The Dallas Morning News
Dallasite has advised the likes of Steve Jobs, and now he’s remaking Henderson Avenue
The man behind the Henderson plan.
Mark Masinter has left a trail of angry activists as he tries to remake Henderson Avenue. The old East Dallas street has established and newer shops but also areas of blight. It’s a 1.1-mile street with pockets of successful restaurants, bars and shops amid disconnected gaps and crooked sidewalks that kill its walkability, especially at night. Masinter’s vision is to connect it and make it unique to Dallas. Though he had to scale back his plans, the City Council approved a version earlier this month that allows him to leave his mark on the area. Henderson is an opportunity for Dallas, he said, to have its version of Abbot Kinney in Venice, Calif., King Street in Charleston, S.C., Elizabeth Street in Manhattan’s Soho district or 23rd Avenue in Portland, Ore.
“I think Henderson has that kind of vibe culturally,” he said. “We own buildings that we won’t tear down. The Porch, Capital Pub, Fireside are all cool buildings that aren’t going anywhere. Houndstooth, not going anywhere; Gemma, not going anywhere.”
“I’m trying to do something tasteful and lasting — as it gets older, it looks better,” he said.
Masinter has made a career of advising retailers about when and where to open stores and developers about how to fill their retail spaces.
Ever wonder why the mall across town has a J.Crew store and yours doesn’t? Or who decided when your city finally got an Apple store? Masinter knows.
He’s the one Apple called when Steve Jobs decided in 2000 that Apple would have stores. He and his partners at Open Realty Advisors have been quietly working out of Dallas for decades on retail projects from California to New York and D.C. and from Canada to Asia.
Masinter is in a partnership on an 85-acre, mixed-use development in Northern Virginia’s Loudoun County near Dulles Airport. The project was underway before Amazon said in September that it’s looking for a second headquarters, and it’s now considered a leading HQ2 site prospect in the Washington, D.C., area.
In Dallas, Open Realty and Los Angeles-based CIM Group have been buying real estate along North Henderson Avenue for more than five years. The partnership owns 127,000 square feet of 18 single-story, stand-alone and strip retail buildings along Henderson between Ross Avenue and North Central Expressway.
Masinter won approval this month from the Dallas City Council to build a 156,500-square-foot office, retail and restaurant development on 4.5 vacant acres on the north and south sides of Henderson between Glencoe Street and McMillan Avenue.
While the plan had strong support from neighbors, it faced fierce opposition from some vocal East Dallas residents who believe the project is too big and will bring too much traffic to the broader area.
Masinter agreed to scale back portions of the project to include a shorter office building in addition to a two-level underground parking garage for the 72,500 square feet of office space, 72,000 square feet of retail and 12,000 square feet of restaurants. The space is in office buildings and bungalows that wrap around a corner to fit in with the area’s older homes. Deputy Mayor Pro Tem Adam Medrano said before a vote was taken at City Council that he received more emails of support than complaints against the project.
Masinter persuaded the council and a majority of surrounding neighbors that he has tested his ideas and has reason to believe that the area has the best chance of becoming Dallas’ premier walkable neighborhood.
He helped internet-first brands such as Warby Parker and Bonobos find their customers in the physical world, and he says, “they helped me prove the concept of Henderson” when both opened stores there in 2014.
Masinter, 54, has been behind the scenes from the beginning on the hot concept rollouts in retail’s heydays of the 1990s and 2000s, including Restoration Hardware, J.Crew and Apple, the store that has redefined the upper ranges of sales-per-square-foot and is at the top of the checklist for Class A properties.
An Atlanta native, Masinter came to Dallas as a high school student to check out Southern Methodist University. It was one of those beautiful sunny days when the campus looks its collegiate best and is alive with students. He picked SMU.
After graduating in 1986 with a degree in political science, he had a choice to make about his career.
“I saw all these young guys driving nice cars and turns out they were all in the real estate business. So I decided I was going to be in real estate,” Masinter said. He got “a grunt job” at Cushman & Wakefield where he learned to cold call, write proposals and go after the business.
He was 29 when he met Restoration Hardware founder Stephen Gordon. There were plenty of furniture stores in America, but Gordon’s fivestore California company’s furniture was different from anyone else’s. There were accessories and reproductions of old toys and something to buy even if you couldn’t afford a leather sofa.
Masinter knew it was a great concept, but he didn’t know how to make it grow and make money doing so.
In 1994, he brought Restoration Hardware as an investment opportunity to Marshall Payne at Cardinal Investments Co., best known locally for buying the Texas Rangers in 1987 and building the team’s stature and operations.
Eventually, the investors including Masinter purchased a 45 percent stake and profited nicely from Restoration Hardware’s growth and initial public offering. At the same time, Masinter said, the whole experience ended up being his MBA.
Payne, who is now chairman and a founder of Dallasbased CIC Partners, the successor of Cardinal, “helped me become a better investor and adviser,” Masinter said.
“Mark convinced Gordon to take on a chief operating officer, a tough thing for any founder to do,” Payne said. “But Mark’s knack for forming relationships made it happen.
“Then and now, Mark has incredible energy and insights. Back then he needed to get honed.”
Masinter’s career is not void of mistakes. Payne said a fund that he invested in with Masinter in 1990s to provide financing to emerging retail and restaurant businesses didn’t work out. And Masinter tried to launch Everything Organized, a Container Store copycat that didn’t make it either. But that’s business, and the ups were bigger than the downs.
When Masinter first got a call in 2000 from Apple founder Steve Jobs, the idea that there would be Apple stores was still a big secret, said Ron Johnson, who was hired by Jobs that same year to head Apple retail. In an interview last week, Johnson recalled Masinter’s first meeting with Jobs.
It lasted five minutes. “Mark and his partners came to Cupertino, and we’re in Steve’s conference room. Steve interrupted Mark and said, ‘I heard you were really smart — smarter than this. I don’t think you made a good presentation. What happened? Rethink this and come back in a week.’”
Steve left the room and the moment’s awkwardness ended up being just a blip. The next week they were back in Jobs’ conference room. Even in 2000, the futurist Jobs “was not a mall person,” Johnson said, and he questioned plans to put Apple stores in malls.
“Steve called and said he was skipping the meeting; it was my decision, but he expected me to make the right choice,” Johnson said. “Steve wanted to make sure I was demanding. That’s how our relationship with Mark started.”
Masinter explained to Jobs that if Apple were going to have a significant retail footprint, it would have to open stores in malls.
“He was quite eloquent in convincing Steve that all retail is local and in many markets the mall is the place his customers love to shop. I think Mark was referring to great malls like NorthPark when he made this case.”
Since then, Open Realty has located all of Apple’s 300plus stores in North America, including the first two that opened on the same day in 2001, both in malls that remain Class A properties today: Tysons Corner in McLean, Va., and Glendale Galleria, just north of Los Angeles. And lots of Apple stores are also on streets. Perhaps the most famous is the hard-to-miss glass cube over the underground store on Fifth Avenue in New York City.
“I remember when Mark said we had to be on Knox Street,” Johnson said. The two walked Knox, and Johnson’s first reaction was, “‘Are you sure?’ It seemed very quiet with a lot of home stores and not a lot of traffic.”
“Mark told me that’s where Apple belongs, and he was right,” Johnson said. The store opened in January 2003 right next to Restoration Hardware, where Masinter cut his teeth.
Masinter won’t speak on the record about his work for Apple, but Johnson, who led Apple retail from 2000 to 2012, said he’s often asked who does Apple’s real estate.
“Mark is one person I’ve recommended unhesitatingly,” Johnson said.
It’s getting harder and harder for retailers to know when and where to open stores. Suburban malls are no longer a slam-dunk strategy for expanding a chain. Online shopping is making stores less relevant, and growing urban populations want more places where they don’t need a car to get to shopping and restaurants.
“Retail is not dead. It’s just different, and to be a successful brand today, you have to be interesting,” Masinter said. “People aren’t going to cocoon themselves in their homes. They want to come out and have coffee and walk through a park. People still like to get out and go, but to places that speak to them.”
Not that many stores are growing because they don’t
“I think Henderson has that kind of vibe culturally. We own buildings that we won’t tear down. The Porch, Capital Pub, Fireside are all cool buildings that aren’t going anywhere. Houndstooth, not going anywhere; Gemma, not going anywhere.” Mark Masinter
need the big footprints they have, he said. “But there will always be great shopping destinations like NorthPark. It’s one of the greatest malls on the planet, and the [Nasher] family has done a great job keeping it relevant. It increasingly is getting better because the family really cares. That caring oozes out of every corner of the place.”
The Dallas-Fort Worth area keeps growing, and it’s on its way to becoming the third-largest U.S. metro area, he said. “It’s a different world. We’re hoping people will walk to work here. We envision the office space being creative co-working space.” Why Henderson?
“I felt like there was a real opportunity for a real street district to exist in Dallas. Knox will always be Knox, and it’s very cool, but it still leaves a lot of room, a lot of white space.”
Knox Street has been developing up, and more tall buildings are in the works. “There’s not going to be a lot of vertical development on Henderson,” Masinter said. “It’s different. That’s not what it needs. We want to fill out the street with interesting food and beverage concepts and stores.”
Masinter said he’s been fortunate to work with “some of the best minds in retailing” as they were beginning and just starting their companies’ upwards trajectories: Gordon and later Gary Friedman at Restoration, Mickey Drexler at J.Crew and Madewell, Andy Dunn at Bonobos, Neil Blumenthal at Warby Parker among them.
He is also proud of the projects that help communities thrive long term, including Plano’s Legacy West. He was invited into a partnership with developer Fehmi Karahan, Robert Shaw at Columbus Realty and Invesco to populate Legacy West with stores and restaurants. Masinter worked on the 425,000 square feet of retail and restaurants in the $2 billion Legacy West development that includes Toyota’s North American headquarters.
“We had to change the narrative about Plano,” Masinter said. In a year of record store closings in 2017, Masinter convinced Frontgate to open its first store in Texas, the only Tommy Bahama Restaurant in North Texas and only the second Madewell in the market to come to Legacy West. It also has the first food hall in the market.
Masinter’s national relationships helped Legacy West open faster than some might expect, Karahan said.
And now he has a smaller project — but one he is leading — on Henderson.
“Mark has worked really hard on Henderson. He’s wonderfully creative and is thinking all the time because he’ll tell you that great streets happen one great deal at a time,” said Open Realty partner Jonathan Siegel.
Local ownership makes a difference, Masinter said. “West Village has local ownership and is a relevant place. [Billionaire oilman and developer] Tim Headington is a gift to this city because of the investments he’s making in downtown Dallas. Look what Klyde Warren Park did for Dallas.”
Now Masinter is getting his turn. “I want to play a small role in making Dallas a city with a soul.”