Santander Consumer USA could shed more than 37% of its office space in its namesake Downtown Dallas high-rise.
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The company is poised to downsize from 400K SF to about 250K SF, giving back several floors, according to a source with knowledge of the deal and a market report obtained by Bisnow. Santander has been the building’s anchor tenant for nearly 10 years.
Santander didn't respond to Bisnow’s request for comment. The property’s leasing agent denied the business is downsizing.
Dallas, like the rest of the nation, is grappling with a glut of office vacancies. Nearly a quarter of office space in Dallas sits empty, which is on par with Austin and Houston but worse than both San Francisco and New York City, according to recent reporting by The Wall Street Journal.
The Central Business District has been hit particularly hard. Bank of America, JPMorgan Chase Bank and Goldman Sachs have all announced plans to either leave or downsize, opting for smaller spaces in neighboring submarkets and putting a significant dent in office occupancy downtown.
Santander Tower, located at 1601 Elm St., is among a handful of properties in the Central Business District where office space is being repurposed into apartments. Pacific Elm Properties, which owns Santander Tower, is also spearheading residential conversions at Bryan Tower and Comerica Tower.
Close to 2M SF of Dallas high-rise workspace is being eyed for conversions, which could result in more than 1,500 housing units, according to The Dallas Morning News.
A limited number of apartments debuted in Santander Tower in August, the DMN reported. Once the conversion is complete, 11 of the building’s 50 floors will house 228 apartments.
Woods Capital purchased the 1.4M SF Santander Tower, formerly known as Thanksgiving Tower, in 2013. Pacific Elm Properties, a subsidiary of Woods Capital, has since invested more than $40M in renovations, according to the property's website.
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