In December, Denton County commissioners approved a Tax Increment Reinvestment Zone agreement with the city of Lewisville to lay a foundation for what could become a $1.5 billion development off Texas Highway 121.
This is not something we do without careful consideration. This particular TIRZ agreement will serve as a kick-start to something we need more of in southern Denton County — a major corporate campus with class A office space.
My fellow commissioners and I agreed to dedicate 80 percent of future ad valorem taxes from the development of 708 acres off Texas 121 as part of the TIRZ.
However, it affects only what builds in the future, not what the value currently is on property tax rolls.
Lewisville will dedicate 100 percent of future ad valorem taxes collected from development of the same property until 2048 or earlier if infrastructure costs have been repaid.
The concept from Bright Realty shows a corporate campus with water features, covered parking and extensive landscaping on land at the juncture of Texas 121 and Texas 121 Business.
Known as the Crown Centre, the complex also will have three lakes and a walking trail.
On nearby property off Texas 121 near FM1171, Bright Realty is proposing The Realm at Castle Hills, a mixed-use urban center with high-end condominiums, apartments, retailers, restaurants and office space.
Both projects will turn currently unusable property into major developments worth more than a billion dollars.
Bright Realty is the same company behind the 2,800-acre Castle Hills, a successful development that welcomed its first residents in 1998 and the Castle Hills Village Shops in 2003. Castle Hills home prices range from the high $300,000s to more than $3 million.
In short, this is a win-win-win situation. It is a win for the developer, a win for Denton County with new development on the tax rolls and a win for Lewisville.
What is a TIRZ? Let me explain. Under Chapter 311 of the Texas Tax Code, a TIRZ is a financing tool to assist cities in developing areas that would not develop without public infrastructure enhancements such as water, sewer, storm drainage and road improvements.
Right now, neither property has infrastructure. Without the TIRZ agreement, installing infrastructure would be cost prohibitive to developers looking to bring in quality projects.
Over the life of the TIRZ agreement, taxable value of the developments could grow to more than $3.6 billion by 2048. That is a significant increase in value and a strong diversification of our tax base.
As Denton County continues to experience strong growth, the demand for housing, retail and office space also increases.
Just drive along Texas 121 and Texas 121 Business. To the north, Legacy West in Plano has created a retail and entertainment mecca. A little to the south, several cranes can be seen building a new sporting goods complex, believed to be the largest ever built right next to the largest furniture store, Nebraska Furniture Mart. Both are part of the Grandscape in The Colony, which has seen phenomenal growth.
These proposed developments mirror similar concepts where residents can live, work and play in the same general area.
Bright Realty expects a quick build-out with the residential portion of the developments filled by 2022 and commercial by 2025. The class A office space could be full by 2034.
When you stop and think about it, that is only four, seven and 16 years away, respectively.
In terms of real estate development, it is a mere blink of an eye.