to move the project forward.”
One thing that definitely will change in Dallas-Fort Worth is Howard Hughes’ corporate footprint.
The company is closing its Dallas corporate headquarters and moving all corporate staff to a facility in the The Woodlands near Houston.
“I don’t expect a year from now, we will have an office in Dallas at all,” O'Reilly said. “The vast majority [of Dallas employees] will be offered the ability to relocate to The Woodlands, but there will be some modest downsizing as well.”
Still, O'Reilly anticipates the company will have some Dallas development ties well into the future.
“We do have two projects in the DFW area,” he said. “One is Monarch City, and the other is a joint venture we have at the Circle T Ranch. What eventually happens with either of those assets, again it's too early to say, but we could still have meaningful ties to the Dallas area through either of those assets depending on what the eventual outcome is.”