Morgan Stanley is expected to occupy downtown’s Fountain Place office tower while it waits for a roughly 700,000-square-foot campus in Uptown Dallas to be built.
Angela Piazza/The Dallas Morning News
For investment banking giant Morgan Stanley and the city of Dallas, it’s all over but the shouting.
The bank has signed a lease to occupy a significant portion of the green-glass, rocket-shaped Fountain Place skyscraper downtown — the strongest sign yet that North Texas is poised to land the company’s billion-dollar regional hub.
Morgan Stanley would occupy the downtown tower for a few years while it waits for a roughly 700,000-square-foot campus in Uptown Dallas to be built. The move would be a win on two fronts for Dallas. The move would bring thousands of jobs.
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While the Fountain Place space would be temporary, it would be a win for a central business district that’s seen corporate users such as AT&T, Neiman Marcus, Bank of America and others shut their doors or leave for new digs just up the street or clear across the metro.
The new Uptown tower would further solidify Dallas’ Y’all Street financial district, centered on McKinney Avenue, Klyde Warren Park and the nearby Victory Park neighborhood.
City, state and Morgan Stanley officials have not commented on the lease or the bank’s long-term plans in North Texas. However, two people with direct knowledge of the deal told The Dallas Morning News the downtown lease has been signed.
1. The bank’s lease has room to grow
The firm signed a lease in mid-July to occupy 123,000 square feet at Fountain Place, 1445 Ross Ave. The deal includes an option for Morgan Stanley to increase its footprint in the 60-story tower as needed. The lease will run for about five years, two people with knowledge of the deal told The Dallas Morning News.
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JLL, the firm representing Morgan Stanley, did not immediately respond to questions about the lease. City of Dallas representatives did not respond to multiple calls and text messages regarding the deal. Morgan Stanley and CBRE, the firm that handles leasing for Fountain Place, declined to comment Friday afternoon.
Initial data from real estate firm CoStar estimates that the vacancy rate at Fountain Place will drop from 54% to 34% if Morgan Stanley occupies about 255,000 square feet, as outlined in previous city documents.
2. The Uptown tower will be a billion-dollar project
City documents released earlier this year outlined a two-pronged process that would see Morgan Stanley eventually occupy a new high-rise at McKinney Avenue and Fairmount Street.
Morgan Stanley would lease about 255,000 square feet at Fountain Place. Around 2031, the banking giant would then occupy its new hub at 2401 McKinney Ave. for 16 years.
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Morgan Stanley plans to invest nearly $97 million and bring 1,500 jobs to Fountain Place by 2031. The firm would invest more than $587 million in the new Uptown building by 2031, city documents show. The company would employ 3,800 people at the site by the end of 2035 with the possibility of additional relocations. The developer is expected to invest another $650 million to build Morgan Stanley’s new office, bringing the estimated value of the development to more than $1.2 billion, updated city documents show.
The bank is also seeking state-level incentives. Morgan Stanley wants the Uptown site designated as a “triple jumbo” enterprise zone — a distinction saved for megaprojects that create at least 500 jobs. Companies that qualify receive refunds of up to $3.75 million in sales and use tax. The jobs are expected to pay an average annual wage of $128,000.
3. The city approved one of its largest economic incentive packages for Morgan Stanley
In June, Dallas City Council approved an $18.5 million incentive package and additional tax abatements to support a planned multiphase development. The deal is one of the largest in the city’s history.
For comparison, Plano gave AT&T $20 million in incentives and a lengthy property tax rebate for the company’s more than $1 billion global headquarters. City officials in the Collin County suburb said it was the largest incentive package Plano has given to a private employer.
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4. There are other signs Morgan Stanley is expanding in Dallas
Golds Gym in Dallas, pictured above earlier this month, is being demolished to make way for a possible Morgan Stanley high-rise.
Nick Wooten/Staff
The downtown lease is the strongest sign. But it’s not the only one.
Earlier this month, the Dallas City Plan and Zoning Commission approved a request for Morgan Stanley’s signage on the Fountain Place tower. Demolition work also began on part of the Uptown site.
Crews began tearing down the former Gold’s Gym at 2425 McKinney Ave. a couple of weeks ago. The News reported in January that Morgan Stanley was eyeing a lease at Fountain Place and a new Uptown tower.
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Morgan Stanley has also listed more than 40 new jobs in Dallas in recent months.
Morgan Stanley narrowed its search for an operational hub to two cities — Dallas and Alpharetta, Ga. Morgan Stanley has more than 3,000 employees in Alpharetta, making it one of the Atlanta suburb’s largest employers.
5. When’s the official announcement?
It’s unclear when an official announcement of Morgan Stanley’s plans might come. Morgan Stanley’s move would be the latest win as Uptown and Victory Park teem with new Y’all Street activity.
Goldman Sachs topped out on its more than $700 million campus next door to Victory Park late last year. The campus is expected to open in 2028.
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A few blocks from American Airlines Center, Canada’s Scotiabank is bringing 1,000 new jobs.
The Texas Stock Exchange has signed a lease for a new Uptown high-rise, the Bank of America Tower at Parkside. As the name suggests, Bank of America will be the lead tenant in the $433 million tower.
The New York Stock Exchange established its Texas presence with a 28,000-square-foot lease at Old Parkland.
“Morgan Stanley’s engagement with Dallas speaks to the strength of our financial services ecosystem, and I look forward to welcoming the firm to Y’all Street,” Dallas Mayor Eric Johnson said in a June statement.